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An analysis (Greek.: resolve) is a systematic investigation in which the investigated object or subject is divided and separated into its components, and these are ordered and evaluated. Most branches of science (e.g. social sciences and economics, computer science, engineering, etc.) use specific statistical tools for analyses. Data analysis corresponds to the phase of evaluation and subsequent interpretation of the collected data. The goal of such an analysis is generally the determination of the current conditions or researching the causes of the current conditions. The analysis phase is generally an indispensable step for solving existing problems or improving a situation.

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In Application Service Providing (ASP), a service provider, the Application Service Provider (ASP), operates an application (e.g. an ERP system) and offers it to customers over a public network (e.g. the Internet). The ASP handles the entire administration, such as backup, installing of patches, etc. In contrast to application hosting, the ASP also offers a service that concerns the application (e.g. user support).

Application Service Provider (ASP): See also Application Service Providing. ASPs are companies that offer another company a complete service, sometimes including software use, over the Internet or a private data network. The required software is not purchased, rather "leased" for use via the data network, when necessary. With the help of ASP services, companies can outsource entire administrative departments.

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Abbreviation for Application Service Providing and Application Service Provider.

Abbreviation for Business to Administration. Refers to the primarily electronic communication processes between companies and public authorities.

Abbreviation for Business to Business. Refers to typically automated communications processes between retail companies. B2B is a major component of e-commerce and significantly exceeds B2C communication in volume.

Abbreviation for Business to Customer. Refers in general to electronic communication processes between retail companies and consumers (end users). Most B2C processes are realised through public portals, Web shops and teleshopping.

Abbreviation for Business to Employee. Refers in general to electronic communications processes between a company and its employees.

Abbreviation for Business Intelligence.

The term generally encompasses analytical processes and tools for transforming the company and competition data into knowledge suitable for decision-making. Internal company data as well as external data are used as sources. The term is attributed to the field of business data processing.

The term intelligence here does not have the meaning of perception or intellectual capacity. Rather it refers to the exchange of messages and information (here in the context of internal company business), as it is used in the name of the American intelligence service, the CIA.

Term Meaning:

A narrow meaning is limited to providing methods and tools. An analytical meaning understands business intelligence as a method within the framework of management approaches, such as knowledge management, customer relationship management or the application of the balanced scorecard. A third, process-oriented meaning is particularly widespread. Due to the constantly changing environment and conditions, permanent adaptation of the fundamental data, methods, tools and goals is necessary, which is best achieved through a continuing process. This approach therefore places the emphasis on the process orientation.

Tools:

Tools used within the framework of business intelligence are categorised as analytical information systems. The base of data for an analysis is provided by a data warehouse or excepts from this (data marts).

The following tools and methods were developed specially for the area of business intelligence:

• Data warehouses
• OLAP
• Data mining
• Business workflow analysis
• Business performance management
• Document warehouses
• Text mining
• Web mining
• Case-based reasoning

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Abbreviation for Customer to Business. Refers to primarily electronic communication processes between private individuals (consumers) and companies.

Abbreviation for Customer to Customer. Refers in general to electronic communication processes between private individuals.

Original term for pickup wholesale in which the customer pays for the goods immediately, takes them away and delivers them himself, in contrast to delivery on order with payment of an invoice or by bill of exchange.

A category is a differentiable, independently observable group of subcategories that are defined as being associated together.

In retail, the term category refers to a group of goods.

Documented result of the category management business process and therefore the basis for controlling a category (group of goods).

Definition of the articles contained within a category (group of goods) as well as the category structure and segmenting.

The principle of Category Management (CM) is the managing and structuring of a company according to the principle of goods categories. These are managed as independent and individually responsible business units, with responsibility for their own processes from procurement to sale. These categories are created with the help of market research analyses performed by manufacturers and retail experts and represent products considered to be related by the purchaser.

"Category management refers to an instrument of retail for strategic and operational planning and controlling of the product selection and merchandise management that grants the category manager broad responsibility for all purchasing- and sales-related activities for a category and implies an intensive (strategic and operationally-oriented) category-oriented cooperation between the manufacturer and retail companies." (Christa FELD: Category Management im Handel, Arbeitspapiere des Seminars für Allgemeine Betriebswirtschaftslehre, Handel und Distribution an der Universität zu Köln, published by Lothar Müller-Hagedorn, Arbeitspapier Nr. 8, Cologne 1996)

What is actually new about this approach is the assignment of products to categories in product groups viewed as related from the perspective of the consumer. This results in a restructuring of the company away from the division between purchasing and sale and toward management according to product categories as strategic business units.

The nine-stage category management business process supports the implementation of category management in a company. Primarily four strategies are available to the company for implementation of the category management business process (selection organisation, sales promotion campaigns, new product development and pricing).

The category management approach pursues the goal of differentiating a company and its products from the offering of other retail companies through the choices within the selection made individually by the consumer, thereby promoting one's own turnover and profit.

The approach is used most frequently in the consumer goods industry in combination with the ECR concept.

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Refers to the daily work required for implementing the strategy. The category management business process refers to the sequence of activities, the methodology and responsibilities that lead to the development and implementation of a category business plan. The management business process consists of eight steps:

• Category definition
• Category role
• Category valuation
• Category performance analyses
• Category strategies
• Category tactics
• Category plan implementation
• Category inspection

Determines the priority and importance of the categories in the entire company and specifies the allocation of resources to the individual categories. The category role should be determined based on a category-spanning, quantitative and qualitative analysis in consideration of consumer, manufacturer, distributor and market data.

