As more and more businesses are looking at pricing, they are asking themselves, “what can we do to jump start the process?” Ultimately, it’s understanding how you price. The process must, at some level, be understood, before you can begin to enhance and evolve.
Pricing process improvements would not be complete without what I'll term a “Day in the Life” of users. I used to call this “riding in the truck” as a reminder – because I have actually ridden in the sales truck to a job site! This is the only true way to fully understand the pricing practices of, empathize with, and appreciate the pains of potential users. If pricing is such a strategic lever that can make a significant difference in profitability, you should be willing to invest the time to understand all the corners of your organization’s pricing practices in order to squeeze out as much ROI as possible. And what better place to start than with the front line of price communication?
The question is: how do you conduct these Day in the Life sessions? I can start by stating what not to do… don’t just ask questions! You must put yourselves in your employees’ shoes… if they are called into a room and must answer a bunch of questions about how they do their job, what do you think they are imagining? No matter how well you prep them, how you preface your message, or how you triage any malcontent, they will be nervous. Unfortunately, that feeling will result in them answering the questions they way they “think” you want them to answer. Anyone can put concepts on paper, which is what their answers will no doubt provide; you are trying to get at the dark and ugly truth about price and profit leakage. Therefore, take the “interview” to the next level… go ride in the truck.
But don’t just observe in the “white lab coat, clipboard, and one-way mirror” sort of way… observe AND interact. You should ask “why did you [insert activity here]” until you fully understand – don’t assume anything. Then go beyond observation and interaction: solicit their feedback for how they would improve their processes. What else do they need? What could they do without? What typically causes them to sit around and wait for three days while competitors steal your business? Get them to believe they will have an impact on the outcome, the new process that they will be asked to follow… BECAUSE THEY DO! Once you have this buy-in and belief instilled in your employees (that you want them to do better and are willing to give your time and efforts to help them), the truth comes out. It’s only then you can work with your cross-functional team to improve your pricing processes in a way beneficial to all… because you know how your organization really prices.