Kindle Notes & Highlights
by
Tim J. Smith
Read between
September 26 - October 6, 2019
understanding of the business and the impact of prices on margins and volumes will be felt more acutely.
understanding how businesses work and the relationships between pricing, customers, competitors, and corporate profits
the pricing leader
their ability to run pricing projects, budgets, and resources.
develop pricing talent,
will collaborate with executives from other departments across the firm.
strong quantitative skills, but their need to lead teams and inform executive decisions will drive a reliance on their business acumen far more than their quantitative background.
strategic i...
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collaborative wor...
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people leadership...
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Grooming individuals may benefit from ongoing professional education provided through academia, corporate trainers, or pricing associations. It will require consistently increasing the job requirements and expectations of individuals to develop their skill sets.
A stint in pricing for high-potential leaders is an excellent approach to rounding out their understanding of the business. People with a finance background can be exposed to sales and marketing through pricing. And people with a sales or marketing background can be exposed to finance through pricing. Because pricing sees and acts across the organization, it can be identified as a good role for cross-training a future leader in the challenges faced by the organization
Pricing careers are rewarding for the intellectually curious and business driven, as the challenges always change and the value of good pricing decisions is clear.
There are a number of software tools that can enable pricing professionals to work more effectively and efficiently.
Some key areas where software is supporting pricing efforts include:
Graphical and statistical analysis of raw data
Configurations and quotes required for specialized offerings
monitoring and measurements of the effectiveness of discounts and promotions.
Price variance policy enforcement
Predictive modeling of the impact of a price change on...
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Enabling highly quantitative pric...
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to be managed consistently across an ...
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These software tools should be used to supplement the efforts of the pricing talent, not ...
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As a corporate development plan, I strongly suggest that firms develop the required talent first, then identify the software needed to accelerate the output or reduce the costs of generating the output of their pricing talent, and not the other way around.
This Value-Based Pricing Framework identifies pricing decision points across the corporate life cycle and the offering life cycle.
provides an organizational route
and taking actions with facts and insights.
it provides a model for developing the organization for driv...
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Using this framework starts with an executive decision: Where am I today and where do I want to be tomorrow?
Motivation and continued pressure from the CEO down has been shown to be the key to propel firms toward pricing excellence
Pricing excellence is a journey. It cannot be achieved in a single act.
a firm does not have to start at the beginning of the framework and work its way forward. One can start anywhere and work from there. The journey should begin with the area creating the greatest challenge for the firm.
Research repeatedly demonstrates that a 1 percent improvement in price capture can lead to a 10 to 12 percent improvement in corporate profitability.
Investing in pricing capability is a strategic decision. It requires developing people, processes, and tools for managing pricing decisions.
And, it is a strategic investment initiative, the value of which takes time to emerge.
Start with a small team of pricing professionals, preferably at least one quantitatively oriented analyst and one strategic thinker.
Measure their performance according to a mixture of broad business indicators such as margin, revenue, and market share growth as well as more focused indicators of how they are managing the challenge assigned.
