Supply Chain Risk Glossary

A composite supply chain risk score on a 0-100 scale that combines four risk pillars -- transportation, energy, materials, and macroeconomic indicators -- into a single number representing overall supply chain disruption risk. Higher scores indicate greater risk. The GDI is calculated by SupplyMaven from primary government and market data sources and updates in near-real-time as new data arrives.

A patent-pending index developed by SupplyMaven that measures US manufacturing activity by analyzing weather-normalized electricity demand across 8 power grid regions. The SMI strips out heating and cooling demand to isolate the industrial electricity signal, then compares it against rolling baselines to detect manufacturing output changes. The SMI uses an inverted scale: lower scores indicate stronger manufacturing activity, higher scores indicate weakness.

A mechanism in SupplyMaven's Global Disruption Index that accounts for structural changes -- tariffs, sanctions, trade agreements -- that persist longer than typical news events. While news-driven signals fade after hours, policy adjustments maintain elevated risk scores for as long as the structural condition persists, with defined decay schedules for temporary measures.

A condition where the number of vessels waiting at or near a port exceeds normal capacity, causing delays in cargo loading, unloading, and onward transportation. Port congestion is measured by vessel dwell time (how long ships wait before berthing), vessel count (how many ships are in the port area), and turnaround time (total time from arrival to departure). Congestion at major ports like Shanghai, Los Angeles, or Rotterdam can cascade through global supply chains within days.

A narrow passage in a maritime shipping route where disruptions can delay or block large volumes of global trade. Major chokepoints include the Suez Canal (12-15% of global trade), the Panama Canal (5-6% of global trade), the Strait of Malacca (25-30% of global trade), and the Strait of Hormuz (20-25% of global oil supply). When a chokepoint is blocked or restricted, ships must reroute, adding days or weeks to transit times.

In port operations, dwell time is the duration a container or vessel stays at a port facility before being moved. Extended dwell times indicate congestion, labor shortages, equipment constraints, or regulatory delays. Average container dwell time at well-functioning ports is typically 3-5 days. When dwell times exceed 7-10 days, the port is considered congested and downstream supply chains are affected.

A port where cargo is transferred between vessels rather than entering the local market. Singapore, Busan, and Jebel Ali are major transshipment hubs. Cargo arriving on large intercontinental vessels is transferred to smaller regional vessels for final delivery. Disruptions at transshipment hubs cascade widely because they affect traffic from multiple origin-destination pairs.

A data reporting form from the US Energy Information Administration (EIA) that collects hourly electricity demand, generation, and interchange data from US balancing authorities. EIA-930 data is the foundation of the Supply Manufacturing Index (SMI), providing the raw electricity demand figures that are weather-normalized to extract manufacturing signals. Data is published with a roughly one-hour lag.

A database maintained by the Federal Reserve Bank of St. Louis containing over 800,000 economic time series from 108 sources. Supply chain risk platforms use FRED data for macroeconomic indicators including industrial production (INDPRO), manufacturing employment (MANEMP), capacity utilization (MCUMFN), the Producer Price Index (PPI), and the VIX volatility index. FRED data is publicly accessible and updated on each indicator's publication schedule.

A measure of how much heating or cooling is needed based on outdoor temperature. Heating Degree Days (HDD) count how far the average daily temperature falls below 65°F. Cooling Degree Days (CDD) count how far it rises above 65°F. In supply chain risk analysis, degree days are used to estimate and remove weather-driven electricity demand from total demand, isolating the industrial and commercial components.

The statistical process of removing weather-driven effects from a data signal. In electricity demand analysis, weather normalization strips out heating and cooling loads to reveal the underlying industrial demand signal. Without normalization, a cold snap that drives up residential heating demand would be misinterpreted as increased manufacturing activity. SupplyMaven's SMI uses degree-day-based weather normalization with region-specific coefficients.

A single numerical score that combines multiple risk indicators into one comparable value. Composite scores solve the problem of comparing disparate data types -- how do you weigh a port congestion delay against a commodity price spike? By normalizing each indicator against its own historical baseline and applying weights, composite scoring produces a single number that captures overall risk conditions. The GDI is a composite risk score.

The process of converting raw data into comparable scores by measuring deviation from a baseline. In supply chain risk scoring, raw values (vessel counts, commodity prices, wait times) are compared against their historical distributions. A vessel count that is 2 standard deviations above its 90-day average produces a higher risk score than one that is only slightly elevated, regardless of the absolute number.

An entity responsible for maintaining the balance between electricity supply and demand within a defined geographic area. Major US balancing authorities include MISO (Midwest), ERCOT (Texas), PJM (Mid-Atlantic), CAISO (California), ISO-NE (New England), NYISO (New York), and SPP (Southwest). Each reports hourly electricity demand data to the EIA.

The total time between placing an order and receiving the goods. Lead time includes supplier manufacturing time, transportation time, customs clearance, and last-mile delivery. Supply chain disruptions -- port congestion, border delays, manufacturing slowdowns -- directly extend lead times. When lead times extend unexpectedly, companies face stockouts, production delays, or expediting costs.

A manufacturing and inventory strategy that minimizes on-hand inventory by scheduling deliveries to arrive precisely when needed for production. JIT reduces carrying costs but increases vulnerability to supply chain disruptions. Even small delays -- a border wait time increase, a port congestion spike -- can halt JIT production lines because there is no buffer inventory to absorb the disruption.

A manufacturing facility in Mexico that imports materials and equipment on a duty-free and tariff-free basis for assembly, processing, or manufacturing, then exports the finished product. Maquiladoras are concentrated along the US-Mexico border and are deeply integrated into North American supply chains, particularly automotive, electronics, and aerospace. Border wait time disruptions at crossings like Laredo and El Paso directly affect maquiladora operations.

A family of indexes published by the Bureau of Labor Statistics (BLS) that measures the average change in selling prices received by domestic producers for their output. PPI is a leading indicator of consumer inflation and cost pressure in supply chains. Rising PPI signals that input costs are increasing across the economy, which typically flows through to procurement costs within 30-90 days.

The CBOE Volatility Index, often called the 'fear gauge,' measures expected 30-day volatility of the S&P 500 index. In supply chain risk, elevated VIX levels correlate with market uncertainty that can drive commodity price swings, currency fluctuations, and changes in trade financing availability. A VIX above 30 historically indicates heightened market stress.

The percentage of an economy's total manufacturing capacity that is currently being used. Published monthly by the Federal Reserve as MCUMFN. Capacity utilization above 80% indicates the manufacturing sector is approaching full output, which can signal tightening supply, longer lead times, and upward price pressure. Utilization below 75% suggests slack in the system.