Fusing Your Team’s Expertise & Pricing Software Technology

Is your business looking to purchase and implement pricing software technology, and you are wondering what will become of your pricing team? Many companies just like yours are currently addressing the same conundrum. Sure, it is a slam-dunk that pricing software will help your organization become more pricing lean and help you achieve your company’s unique set of business objectives (whether its revenue or profit maximization, or simply becoming more efficient). But did you know that it will also transform your pricing team into pricing strategy wizards too?

At Pricefx, we’ve spent the last decade and more assisting companies across a range of industries to elevate their pricing strategies, fine tune their pricing processes, and become pricing execution experts. And we’ve seen first-hand how pricing teams are transformed when new pricing software is introduced into the company mix.

The use of pricing software in conjunction with human pricing teams has become increasingly prevalent in today’s business landscape. By automating everyday tasks such as price list updates, the time-savings and error reduction that pricing software allows for can give pricing team members more time to be strategic and track down pockets of value and profit points that their organization never knew existed before.

In this article, we will explore the benefits of blending pricing software with your team, focusing on the automation of tasks and the strategic opportunities it can unlock.

The Liberation from Mundane Tasks: Unveiling Strategic Potential

By integrating pricing software into the fabric of everyday operations, organizations not only liberate their teams from mundane tasks but also empower them to chart a course towards strategic excellence. The liberated bandwidth allows pricing teams to don the mantle of strategists, navigating through the data-rich landscape to uncover hidden pockets of value and propel the organization towards sustained profitability and success. Let’s take a closer look at the top 8 ways the human-software symbiosis can have a positive effect on your organization:

1.     Automation, The Great Time-Saver

One of the most profound impacts of pricing software on a team is its ability to automate routine and time-consuming tasks. Take the classic example of price list updates. Previously, this process required manual entry, cross-referencing, and verification, consuming a huge portion of a team member’s working hours. With pricing software, this task becomes automated, allowing pricing teams to reallocate their time to more strategic endeavors.

It’s precisely a problem that European tire manufacturer, Michelin, solved by adopting the Pricefx solution.

 

One of the key challenges Michelin was facing was keeping track of the cost of rubber, steel, carbon black and other raw materials that were constantly increasing. They simply could not keep up with the cost increases because they were changing so rapidly. Updating price lists took as long as 2 months and meanwhile, profit margin slipped out between the cracks as prices kept on rising.

 

The Solution

 

Using the Pricefx Price Setting functionality, Michelin cut their recalculation time for price lists from 2 months to 20 minutes!

 

Now in 20 minutes, Michelin can set, manage, and optimize prices across their entire product portfolio and get a handle on complex pricing activities in one place. The price-setting and price optimization tools work together allowing Michelin to make the most of their pricing strategy. All while minimizing margin leakage and increasing bottom-line profit.

 

What is also means with those kind of time savings, pricing teams can be repurposed to go and discover additional pockets of value. Instead of preparing price lists for 2 months, Michelin’s pricing team went out and discovered other points of value for 2 months. So, during that time, they went about discovering approximately €1 million worth of value from underpriced products – additions to their bottom line they never knew they had.

2.     Strategic Exploration Unlocked

In a neat segue to the Michelin story above, the beauty of pricing software lies not in its capacity to replace human decision-making but in its ability to amplify it. By handling the repetitive tasks, the software liberates pricing team members to explore new horizons.

They can now delve deeper into data analytics, trace consumer behavior trends, and identify pockets of untapped value and profit points. This strategic shift is crucial, enabling businesses to spot opportunities that were previously hidden in the noise of manual processes.

3.     Precision and Error Reduction

Another benefit of integrating pricing software into the team’s workflow is its exceptional precision and error reduction capabilities. Human errors are inevitable, especially in repetitive tasks. The software’s accuracy ensures consistency in pricing strategies, minimizing costly mistakes that might have slipped through in manual processes. This precision elevates the team’s overall performance, fostering trust in the decision-making process and enhancing customer satisfaction.

4.     Insights that Drive Innovation

Beyond timesaving and precision, pricing software provides invaluable insights that drive innovation within the team. The data gathered and analyzed by these tools offer a comprehensive view of market dynamics, customer behaviors, and competitive landscapes. These insights act as a compass, guiding the team towards innovative strategies and product offerings.

