Glossary

The terms the writing here coined or uses in its own sense, one sentence each, linked to the page that is the source. The Lab's own vocabulary - Intelligent Orchestration, OODAA, the projects - is in the Lab's glossary.

Asymmetric supply chain: An asymmetric supply chain has a funnel shape - a fragmented base of artisanal producers and small enterprises, market access and value controlled in the mid-section, capital and data at the neck. There is nothing to adjust around a shock, so it travels up the funnel to the market and back down to the base, which absorbs it. In the research literature the same phrase usually means relational, informational or dependence asymmetry between trading parties; the sense used here is structural - the shape of the network and where the variance enters it. Read heuristic 02.
Contractual flow: Contractual flow - commercial commitments, title transfers, quality terms, arbitration rules. In my world, the contract isn't just the source of information about a trade or commercial deal - it's the trade itself. Read the article.
Decision loop: A decision loop is a network of handovers that ends in a specific decision, combined with a feedback loop that sends the outcome back to the person who will decide next time. Readiness for agentic AI is a property of the loop, not of the company - see b = f + s + p, the count of function, system and P&L boundaries the loop crosses between trigger and return. Read heuristic 03.
Deterministic kernel: Deterministic kernel - The same thinking explains why, in this project, netting, allocations, and compliance protocols will be deterministic by design: same inputs -> same repeatable result. An LLM might explain the plan or create a draft email to chase shipping documents from the vendor, but every number in that text should come from the deterministic kernel. Read the chapter.
Ecosystem calibration: Ecosystem calibration - all four flows (in my case it's from farm to cup), partners, irrespective of their maturity level and sophistication, get calibrated to shared signals and standards, with no conductor in between. Read the article.
Four-flow orchestration: Four-flow orchestration - all four flows that represent every function and legal entity across a single enterprise or group of affiliated companies. Handovers are automated in an integrated way, so that every function, system, process, and P&L form a unified fabric of business execution. Read the article.
Heuristics: Heuristics is the author's series of one-page rules for operations and supply chain, each carrying a problem, a rule, a test, a real case, the mistakes and a maxim. Read the series.
Hybrid supply chain: A hybrid supply chain is brand-centred and layered - asymmetric upstream, symmetric downstream. Brand owner and contract manufacturers absorb different halves of a shock by contractual arrangement, and the model restores itself only while neither half exceeds what it was designed to carry. Distinct from the common usage, where a hybrid operating model means centralised functions combined with decentralised ones; that is a question of who reports to whom, this is a question of which physics each end of the chain runs on. Read heuristic 02.
Idealised Supply Chain Design: Idealised Supply Chain Design is a design method that abstracts a supply chain problem to the function it has to perform, then moves the system toward the ideal of performing that function with no system at all. It redefines the TRIZ ideal - the function is performed, but there is no system doing it - for supply chain - the customer (or consumer) receives the product, with no supply chain behind it. Read heuristic 04.
Ideality (I = ΣV / (ΣC + ΣH)): Ideality (I) is the sum of Value (V) it delivers (speed, flexibility, availability) over the sum of costs (C) to run and harm (H) produced (waste, lead time, working capital, emissions). Systems must evolve toward more useful function for less cost and harm; the ideal final result is when the supply chain function is performed and the system executing it is no longer needed. Optimisation shrinks a term in the denominator and usually adds elements to hold it there; dissolution sets a term to zero. Read heuristic 04.
Locus: Locus is the horizontal axis of the Variety Map - where the variety is absorbed. Locus runs from edge to the centre. Moving left on Locus enables shortening response time and keeping local knowledge as a differentiator. Moving right pools scale and leverages scarce skills. In cases where the decision loop's response window is shorter than the cycle time of the round trip it needs to make to the centre and back - the loop shouldn't be allowed to be positioned at the centre. Read the Variety Map.
Mechanism: Mechanism is the vertical axis of the Variety Map - how a loop's uncertainties are absorbed and graduated by what is encoded. Mechanism runs on a spectrum - from judgement to encoding, from manual (T1) to self-tuning (T5). Moving up on Mechanism lowers the cost per decision and raises the cost of uncertainty. Read the Variety Map.
Operating Model Physics: Operating Model Physics is a method for designing operating models. Each decision loop is placed on a two-axis map by where operational surprises are absorbed and how. Read playbook 01.
Outside Variance Ratio (OVR): The Outside Variance Ratio, or OVR, is the share of an operation's total variance that originates outside the company's walls - sigma squared (outside) divided by sigma squared (total). A low OVR indicates symmetric physics; asymmetry appears as OVR rises. It is ordinal in practice, a field estimate rather than a figure measured to two decimals, and it is the quantitative form of the third question in the heuristic 02 test. Read heuristic 02.
Requisite variety in supply chain: Requisite variety in the supply chain is the rule that any department can control only as much variation as it can absorb, and everything beyond that brings costs, delays or constant troubleshooting. Stated formally as Vr >= Ve - the distinct actions an operation can take in a time step against the distinct situations it faces - after W. Ross Ashby. Read heuristic 01.
SCOPEC: SCOPEC - I chose the name SCOPEC because it describes what I want to build: a test tool covering supply chain operations planning and execution in commodities. Read the chapter.
Second landscape: Second landscape - Every supply chain runs on two distinct technology landscapes. The official one records what happened: every transaction, supply chain event, and data point. Alongside this, there's another- a second landscape that enables daily operational decisions. The last one also defines what happens next. Read the chapter.
Supply chain orchestration: Supply chain orchestration - touches one of the four flows (one of the functions) and gets only one view of the data. Decisions are still routed via operators. Read the article.
Symmetric supply chain: A symmetric supply chain is interdependent and balanced - partners share information, decision rights, risk and sometimes assets, so when an external factor hits one node the whole ecosystem adjusts to restore inventory and capacity to homeostasis. Read heuristic 02.
Variety Map: The Variety Map is grounded in two axes and a square. A loop's uncertainty/surprises get absorbed where the locus runs from the edge towards the centre. The mechanism defines how to shift from judgement to encoding. Every decision loop in an operating model should have one point on it. Its four quadrants are Craft, Desk, Engine and Autopilot. Read the Variety Map.
Variety Shortfall Test: The Variety Shortfall Test takes the operational problem that keeps coming back and asks which of four layers is short - you cannot see it, you can see it but cannot act, you can act only one way, or the right action lands too late. The short layer is the one to fix, not the noisiest one. Read heuristic 01.
Waystation: Waystation - a stop between systems where work arrives in one format, is checked by a human hand, and leaves in another with a new name. Waystations are where variety leaks and spreadsheets breed. Read the chapter.
Zero-shot model: Zero-shot model - They are pre-trained on synthetic and real tables. My current understanding, in simple words, is that they take a table they've never seen and produce a calibrated prediction without any training run. Read the chapter.