While complexity is in many ways given in enterprise-level pricing, pricing specialists should be investing their effort in value-driving pricing strategies instead of managing inefficient approval processes and workflows. Delayed reactivity to market forces, drawn-out sales cycles, and wasted time and resources in pricing and sales teams are a few ways using manual approval processes compromises a company’s competitiveness. Pricing software’s approval workflow automation can help.
Here at Pricefx, as a cloud-native pricing software company, we’ve seen firsthand the powerful impact that approval workflow automation can have on a company’s pricing efficiency, accuracy, and competitiveness in the market.
In this article, we’ll explore how pricing software streamlines approval workflows, starting with tell-tale signs your company’s processes would benefit from automation, followed by how pricing software enhances the approval process in practice.
So, let’s dive in.
Signs Your Company Should Automate Its Pricing Approval Workflows
In a pricing context, a company’s approval workflow is the sales process of approving or rejecting prices and commercial agreements based on how well they align with a company’s pricing strategies and policies.
If managed through manual channels like email and Excel, complex approval processes can often result in considerable delays in delivering prices to customers.
When price is often the final frontier of a buying decision, delayed decision delivery has far-reaching financial consequences, as it erodes trust in commercial relationships in the long-term and, at worst, can cause prospective partners to desert the relationship entirely.
To mitigate costly delays and inconsistencies in price negotiations, pricing software is designed to expedite and streamline the approval process.
But first, it’s worth exploring whether your company’s approval workflows could use the help.
How to Tell If Your Approval Workflows Need Automation
Before exploring how pricing software helps, first consider whether any of the following resonate with your business to decide whether approval workflow automation is the right choice:
If any of these sound familiar to you, let’s keep going.
Pricing software automates and streamlines approval processes across the entire journey to pocket price, namely in pricing, quotes, and agreements. Here’s how all of these areas benefit from pricing software’s workflow automation:
Automated Role Assignment for Quicker Turnarounds
Pricing and sales executives no longer need to worry about who needs to approve which prices or agreements, and when, which is so often the case in complex and hierarchical approval structures.
Companies can easily embed their workflow logic directly in a pricing software solution by assigning distinct levels of authority to their corresponding roles or teams. Based on that logic, the pricing solution can then automatically trigger approval requests and route them to the right people.
Pricing software’s role-based approval authority automation is like having a process-minded project manager who ensures the right approval tasks go to the right people, in turn mitigating bottlenecks and allowing each role to focus on their own responsibilities.
Automated Guardrails for Consistent Decision-Making
By enforcing the pricing guardrails you define upfront, pricing software supports more precision and efficiency in decision-making, whether that’s when addressing the challenges of introducing new products or in pricing and quoting workflows.
In pricing or quoting, a company can establish guardrails in the solution that allow managers to approve prices that deviate 5-10% from the agreed norm, while reserving the final say on those which deviate further to higher-level executives.
This ability is particularly useful in industries where new product pricing is required, but there isn’t any pricing history available to support the pricing decision, such as the spare parts industry.
In this case, typically an operational pricing manager would propose a price for the new product and a complex approval process would begin. By automating a few simple thresholds in that price setting process, the person responsible can respond with an educated decision and skirt much of the red tape.
Centralized Record-Keeping of Approval History for Heightened Visibility and Efficiency
Pricing software acts as a singular source of truth for approval history by enabling real-time status tracking, accessible by everyone and housed in the same location.
With more visibility into approval progress across the organization, key decision-makers can easily identify and address any approvals that are still pending. This is a sharp contrast to disparate storage and communication systems, like email or Excel, which can often lead to missed deadlines, duplicate requests, or even the complete loss of information. What’s more, companies can take advantage of this increased transparency to pick up on common bottlenecks in their approval process and make improvements as they go.
With pricing, this capability is especially valuable for keeping up with price revisions, since pricing or sales managers can easily lose track of the reason behind an exceptional approval several months after the fact.
Similarly, in the case of rebate approvals, typically a long and arduous process, centralized record-keeping cuts down on the time investigating previous agreements. Consider what the typical rebate approval process looks like: first, the sales department negotiates rebates with customers, after which pricing teams calculate profitability and provide their feedback with some adjustments. This is often followed by considerable back-and-forth, as sales may push back, requiring pricing to then take another look. Eventually, controlling, finance, and even legal departments could get involved.
Without a way to easily look up who did what, when, and for what reason, that same approval process will need to repeat itself the following year. Record-keeping in pricing software cuts down on that redundancy of effort.
Automatic Notifications as an Accountability Mechanism
Based on a company’s conditions for exceptional pricing and role-based approval permissions, the pricing software solution will automatically notify all relevant parties through an email notification when pricing or commercial terms should be approved or revised.
Automated alerts ensure that all stakeholders are made continually aware of their responsibilities in the approval process and respond within the established deadlines. In other words, they work as a built-in accountability mechanism in the approval processes – no more time-consuming (and frustrating) back-and-forth between roles or departments.
Integration with CRM and Third-Party Systems for Empowered Collaboration
One of the biggest time wasters for sales and pricing teams alike is the search for the right data to inform their pricing decisions, which can stunt their ability to quickly move forward in the approval process.
Pricing software’s seamless integration with CRM and other third-party systems provides those involved in the approval process with immediate access to sales and customer data, empowering them to make quicker, more informed pricing decisions.
Additionally, as all teams work in a central platform and draw from the same insights, this in turn supports better collaboration and consistency in workflows.
How to Know Which Pricing Software Is Right for You
We hope by now you have a few handy uses for workflow automation in your back pocket, and you’ve gained clarity on the potential of pricing software in addressing the common workflow challenges we’ve described in this article.
If you’re looking to harness the full potential of pricing software, consider checking out our comprehensive guide on choosing the best pricing software for your unique requirements:
Isaias Jaramillo-Rojas is a Solution Strategist at Pricefx, where he provides guidance in the sales process by creating suitable and custom solutions for companies that are looking to boost their pricing performance through data supported decisions. Working in the past years as a Pricing Manager in the DACH Region, he focused on the development of omni-channel distribution strategies and automatization of end-to-end pricing business processes.