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Why Do Pricing People Get Passed Over?

Imagine this…

As you leave work Friday night, you’re confident in the knowledge that you’ve had a productive week. You and your team have done what’s expected and you’ve done it very well. So it’s time for some well-earned relaxation over the weekend!

But when you arrive back at work Monday morning, you learn that your corporate snow globe is about to be shaken…really hard.

After years of not seeming to care all that much, management now “gets it” and has decided to take the company’s pricing capabilities to “the next level”. Your function is going to be “re-engineered” for greater effectiveness. Some of your team members will be reassigned or even let go to make room for “personnel upgrades”.

And you? Technically, you’re not being demoted and will still get to keep your title. But you’ll soon be reporting to a new person they’re hiring, from the outside, to provide “strategic direction” and “drive the pricing agenda.”

As you furiously search for an old resume to update, you can’t help but wonder what the hell just happened?

Now, I wish I could say that this scenario is pure fiction. But I’ve heard this same basic storyline again and again…usually after it’s far too late to change the plot. And while the details are different in each instance, the underlying dynamics are almost always the same…

  1. The pricing team does exactly what they’re told to do. They work through their tactical to-do lists. They keep their heads down and stay focused on their assigned activities. And they never look beyond their current responsibilities to see what they really should be doing.
  2. This meets management’s expectations perfectly. When it comes to pricing, management rarely knows what the end-game should really look like. And as a result, they’re very often content with whatever is being done with pricing, as long as something is being done with pricing.
  3. Then, the management team has an epiphany. They talk to a consulting firm. They hear what other companies are doing. They pass around a case study from the latest issue of HBR. However it happens, it happens…and management very quickly realizes that their company’s pricing capabilities are not where they really need to be.
  4. Finally, management decides to bring in new blood. The tactical pricing activities that were once perfectly acceptable are now missing the mark. Management’s expectations have changed dramatically and the current pricing team is no longer meeting them. And because they’ve never stepped up or taken the initiative in the past, the current pricing team is often deemed incapable of meeting these more strategic expectations…causing management to look elsewhere.

It’s not pretty. And it’s not fair. But it happens…a lot.

When you’re not being pushed, it’s very easy to just sit still. It’s very easy to get lulled into complacency by management’s low expectations. It’s easy, but it’s not smart. Because all of that can change very quickly…as quickly as changing one’s mind…and you could find yourself behind the eight ball, seemingly overnight.

Don’t let it happen to you. Use the resources below to figure out what your pricing team should be doing and start doing it! Remember…if you’re always waiting to be told what to do, you’ll eventually be told to step aside.

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