Terminology 

Validation: - To check whether a document is the correct type for a particular EDI system, as agreed upon by the trading partners, in order to determine whether the document is going to or coming from an authorized EDI user.



Value Added: - Increased or improved value, worth, functionality or usefulness.



Value Analysis: - A method to determine how features of a product or service relate to cost, functionality, appeal and utility to a customer (i.e., engineering value analysis). Also see: Target Costing



Value Based Return (VBR): - A measure of the creation of value. It is the difference between economic profit and capital charge.



Value Chain Analysis: - A method to identify all the elements in the linkage of activities a firm relies on to secure the necessary materials and services, starting from their point of origin, to manufacture, and to distribute their products and services to an end user.



Value Chain: - A series of activities, which combined, define a business process



Value of Transfers: - The total dollar value (for the calendar year) associated with movement of inventory from one "bucket" into another, such as raw material to work-in-process, work-in-process to finished goods, plant finished goods to field finished goods or customers, and field finished goods to customers. Value of Transfers is based on the value of inventory withdrawn from a certain category and is often approached from a costing perspective, using cost accounts. For example, Raw Materials Value of Transfers is the value of transfers out of the raw material cost accounts (you may have cost centers associated with inventory locations, but all "raw ingredients" usually share common cost accounts or can be rolled up into one financial view). The same goes for WIP. Take the manufacturing cost centers and look at the total value of withdrawals from those cost centers. While Average Gross Inventory represents the value of the inventory in the cost center at any given time, the Value of Transfers is the total value of inventory leaving the cost center during the year. The value of transfers for Finished Goods is, in theory, equivalent to COGS.



Value Proposition: - What the supply chain member offers to other members. To be truly effective, the value proposition has to be two-sided



Value stream mapping: - A pencil and paper tool used in two stages: 1. Follow a product's production path from beginning to end and draw a visual representation of every process in the material and information flows. 2. Then draw a future state map of how value should flow. The most important map is the future state map.



Value stream: - All activities, both value added and nonvalue added, required to bring a product from raw material state into the hands of the customer, bring a customer requirement from order to delivery and bring a design from concept to launch.



Value-Added Network (VAN): - A company that acts as a clearing-house for electronic transactions between trading partners. A third-party supplier that receives EDI transmissions from sending trading partners and holds them in a "mailbox" until retrieved by the receiving partners.



Value-Added Productivity Per Employee: - Contribution made by employees to total product revenue minus the material purchases divided by total employment. Total employment is total employment for the entity being surveyed. This is the average full-time equivalent employee in all functions, including sales and marketing, distribution, manufacturing, engineering, customer service, finance, general and administrative, and other. Total employment should include contract and temporary employees on a full-time equivalent (FTE) basis. Calculation: Total Product Revenue-External Direct Material / [FTE's]



Value-Adding/Nonvalue-Adding: - Assessing the relative value of activities according to how they contribute to customer value or to meeting an organization's needs. The degree of contribution reflects the influence of an activity's cost driver(s).



Value-of-service pricing: - Pricing according to the value of the product being transported



VAN: - See Value-Added Network



Variable Cost: - A cost that fluctuates with the volume or activity level of business.



VBR: - See Value Based Return



Velocity: - Rate of product movement through a warehouse



Vendor Code: - A unique identifier, usually a number and sometimes the company's DUNS number, assigned by a Customer for the Vendor it buys from. Example



Vendor Owned Inventory (VOI): - See Consignment Inventory



Vendor-Managed Inventory (VMI): - The practice of retailers making suppliers responsible for determining order size and timing, usually based on receipt of retail POS and inventory data. Its goal is to increase retail inventory turns and reduce stock outs. Its goal is to increase retail inventory turns and reduce stock outs. It may or may not involve consignment of inventory (supplier ownership of the inventory located at the customer).



Vendor: - The manufacturer or distributor of an item or product line. Also see: Supplier



Vertical Hub/Vertical Portal: - Serving one specific industry. Vertical portal websites that cater to consumers within a particular industry. Similar to the term "vertical industry", these websites are industry specific, and like a portal, they make use of Internet technology by using the same kind of personalization technology. In addition to industry specific vertical portals that cater to consumers, another definition of a vertical portal is one that caters solely to other businesses.



Vertical Integration: - The degree to which a firm has decided to directly produce multiple value-adding stages from raw material to the sale of the product to the ultimate consumer. The more steps in the sequence, the greater the vertical integration. A manufacturer that decides to begin producing parts, components, and materials that it normally purchases is said to be backward integrated. Likewise, a manufacturer that decides to take over distribution and perhaps sale to the ultimate consumer is said to be forward integrated.



VICS: - Voluntary Interindustry Commerce Standards. The retail industry standards body responsible for the CPFR standard, among other things.



Viral Marketing: - The concept of embedding advertising into web portals, pop-ups and as e-mail attachments to spread the word about products or services that the target audience may not otherwise have been interested in.



Virtual Corporation: - The logical extension of outpartnering. With the virtual corporation, the capabilities and systems of the firm are merged with those of the suppliers, resulting in a new type of corporation where the boundaries between the suppliers' systems and those of the firm seem to disappear. The virtual corporation is dynamic in that the relationships and structures formed change according to the changing needs of the customer.



Virtual Factory: - A changed transformation process most frequently found under the virtual corporation. It is a transformation process that involves merging the capabilities and capacities of the firm with those of its suppliers. Typically, the components provided by the suppliers are those that are not related to a core competency of the firm, while the components managed by the firm are related to core competencies. One advantage found in the virtual factory is that it can be restructured quickly in response to changing customer demands and needs.



Visibility: - The ability to access or view pertinent data or information as it relates to logistics and the supply chain, regardless of the point in the chain where the data exists.



Vision: - The shared perception of the organization's future--what the organization will achieve and a supporting philosophy. This shared vision must be supported by strategic objectives, strategies, and action plans to move it in the desired direction. Synonym: vision statement.



VMI: - See Vendor Managed Inventory



VOI: - See Vendor Owned Inventory



Voice Activated or Voice Directed: - Systems which guide users such as warehouse personnel via voice commands



Voice of the customer: - The expressed requirements and expectations of customers relative to products or services, as documented and disseminated to the members of the providing organization.