Hello. And thank you.
All again for joining us for another episode of the
professional pricing Society podcast, my name is Terrance and
we have a very informative conversation today, with one of
our PPS Euro, 22 conference speakers very special guest
today, sidebar just in case you are not aware PPS is conducting,
their 17th annual European and Global conference in Barcelona
Spain. This upcoming December 7th
through the 9th. So if you still need to
register, Stir. You can do that by visiting our
website pricing Society.com /p P s-- Euro 22.
Our speaker today is Larissa craft Pricing and profitability
management pricing Center of Excellence.
Set up rebate management, and ethical pricing this Larissa.
How are you doing today? I'm doing really well.
Thanks for having me Terrance. Good to be here.
Good! Good.
We're very excited to have you with us as well.
Today, now, we're going to go ahead and jump into our
conversation thinking about pricing as a function.
Where does this typically belong in an organization who was
responsible for owning this? This particular aspect of
pricing, As a function. Well, Terrence, if you look at
the old classical marketing framework of for peace, what we
call it, right? So it is part of the marketing
organization and the classical way, but things change very
quickly and now I think pricing as a function has evolved over
time. So if pricing leaders must
influence, the long-term results of a firm while, not impacting
competitive advantage in the industry and if the pricing
leaders communicate with all the external and internal
stakeholders, and if And to make sure everyone is well, informed
about the pricing and the strategy and what the pricing
team is trying to do how it performs to support commercial
teams and overall strategy of the firm, I believe, pricing for
me, as a standalone function, at the c-suite, level and lot.
Lost in finance accounting, marketing or sales in the
classical set up. So for me, pricings a standalone
function, it does require a very unique set of skills.
Skills and training and capability development.
Sure, sure, absolutely. Now, you know, thinking about
capability development, as you just mentioned training,
continuous, learning, and the pricing world.
Of course, all those things, all those components are very
crucial. But when does it stop?
You have to kind of ask your ask yourself.
The question. When does it ever kind of stop?
Well, actually, you know, it's good to be part of the
professional pricing Society conference in Barcelona this
year. And that's really a confirmation
that actually capability development training.
Is learning in the pricing World, never stops because
things are moving and, you know, always changing fast as the
organization is maturing from cost.
Plus two Dynamic pricing servitization is a big topic.
Now, in the pricing World pricing, folks must constantly,
learn develop and grow. So what our pricing strategy
Frameworks and roadmaps that should be developed by various
pricing strategies. Ever you did couple years ago,
it's not the same this year. Look, what's happening outside?
You know, in the economy, inflation turmoil, Etc.
So for me, that never never stops.
So, can in-depth overview of these Concepts and guidelines be
provided. While assessing, you know, the
bottom line impact of these initiatives in The Firm.
It's one in a one-year is one strategy next year.
You should be really, really Dry land, adopt another strategy.
So hands, you have to work on your capability development
training and continuous learning in the pricing World.
Another big question for the pricing, folks always can affirm
sustained competitive Advantage by applying various pricing
strategies pricing models and by creating and selling products
with the improved pricing strategies that could sustain
the economic profit long-term so.
And to answer those types of questions you need to To focus
constantly on your capability development, training,
continuous, learning, and hence, you always have to come to
professional pricing society and work on your certification and
keep your skill set and knowledge up-to-date fully agree
with you. And as you mentioned, you know,
capability development training, continuous learning.
None of these components ever stop.
You know, it's an ongoing process just because pricing in
itself is is continually changing and evolving with the
with the Times. Now, when you speak about
capabilities, what exactly are the key capabilities?
You know? In order to be a very successful
pricing leader in today's today's world.
Well, for me, first and foremost is passion passion, and one more
time, passion about pricing. Sure.
Absolutely. Have to be passionate about
pricing. You either love it or you hate
it. Yeah, once you love it, you
stuck in it for the rest of your life.
And another big thing that pricing family is a very small
family, very focused because it's very unique, right?
So all of the things that you need to do in pricing and how
you take it to the next level. So what are the key capabilities
is just some of you you know, already know them but I would
like to add couple additional ones because things are changing
you know, price setting and price getting for me price
getting its you know, for your commercial teams really do.
Take your guidance from the price from folks and go out to
the market and get that price, right?
So for me, if you if you just what I call them, volume Junkies
you just go out there. Anybody can be a volume junk,
you just go inside the volume, but when you start adding the
value piece to it, wow, that it's really you're demonstrating
your capabilities. As I said, you know, successful
price getter yeah with the support of price Setter, you
know, the pricing department, so price getting price setting.
