Contract and OEM Manufacturing Industry Terminology

“Set AQL to 0.4% for major defects on the PCBA”; “This lot failed IQC because it exceeded the minor-defect AQL”; “Audit the supplier’s AQL sampling plan before ramp.”

“Freeze the BOM for PVT by Friday”; “Costed BOM shows $86 COGS at current pricing”; “Engineering ECO will bump the BOM revision to D.”

“This is a BTP program—no design changes without an ECO”; “Quote the BTP drawing pack with Class 3 workmanship”; “We need a DFM review even for BTP to avoid yield loss.”

“Issue a CAPA for the solder bridge escape”; “Containment is step 1—what’s the preventive action?”; “Close the CAPA after 30 days of defect-free SPC data.”

“Select a CM with medical ISO 13485 capability”; “Our CM will manage the supply chain under a VMI program”; “Move the program to a second CM for risk diversification.”

“Target COGS is $120 at 10k EAU”; “VA/VE lowered COGS by 8%”; “COGS variance due to resin surcharge and scrap.”

“DFA change eliminated four screws per unit”; “Rotate the connector 90° to improve DFA”; “DFA index improved from 42 to 78.”

“Panelize the PCB for better DFM”; “DFM feedback: widen the solder mask dam”; “DFM review cut cycle time by 20%.”

“Add ICT test points per DFT guidelines”; “DFT gap explains low coverage on the power rail”; “DFT changes reduce functional test time by 30%.”

“Enable EDI 850/855/856 before SOP”; “POs will flow via EDI, not email”; “EDI backlog mismatch caused a shipment delay.”

“The MCU is EOL in Q4—initiate a re-spin”; “Plan an LTB to cover 24 months of demand”; “Update the AVL to replace this EOL capacitor.”

“Release ECO-217 to update the connector footprint”; “No build until ECN is signed by QA”; “ECO moved the BOM to rev G.”

“MRP runs nightly in ERP”; “Create the PO in ERP and push the ASN to the 3PL”; “ERP routing update changed standard cost.”

“PFMEA shows high RPN on solder voiding”; “Mitigate with process window characterization”; “Update DFMEA after the design change.”

“FAI revealed a dimension out of tolerance on the bezel”; “Customer requires AS9102 FAI forms”; “Run FAI at SOP and after major ECOs.”

“Gage R&R %GRR must be <10% for this CTQ”; “Poor R&R explains noisy SPC charts”; “Re-train inspectors and re-run R&R.”

“Quote DDP to our EU DC”; “FOB Yantian—customer books freight”; “Incoterms confusion caused a customs hold.”

“CM must be ISO 9001 and AS9100 certified”; “Audit found a minor against clause 8.5”; “Maintain document control per ISO 9001.”

“Switch to JIT deliveries from the EMS”; “Kanban + JIT reduced WIP by 35%”; “JIT risk increased under long semiconductor lead times.”

“Set kanban size to two bins per part”; “Electronic kanban ties MES to supermarkets”; “Kanban starved the line—recalculate reorder points.”

“MCU lead time is 26 weeks”; “Reduce internal lead time with line balancing”; “Quote lead time shrank after we onboarded a second source.”

“Lean event cut changeover by 50%”; “Map the value stream before Kaizen”; “Lean reduced travel distance by 1 km per unit.”

“Scan every serial at MES start/finish”; “MES enforces the latest ECO”; “Link AOI results to MES for SPC.”

“MRP exploded the BOM for the November build”; “Firm the MPS before running MRP”; “Planner canceled excess POs after MRP reschedule.”

“Connector MOQ is 3,000 pcs”; “MOQ drives E&O risk at low demand”; “Negotiate MOQ down for proto builds.”

“Execute the NDA before sharing the CAD files”; “NDA covers process IP and pricing”; “No photos per the NDA.”

“Open NPI gates in PLM”; “Run a pilot lot before SOP”; “NPI checklist includes PFMEA and control plan.”

“Quote shows $85k NRE for molds and ICT”; “Amortize NRE over the first 10k units”; “Additional NRE needed after the enclosure redesign.”

“OEE improved from 62% to 78% after SMED”; “Biggest OEE loss is unplanned downtime”; “Use OEE to justify a new SMT line.”

“The OEM owns the IP, the CM owns the process”; “OEM wants box-build and fulfillment”; “The OEM will approve all AVL changes.”

“OTD target is 98%”; “Missed OTD due to ECO hold”; “Supplier OTD will factor into the scorecard.”

“Goal is <500 PPM at OBA”; “Incoming PPM spiked due to plating defects”; “Warranty PPM trending down this quarter.”

“Release rev E in PLM before build”; “PLM is the master for BOM and drawings”; “Sync PLM to ERP nightly.”

“Submit Level 3 PPAP to the customer”; “CpK failed on diameter—PPAP on hold”; “Run-at-rate is part of PPAP.”

“Report Cp/Cpk for the critical bore”; “Low Cpk explains the scrap spike”; “Improve Cpk via tighter process controls.”

“Issue the PO after the quote is approved”; “PO terms reference the SOW and SLA”; “Match invoice to PO and receipt in ERP.”

“Audit the CM’s QMS annually”; “Work instruction WI-102 is under QMS control”; “QMS requires documented training.”

“Open an RMA for the field failures”; “RMA data feeds our FRACAS”; “RMA backlog is impacting OTD.”

“Request updated RoHS/REACH declarations from suppliers”; “This pigment is REACH SVHC—seek alternatives”; “RoHS non-compliance can block EU shipments.”

“Increase safety stock during the holiday peak”; “Safety stock calc uses lead-time variability”; “We burned safety stock during the strike.”

“SMT line 2 runs lead-free paste”; “PCBA yield dipped after the paste change”; “Route boards to ICT before conformal coat.”

“Follow SOP-210 for potting”; “Revise the SOP after the ECO”; “Train operators to the new SOP by Friday.”

“SPC shows the oven drifting out of control”; “Tighten the control limits after process improvement”; “SPC prevented a yield excursion.”

“Takt is 42 seconds—add a station”; “Mismatch to takt caused WIP buildup”; “Rebalance the cell to meet takt.”

“Tooling lead time is 8 weeks for the injection mold”; “Spare cavities reduce risk”; “Budget NRE to refresh worn tooling.”

“MES provides unit-level traceability”; “Traceability enabled a targeted recall”; “Capture paste lot and reflow profile for each board.”

“VAVE swapped to a common fastener, saving $0.12/unit”; “Host a VAVE workshop with suppliers”; “VAVE identified an over-spec’d resin.”

“Cap WIP at two hours per cell”; “Excess WIP hides problems”; “MES WIP report shows a bottleneck at test.”

“SMT first-pass yield is 96%”; “Scrap pareto will lift yield”; “DFT improvements boosted functional yield.”

“Adopt zero-defects thinking at launch”; “Poka-yoke supports zero defects”; “Tie bonuses to zero-defect milestones.”