Operations Management Chapter 3

ISO 14000

A family of international standards for environmental management developed by the International Organization for Standardization (ISO).

analytic SRM

A method that allows the company to analyze the complete supplier base.

ISO 9000

A series of management and quality assurance standards in design, development, production, installation and service developed by the International Organization for Standardization (ISO).

transactional SRM

A system that enables an organization to track supplier interactions such as order planning, order payment and returns. The volume of transactions involved may result in independent systems maintained by geographic region or business lines. Transactional SRM tends to focus on short-term reporting.

supplier relationship management

Accenture defines SRM as "the systematic management of supplier relationships to optimize the value delivered through the relationship over their life cycle."

posttransaction costs

Costs are incurred after the goods are in the possession of the company, agents, or customers.

pretransaction costs

Costs that are incurred prior to order and receipt of the purchased goods.

supplier certification

Defined by the Institute of Supply Management as "an organization's process for evaluating the quality systems of key suppliers in an effort to eliminate incoming inspections."

supplier development

The efforts of a buying firm to improve the capabilities and performance of specific suppliers to better meet its needs.

environmental management system

The practices put in place by a firm to try to reduce environmental waste and improve environmental performance.