Glossary of Lean Management and Supply Chain Management terms

For mutual understanding: short definitions of important terms from the world of continuous improvement and Supply Chain Management


Click on one of the letters beneath to check the glossary for terms beginning with that letter.



Japanese for master or teacher

A sensei is a lean production expert. The sensei passes on his / her knowledge as the mentor.

Sequencing stability

The sequencing of components to be manufactured / assembled should correspond to the planned sequence; this ensures uniform production, transparent and manageable production control, and logistics that align with production. > Just-in-sequence

Sequential manufacturing

In sequential manufacturing, the sequencing of production materials is value stream-driven and production materials are connected using simple transportation devices.

Set-up redcution

To reduce set-up time, the set-up process is observed and analyzed (e.g. using the ECRS – eliminate, combine, rearrange, simplify – method), > waste is reduced, and the developed concept is tested and standardized. The defined process standard is the basis for training employees who carry out the setup process. One of the ways > overproduction is decreased is by producing smaller lots. To produce these lots without too much time loss, the setup times must be kept as short as possible.

SFM (Shop Floor Management)

Shop Floor Management supports the consistent development of on-site processes and procedures. The presence of management in production areas and their focus on deviations from standards dramatically speeds up decision-making and results in the immediate implementation of solutions.

Shop Floor Management clearly defines management’s tasks and requires special modes of behavior. Management is supported by the application of specific tools.

Five Shop Floor Management-related tasks are carried out on-site and are as follows:
1. Carry out regular communication
2. Confirm processes
3. Enable employees

4. Carry out continuous process improvement
5. Solve problems in a structured manner

SFM exemplifies behavior that encourages employees to solve problems within their scope of competencies and initiate improvements. For example, management keeps its comments to a minimum, only makes binding commitments, gives but also accepts feedback, gains its own perspective of a situation, allows mistakes in learning situations, does not lay blame and puts in place questioning techniques.

SFM tools support the effectiveness of management, e.g.: production diary, KPI charts, problem-solving sheet, T-cards.

Signal Kanban

Every container is marked with a Kanban card or signal. When last part is taken, the > Kanban is sent to the source and added to the Kanban board. The Kanban board reflects the exact inventory levels and depicts the level of > overproduction by source and destination. Based on the distribution of the cards in the color-coded areas, the allocation of the workstations as well as the control loop dimensioning can be determined.


SIPOC is a > Six Sigma tool that summarizes, in table form, an entire process at the start of an improvement measure or a project. SIPOC can be used to clearly delimit processes within a process chain. A SIPOC diagram illustrates a moment in time of a process. Each of the letters in SIPOC represent the names of the columns in the table: S – Supplier, I – Inputs, P – Process, O – Output, C – Customer.

Six Sigma

Six Sigma (6σ) is a set of management techniques to manage quality and to improve processes and process output quality. Its key element is to describe, analyze, improve and monitor business processes using statistical methods. As a rule, every quality characteristic leads to an undesired variation in process results. As a part of a so-called process capability inspection, deviations from the target state in relation to the tolerance level of the characteristics in question are identified. The standard deviation of the characteristic (the Greek letter σ, which is read as sigma) plays an important role. It measures the variance of the characteristic and how much the characteristics’ values deviate from one another. The further the standards deviate from the range of tolerance, the more likely it is that the tolerance levels will be exceeded. Also, the further the mean is from the middle of the tolerance range (the closer it is to one of the tolerance levels), the greater the regression. That is why it is important to measure the distance between the mean and the closest tolerance range using standard deviations. This distance, divided by σ is the process capability index cpk; Cpk = 1 if the mean is 3 σ from the closest tolerance level. These techniques were named Six Sigma because Six Sigma requires that the closest tolerance level be at least six standard deviations (6σ, Six Sigma) from the mean. When this requirement is met, we can assume that a zero-error production has been met and that the tolerance levels are rarely exceeded.

SMED (Single minute exchange of die)

Shigeo Shingo came up with this series of techniques to set up production equipment in less than 10 minutes. > Set-up reduction


Source is used to indicate the material’s point of origin / production facility. The opposite is the drain.

Standard layout

A standard layout diagram illustrates a workstation or cell and indicates how and in what order standardized work is performed.

Standard work

Standard work describes the pre-defined process steps carried out by an employee during > takt time.

Standard work combination sheet

A standard work combination sheet is a document that displays the process steps for one or several employees. It is used to display the optimum combination of human and machine work.


Standards describe the predefined procedure of processes and workflows. Standardization ensures that optimum performance is continuously achieved, that resources are used efficiently and that quality remains consistent, regardless of the operator. Standards are visually recognizable, making it easier to immediately identify errors and problems that deviate from the standard. Based on this, e.g. error stoppage measures are determined, or a problem-solving process is started. Standards make it possible to more quickly and easily familiarize employees with the process.

Stop-the-line authority

The ability of workers to stop the process when there are problems and to pull the > Andon cord. This prevents defective parts from entering downstream processes.


The term supermarket is used to identify an instrument that independently controls production. In a supermarket, all components can be found in a pre-defined area; they are organized for optimum reach, their inventory level is limited, and components are replaced as soon as they are used.

Swim lane diagram

A swim lane flowchart is used to analyze and model business processes by illustrating the business processes as a flowchart. Various job responsibilities are placed horizontally in a (swim) lane, so that the transfer of responsibility or interfaces is more apparent.