The four most common category roles are:

• Profiling category
• Obligatory category
• Impulse/seasonal category
• Supplement category

Serves to implement the roles assigned to the categories and achieve the envisioned performance goals.

The most important category strategies are:

• Promotion of the customer frequency
• Increasing the transaction value
• Defending territory
• Earning profit
• Awakening interest
• Enhancing the image
• Achieving cashflow.

Tactical options for implementation of the category strategies. Within the scope of the category management business process, category tactics are developed within the following areas:

• Selection policy
• Shelf presentation
• Pricing policy
• Sales promotion

Abbreviation for Category Management.

A variant of the Continuous Replenishment Program.

Manufacturers and distributors control the supply of goods together. The normal products are controlled by the industry and the sales products by the distributor.

Consulting, also called consultancy, refers to advising activity by a company or service provider ("consultant").

The activity typically involves an advisorial role in problem-solving all the way to implementation of complete concepts, primarily in a business or technical environment and in close cooperation with the affected management.

Abbreviation for Customer Relationship Management.

The goal of Customer Relationship Management (CRM) is to enable the company to organise its customer relationships more efficiently and effectively, thereby improving customer satisfaction and loyalty as well as the profitability of the company.

Principles

CRM is a management system based on four pillars:

• Philosophy, vision, strategy (customer orientation, success orientation)
• Organisation (customer-oriented processes)
• People (customers, employees and management)
• Technology (information and communication technology)

CRM supports the communication in the customer process with reliable numbers, data and facts (NDF) in order to focus attention on relationships with a high customer value and identify weaknesses in dialog with the customers. In the spirit of improved customer orientation, the goal is to be able to offer services customised for the customer and his needs.

The goals of CRM are:

• Increasing market share
• Improving loyalty
• Segmenting the customer base
• Cost reduction through central data collection
• Improving service with comparably low expense
• High availability of customer data as a result of an increased data security level

Implementation

A CRM system is implemented with the help of a relational database which allows all customer data to be stored in a data warehouse with the help of reliable and automated data entry and makes this data available for automatic analysis via data mining or OLAP.

CRM is also a positive approach from an ethical perspective. However, this is generally not considered entirely free of problems, as some people see a risk to the privacy of the customer. Critics also fear that unfair sales techniques could be applied because the company can also pursue manipulative tactics based on extensive personal information, such as the analysis of special cookies or a conversation profile regarding field service contacts.

The benefits of a CRM analysis are extensive:

• High customer data transparency for all employees
• Comprehensive analyses are possible with ease
• What are the characteristics of the individual customer?
• How much turnover and costs does the customer generate?
• How loyal is the customer?
• What is the purchasing behaviour of the customer?
• What preferences does the customer have?
• How much personalisation is possible (beyond the form of address)?
• What information is relevant for decisions on courses of action?

Sub-areas

Customer Relationship Management is typically divided into analytical, operational and communicative CRM. The following areas are covered within marketing:

• Sales
• Service
• Customer care
• Complaint management
• Call centre management
• Obtaining new, relevant information

Communicative CRM addresses the direct interface to the customer – the points of customer contact. The various communications channels are made available for customer contact through communicative CRM.

Analytical CRM performs analyses of the customer and transaction data collected in the data warehouse system using business intelligence methods (e.g. data mining); the resulting information is then used in operational CRM for customer evaluations, customer segmentation or automatic offer management.

Specifications

• Detailed address information
• Complete customer history
• Specific marketing campaigns
• Individual reporting
• Simple customer statistics
• Rapid order information
• Document management
• Responsibilities and schedule management

Success Factors and Bottlenecks

Success factors in the introduction of CRM are:

• Management support (the management must be convinced of the introduction and provide a sufficient budget)
• Clear goals, strategies and concepts
• Definition of business processes
• Depiction of more than just the current situation
• Acceptance within the company
• Inclusion of the employees in the development/introduction
• Field service/sales must absolutely be on board, mobile data transmission is essential
• Appropriately sized project team (only experienced employees, inclusion of CRM experts)
• Cleansing of existing data before inclusion
• CRM architecture (particularly regarding performance, availability, online/offline)
• Solid, comprehensible data model
• Scalable components
• Integration of the software into the existing IT landscape
• High reliability of the data administration and backup
• Inclusion of customers ("friendly customers")

One must watch out for the following "traps" during CRM introduction:

• Paying too much attention to tools and technology
• Poorly integrating existing systems
• No commitment by those involved
• Availability throughout the company (globally) is often not guaranteed
• Data graveyard
• Glass customers (legal problems?)

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Excerpts from the data warehouse.

The systematic (automatic or semiautomatic) detection of economically relevant patterns or relationships in databases or other data pools.

Data filtering is performed with advanced statistical tools that develop and evaluate hypotheses as a creative process, in contrast to standard queries in OLAP. One searches for patterns, structures, deviations, regularities, relationships and influences. Pattern recognition and knowledge extraction is also referred to as KDD (Knowledge Discovery in Databases).

An often very large database that can access all data relevant for a global perspective on a company or even a group.

The data is provided from heterogeneous and distributed sources according to the "copy and prepare" principle. It is an important instrument for the company's information management and is frequently used as a decision-making tool.

The core data collected often represents the basis for further operational analyses, such as Online Analytical Processing (OLAP) or data mining.

