Procurement terms: Z

Refer to Budgeting, Zero Based

Refer to Pricing, Zero Based

The goal of some quality systems is the generation of no substandard outputs. In practice, this equates to zero defects and, by way of comparison, Six Sigma quality systems aim to produce no more than 3.4 defects per million cycles. This illustrates that zero defects is a very challenging goal. See also Six Sigma.

Refer to Inventory, Zero

In game theory, a zero sum game is when one player ‘wins’ only when the other player ‘loses’. For example, if the seller offers to sell a machine at a price of $1000 and the buyer aims to buy the machine for $800, there will be a ‘win:lose’ outcome. Every dollar the buyer ‘wins’ represents an equivalent ‘loss’ for the seller. If, alternatively, the parties agree a price of $900 and a three-year support contract of $100 a year, value has been created for both parties and may be considered a ‘win:win’ outcome. See also Win:Win.

A term used to describe location within a warehouse. A hierarchy of terms may be used to describe particular areas within a warehouse, for example, zone, aisle, bay, level and position. In this case, zone is the highest order in the hierarchy and might describe an area of the warehouse that has common characteristics such as a detailed picking zone, or the secure storage zone.