LIFO is a term describing the practice to process those goods first that were received last, for Generic Stock. LIFO is generally only relevant for Make-to-Stock processes. Make-to-Order and Engineer-to-Order processes pick based on the order reference of the inventory (Sales Order Stock).
LIFO is not a common practice in order picking. Generally, picking processes are driven by algorithms that take more complex rulesets into consideration.
In Accounting, LIFO describes the practice to value inventory based on the principle that inventory acquired or produced will be sold first, which reduces income taxes in times of inflation. IFRS has banned LIFO as an approved accounting practice.