For instance, through advanced analytics, pricing teams can identify price elasticity, understanding how changes in price affect demand. Armed with this information, they can fine-tune pricing structures to maximize both revenue and customer satisfaction. Moreover, software-generated insights can highlight correlations between pricing fluctuations and customer retention rates, shedding light on optimal pricing thresholds that keep customers engaged while ensuring profitability.

It is worthwhile to note that with Pricefx, the reporting is automated, always to hand and always with the latest data. What’s more, it is easy to see trends over time with our solution. Of course, this is in direct comparison to manual pricing with Microsoft Excel. With Excel, you may see snapshots in time but building the capability to see a trend developing over time is as time-consuming and about as manual as you can possibly imagine.

5.     Collaborative Decision-Making

While pricing software empowers teams with data-driven insights, its integration doesn’t eliminate the need for human judgment and collaboration. Instead, it amplifies these aspects. Teams can now leverage the software’s insights as a foundation for informed discussions and collaborative decision-making.

By combining human expertise with software-generated data, pricing teams can fine-tune strategies that align with broader business goals. This collaboration fosters a more comprehensive understanding of the market landscape, enabling teams to adapt swiftly to changes and optimize pricing strategies accordingly.

6.     Adaptability and Continuous Improvement

The dynamic nature of markets demands constant adaptation, and pricing software supports this need for agility. It allows teams to swiftly adjust pricing strategies in response to market shifts or competitive maneuvers. Real-time data analysis enables rapid decision-making, ensuring that businesses stay ahead in the ever-evolving market ecosystem.

Moreover, the integration of software encourages a culture of continuous improvement. Teams can analyze past performance, experiment with different pricing models, and assess outcomes efficiently. This iterative approach fosters a learning environment within the team, promoting constant refinement and optimization of pricing strategies.

7.     Ethical Considerations and Human Oversight

While pricing software offers an array of advantages, ethical considerations and human oversight remain imperative. Algorithms powering these tools are only as unbiased as the data fed into them. Pricing decisions can significantly impact consumers and markets, making it crucial for human experts to oversee and validate the outputs of the software. Human oversight ensures that decisions align with ethical standards and prevent potential biases from impacting pricing strategies.

In essence, the harmonious integration of pricing software with human expertise fosters a synergy that optimizes pricing strategies. It liberates teams from mundane tasks, empowers them with data-driven insights, encourages collaborative decision-making, and drives continuous improvement.

However, the human touch remains vital, providing ethical oversight and ensuring that the pricing strategies align not only with profitability but also with ethical and customer-centric values.

8.    Refine and Regularly Review Your Transformational Pricing Program

A successful pricing transformation program thrives on its adaptability and continual refinement. Regular and periodic reviews serve as the cornerstone for optimizing such initiatives. It’s crucial to consistently evaluate the program’s advancement, ensuring alignment with predefined objectives, scope, and timelines. This evaluation involves a comprehensive assessment of performance metrics alongside identifying any challenges, issues, or potential risks that might have surfaced during the implementation phase. Swift and effective resolution of these obstacles is paramount to sustaining the program’s momentum.

Moreover, integrating feedback loops into the program is essential. Soliciting input not just from the team members involved in the implementation but also from users and customers creates a well-rounded perspective. Their insights often unearth nuanced aspects that require attention and improvement, enriching the overall quality and value of the pricing strategy.

With automation, streamlining several pricing processes—such as the previously labor-intensive price list updates—the team now has more hours at their disposal. This ‘surplus’ time presents a golden opportunity to delve into the depths of the pricing program, enriching the overall depth of understanding and implementation of your organization’s pricing. The team can conduct comprehensive reviews, meticulous scrutiny of pricing strategies, analyzing data trends, market shifts, and customer behaviors with a newfound depth and precision.

A Symphony of Human Ingenuity and Technological Prowess

Now you know that blending pricing software with a human pricing team can provide significant benefits for organizations. By automating everyday tasks with quality pricing software like Pricefx and freeing up time for pricing team members, and viewing through the prism of previously unavailable insights and analytics, organizations can unlock new value and profit points that they may not have been aware of before.

However, to make the most of pricing software, organizations must also carefully consider their pricing strategies and models to ensure that they are optimizing their pricing decisions. By choosing the right pricing approach and leveraging the power of pricing software, organizations can stay competitive and maximize their profitability in today’s dynamic business landscape.

But how to choose the right pricing strategy? To begin your pricing strategy learning journey, check out the Pricefx ‘Complex Guide to Pricing Strategies,’ by clicking on the image below:

Meanwhile, Happy Pricing!