Very, very important. Ain't that something that I'm
working with a lot of folks. And you know what, I teach at
the University's, another big thing is pricing process.
So that's a very important capability because what I'm
hearing more and more week processes are in place like of
ownership. People don't really know where
pricing process said, whether it's part of the sales process,
whether it's part of the integrated business planning or
either either is part of the order to cash.
Process. So a lot of questions and then
there is no one, clear answer. So you really need to see, you
know, what the industry is with product is what the services and
really step back and say, okay, where am I pricing process sets
in my organization. So, and again, in order to
understand and own end-to-end process because there are so
many silos and you losing value as you go from one side with to
the other. So that capability of really
owning and understanding the Rising process is very, very,
very important. Yeah, sure.
Next thing their hands is very important is really how do you
get all your stakeholders in organization to get the right
level of decision support because he constantly you know,
leaving money on the table. So and again it's all about the
integrated approach agile approach really adjusting and
really getting your decision support at the right level the
right time. So then you You know, you
maximize your value, the next big thing, what I hear?
And what I see, really dealing with various folks out there in
the industries data data, hygiene pricing impact polluted,
with other factors, you know? And so you know what, hands,
you're not getting the right pricing decision.
So, it's a very important capability data data, knowledge,
data ownership, the data cleansing organization
day-to-day. Dictionary.
So, those are very important capabilities and you need, you
know, constant development around that topic.
Another one Terrance that comes to mind is really lack of
understanding of customer value drivers.
You know you don't really sit down and take the time to map
out all the key value drivers for your customers and clients
and and it does require special capability to deal with that.
The next one, I would like to talk About, you know, we are
becoming digital. Everything is digital what it
takes my 12 year old son to do in 5 minutes.
It takes me a couple hours to figure out dry to digital skill.
Set is becoming more and more important in the present world.
You know, the pricing software's, implementation,
challenges, etc, etc. So digitization, digitalization
in the pricing world is absolute must, and because things are
changing. So, Quickly, two technologies
are developing you continuously need to work on those
capabilities and really Master it and take it to the next
level. A couple other things to note
here, for our listeners sustainability is becoming a big
Topic in the pricing world as well because what, we writing
research around and, you know, a lot of surveys with the real
companies we're trying to understand The consumers are
really prepared to pay more for a sustainable product or service
or less and how they really taking it within their firms.
And hence it's very important. The way pricing organization is
said, in terms of, you know, organizational, Savvy how it is
organized, how it is ingrained in their organization.
And hence, you do need to understand this organizational
ecosystem and hence, you need to get that capability of me.
In the mapping your organizational ecosystem in your
organization, you know, in the right way.
So it's very important. Okay.
Wow, that was a, that was a great amount of Jim's.
They're great amount of insightful pieces that kind of
go into the capabilities of it, is of a successful pricing
leader. Now, when you think about those
capabilities, you know, data, hygiene being value-driven
digitalization with those contribute to what you would
consider to be the best form of a pricing organization.
Absolutely. There are new forms of pricing
organizations evolving. So that's what we see in
reality, you know, running the research and working closely
with many organizations. So it's not anymore this, you
know, old way of hierarchical approach or Central pricing,
totally disconnected organization.
So you really looking at, you know, integrated forms of
pricing organizations. It's out there.
And then it's really important to look at your organization and
the form that should produce the most optimal pricing,
conclusions, and results for the organization, right?
So during my workshop in Barcelona will be talking about
real case study from a real company that I helped set up.
The pricing Center of Excellence.
What we call C Oe What is a see pricing?
Co e. It's a center team in a central
team of skilled employees that provide shared resources.
Best practices expert Knowledge and Skills to make data
processing easier while changing the skill set and capabilities.
It enables a digital way of working that contributes to
long-term, growth and Value Vision of the company.
So we will be talking this particular case.
D. That had three teams within the
Centre of Excellence for pricing one was this on the project
management because we constantly looking at new technologies and
pricing software's, right? So will you do need a very
strong project management Drive in their organization?
And there are two types of project management that this
particular company dealt with and pricing.
One type of project management when you deal with the software
implementation, that's, you know, gay To approach, right?
So traffic lights and how you really going through different
Gates on the project management and and how you value your
process and progress. And then there is another
project management that this particular company adopted, that
was the agile scrum methodology. And that's a two week, three
week, quick wins, implementations right under the
edge aisle approach. So it's a new thing out there
and it works very well for the price.
Racing team as well for various smaller types of projects, quick
wins and quick reactions, right to what we need.
So that's one team on the center of excellence.
The second team is the process team, so that that team will be
dealing with. I was dealing for in this
particular case, the real case study.
