In a recent published paper, I reported that only 9% of business schools in the United States offer a dedicated elective in pricing. Only a few reputable business schools also offer an executive education program dedicated to pricing strategy and tactics. The lack of adoption of pricing science in the business curriculum represents a strong barrier to the proliferation of pricing knowledge in the executive suite. A less-reported topic, though, is the changing skills required for tomorrow’s pricing professionals in the face of rapidly changing technology. When schools do offer a pricing elective, the focus of the curriculum is heavily geared towards analytics, tactics, economic models and sometimes pricing strategies. Missing from the curriculum are important aspects of pricing in the areas of organizational theory, behavioral science and the psychology of pricing.
In November 2011, I was invited to be the moderator for a pricing panel held at the University of Rochester’s Simon School of Business. This panel was held for members of the Pricing Club, students of the Pricing MBA, university faculty and anybody desiring to attend. Most of the discussion that day focused on analytics, tools and models used to optimize pricing decisions. I was able to move the conversation to the topic of the balanced skill set required from tomorrow’s pricing professionals. My point was that rapid and breakthrough technological changes (cloud-based software, integrated systems and predictive analytics) would “take over” a significant portion of the analytical work, allowing pricing professionals to pay much more attention to other critical aspects of value and pricing management(See Figure 1: Pricing Today & Tomorrow).
Figure 1: Pricing Today & Tomorrow
Therefore, the skill set of tomorrow’s pricing professionals will require pricing “geeks” to become sleeker in the areas of organizational transformation, change management, and psychology of pricing. In the figure below, I propose a list of “left brain” skills versus “right brain” skills that will be required in the future (See Figure 2: Left Brain & Right Brain Skills).
See Figure 2: Left Brain & Right Brain Skills
Many consultants, practitioners and scholars report the organizational journey that is required to bring firms along the pricing maturity model. Pricing professionals need to act as change agents who can influence internal stakeholders to support pricing projects. They need to be able to adapt their language to their audience and significantly influence the level of organizational buy-in. When in positions of leadership, pricing professionals need to share vision, act with confidence, demonstrate mindful scanning and problem solving, and create a strong teamwork environment. As the complexity of data increases along with environmental uncertainty, pricing professional must be able to mindfully manage complexity and propose simple solutions. Most important of all, pricing professionals must be able to tell stories and create conversations with sales representatives, customers, and other relevant stakeholders. This particular skill is highly relevant during the process of economic value estimation when subjective value drivers are discussed and debated and when the goal of the conversation is consensus on what value means. We experienced that firsthand during the building of our first value model using the LeveragePoint value-based pricing platform. The conversation was led by our Pricing Manager and included regional sales managers, business managers and myself. This was a very useful exercise for all of us, as it uncovered differences in language, meaning and expectations. Working in a collaborative manner on the LeveragePoint platform removed barriers, forced a common language and allowed us to reach consensus faster.
The prevalence of skills leading to superior emotional intelligence will force a change not only in the pricing curriculum in business schools but also in training programs inside corporations. I recommend greater emphasis on these “right brain” skills in MBA courses, in the Professional Pricing Society certification process and also in consultants’ training modules. Tomorrow’s pricing professionals will rely on advanced technologies and at the same time will act as mindful organizational actors to lead firms through their transformational journeys.
Follow me on Twitter (@StephanLiozu) and on LinkedIn to continue the discussion. Price well!
Stephan Liozu is President & CEO of Ardex America Inc (www.ardexamericas.com), an innovative and high-performance building-materials company located in Pittsburgh, PA. He is also a PhD candidate in Management at Case Western Reserve University and can be reached at email@example.com.