Transformation toughening as it applies to zirconia

http://www.ms.ornl.gov/programs/energyeff/cfcc/iof/chap21-2ttz.pdf

It is a strain triggered phase change which is supposed to introduce compressive stresses into the matrix, therefore increasing toughness. This is a very simplistic view however, and you would do well to follow this further in the literature, which plenty is available.

Cutting tool inserts are small "blades" which are used in a lathe. The inserts have a hard tip, which performs the machining/material removal. The inserts can be swapped out from the machine easily, as required. See

http://www.gilmorediamond.com/gilinserts.html

for examples

Certain materials, principally ZrO2, can be doped and sintered in such a manner that upon the propagation of any surface cracks the crack front engages a crystalline zone which expands when the crack hits it. This expansion puts a compressive force around the crack, blunting its propagation.