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Organizational confidence in pricing is a necessity on the journey towards pricing excellence. Without it, companies face erratic discounting, misaligned goals and incentives within and across departments, and more. This webinar will highlight the importance of pricing confidence on firm preformance, as well as provide practical steps and programs your organization can design and implement to boost pricing confidence. Stephan Liozu is our presenter. Stephan Liozu (www.stephanliozu.com) is the Founder of Value Innoruption Advisors. He specializes in disruptive approaches in strategy, innovation and value management. He is also a PhD candidate in Management at Case Western Reserve University and can be reached at [email protected].
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Copyright © 2012 by LeveragePoint Innovations Inc. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means —
electronic, mechanical, photocopying, recording, or otherwise — without the permission of LeveragePoint Innovations Inc. This document provides an outline of a presentation and is incomplete without the accompanying oral commentary and discussion.
COMPANY CONFIDENTIAL
Organizational Confidence: Generating “Pricing Superheroes”
with
Stephan Liozu, Ardex Americas
Monthly Webinar Series - July 2012
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Sponsored by LeveragePoint the Software Solution for Value-based Pricing
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Today’s Presenter
Stephan Liozu is President and CEO of ARDEX Americas, a
manufacturing business that has been serving customers in North, Central, and South America for more than 30 years. Stephan's executive specialty is the design of innovative and differentiated business strategies for industrial firms, and the implementation of advanced value-based pricing strategies. Since 2001, he has been a visiting professor in universities in Toulouse, France, teaching "International B2B Pricing Strategies" and "Innovative Strategies in Industrial Markets" and "Leadership Development" to master's degree students.
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The Research Journey (2009-2012)
QUALITATIVE PROJECT 1 (2010)
QUANTITATIVE PROJECT 1 (2011)
QUANTITATIVE PROJECT 2 (2011)
QUALITATIVE PROJECT 2 (2011)
44 Interviews in 15 Industrial firms across 10 US States.
Developed Initial 5 C model for the transformation to value-based pricing.
Confidence construct was part of the 5 Cs and was most unexpected finding.
748 survey respondents with pricing, marketing, and business professionals.
Validated the 5 C model and their impact on relative firm performance.
Organizational confidence positively and significantly influenced firm performance.
507 survey respondents with account, contract, and sales managers.
Research focused on antecedents and consequences of organizational confidence.
Organizational confidence positively and significantly influenced performance.
16 in depth interviews with top pricing leaders in Fortune 500 firms.
Focusing on specific programs and projects to build organization confidence.
Designed the confidence-building training programs integrating all results.
The 5 Organizational C’s to Pricing
Excellence
CENTER-LED CHANGE
CONFIDENCE CAPABILITIES
ORGANIZATIONAL
TRANSFORMATION
CHAMPIONS
© C
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t L
iozu
2012
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Organizational Mobilization For
Pricing Excellence
Champions at the top leading the transformation
Organizational Change requires organizational mobilization
Formal and informal organizational Capabilities
Organizational Confidence acts as the fuel of the transformation
Center-led management through specialized experts supporting
divisional decision making process and pricing projects
Courage
Sense of Resilience
Scientific and Fact-based Decisions
People Development
Courage to resist to customer objections
Courage to increase prices when needed
Courage to stand firm in front of customer pressures
“We are worth it” attitude
Ability to face uncertainty in the external environment
Persevere when experiencing failures of breakdowns with pricing programs
Ability to analyze failure, to learn from them, and to move on
Use of scientific tools and models to support pricing decisions with internal stakeholders
Conduct all necessary research and testing
Reduce irrational perceptions and fears through training of the front line employees
Positive communication to energize teams
Special coaching and mentoring programs with the sales force
Strong alignment in the incentive programs around value and pricing excellence
People performance management process: talent management
Themes Emerging from Qualitative
Interviews on Organizational Confidence
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Some Symptoms of Lack of Organizational
Confidence in Value Programs
Erratic discounting behaviors and intensity in sales force.
Discounting in a nano second at the beginning of negotiation.
Claiming value orientation in strategic statements and not realizing it.
Creation of numerous new terms and conditions of sales.
R&D speak innovation, marketing speaks value, and sales speaks discounts.
Short term volume-driven pricing actions at the end of the quarter.
Misaligned goals and incentives systems across and within departments.
“Here is a book on value….go and get it done!!!”
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What is Organizational Confidence?
Organizational confidence is a generative capacity of an
organization to cope effectively with the demands,
challenges, stresses, and opportunities it encounters
within the business environment. It exists as an
aggregated judgment of an organization’s individual
members about their (1) sense of collective capacities,
(2) sense of mission or purpose, and (3) a sense of
resilience. In its most basic form, organizational efficacy
is a sense of “can do” (Bohn, 2001).
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To what extent do you agree or disagree with the following statements
about your organization. (1=Strongly Disagree to 7=Strongly Agree)
We can take on any challenge
Because our departments work together well, we can beat our competition
We are more innovative than most organizations I have worked in
Everyone works together effectively
People here have a sense of purpose to accomplish something
We have a strong vision of the future
We are very certain about what we will accomplish together as a company
We are confident about our future
We believe in the value of our products/services
We have the necessary courage to stand firm to customers’ pricing objections
We have the necessary courage to implement difficult price changes in the market
We have a strong sense of resilience with pricing
How did We Measure Organizational
Confidence? (Adapted from Bohn)
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Dimensions of Organizational
Confidence (iMindMap®)
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Importance of People Beliefs
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Progressive & Pragmatic Internalization
of Pricing Practices
Stim
uli
So
lutio
ns
Pilo
t Pro
gra
ms
Incre
ase
d A
do
ptio
n
Fu
ll Ad
op
tion
DN
A
Mo
difica
tion
Search Behavior Success Stories Transformation
Experiential Leaning Transformative Learning
► Change mindset/frame of reference
► Learn a new language (value)
► Importance of mentoring/coaching
► Enduring and irreversibility of change
to transform the firm DNA
► Knowledge foundation in pricing
► Experiments & Pilot Studies
► Trial & Error approach
► Celebration of success & stories
► Analysis of failures/breakdowns
© Copyright Liozu 2012
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Some Final Thoughts!
More than the sales force! (R&D, marketing, finance)
Effect of environmental turbulences (competition,
innovation, M&A, market cycles, etc.)
Break in investments and organizational discontinuity
(changes at the top, downsizing, re-engineering)
Confidence does not mean arrogance.
Confidence does not mean only high price or raising prices.
Mindfulness is critical (resilience, attention to details, learning from
failures, sensitivity to operations, deference to experts).
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Our Next Webinar – Sept 17th
• Brian Clarke Vice President Pricing Evaluation International Data Corporation
• Competitive Intelligence and Pricing
• September 17, 2012 12 – 12:30 pm ET
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Thanks for Watching!
(617) 252-2876
Stephan Liozu
@StephanLiozu
(724) 203- 5404
www.linkedin.com/in/stephanliozu