Definition of a Data Warehouse

Agreement largely exists on the following:

• A data warehouse allows a global view of heterogeneous and distributed data sets by collecting the data relevant for a global view from the data sources into a shared, consistent data set.
• The contents of a data warehouse thereby originate from the copying and preparation of data from various sources.
• A data warehouse is usually the basis for the aggregation of operational figures and analyses within multidimensional matrices, known as Online Analytical Processing (OLAP).
• A data warehouse is frequently the basis for data mining.
• The applications generally operate with excerpts from the data warehouse constructed specifically for the application; these are referred to as data marts.

The other definitions differ primarily in the general purpose of a data warehouse, its scope and the handling of the data it contains.

The spectrum of definitions begins with the restrictive view by Inmon:

"A data warehouse is a subject-oriented, integrated, time-variant, nonvolatile collection of data in support of management's decision-making process." (1)

The following definition by Bauer and Günzel is less restrictive, but is oriented toward a special purpose, the analysis function:

"A data warehouse is a physical database that represents a view into (arbitrary) data to make analyses possible.“ (2)

The spectrum of definitions ends with the definition by Zeh, which lacks restrictions on the scope and handling of the data as well as the purpose:

"A data warehouse is a physical data set that allows an integrated view of the fundamental data sources.“ (3)

The limitation "physical" is necessary to differentiate the data warehouse from "logically" integrated database systems.

History of the Data Warehouse

The "data warehouse" concept was coined in the mid-1980s at IBM and referred to as an information warehouse. The term "data warehouse" was first used in 1988 by Devlin. Recently, data warehouse systems have also been called business warehouse systems or business intelligence systems, in order to emphasise the business significance of such systems.

(1) Inmon, W. H.; Hackethorn, R. D.: Using the Data Warehouse. New York: John Wiley & Sons, 1994, ISBN 0-471-05966-8

(2) Bauer, A., Günzel, H.: Data Warehouse Systeme - Architektur, Entwicklung, Anwendung), dpunkt, 2000, ISBN 3-932588-76-2

(3) Zeh, T.: Data Warehousing als Organisationskonzept des Datenmanagements. Eine kritische Betrachtung der Data-Warehouse-Definition von Inmon. In: Informatik, Forschung und Entwicklung, Volume 18, Issue 1, Aug. 2003

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Data warehousing consists of four steps:

1.  Data acquisition.
2. Administration of the data at a central location.
3. Provisioning of the data in combination with tools that allow for interpretation, analysis and the creation of reports.
4. Creation of reports in order to make decisions based on concrete goals.

Data analysis refers to the preparation and evaluation of collected data. These data can be collected empirically (such as through surveys) or may already be available, for instance in the form of documents or databases (see also document analysis). Data analyses are performed in market research as well as within the scope of software application development, where data analysis generally begins with the system analysis and represents one of the basic inputs for a specification.

Internationally standardised, uniform system of globally unique 8-, 13- or 14-digit article numbers for products and services. It represents the basis for the use of scanner technology, thereby significantly simplifying electronic communication through the definition of reading technologies and data contents.

The EAN is generally printed on the product packaging as machine-readable barcode and decoded by a laser scanner upon payment at scanner checkout registers. The advantages of EAN are:

• Faster processing of the customer (less waiting time at the point of sale)
• Greater reliability (no typos or mistakes)
• Simplification of goods traffic, automatable warehousing
• No labels required, the price only has to be on the shelf
• Transparent, global standardisation (currently 90% of all goods) and
• Traceability (particularly for meat and fish inspections).

The EAN philosophy also includes the electronic transmission of data between the participating companies via EDI, to which end the EANCOM standard was developed.

Description of EAN 13:

The EAN has 8 or 13 digits. The EAN-13 consists of

• Country number (2 or 3 digits):
• D has numbers 40-43,
• A 90-91,
• CH 76,
• F 30-37,
• NL 87,
• Poland 590,
• Czech Republic 859,
• etc.
• Company number (manufacturer) (5 or 4 digits)
• Article number (5 digits)
• Test code (1 digit)

The country number and company numbers are managed by the EAN administration of the country and assigned a single time. There are currently 98 countries.

The article number is available for every member company and is usually broken down by article groups or company processes.

The test code serves for data security and is calculated by a standard algorithm with a weighted checksum. It may not be left off.

Description of EAN 8:

The shortened version EAN-8 is conceived particularly for small articles that do not have space for long numbers (e.g. paper clips or bubble gum), but also for local goods (e.g. milk cartons). The article number is reduced to 3 digits (4 incl. the test code) and may not cover all articles for many companies.

In contrast to the UPC code, the EAN-8 cannot be created from an EAN-13 code, it must be applied for separately.

Note: The country number does not necessarily indicate the country of manufacture, rather the country where the manufacturer is registered. Depending on the company location or supplier company, these countries may not be identical.

The Test Code

The test code of the EAN is calculated by multiplying the numbers alternatively by 3 and 1 from right to left, then adding up these products. The test code is the value that when added to the result would bring it to the next multiple of 10.

The same process is also typical for other product identifiers.

A special country code is available for supermarkets so that a barcode can be assigned to foods weighed locally and intended exclusively for internal use.

• 2xx (in place of the country number)
• Article number (4 digits)
• Weight, quantity or price (5 digits)

This code is primarily used for fruits and vegetables as well as meat and sausages. Various grocery discounters also use these store-internal EANs in the shortened EAN-8 form.

