Implementation of Pricing Tools: How to Address the Time-to-Value Challenge
Under the pressure of high global inflation since 2022, many companies have prioritized the implementation of pricing tools to exploit value pockets that were previously considered less attractive.
With limited maneuverability and moderate risk-taking, company management requires these projects to demonstrate their ROI as quickly as possible, all while not ignoring the intrinsic complexity of these resource-intensive projects that require data and involve various teams.
Louis-Marie de Langlois, Senior Manager and project implementation leader at Converteo, offers an overview of the challenges of implementation and the contradictory demands currently influencing the pricing solutions market.
An Acceleration in the Growth of the Pricing Solutions Market
Driven by competition and increasing pressure on their margins, more and more B2B and B2C players are considering equipping themselves with specialized tools to prepare their pricing strategy, optimize it, manage it in an increasingly responsive manner, and support their sales teams.
“Off-the-shelf” pricing solutions, now richer “by default” and available in SaaS, were once reserved for the largest multinationals or specific sectors where such tools were essential (e.g., airline transport and hospitality). They are now attracting smaller companies that previously relied on Excel spreadsheets and the expertise of their teams.
This has led to a proliferation of tools within the Pricing Management & Optimization space, sometimes specialized in a particular sector or industry. These tools are providing tough competition to modules developed by some ERP and CRM systems that attempted to add a pricing dimension to their offerings (e.g., SAP Omnichannel Promotion Pricing, Salesforce Revenue Cloud, Hubspot CPQ).
Structural Pressure for Reduced Time-to-Value
The dual maturation of the pricing solutions market and its leaders encourages companies to increasingly move away from systematic feasibility studies and Proofs of Concept, as well as from “evangelization” aimed at demonstrating the value of acquiring such tools. This shift favors more assured and proactive approaches: comparative analysis of tools, RFPs, and RFQs.
A corollary of this interest in pricing is the growing demand for rich standard functionalities, speed, and flexibility in implementation from more agile clients, who are sometimes smaller than before.
More generally, the time-to-value (TTV) of a pricing solution must be increasingly short to attract interest. This TTV encompasses the time for implementation (including design), training, and onboarding, as well as the time required to achieve the expected gains, which often depends on a parallel project to revise the commercial policy to fully leverage the tool’s functionalities.
As a result, vendors are pressured to meet the conflicting demands for “speed of benefit,” increasingly advanced functionalities, and personalized support (including training and change management) to convince and retain their customers.
The promotion of “accelerators” in 2024 (such as those from the pricing solution provider Pricefx), which are pre-configured components that speed up the implementation of solutions, is one of the telling signs of the strong positioning of pricing tools around the promise of quick results.
Some Ways to Reduce Time-to-Value
Adopt Agile Methods to Decrease Perceived Time-to-Value
Clients of pricing solutions such as PROS, Pricefx, Pricing Hub, or Revionics are also keen to maximize the return on annual or multi-year licenses by deriving tangible benefits as early as possible.
Given that a pricing tool implementation project typically takes at least three months, and often longer, it is crucial to accurately estimate the project’s duration and minimize slippages. However, it is also essential to pace and support this extended timeline internally by reducing the perceived time-to-value for teams by delivering parts of the pricing tool in stages (for example, module by module).
Implementing an agile, reactive, and transparent construction methodology is an excellent way to alleviate pressure on the project. The incremental delivery of usable lots, initially modest but quickly addressing (a portion of) specific business use cases, appears to be the most obvious lever to achieve this.
Meet IT Prerequisites for a Successful Implementation
The traditional prerequisites for a successful IT project remain valid for the rapid deployment of a pricing tool; unfortunately, this does not mean they are trivial or already in place before most such projects begin:
- Clear Definition of Roles, Responsibilities, and Required Investment for IT
- Centralized Repositories and Reliable, Accessible Data Sets
- Controlled and Documented Technical Ecosystem
- Clear Vision of Target Processes and Associated Functional Requirements
Pricing projects often reveal deficiencies in these prerequisites, as they involve a variety of data, teams, and tools that are rarely addressed within the same project.
Assemble a Broad Team Supported by a Strong Sponsor
In addition to technical and data resources, many business teams are involved in the implementation of a pricing tool. They may be users or stakeholders in the tool’s implementation or data provision: Logistics, Sales, Marketing, Finance, etc.
An identified sponsor, equipped with the necessary resources and a clear mandate from management, is essential to frame the project, set a direction, and maintain focus despite the plurality of interests and roadmaps.
A common reason for failure in such projects (92% according to an article from the Professional Pricing Society) is the difficulty in steering change in a common and positive direction for the company, i.e., leading teams. Trust in the company’s management is paramount.
Operationally, the project relies heavily on the commitment of business and technical experts, whether internally, from the vendor, or from a third-party company. This involvement is particularly crucial in long-term projects with high stakes, where the risk of discouragement or deviation is significant.
An increasing number of pricing tool vendors are rel
Ensure Sufficient Resources for User Empowerment
inquishing all or part of their configuration after installation, along with ongoing maintenance and user training, to focus on their core business—product development. They rely on partner integrators or internal teams at their clients to manage the product’s “life” phase.
However, like all IT projects, a pricing implementation project does not conclude with the delivery of the tool integrated into the target ecosystem.
The project has not achieved its objectives until users are trained, autonomous (and satisfied) in their use of the tool, which is configured to meet their specific requests. This is subject to the inevitable trade-offs made by the sponsor, which must be justified, explained, and sometimes imposed to be accepted and not hinder overall adoption.
Therefore, the management of the implementation project must ensure that a timeline and budget are established to cover the advanced configuration of the tool, training for various user groups, and ensure that resources will be mobilized and organized to maintain and evolve the tool.
While Waiting for AI…
The upcoming structural changes promised by the use of Artificial Intelligence could accelerate the implementation of pricing tools, particularly by reducing the phase of configuring the tool to the client’s specifications, which accounts for a significant portion of the delays in such projects.
This will require the AI to possess capabilities for understanding, abstraction, and implementing a number of rules and processes that currently need to be configured manually in the tool.
In the meantime, the rapid and effective implementation of pricing tools still relies on the pillars that traditionally ensure the success of an IT project:
- A sponsor with a direct mandate (and support) from management
- Accessible and reliable data
- A sufficient number of expert resources, according to the needs of the various project phases
- A development/integration phase organized according to agile methods for a shorter Perceived TTV
- Continuous attention until the end-users are fully autonomous
- A sustainable plan for ongoing maintenance
At Converteo, we have experience with long-term IT projects driven by agile methods and foster strong collaboration among stakeholders: business users and sponsors on the client side, engineers and project managers at Converteo, and experts from the tools we work with or are certified partners of (e.g., Syncron, Pricemoov, Pricefx).
Contact us for your pricing tool implementation needs!
