Infrastructure and Construction Services
Created Robust Pricing Framework and Strong Pricing Culture to Drive Margin Growth
Developed a pricing framework and instilled a pricing culture, driving 4.1% margin growth
Building a Pricing Culture: A Strategic Framework for Margin Growth
An Infrastructure TIC & Construction Services provider implemented a value-aligned pricing framework, driving 4.1% margin growth and organizational buy-in.
With a complex business structure spanning multiple locations, markets, and service lines, this Infrastructure TIC & Construction Services provider struggled with inconsistent pricing and a lack of centralized data. Regional and project-based pricing decisions made standardization difficult, while historical data lacked the necessary details to inform pricing strategies. To address these challenges, the company designed a strategic pricing framework, embedded margin guidance into existing tools, and developed a Pricing Center of Excellence. The result was a 4.1% margin growth, standardized pricing expectations, and a cultural shift towards pricing accountability.
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Situation
Decentralized Pricing Challenges in a Complex Business Environment
Inconsistent pricing, poor data quality, and regional variations created barriers to margin optimization.
- Poor historical data that lacked quality details such as key job attributes
- High degree of business and systems complexity spanning ~125 locations, 7 end-markets, multiple service lines, >10k customers, and >40k projects annually
- Rough margin % targets exist by region but many pricing decisions occur by location and salesperson
- Centralized, standard pricing difficult to implement due to regional and project-based differences
Approach
Establishing a Pricing Framework to Drive Standardization and Performance
By embedding margin guidance, centralizing data, and fostering a pricing culture, the organization improved pricing discipline and profitability.
- Designed a strategic, value-aligned pricing framework that determines target margins based on market segment, technician specialization, and job requirements
- Embedded margin guidance into client’s existing pricing tools via API to reduce process changes for sales team
- Instilled a “pricing culture” for the field estimators by providing credible, defensible recommendations
- Created a centralized dataset for analytics to provide a trustworthy feedback loop of results
- Developed a Pricing Center of Excellence that includes a degree of centralization and performance management
Pricing Framework
Developed methodology that transformed the pricing process to be based on facts, informed judgement, transparency, and continuous improvement
Organizational Buy-In
Leveraged available data and strategic workshops to drive change management through the Client’s business
Impact
Pricing Alignment Drives Margin Growth
Standardized pricing and team buy-in delivered lasting results
4.1%
Margin Growth
Standardized pricing expectations
Organizational buy-in and culture shift
Unlocking Competitive Advantage: How Competitive Intelligence Fuels Strategic Pricing
Learn how competitive intelligence drives informed pricing decisions and an effective pricing and commercial strategy
Price vs. Volume Tradeoff
Every business, whether selling products or services, faces a familiar dilemma: lower the price to attract more customers or maintain higher prices to protect profit margins.
Professional Services Overview
Does your pricing strategy capture your full value?