Pricing readiness assessment
Pillar 1 of 4
0 of 20 answered
Segmentation
Whether customers and products are grouped by more than volume or last year’s territory.
A/B/C volume tiers and inherited regions are a start. They ignore willingness to pay, cost-to-serve and behaviour. Differentiated pricing on a crude tier is a volume discount with better stationery. A segment is only real if a quote uses it.
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Value Articulation
Whether price is tied to quantified customer value, or to cost-plus and habit.
Cost-plus is simple and easy to defend in a meeting. It also charges every customer as if they received the same thing. Value-based pricing starts when willingness to pay is a number — a calculator, a researched driver, a page the field will actually open — not a story from the last lost deal.
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Price Governance
Who owns price decisions, who may break them, and whether that is written down.
Governance is not bureaucracy. It is the operating system: who sets list and floor, who exceptions, where the wall is, and what a breach produces. Without that, the loudest person in the room is the pricing function — and a platform will automate the folklore.
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List Price Architecture
Whether list and floor prices are derived from a rule you can explain, or inherited and uplifted.
Inherited lists and an annual across-the-board uplift are not architecture. Architecture is a rule you can explain for a family — cost, value, a competitor set, a floor — and a date when the previous list dies. Fossils stay in the book until someone retires them on purpose.
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Market Intelligence
Whether competitor, cost and index signals reach the price decision — and how old they are when they do.
Most B2B books are priced annually and updated when a contract is already lost. Commodity indices, competitor prices and input costs are what keep a list from being last year’s list. If those signals arrive as a forwarded email, they are not in the model.
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Quote-to-Cash Cycle
Whether a standard quote reaches the customer in hours, or dies in a queue.
In B2B, time-to-quote is a competitive fact. While the deal sits in a queue, the customer is sitting with someone else. A week-long quote is not diligence. It is a transfer of the conversation. Cycle time belongs on the pricing scorecard, not only in operations.
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Approval Architecture
Who can approve what, and whether senior time is spent on routine deals.
Too many layers and the deal stalls. Too few guardrails and margin erodes. The useful design is a matrix: deal size, discount depth, who decides, how long they have. Everything else is a meeting. Authority that is not written down will be invented in Slack.
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Exception Handling
Whether an override is a rare event or the actual process.
Every exception is a vote that the standard rule does not match the market — or that the field does not trust it. A high rate is not an efficiency problem. It is a design problem wearing a workaround. Codes you never read are decoration.
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Rebates and Off-Invoice Terms
Whether rebates, freight, terms and promotions sit in one view before the deal closes.
Off-invoice items are often the hidden majority of the drop from list to pocket. They sit in finance, logistics and marketing, and they rarely meet in one number before the deal is closed. A rebate the quote cannot see is a price the quote cannot defend.
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Waterfall Visibility
Whether pocket margin is visible at the point of decision, or only reconstructed later.
The McKinsey price waterfall traces how value falls from list to invoice to pocket price to pocket margin. Most companies manage the invoice. The rest of the drop happens in rebates, freight, terms and cost-to-serve — and leadership often cannot name the size of it when the quote is still open.
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Price and Product Data Quality
Whether cost, product, customer and list attributes are accurate enough to quote from.
Master data is the foundation of every pricing decision. A two-percent error in cost can erase the margin a whole programme was bought to find. Accuracy here is not a data-team metric. It is whether the number on the quote is the number the P&L will see.
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System of Record for Price
Whether there is one place that wins when lists disagree.
When the ERP says one thing, the CRM another, and a workbook a third, every analysis starts with an argument about which number is right. A pricing platform will not resolve that. It will inherit it. Two sources of record is no source of record.
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Integration and Channel Consistency
Whether every channel quotes the same SKU from the same logic.
When channels disagree, customers arbitrage. When similar customers in a segment get wildly different prices, you have given away the segment’s ceiling and trained the book to ask. Integration is the plumbing. Underestimating it is how implementations double in length.
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Analytics and Reporting
Whether pricing, sales and finance can see exception rate and pocket margin without a ticket.
Most companies can say what happened last month. Diagnostic (why), predictive (what next) and prescriptive (what to do) analytics are rarer. A waterfall you can only rebuild in a spreadsheet is a report, not a capability. Insights that live in one analyst’s workbook do not change a deal.
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Pricing Tooling
Whether the team works in one published tool, or in local copies that still win the argument.
Excel is not the enemy. Unowned local copies are. A dedicated tool that the field works around, while a workbook still wins the argument, is how you pay twice for the same list. The question is not “do we have a platform.” It is “which file actually set last week’s price.”
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Roles and Accountability
Who is accountable for price, by name, and whether that name is findable.
Pricing is often an orphan — shared by sales, finance and product, owned by none. A dedicated mandate, even a small one, is what turns a set of meetings into a capability. A job description nobody can find is not a role.
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Capability and Training
Whether pricing and negotiation skill is built on live deals, or mentioned once at onboarding.
Perfect policy still fails if the field cannot explain a number. Literacy across pricing, sales and finance is what turns a scorecard into a habit. Training that never opens last month’s exceptions will not change next month’s quote.
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Incentives and Alignment
Whether the commercial team is paid to keep margin, or only to win the deal.
The tension between “win the deal” and “keep the margin” is the job. When sales and finance are not aligned, every deal is negotiated twice — once with the customer and once internally. Shared KPIs are how that second negotiation ends. Technology does not resolve a compensation fight.
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Change Adoption
Whether anyone measures if the field used the last price change.
The best design fails if the organization will not adopt it. “We tried this before” is data. It belongs in the plan, not in a surprise six weeks after kickoff. Announcing a policy is not adoption. Adoption is the share of quotes that actually used it.
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Executive Sponsorship
Whether leadership opens the number or the anecdote when they set price.
Availability of data is not the same as use of data. If executives price from gut and relationships while a dashboard exists unused, the organization is not pricing-ready. It is pricing-equipped. A programme that cannot survive an override without a recorded reason will not change commercial behaviour.
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