Why pricing is a capability, not a project

A management team has prioritized pricing as a value lever. Perhaps margins are under pressure, a new pricing leader has joined the organization, or commercial excellence is a key pillar in the latest strategic plan. Regardless of the motive, the intention is clear: pricing matters.

We often hear executives use different labels for these efforts, from "pricing project" to "pricing initiative." These terms suggest a finite scope and timeline.

Yes, a one-time analysis to clean up outliers or implement an annual price increase can yield short-term impact. But the limitations of projects become obvious when market dynamics shift.  Vendor costs spike repeatedly and unpredictably. Discounting behavior spirals out of control. In these moments, organizations that treat pricing as a project find themselves reactive and exposed.

This is where the case for building pricing capability becomes essential.

Addressing the three core problems

At its core, pricing transformations usually include three problems: a math problem, a technology problem, and a people/process problem.

• The math problem: How should we set our prices? What are our floors, targets, and stretches? How do we incorporate elasticity, segmentation, or value drivers?
• The technology problem: Should we build or buy? What tools will help us scale our logic into the market?
• The people and process problem: Who needs to behave differently, and how? Who will champion change? Who else in the organization is affected? Will the change be sustainable?

The first two issues are usually well scoped and funded. Organizations hire external experts, purchase software, and run analytics. But the third challenge is routinely underappreciated, under-resourced, or ignored altogether. And it’s precisely what prevents pricing from becoming a true organizational capability.

Shifting the pricing narrative: From one-time fix to continuous capability

To elevate pricing beyond a project, companies must embed pricing into the way they operate. This means building infrastructure that supports the tools and algorithms long after go-live. They must create feedback loops, foster learning, and drive iteration.

A well-functioning pricing capability often includes:

• People and talent: Dedicated pricing resources who not only understand the tools but can interpret data, manage stakeholders, and guide decision-making. These are not one-off project hires. They represent embedded roles with clear career paths.
• Feedback loops: The ability to consume data post-transaction and measure the effectiveness of the pricing system. Organizations act on clear KPIs to adjust strategy, improve execution, and refine pricing logic.
• Scenario planning: The capability to anticipate and simulate market shifts. Tools such as elasticity calculators or what-if simulators help organizations prepare for vendor cost shocks, volume shifts, or competitive price moves.
• Standing governance bodies: A cross-functional pricing council that reviews performance, drives alignment, and prioritizes enhancements.
• Embedded learning mechanisms: Regular reviews of pricing effectiveness, coaching for front-line teams, and reinforcement of desired behaviors.
• Clear ownership: Pricing can't live in a silo. Successful organizations define who owns what and ensure C-level sponsorship to drive alignment and accountability.

Pricing excellence for long-term value

Many organizations approach pricing initiatives expecting a clean handoff and a neatly wrapped ROI. But effective pricing doesn’t work that way. It is dynamic, iterative, and heavily dependent on people.

The project may be the spark, but capability is the fire. To sustain it, you need more than one model. You need a mindset. Tools and models are important, but they must be supported by the right skills, governance, and forward-thinking culture to deliver lasting results.

At Simon-Kucher, our decades-long expertise in pricing enables us to support you in your pursuit of sustainable and profitable growth. Reach out to our specialist teams today.