Our conversation was about why it’s important to communicate with senior management about the role pricing plays and why the C-Suite needs to make it a priority in 2021.
The trouble is that many in the C-Suites lack direct experience with pricing. Therefore, pricing professionals should focus on educating their senior management, but how do they go about doing this?
I’ve put together five tips to help pricing professionals navigate the process, so they can get in front of senior management to successfully make their case.
Let’s dive in.
Tip #1: Find a Sponsor to Champion Your Cause
During my career, I have noticed how many initiatives often get tied up and even derailed within middle management – and that can happen with pricing, too.
The best way around this is to have a sponsor in the C-Suite – someone who can help you feed the critical information about the role it plays with the rest of the C-Suite on a regular basis.
By doing this, they can promote pricing’s role and impact, as well as highlight quick wins you might have to report on a regular basis. Over time, this creates an understanding of pricing and helps others realize the importance of it to the health and profit-making capacity of the organization.
Therefore, it is essential to find a way into the C-Suite. It’s not as easy as opening a door and simply walking in, but one way around that is to find a sponsor.
Tip #2: Focus on Education
As I mentioned earlier, many senior managers do not have direct experience in pricing so socializing it to key stakeholders in the C-Suite is important.
When doing that, one should focus on education and helping senior managers understand the pricing basics and the role it plays, especially within the context of sales, marketing and commerce.
Now, you could get lucky and secure a couple of hours to present your case to the C-Suite – but you also might not be so fortunate.
However, eventually, you will get that chance because many companies are moving to sales automation which includes CPQ. When that happens, you will have a chance to go in along with the sales guys and look at your pricing strategy, too.
Tip #3: Emphasize the Financials over the Technical
Often, many pricing professionals make the mistake of positioning pricing as a technological or analytical play. Instead, approach the C-Suite with a more familiar approach by focusing on the financial impact pricing can bring to the organization using the financial terms and vocabulary senior managers are familiar with. When you speak the language of your stakeholders you are more likely to connect and resonate with them. Also, because you will likely have a limited amount of time to present your case, you want to make sure they understand your point quickly.
Therefore, use a balanced approach by bringing up familiar topics and highlighting the marketing and sales impact, as well as the technology of pricing.
You will enjoy a greater likelihood of success this way.
Tip #4: Use the KISS Principle to Your Advantage
The essence here is to keep it simple.
The key is to not overwhelm your senior management because you want to keep their attention and have them be receptive to your position.
To prepare, ask yourself, "What are we here for? What are we hoping to accomplish? How are we going to work with sales? What's the impact?"
And then bring the “outside in” by providing examples of other companies that are using pricing effectively and how it’s working well for them.
Remember that less is better. Use plain English when communicating rather than technical jargon and be sure to balance it out by emphasizing how it connects with sales, supply chain and finance so it’s not seen as something completely separate but rather part of the entire process.
Tip #5: Think Context: Connect Pricing to Other Strategies
By connecting your pricing program with other strategic programs, you give it context. And depending on the situation, believe it or not, sometimes it's better not to mention pricing at all.
For example, if you have a sales or marketing transformation, you can insert pricing as one of the components. This way you will fit in within a larger context. The key is to find a way to piggyback on marketing, sales or supply chain.
Additionally, it's even better when someone else pays for the program, because it doesn't come out of your budget. So that's a double win.