History

The Uniform Product Code (UPC) with 12-digit numbers was introduced in the USA already in 1973. One year later, Europe began to consider a similar system that was to be compatible with UPC. In 1977, the European Article Association was founded, which was later renamed EAN International. It has member organisations in 98 states.

In recent years, an effort has been made to unify the two systems. The American product code, which is administered by the Uniform Code Council (UCC) is now being integrated into that of the EAN. The system is receiving the new name EAN•UCC.

As of January 1, 2005, EAN-13 will be de facto introduced in North America as well, but a transition to the 14-digit GTIN will also be recommended at the same time.

The Barcode for EAN-13

The code families UPC-A, EAN-8 and EAN-13 all use the same "alphabet" in displaying the barcode: two light and two dark lines define one digit. The lines appear in four different line thicknesses. The lines are twice, three times or four times as wide as the thin line unit, whereby the four lines of one digit taken together are seven times as wide as the thin line unit. Each digit has two codes that exhibit mirror symmetry. They are called "uneven" and "even".

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Word constructed from EAN and COMmunication: Standard for electronic data exchange that is an official UN/EDIFACT subset and is made available by EAN International for use by all industries. EANCOM® is the recommended EDI standard for ECR.

Examples of EANCOM messages are:

• ORDERS (orders)
• DESADV (despatch advice)
• INVOIC (invoice)
• PRICAT (price and article information)
• SLSPRT (sales report)
• RECADV (receive advice)
• ORDRSP (orders response, response to an ORDERS)

The term was popularised in an ad campaign started by IBM in the year 1998 and refers to the performance of any kind of business over electronic transport channels or media.

The main areas are: Internet business, security and payment, interorganisational workflow management and middleware and brokerage.

The term is categorised as follows, based on the participants:

• B2B Business-To-Business
• B2C Business-To-Consumer
• C2B Consumer-To-Business
• B2A Business-To-Administration
• B2E Business-To-Employee
• C2C Consumer-To-Consumer

Abbreviation for Efficient Consumer Response.

Predecessor of the term e-business, which stands for the performance of commerce or service business via electronic channels, particularly via the Internet. The advantages of e-commerce are found particularly in the massive savings in infrastructure resources.

Abbreviation for Electronic Data Interchange.

Describes the automatic and asynchronous transmission of structured messages between application systems of different institutions.

ECR is a joint initiative by manufacturers with wholesalers and retailers as well as additional partners of the supply chain with the goal of improving processes through shared efforts, thereby offering the consumers the best quality, service and product diversity at optimal costs.

"Efficient Consumer Response (ECR) is a vision, strategy and bundling of advanced technologies for the entire company that seeks through partnership and trust-based cooperation between manufacturers and commerce to remove inefficiencies along the value chain in consideration of the consumers' needs and maximum customer satisfaction in order to achieve advantages for all parties that could not have been achieved alone."

[von der Heydt, A.: Efficient Consumer Response (ECR): Basisstrategien und Grundtechniken, zentrale Erfolgsfaktoren sowie globaler Implementierungsplan; Frankfurt am Main 1998; p.47.]

Abbreviation for Enterprise Resource Planning.

ERP refers to the corporate task of planning the use of resources available in a company (such as capital, equipment, personnel) as efficiently as possible for operational processes.

ERP includes the planning and controlling of the entire value chain of the company.

ERP systems consist of multiple applications that serve for purchasing, material management, production planning and control, warehousing, personnel management, quality assurance and financial management.

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"Wholesale refers to the sale of products to commercial buyers, generally resellers. Wholesale also refers to the sale to regional bodies, state companies, public savings banks, trade chambers and other non-private large buyers. The sale to private households is referred to as retail.

According to the type of sale, one differentiates between drop ship wholesale and warehouse wholesale. In drop ship wholesale, more than half the turnover is made in product sales with which the products are transported from the upstream supplier to the customer. The wholesaler books these goods as received without ever storing them. Customs warehouses, warehouses in free ports and foreign warehouses are not considered warehouses for drop ship business. If less than half the turnover is made in drop ship business, this is called warehouse wholesale."

Companies engaged in wholesale are called wholesalers.

[Excerpt from: Microsoft® Encarta® Enzyklopädie 2002. © 1993-1999 Microsoft Corporation. All rights reserved.]

The term hardware refers to the static, physical components, functional elements and peripheral devices of a data processing system. Examples of hardware are: printer, keyboard, mouse, monitor, motherboard, processor, chipset, etc.).

Implementation is the concrete establishment of structures and (work) processes in an organisation or a system in consideration of the framework conditions, rules, goals and specifications.

In computer science, implementation means the creation of a computer program based on an algorithm or software design after selecting a suitable programming language.

In the area of IT service, implementation means the integration of software and/or hardware into an existing system environment.

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EANCOM® message type.

The invoice conveys payment demands for goods and services that were delivered according to agreements between sellers and buyers.

With correct designation, this message type also serves for conveying proforma invoices, credit notes and debit notes. The seller can invoice one or more transactions at a time. An invoice can encompass goods or services of one or more orders, delivery instructions, call-forward notices, etc.

The message can contain references to payment conditions, transport details and additional information for customs and statistics purposes for cross-border transactions.

EANCOM® message type.

The inventory report is a message between interested parties that specifies information regarding planned or target inventories. All goods, services and locations that are named in the inventory report were first identified with the partner master data and price list / catalogue messages.

