| activity analysis | The detailed identification and description of the activities conducted in an enterprise.
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| activity-based management (ABM) | Using an activity-based costing system to improve the operations of an organization.
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| benchmarking (or competitive benchmarking) | The continual search for the most effective method of accomplishing a task, by comparing existing methods and performance levels with those of other organizations or with other subunits within the same organization.
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| best practices | The most effective methods of accomplishing various tasks in a particular industry, often discovered through benchmarking.
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| continuous improvement | The constant effort to eliminate waste, reduce response time, simplify the design of both products and processes, and improve quality and customer service.
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| customer profitability analysis | Using the concepts of activity-based costing to determine the activities, costs, and profit associated with serving particular customers.
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| customer profitability profile | A graphical portrayal of a company's customer profitability analysis.
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| employee empowerment | The concept of encouraging and authorizing workers to take the initiative to improve operations, reduce costs, and improve product quality and customer service.
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| just-in-time (JIT) inventory and production management system | A comprehensive inventory and manufacturing control system in which no materials are purchased and no products are manufactured until they are needed.
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| just-in-time (JIT) purchasing | An approach to purchasing management in which materials and parts are purchased only as they are needed.
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| kaizen costing | The process of cost reduction during the manufacturing phase of a product. Refers to continual and gradual improvement through small betterment activities.
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| non-value-added activities | Operations that are either (1) unnecessary and dispensable or (2) necessary, but inefficient and improvable.
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| non-value-added costs | The costs of activities that can be eliminated without deterioration of product quality, performance, or perceived value.
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| process | A set of linked activities.
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| process value analysis (PVA) | Another term for activity analysis, which is the detailed identification and description of the activities conducted in an enterprise.
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| production Kanban | A card specifying the number of parts to be manufactured in a particular work center.
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| pull method | A method of coordinating stages in a production process. Goods are produced in each stage of manufacturing only as they are needed in the next stage.
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| reengineering | The complete redesign of a process, with an emphasis on finding creative new ways to accomplish an objective.
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| target costing | The design of a product, and the processes used to produce it, so that ultimately the product can be manufactured at a cost that will enable a firm to make a profit when the product is sold at an estimated market-driven price. This estimated price is called the target price, the desired profit margin is called the target profit, and the cost at which the product must be manufactured is called the target cost.
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| theory of constraints | A management approach that focuses on identifying and relaxing the constraints that limit an organization's ability to reach a higher level of goal attainment.
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| total quality control (TQC) | A product-quality program in which the objective is complete elimination of product defects.
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| two-dimensional ABC model | A combination of the cost assignment view of the role of activity-based costing with its process analysis and evaluation role. Two-dimensional ABC is one way of depicting activity-based management.
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| value engineering (or value analysis) | A cost-reduction and process improvement technique that utilizes information collected about a product's design and production processes and then examines various attributes of the design and processes to identify candidates for improvement efforts.
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| withdrawal Kanban | A card sent to the preceding work center indicating the number and type of parts requested from that work center by the next work center.
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