1) Put pricing strategy on the Boardroom agenda
Management time should be dedicated to setting the most profitable pricing strategy. The leverage of pricing is enormous and the right strategy can drive rapid profit improvement, yet over half (55%) of business leaders believe there has been insufficient focus on pricing at board level to date.
2) Align pricing to the overall business strategy, and the new market dynamics
Review your pricing strategy as part of a full business strategy review. Market dynamics and customer buying habits have changed. Previously held assumptions around market dynamics must be reviewed and challenged, and the business model re-evaluated as a result. Setting and executing pricing policy will be a critical element of this to drive profitable growth.
3) Get access to the right information
Ensure you have access to robust, accurate and timely data to inform pricing decisions. This should include a granular level of understanding of the profitability of products and customers. Effective business intelligence does not just drive action, it drives decisions and strategy.
4) Drive consistent execution
Be prepared to take on the significant challenge of changing the behaviour of sales teams from the pre-recession world. Embed the right incentives, processes and controls that are required to ensure your pricing strategy is executed consistently, and your sales force is delivering profit, not just volumes.
5) Be prepared for future changes
Invest time in understanding how pricing models in your sector are likely to change in the next few years, and what you need to do now to prepare your organisation to implement those changes successfully.