You’ve seen the benefits of pricing software and persuaded your boss to invest in it… But how can you avoid the pitfalls that can derail a pricing software project?

With 19% of projects being cancelled, 52% being compromised (late, over budget and/or fewer capabilities than required) and over half costing nearly double their original estimates, how can you dive into your project with confidence? What elements should you be incorporating to ensure its success?

For over 10 years, Pricefx has been the go-to partner for companies looking to launch their pricing software projects. We know what it takes to deliver a pricing solution that meets your deadlines and budget, and more importantly, that elevates your pricing performance to new heights.

In this article, we’ll explore the people and processes we know to be essential in any software implementation, explain why we think steering committees are worth their weight in gold, show why agile methodology will support success every step of the way, and reveal the common tripping hazards of pricing software implementation that lay in wait to derail the whole thing.

First, though, let’s look at why so many software implementations fail.

Why Software Projects Can Fail

Understanding the underlying reasons why so many software projects fail is crucial for avoiding common pitfalls and ensuring success. Consider the following reasons:

• Lack of clarity:  You’ve got to have a really good idea of the scope of your software project, the problems you are trying to solve, the processes you need to improve, and the goals you want to achieve. It is essential that you deeply understand the needs and end goals of your intended users and that your design and development is led by these. You need a detailed roadmap that sets out a strategic plan, emphasizes your objectives, lays out your KPIs (Key Performance Indicators), and defines what success looks like. If you are not 100% sure of where you are going, you will never get there.
• No Executive Support: It is essential to have someone (preferably in the C-suite) that champions the project within the organization, clears away roadblocks, and finds the required money and best people. Without this high-level support, your project may never even get off the ground.
• Indifferent Stakeholders: The people who stand to benefit from the software all need to fully understand why and how the project is happening. They need to be on the same page so that important decisions can be made and so that you are not wasting time convincing those who should be on your side to take an active involvement. The last thing you need is to dedicate valuable resources to a new project that the team it is intended for will not adopt.
• Poor Communication: If product requirements are not clearly expressed and communication between internal and external teams is not transparent, you will likely have confusion, delays, and missteps plague your project from day one.

Learn more in greater detail in the article below:

What You Can Do to Ensure Pricing Software Project Success

At Pricefx, we advise our customers to take a two-pronged approach to project success: have the right people on board and employ processes that support the project’s outcomes from the very beginning.

So, let’s look at each in more detail.

Getting The Right People on Board

All stakeholders of the project must understand its reasons and their roles and responsibilities for its success. Assigning project roles will give you the confidence that every base is covered and that everyone is engaged throughout the process.

At Pricefx, we couldn’t be more enthusiastic about steering committees. We have seen just how powerful these are in ensuring the deliverability of a successful project, one that is on time, on budget, and on spec.

A steering committee is the advisory body that steers the project. It runs at a level above the project team and helps resolve any issues and clear any obstacles it comes up against.

Each member has a stake in how the project is managed and is concerned with its direction, scope, budget, and timeliness, as well as the processes employed, and methods used. The steering committee will meet frequently to discuss each of these aspects, to guide those with more hands-on roles, and to help ensure project direction is aligned with goals.

What a Steering Committee Does

So, who do you need on your steering committee?

• An Executive Sponsor:  This is typically a VP or C-level member; someone who gives overall guidance and direction to the project team, removes obstacles, and makes resources available. They are dedicated to making the project a success.

• Project Owner/Lead (sometimes called a Solution Manger or Solution Director): This will often be your head of pricing; someone who understands what will bring most valuable to the business and how competing priorities line up. They will define and outline project requirements and prioritize work at each phase.
• Core Software Implementation Team:  Yourimplementation team is responsible for the actual build and will work closely with your software vendor’s team to deliver your end solution.
• IT Project Manager:  Responsible for the overall coordination and smooth-running of the project, this person ensures everyone is prepared, aligned, and coordinated. They are instrumental in managing project timelines, budget, and scope .
• IT Lead:  Your IT lead understands the company’s system landscape and takes a hands-on approach. They understand how different applications work together and collaborate with a solution manager on the vendor side. They also need to know the shape and landscape of data on the customer side from the data origins to its eventual flow. Some commercial understanding (not only technological prowess) is required to value the commercial benefit of the project. In other words, the role of the IT Lead is critical, and they should be more than a ‘technology gatekeeper.’
• Subject Matter Experts:  These could be experts from your pricing, finance, accounting, quoting, sales, and/or rebates teams who can provide insights into how things are done today, so that processes can be correctly implemented. Without them, you run the risk of building an unusable solution.
• Solution Engineer: responsible for exporting data from your systems ready to be imported into the new solution.