Various inventory classes can be identified and financially evaluated. Quantity information can refer to typical or planned quantities, minimum/maximum quantities, reorder inventory quantities and current inventory quantities.

General term for processes, technology and infrastructure for processing data and for telecommunication.

The performance of IT services is also called IT services or IT service. The terms IT consult, IT consulter, IT consulting, IT consultant and IT consultancy are all used for consulting services and service providers.

The term IT solutions is a collective term for hardware and/or software solutions as well as for consulting and service in the IT area.

Warehousing is a term from production planning that is concerned with the costs produced by a warehouse.

The total costs arising from a warehouse consist of three cost subcategories:

1. Fixed costs
2. Fixed order costs
3. Variable warehousing costs

Various models, called lot size models, are developed to minimise the fixed order costs and the variable warehousing costs.

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Warehouse controlling is part of warehousing and strives for a feedback cycle.

(Because the controlling is based on feedback, the term warehouse regulation would be more precise.)

Abbreviation for Logistics Execution System..

In reference to the flow of goods, logistics is defined as the totality of warehouse, transport and information processes. This also includes the planning, organisation, controlling, processing and monitoring of the affected goods and information flows.

Logistics (in the broadest sense) secures the availability of goods and information in particular. Processes for bridging space (transport) and time (warehousing) - i.e. the flow of goods - are traditionally at the centre of the analysis. One speaks of a spatial-temporal goods transformation.

A corresponding flow-oriented definition of logistics is proposed by the Council of Logistics Management:

"Logistics management as part of supply chain management implements and controls the efficient and effective movement of goods, services and the associated information between the points of origination and consumption such that the requirements of the customers are fulfilled."

Due to increasing importance, logistics has developed in several stages into a comprehensive management concept. A modern definition of logistics that reflects this is given by Göpfert:

"Logistics is a special management approach for development, organisation, controlling and realisation of effective and efficient flows of objects (goods, information, money, individuals) in company-wide and inter-company value creation systems."

In this definition, the term logistics largely encompasses that of supply chain management.

Development of Logistics

Historically, logistics has its origins in military activity. It ensured the resupply of the army.

Originally understood as a primary function of material management, logistics is currently seen as a company function that cuts through departments such as procurement, operational work (production in the widest sense) and sales.

Goals, Tasks and Areas of Logistics

Logistics can be defined more concretely as integrated planning, organisation, controlling, processing and monitoring of the entire material and goods flow with the associated information flows, starting at the supplier, extending through the operational value creation stages (of one's own company), such as production and/or distribution stages, and continuing to delivery of the products to the customer, including waste disposal and recycling.

This can be expressed more pragmatically with the "6 R's" of logistics: The goal is to provide the right product at the right time, the right price, the right place, in the right quantity and in the right quality, all in a customer-oriented fashion and for minimum costs.

One therefore horizontally divides logistics in the narrower sense into 4 subsystems:

1. Procurement logistics (from the supplier to the incoming warehouse)
2. Production logistics (material and goods management, management of semi-finished products in intermediate warehouses, partially also manufacturing management)
3. Distribution logistics (sales logistics) (from distribution warehouse to the customer)
4. Disposal logistics (reverse logistics) (taking back waste, empties, recycling)

Within the framework of distribution logistics, one also speaks of marketing logistics. Personnel logistics, on the other hand, is the core task of the personnel department (planning of personnel use).

Through modern concepts such as ECR (Efficient Consumer Response) and technologies like EDI (Electronic Data Interchange), logistics can be organised more efficiently. Examples are JIT delivery and Kanban.

Depending on the type of activity, one also differentiates between warehouse logistics, packaging logistics and transport logistics.

Tasks and Factors of Influence

One of the most important tasks of logistics is transport. Logistics is responsible for transport from the manufacturer to the company, intra-plant transport and transport to the customer.

Additional functions are:

• Goods inspection and handling
• Storage and picking
• Packaging
• Controlling and planning the production processes
• Coordination of the process execution

Special tasks of logistics include securing the goods during storage and during transport, not only for valuable goods such as money shipments but also for hazardous goods, in particular.

Goals

The goals of logistics are providing a valuable service, quality and reduction of costs. Goal conflicts arise here. For example, a large inventory may reduce costs associated with incorrect quantities and increase the delivery readiness, but it automatically increases the warehousing costs. The logistics cost accounting serves here as an instrument for optimisation.

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The term logistics chain refers to the totality of all business activities that are required in order to meet the demand for products or services, from the original need for raw material and data to the transfer to the end consumer.

Term from EANCOM® for all message types that contain instructions or information related to articles and quantities.

Examples:

• DESADV,
• RECADV,
• PRICAT,
• INVRPT,
• PARTIN.

A Management Information System (MIS) collects, enters, processes, maintains, analyses, uses, distributes, plans, transfers, manipulates and visualises the company information. Management Information Systems (MIS) are used in the functional area of all business processes and procedures, in decision-making, strategising and performance monitoring.

Abbreviation for Management Information System.

A computer network (or simply: network) represents a collection of computers (in particular) and other modules connected together for sharing information.

The purpose is the effective and rapid exchange of information.

Depending on the type, networks are divided into local (e.g.: LAN), non-local (e.g.: MAN, WAN, GAN, Extranet), wire-bound (e.g. Ethernet) and wireless networks (e.g.: WLAN, Bluetooth, UMTS, GSM).

