All too often, well-intentioned pricing improvement initiatives turn into nothing more than a sophisticated, corporate version of “Gotcha”. Equipped with a variety of analytics tools, pricing people look at hundreds of deals and make determinations as to whether or not those deals were priced properly.
Then, those salespeople responsible for making the less-than-ideal decisions might be treated to a “training opportunity”. Or, maybe they’ll receive a stern admonishment to “get it together” or “not do it again.”
If so, consider this: What good does it do now…really?
The deals are done. The margin dollars are gone. Sure, the after-the-fact corrective actions might prevent it from happening again. But the odds are against it…way against it. The more likely outcome is that the salespeople will come to resent the pricing people, seeing them as backseat drivers…or even snitches. And, this adversarial dynamic is hardly ideal for producing improved results over the long-term.
So stop it. Stop trying to treat the symptoms long after the disease has claimed its victims.
But there’s another way. As a diagnostic guide in The Journal outlines, Preventing Outliers Before They Happen, you can focus your energies on prevention. Focus on the things you can influence ahead of the transaction to increase the odds of better outcomes. Because once those deals are done, they’re done—and no amount of after-the-fact finger-pointing will get those margin-dollars back.