Having a steering committee made up of the right people, each with clearly defined roles and responsibilities, sets you up for success. It ensures your project gets the support, funding, and expertise it requires, and the time, consideration, and championing it needs.

Choosing the Agile Approach

Agile methodology has become standard in software development, with over 80% of companies employing it—possible because it has helped 98% of them become more successful. The top reasons for the switch to Agile include increased productivity, better prioritization, clearer accountability, enhanced collaboration, and continuous feedback.

Agile is about developing software with an iterative approach—breaking down the project into smaller “sprints” and therefore being able to respond to changes in the plan much better for continuous delivery.

At Pricefx, we are huge advocates of this way of working, and here is why:

• Customer-focused “user stories” ensure continuous delivery based on actual needs. And thanks to better customer control, the highest priority features are developed first.
• Working with short development cycles means the project remains flexible and teams can react quickly to the changing needs and goals of the customer, giving them a competitive edge.
• Continuous transparent communication fosters good customer-vendor relationships and helps teams create something of impactful value.
• Through direct involvement and by giving feedback and approvals after each iteration, customers have a tangible impact on the result of the software project.

Typical Pricing Project Blind Spots

Even companies with a clear idea of their requirements, that embrace an agile approach, and have a strong and passionate steering committee can be blindsided by misconceptions and misunderstandings. Here are some we have seen repeatedly:

Underestimating the Time Commitment

One of the biggest struggles we have seen with our customers, even those with a clear idea of what they want their new solution to do, is that they do not realize how much work is going to be required on their side.

Each company prices differently and there is no one-size-fits-all solution. Pricing software needs to be configured and customized to your precise way of doing things. This means your vendor or developer will need to understand your processes inside out. You will need to take the time to communicate your needs clearly and to test each iteration as it is built.

We also see a massive underestimation of how much their IT team will be involved. Being realistic about the time your project is going to take will help you assign IT responsibilities around existing tasks to avoid delays or bottlenecks.

Underestimating the Importance of Your Data

Not fully understanding the scope of the data that should support your solution is like trying to build a house without a foundation. If your data is not already consumable (clean data, with consistent formatting and no duplicates) by the system you are building, then you will not succeed. A lack of clarity, cleanness, or completeness in your data can cascade through your project, slowing it down, even halting it completely.

The three data sets you will need to start any pricing project are:

• customer master data
• sales transaction data
• product data

At Pricefx, we guide our customers through three phases of data preparation and are part of an initiative that we call Data Readiness Management:

• Identification Phase: The identification of your business processes, working out what data each business process requires (data scoping), locating relevant data and who owns it (data sourcing).
• Data Quality Phase: The locating of data quality gaps and outliers that have the potential to derail your implementation. If you cannot clean them up, then be able to point out where they are to your vendor.
• Data Availability Phase: The ease and speed with which you can access and extract relevant data. A lack of data availability is one of the biggest reasons we see for severely delayed or cancelled projects. Planning for data availability lead-times is critical for project success.

Underestimating the Value of Skilled Developers

Skilled developers make for a smooth-sailing development process and the extra investment will save you headaches, time, and money in the long run. They are more likely to follow software development best practices (ensuring the longevity of your solution) and to abide by the guidelines of coding standards. Having source control will give you a centralized source for your code and enable you to manage changes when required. A code review is recommended before launch to identify any bugs or defects.

Just as importantly, your developers should be genuinely interested in the project and care about the outcome.

Software Project Success

Ensuring a successful software project requires a people + processes approach;

• A steering committee ensures executive and stakeholder buy-in, that project goals and direction are clear and well communicated, and that everyone knows what they’re doing and why.
• Agile development ensures that all requirements are well understood and communicated, that the project remains flexible to changing customer needs, and that the customer is involved every step of the way.

From years of experience, we know that agile pricing projects led by steering committees are much more likely to succeed and to come in on time, on budget and on spec.

If you are interested in learning more about the various phases involved in a pricing software project, check out our article:

Meanwhile, Happy Pricing!