Abbreviation for Online Analytical Processing.

In database theory, an OLAP cube (also called a data cube) is an abstract representation of the projection of an RDBMS (Relational Database Management System) relation.

Online Analytical Processing (OLAP) is an analytical information system like data mining or text mining. While the latter are used for discovery of information without hypotheses, OLAP requires hypotheses.

With OLAP tools, a data set, usually a data warehouse, can be analysed and queried in a user-friendly fashion.

In contrast to operational databases, one does not work with individual, normalised tables in OLAP, rather with so-called dimension tables. This makes possible fast responses to complex queries. The structure on which OLAP is based is an OLAP cube, which was created from an operational database. This is generally organised in a star structure with a fact table and the respective dimension tables. One differentiates between ROLAP, which accesses a relational database, and MOLAP (multidimensional OLAP). HOLAP (H: hybrid) is an intermediate form between ROLAP and MOLAP. Each type has its advantages and disadvantages. MOLAP can very quickly calculate aggregations, but generates very large quantities of data. ROLAP requires the least space and scales better, but is slower than MOLAP.

OLAP tools are frequently characterised by their multidimensionality. This multidimensionality is used to observe and evaluate relevant business figures (such as turnover or cost values) based on various dimensions (e.g. customers, regions, time). Cubes are used for visual representation. These cubes are divided into various dimensions, which are in turn divided into elements.

This can refer to a retail shop, a checkout in a shop or a variable location at which a transaction takes place.

Abbreviation for Point of Purchase/Point of Sale. The terms Point of Purchase (POP) and Point of Sale (POS) are used synonymously.

"Endeavour that is essentially characterised by a unique set of conditions, such as the goal and time, financial, personnel limitations and other limitations or boundaries with respect to other endeavours and project-specific organisation." [DIN 69901]

"Totality of management tasks, organisation, technologies and means for execution of a project." [DIN 69901]

The term project management is also used as a synonym for the managing entity.

Structures and methods of project management are industry-specific and depend on the size of the project. Accordingly, the tools range from simple monitoring of fulfilment to support by project management software through all phases from planning to implementation and integration.

The term process chain refers to business processes that are represented in a logical and functionally structured form.

Retail is an English term corresponding to the German "Einzelhandel".

Retail management means the managing, steering and controlling of the processes of retail.

Retail technology describes the procedures, methods and steps for realising the processes that define retail.

RFID is a method by which data can be read and written without contact or line of sight. The development history of this technology is complicated and extends far back.

The term RFID refers to the complete infrastructure that makes it possible to read information wirelessly from the RFID tag (also called an RFID transponder). This includes the RFID tag, the transceiver with which the RFID tag is addressed as well as the integration with servers, services and other systems, such as POS or merchandise management systems.

The data are saved on so-called RFID tags – often also called "RFID transponders". The saved data is read via electromagnetic waves. At low frequencies, this occurs inductively (near field), at high frequencies via radio (distant field). The distance at which an RFID tag can be read varies between a few centimetres to max. 30 metres based on the design (active/passive), the frequency band used, the transmission strength and environmental influences.

There are also chipless RFID tags that operate reflectively. These contain no saved, temporally resolved code, rather they have a frequency and phase image distributed over their surface that is interpreted spatially as a code.

Unit Size

If the chip is also very small, the unit size is determined mostly by the antenna (which depends on the frequency or wavelength) and the housing (and its protection class in particular). This seriously limits the installation locations and possible applications.

RFID transponders can even be as large as books, depending on their area of application (e.g. in container logistics). However, it is possible with today's technology to manufacture very small RFID transponders that can be used in monetary bills or paper.

Technology

The structure of an RFID tag requires essentially an antenna, an analogue circuit for receiving and sending (transponder) as well as a digital circuit and permanent memory. The digital circuit is a Von-Neumann computer in more complex modules.

The RFID tags differ quite significantly in other areas. Some RFID transponder have writable memory in which information can be stored during its lifetime.

An RFID tag can vary in form and size from a few millimetres to several centimetres, depending on the model and design. The appearance can be round and solid to flat and flexibly or anywhere in between.

Depending on the area of application, the other characteristics, such as radio frequency, transmission speed, service life, cost per unit, memory space and functionality, can differ widely. Cryptography modules or external sensors, such as GPS, can also be integrated into RFID transponders for special applications. The RFID transceivers also differ in functionality and appearance. For instance it is possible to integrate them directly into racks or access control infrastructure (e.g. at border control). Active RFID tags even sometimes have the ability to communicate directly with orbital satellites. The majority of different devices and tags are only completely compatible to a small extent. The frequencies used and preferred standards vary regionally.

Problems with signal clarity can also arise for products with a high water content (yoghurt, mineral water, etc.) and in the presence of metal parts (shopping carts, car parts, etc.). These can further reduce the already weak signals of passive RFID transponders. Problems can also arise if the tag is located directly on the product and this has a "high" density. For instance, a tag on tightly packed noodles, such as spaghetti, is more difficult to read than on other noodle types with more intervening space. It differs from application to application. The theory that products with high water and metal content lead to problems does not always hold true and varies significantly from product to product.

Energy Supply

The most significant differences are seen in the type of energy supply to the RFID transponders. Small radio chips with no batteries have no power supply and must obtain their supply voltage through induction from the radio signals of the base station. This does reduce the costs and the weight of the chips, but it also reduces the range. This type of transponder is used for product authentication and identification, payment systems and document tracking because the costs per unit are decisive for these applications. Transponders with their own energy supply achieve a significantly higher range and have more extensive functionality, but also cost significantly more per unit. For this reason, they are used in places where the transponders have a long service life, such as in container logistics or toll collection.

