This PPT slide, part of the 63-slide Pricing Strategy Implementation Toolkit PowerPoint presentation, presents a Pricing Action Maturity Model, structured to guide organizations through 4 distinct levels of pricing practices: basic, emerging, established, and superior. Each level outlines key practices across 3 dimensions: Pricing Procedures, Roles & Responsibilities, and Metrics & Rewards.
At the basic level, pricing procedures are rudimentary, with front-line employees required to follow a basic price list. If deviations are necessary, they must seek approval from supervisors. This indicates a lack of autonomy and a cumbersome decision-making process. As organizations progress to the emerging stage, pricing practices become more systematic. Price lists are updated regularly, and there is a documented process for non-standard pricing, reflecting a move toward structured pricing strategies.
Roles and responsibilities evolve similarly. Initially, pricing responsibilities are vague and often shared among multiple individuals. As maturity increases, roles become clearly defined, with one person accountable for each product line. This clarity is crucial for effective pricing decisions and aligns accountability with performance.
Metrics and rewards also shift significantly. At the basic level, incentives are based on aggregate sales volume, lacking granularity in profitability analysis. As organizations mature, sales incentives begin to incorporate profitability considerations, moving towards a more nuanced understanding of performance metrics. By the superior level, incentives are tailored to individual transactions, reflecting a sophisticated approach to pricing that considers specific account and product profitability.
This model serves as a roadmap for organizations aiming to refine their pricing strategies, highlighting the importance of structured processes, clear roles, and sophisticated metrics in achieving pricing excellence.
This slide is part of the Pricing Strategy Implementation Toolkit PowerPoint presentation.
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