Another of our simple LinkedIn polls. These polls are meant to provoke discussion amongst people interested in pricing and its strategic connections to product management, marketing, sales and finance. They are not meant to be authoritative. We are always looking for new themes, so please send your ideas to firstname.lastname@example.org.
This month's theme is the search for talent. Pricing is emerging as the critical business issues for many companies. Companies that lack good pricing capabilities, one will not reap the rewards of innovation, will struggle to deal with changing commodities costs, and will leave themselves open to competitors able to execute a pricing strategy. The 1% solution is an old saw in the pricing community (see Figure 1: The Impact of a 1% Change), but it is even more important to execute on pricing in the current environment where the economic environment makes it difficult to execute on top-line growth and costs have already been pared down as far as possible.
Pricing requires a software platform in order to execute effectively, but it also needs good people. Many companies are trying to grow their pricing teams and are looking for new talent. So the questions becomes, where to look and what kind of people to look for, as there are not a lot of well-trained pricing people and we need to grow the talent pool.
Of course the best place to begin a search is the Professional Pricing Society and its LinkedIn Group. And there are now business schools such as the Simon Graduate School of Business at the University of Rochester in New York State. But many companies will begin by looking inside for people that can be groomed for pricing leadership, so where should they look?
This was the question asked in out most recent LinkedIn poll. The poll is still open and you can participate here and view the results. Be sure to read through the comments! The results as of Friday November 11 are shown in Figure 2: Interim Results for "What is the best place to look for new pricing talent?
The most popular answer so far is Marketing at 40%. The Sale and Sales Operations answers combined for 34%. People looking for people with more quantitative skills split their votes between Finance and MBAs for 27%. Reading through the comments suggests that the real answer is that "Pricing Requires a Cross-Functional Team." One needs strong quantitative and analytical skills to make good pricing decisions, but one also needs to be able to use this quantitative insight to make market decisions and to communicate those decisions in the market. But in B2B, sales plays a critical role in actually negotiating can capturing prices and sales often has some of the best insight into customers and competition. A good pricing team will bring together people with understanding in all of these areas. At LeveragePoint we have taken this into account in designing our Software as a Service (SaaS) pricing platform. We provide explicit support for people who like to get into the data, for strategic decision making, for crafting messages about the value proposition, and for sales to use unique value propositions with each customer.