Archives tagged: commercial policy

When and How to Automate

By Kyle T. Westra May 23, 2018

Software is good at automating repeatable processes, but that doesn’t make them the right processes. Doing the wrong thing efficiently isn’t the same as doing the right thing. There’s a reason that Peter Drucker wrote about the effective, not the efficient, executive.

The Process for Pricing Innovation

By Tim J. Smith, PhD February 23, 2018

A good pricing decision is two-fold: One defines an aspirational list price and a commercial policy that deducts from this list price known discounts, which lead to the expected target prices by customer segment and perhaps channel.

Pricing is Product Management’s Responsibility Too

By Tim J. Smith, PhD November 16, 2017

Product managers undoubtedly can be held accountable for the profitability of their portfolio. It is reasonably possible to make portfolio profitability a key performance indicator of a product manager. And it reasonable to make this part of their compensation package, thus holding them not only accountable but impacting their own economic condition based on the quality of the decisions they make.

Shaping Customer Behavior Through Commercial Policy

By Tim J. Smith, PhD October 18, 2017

There are two basic approaches businesses take to managing commercial policy. For most, the default approach is tactical decision making. For some, they take the leap and add strategic decision-making.

Give-Get

By Tim J. Smith, PhD August 24, 2017

I have seen three or four multinationals, and four to six local suppliers sell the same core product in the same country, at roughly the same price. Because there is so much competition in these markets, customers ask for discounts and drive suppliers to bid against each other to win their business. It is hard to make a stable supplier business in these situations. How can one win? And, what does value-based pricing have to contribute to these markets?

Sales, Marketing, Finance and Pricing in Price Management

By Tim J. Smith, PhD June 16, 2017

Our own research—that of Homburg, Jensen, and Hahn—as well as research by Hinterhuber and still other works by Liozu, repeatedly indicated firms that engage sales, marketing finance, and pricing leaders in pricing decisions outperform those that don’t. At this point, we may even call this settled managerial science.

Product Management v. Sales: Profit Based Incentives for Both

By Tim J. Smith, PhD May 15, 2017

Can both product managers and salespeople have their incentives and key performance indicators aligned to the corporate goal: profits? Yes. They can…