So process team is really mapping out and to end the whole
pricing process, where it sits. So really eliminating all the
silos automating things. Along the line of this process
where you have the repetitive tasks.
We used our PA creation that robotic automation technology.
Right rpas, animation also chat Bots for certain things and the
customers come in. So you don't have to really
repetitively pick up the phone or answer, email whatever.
So we also call chatbots, we set up throughout this team to
improve the process and also some AI.
II solutions that set in this team also to help the process be
you know, more robust agile fast and the third team in the center
of excellence for pricing that we set up was data and Reporting
team. So the data team is really
creating the dictionary glossary rules for data cleansing
management of the master data and then translate it into the
reporting kpis link to the Pinot pricing.
For etcetera. So there are new forms out
there. So it's very important to really
step back and say, okay, he's our pricing organization,
fitting fit for berga, no purpose for the future is a
really sustainable and, and what do we need to do something
different to get around that and we have a clear case study to go
over it. Hmm.
No good. Good good, yes.
That that would be a solid solid evaluation of what the best form
of a pricing. Ian is so thank you for
clarifying that now let's switch gears a little bit.
Can you tell me what exactly is ethical pricing?
And why exactly is it important to know about?
Well today, you know, in today's world is you, you know, and
everybody knows, you know, we're dealing with a lot of pressure
on the results and the bottom line value creation inflation in
a supply chain inventory challenges.
So, a lot of companies that leadership could, you know, fall
into the really an ethical way of making the, you know, the
decisions around what they're trying to do when they trying to
achieve or to reach that goal. It's a lot of pressure, so it is
human nature. And so we just need to make sure
that we do not forget about ethical pricing aspect.
We do things right? So we must get ahead of pricing
FX. We must look at the you know
code of conduct. We must look at certified fair
prices you know fair play privacy challenges, you know
regulation governance because you can fall into really Falls,
trap an ethical decision, You know, making a drive because,
you know, you have a pressure from the top to get to certain
Target here in these very difficult times, these days.
So, ethical pricing, there are two fold one, when you look at,
you know, ethical decisions and ethical strategies in the very,
very difficult conditions and the second thing when you add
some Mission pricing, to your strap pricing strategy and we'll
have a real cake. Study from a great company in
Bangkok the deals with you know, High valued seeds for their
plantations, right? So and when this particular
consultancy came in and did the work for them, you know, the
girl recommendation was to come and increase prices at 20% well,
because of this strategy and is ethical prices.
Icing Mission pricing that this particular seeds company.
Has the conclusion was to go and only increase pricing with the
farmers that two percent versus what was recommended.
Right under the calculation 20% because of this ethical
mission-driven pricing because the, you know, they believe in a
very high value of seeds, you know, the quality of seeds and
that relationship with the customers that are very
important. Mordant.
So and also the farmers. So this is the whole circle
there. So we will go through the
details of this real case study to understand what was behind
that particular decision, right? Going to present price increase
and not 20 as recommended by the calculations.
So it's really amazing. It's also, very important topic
coming up more and more social sustainability, I am the Chief
Human Rights. Officer the slave free trade.
We mapping out, it would complete supply chain of many,
clients of ours to understand where they have, you know, slave
labor along the line of their supply chain, where they have
their child labor, how the human rights framework is positioned
and how its translating into the pricing, right?
So what are the consumers looking for?
So very important topic. And I also teach my students
that As a fundamental science of pricing, never compromise your
ethics, always make sure that you get ahead of your pricing
effects in your daily lives and daily jobs.
Okay, that was amazing. I appreciate your insightful
knowledge about ethical pricing and just you know it kind of
expounding on the best practices you know centered around B2B
pricing Miss Larissa creates Copa, really appreciate your
time today. Thank you so much for being with
us and just allowing us to be you know fed with your with your
pricey knowledge and insightful information.
Now if you don't mind, do you mind sharing with the listeners
where they can find any more? More of your information that
you may have any more of your resources anywhere.
Well, I am on link it in so you can find me on LinkedIn.
So I have Publications and also other interesting postings that
I have on pricing and also you know, check check us out and
slave free trade and we just went live with a up chocolate
customer in Scotland. That's the first chocolate
producer that we mapped out. That has zero slave labor, you
know, in their supply chain. So in the cocoa farm that
produces that raw material for this particular companies in
Colombia. And so that's also quite
interesting how it is, also impacting the pricing and things
like that. So you can also see that in on
our side, you know slavery trade and also in social media.
Yeah. Okay, thank you so much.
I really appreciate your time until next time.
Bye bye.