Glossary

Kaizen is the business concept of continuous improvement. The term originated in Japan (the word Kaizen means improvement). It became widely known globally when Toyota publicized its production philosophy and management methods, which include systematic, organized improvement of processes by those who operate them, using straightforward methods of analysis.

Kanban, which means signboard in Japanese, is a workflow management system. The most widely used implementation is Kanban cards. A Kanban card is a colored card which is attached to the container used to move the output of one process to the next process. When the next process consumes that material, the kanban is returned to the producer process, authorizing the producer process to make the next container load of output. The aim is to make sure each part of the factory stocks only the inventory that is needed, no more, no less. This eliminates ‘stock outs’ and reduces inventory carrying costs.

Key Performance Indicator (KPIs) are metrics tracked by an organization to help evaluating how successful it is, and to help defining and achieving its long-term goals. KPIs can cover both financial and non-financial aspects, including estimation of difficult-to-measure activities like leadership development, service, and customer satisfaction, as well as more measurable activities such as production efficiency and energy use.