Knowing manufacturing terminology might not seem like the most important thing in the world. However, if you want to succeed in any industry, and especially climb up the career ladder, knowing the lingo is a must. This way you’ll be able to understand how the industry works, what’s needed for different production lines, the philosophy of different manufacturers, and basically just understand your bosses so you can impress them.
Knowledge is power, especially when it comes to your career. Here are a few more manufacturing terms to help you grow in your career.
Industry 4.0
In case you didn’t know, the world is currently in its fourth industrial revolution. It’s a digital age of industry, and therefore it’s come to be known as Industry 4.0. The term refers to the current manufacturing technologies, automations, and innovation trends. It encompasses both physical production processes and digital manufacturing processes to illustrate links between the two operations.
Lean Manufacturing
Lean manufacturing is a production system that aims to reduce waste, increase productivity, and improve processes to create value for customers. It uses techniques and tools to eliminate waste from the manufacturing cycle. It’s one of the ways the industry hopes to become more environmentally sustainable while also saving more money and resources.
Activity-Based Costing
An important term for manufacturing accountants and supervisors to know, activity-based costing involves taking all your products and services and assigning overhead costs and indirect costs to them. This procedure bases the costs on how much of these products and services are used up during daily operations. With this, manufacturers are able to reduce both spending costs and wasted materials which is essential to lean manufacturing.
Computer-Aided Manufacturing (CAM)
Because we’re in the digital age of industry, computer-aided manufacturing (CAM) has become a major part of the average workday. It relies on the use of computer-controlled machinery and software to automate processes. By using this process automation to increase their productivity, workers can focus on other tasks since these systems don’t need as much human intervention.
Takt Time
Takt time is the rate you have to produce a product to meet customer demand. For example, if you get two orders every hour, you need to complete one order every 30 minutes. By knowing how long it takes to make products to meet customer demand, manufacturers can better plan out the building and assembly line procedures to meet everyone’s needs.
Takt time = Total available production time / Average customer demand
Enterprise Resource Planning (ERP)
Enterprise resource planning (ERP) is an effective business strategy for manufacturers to manage day-to-day operations. These days, most ERP is done using software that manages, tracks and automates activities and procedures. This includes supply chains, accounting tasks, inventory, procurement, and order processing. The applications also analyze data from across all the manufacturing departments, which helps when making business decisions.
With this vocabulary lesson of essential manufacturing industry terms, you’re sure to see success in your career. Use this knowledge to understand the industry better and improve your performance, and you’re sure to impress your supervisors and show you’re ready to move up the career ladder.