RFID tags exist fundamentally in two designs:

• Active RFID Tags
• Active tags are battery-operated and can typically be both read and written to. Active tags are normally in a resting state, i.e. they are not sending any information. Only when a special activation signal is received is the transmitter activated. Depending on the model, the internal memory can hold up to 1 million bytes. Active RFID tags are generally larger than passive tags, have a higher range, a shorter service life and are significantly more expensive.

Passive RFID Tags

Passive tags obtain their energy for transmission of information from the received radio waves. The saved data can only be read, and the quantity of data that can be stored is significantly less than with active tags. This memory is typically used to store a unique identification number (GUID). Passive RFID tags are smaller and lighter than active tags, have a lower range, a nearly unlimited service life and need a stronger reading unit; however, they are less expensive to produce.

Three frequency bands are recommended for use:

• Low frequencies (30 - 500 KHz). These systems have a short range and long transmission times, but are inexpensive to procure and are therefore suitable for access control, immobilisers and warehouse management (frequently 125 kHz = LF).
• Medium frequencies (10 - 15 MHz) have a short to medium range, medium transmission speed, average to inexpensive price class. So-called smart labels operate in this frequency range (generally 13.56 MHz = HF).
• High frequencies (850 - 950 MHz, 2.4 - 2.5 GHz, 5.8 GHz) have a high range (max. 30 metres) and fast reading speed, but the prices increase rapidly with higher power systems. Used in the area of automated toll systems and transport vehicle identification. Typical frequencies are 433 MHz, 868 MHz = UHF, 915 MHz, 2.45 GHz = µW (microwave) and 5.8 GHz.

Encryption

Most RFID tags send their information as clear text, but some models also have the ability to transmit encrypted data.

Costs

According to a ZDNet article, the price of (passive) RFID tags ranges between 5 and 10 cent per tag for a run from 1 to 10 billion. For a run of approximately 10,000 tags, the prices run around 50 cent to 1 euro, depending on the size.

For this reason, manufacturers have developed the concept of chip sharing, i.e. the participants in a supply chain jointly use and profit from a transponder and therefore share the costs. All these technical tricks should improve the popularity of RFID. Unfortunately, the requirements (such as encryption) are increasing, as well as the costs.

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Abbreviation for Supply Chain Management.

Software refers to all non-physical functional components of a computer. This includes computer programs as well as the data intended for use with computer programs.

Software is typically used in connection with hardware, which refers to the physical carrier of the software. In this sense, the term was first used in 1957 by John W. Tukey.

Software can be divided into:

• System software that is required for the proper functioning of the computer (this includes the operating system as well as additional programs such as anti-virus software), and
• Application software that supports the user in performance of his tasks thereby providing him with the actual, direct benefits.

The use of software is subject to legal limitations according to the license: one differentiates here between proprietary and free software.

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Supply Chain refers to a company-spanning virtual organisational structure (network) that produces specific economic goods for a defined target market as a holistic system.

Examples of supply chains are the delivery chains of the automotive industry or the textile value chain. In the extreme, the supply chain can also extend from raw material extraction to recycling (sometimes even disposal) of old products (from dirt to dirt). The interorganisational division of labour between the independent, participating companies defines the extent and structure of the supply chain. Due to the tendency toward concentration on core competences (outsourcing, reduction of the intraorganisational division of labour), more highly differentiated (i.e. with greater division of labour) supply chains are increasingly developing.

As a result, it is not vertically integrated individual manufacturers that are competing in the respective target markets, rather it is complexly structured alternative value chains (delivery chains / supply chains) that are comprised of systematically connected, but autonomously acting business entities. Decentrally organised value systems achieve competitive advantages in particular through a structure configured appropriately for the market as well as superior coordination of the autonomously controlled activities in the supply chain.

In this regard, Supply Chain Management (SCM) strives for a long-term (strategic) and short-term (operational) improvement in the effectiveness and efficiency of industrial value chains. Alternatively, the term delivery chain management is also used.

Separation from Logistics

The terms SCM and logistics are often used synonymously. In fact, SCM and logistics both strive for the organisation of object flows (goods, information, values) along the process stages of the supply chain, whereby attempt to achieve an improvement in the (end) customer benefit (effectiveness) and a system-wide improvement of the cost/value ratio (efficiency).

The development of logistics from a functionally oriented cross-departmental activity (in particular transport and warehousing) within the company to a comprehensive management concept makes a qualitative leap in the transition to modern supply chain management. While logistics considered the object flows largely independently of institutional questions, SCM explicitly takes into account in the analysis the structuring and coordination of autonomously acting business entities in a value creation system. SCM therefore emphasises the interorganisational aspect of the logistical management task more than logistics does.

Theoretical Foundation of SCM

The special properties of the (complete) "supply chain" system arise from the specific dynamic interaction of the supply chain members. These system properties cannot be derived from the sum of the properties of the individual participating entities, rather new properties emerge as the result of complex dynamic processes (emergence). The scientific study of SCM (as far as the formal/mathematical side is concerned) therefore relies heavily on the principles of system theory as well as chaos and complexity research. From a business administrative perspective, the explanatory approaches of new institutional economics (transaction cost theory, property rights approach, principal agent theory) as well as those of the resource-based view are applied in the analysis of SCM problems.

The Goal of a Supply Chain

• End customer orientation
• Increasing customer satisfaction through need-oriented delivery
• More rapid adaptation to market changes
• Avoidance of "out of stock"
• Reduction of the inventories in the entire logistics chain
• Simplification of the goods flow
• Reduction of the delivery times.

Typical Problems of Supply Chain Managements

Characteristic problems of supply chain management are:

• Cooperation and competition between the members of a supply chain (can decentrally controlled supply chains be more competitive than vertically integrated competitors – and why?)
• Allocation of performance processes and disposition rights as well as costs and financing burdens and risks and the distribution of value creation contribution throughout the supply chain.
• Configuration of the process structures in the supply chain.
• Use and design of alternative forms of coordination: for example through central planning via appropriately constructed stimulus systems, through system-wide transparency or information transparency through interorganisational learning with corresponding behaviour adaptation by the autonomously acting entities.
• Reduction of error sources and interference potential at the interfaces of the supply chain members (quality management); Robustness of the supply chain versus disruptions.
• Overcoming the disadvantages of unevenly distributed knowledge and the spread of distorted information in the supply chain (information asymmetries); for instance as expressed by the so-called whip effect.
• Holistic warehouse management for multi-stage warehousing hierarchies (echelon inventory planning).
• Overcoming of complexity and variant diversity in the supply chain (in particular postponement and decoupling point).

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(Greek: collection, the entirety, the connected)

Ordering and/or organisational principle, in particular a complete collection of objects and/or structures delimited from its environment. If an interaction of the system with its environment takes place, one speaks of an open system, otherwise of a closed system. 

Investigation of the function, structure and functionality of systems.

In system analysis, the observer of the system constructs a model. In doing so, he makes a selection with regard to the elements and relationships of the system.

This model is a limited, reduced, abstracted representation of the reality, with the help of which statements are made regarding past and future developments and behaviours of the system within limited scenarios.

In computer science, system analysis refers to the first phase of the software creation process. This step investigates what a (software) system should do and attempts to create a model of the future system from the perspective of the user.

The way in which the system will be implemented is not investigated and no decisions regarding the implementation are made at this stage.

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Also known as intelligent text analysis, text data mining or knowledge discovery in text.

Generally refers to the process of extracting the interesting and non-trivial information and knowledge from uninteresting text.

Text mining is attributed a high commercial value.

Vendor Managed Inventory (VMI) is an instrument for improving performance in the logistics chain with which the supplier has access to the inventory and demand data of the customer. With VMI, the supplier accepts responsibility for the inventory of his products at the distributor or retailer. The sales data and current inventories, which are transmitted from the distributor to the supplier via the Internet or EDI, form the basis for this process.

The advantages of VMI are (among others):

• Rapid reaction by the supplier to fluctuations in demand
• High level of service
• Greater responsibility and more freedom on the part of the supplier to plan the deliveries
• Low inventory levels at the distributor

The distributor regularly gives the supplier a sales report, upon which the supplier sends a delivery to the distributor without an order. This is supported by the fundamental technologies of ECR - such as EDI, XML, RFID, databases, barcodes, etc.

Why is VMI so important?

It is no longer sufficient today to optimise internal goods flows and value creation. For this reason, the focus is on the perspective of "improvement of the information flow from the customer of my customer to the supplier of my supplier“.

How does VMI work?

The suppliers obtain access to the planning data via your Web portal. In the event of insufficient inventory, you receive a delivery of the required parts with no action on your part. Via an eCG (eCG=Electronic Commerce Gateway: universal hub for internal and external data. Combines the business processes between companies), the notified deliveries are transferred into the ERP system (ERP=Enterprise Resource Planning: software solution for processing of internal operational processes. Sales, purchasing, material management, accounting, wage+salary, access controls, etc.). The consumed parts are periodically invoiced.

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Managing, steering and controlling warehouse (management) processes. See also merchandise management.

Abbreviation for Warehouse Management System.

Workflow is the term for processes that divide up necessary work and are initiated for the performance of business activities.

These encompass a spectrum that ranges from simple processes to complex processes that involve the entire organisation or multiple organisations.

Workflow Management (WfM) encompasses all tasks that must be performed in the modelling, specification, simulation as well as execution and controlling of the workflow.

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A Workflow Management System (WfMS) serves for active controlling of processes that divide up necessary work. A workflow management application is an implemented solution for controlling workflows based on a workflow management system.Workflow management systems support structured tasks and processes, while groupware provides support for more unstructured processes.At a technical level, an increasing integration of the functionality of workflow management systems, CSCW systems, document management systems, enterprise content management (ECM) systems and enterprise resource planning (ERP) can be observed. Workflow systems are frequently attributed to groupware and the area of CSCW (computer supported co-operative work) because they regulate the work of different persons within an organisation. In contrast to CSCW systems such as multi-user editors, WfMS only have minor support for cooperative interaction.Goals:The introduction of workflow management generally pursues the following goals:

• The quality of the processes should be improved,
• The quality of the processes should be standardised,
• Faster processing of customer orders should be achieved,
• The transport and standing times should be shortened,
• The processing times, and therefore the costs, should be reduced,
• The information availability should be increased (see information logistics),
• Media gaps should be avoided and
• The flexibility of the processes should be increased through central storage of the process logic.

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