Price and revenue optimization (PRO) software uses analytics to help companies maximize profitability for any targeted level of revenues. PRO utilizes data about buyer behavior to gauge individual customers’ price sensitivity and predict how they will react to prices. It enables users to charge buyers who appear to be less sensitive more than those who appear more price-sensitive. PRO is a significant departure from inward-focused, single-factor pricing strategies such as cost-plus pricing or, in the case of financial services, risk-based pricing (using a borrower’s credit score, for example). Instead it offers a multifaceted customer-centric analytic approach to pricing built on analysis of large sets of data.
A core objective of my research practice and agenda is to help the Office of Finance improve its performance by better utilizing information technology. As we kick off 2014, I see five initiatives that CFOs and controllers should adopt to improve their execution of core finance functions and free up time to concentrate on increasing their department’s strategic value. Finance organizations – especially those that need to improve performance – usually find it difficult to find the resources to invest in increasing their strategic value. However, any of the first three initiatives mentioned below will enable them to operate more efficiently as well as improve performance. These initiatives have been central to my focus for the past decade. The final two are relatively new and reflect the evolution of technology to enable finance departments to deliver better results. Every finance organization should adopt at least one of these five as a priority this year.
Topics: Big Data, Performance Management, Planning, Predictive Analytics, Sales Performance, Supply Chain Performance, forecasting, Budgeting, close, dashboard, PRO, Tax, tax data warehouse, Analytics, Business Analytics, Business Collaboration, Business Performance, CIO, Customer & Contact Center, Financial Performance, In-memory, Accounting, CFO, pricing, Supply Chain, CEO, demand management, Financial Performance Management, FPM, price and profitability optimization, scorecard, S&OP
People who don’t spend much time analyzing the software market may have trouble understanding the differences between products in a given software category or the difference between two categories. This happens because vendors and commentators use the same words to describe different depths of functionality and degrees of comprehensiveness in one type of application. As well, there can be multiple categories of software that address the same general business issues but are designed for different specific uses. Not only is it worth the effort to sort through the labels and understand what does what best, but different categories of software that are sold and deployed separately can provide even greater value when used together.
Topics: Performance Management, Sales Performance, Supply Chain Performance, dashboard, PRO, Operational Performance, Business Analytics, Business Performance, Financial Performance, CFO, pricing, Supply Chain, CEO, demand management, FPM, price and profitability optimization, scorecard, S&OP
At this year’s Global Pricing Forum, host Nomis Solutions announced the availability of its Discretion Manager software, which supports dynamic price negotiations. The annual event brings together thought leaders and practitioners interested in pricing. Nomis currently has 17 of the largest 100 banks as customers. With more customers, this year’s event had larger attendance than last year’s.
Topics: Big Data, Sales Performance, credit, financial analytics, Nomis Solutions, pricing and revenue optimization, PRO, yield management, Operational Performance, Analytics, Business Analytics, Business Performance, Financial Performance, pricing, banking, financial services
One of the most important IT trends over the past decade has been the proliferation of ever wider and deeper sets of information sources that businesses use to collect, track and analyze data. While structured numerical data remains the most common category, organizations are also learning to exploit semistructured data (text, for example) as well as more complex data types such as voice and image files. They use these analytics increasingly in every aspect of their business – to assess financial performance, process quality, operational status, risk and even governance and compliance. Properly applied, business analytics can deliver significant value by deepening insight, supporting better decision-making and providing alerts when situations require attention from managers or executives.
Topics: Planning, Predictive Analytics, Customer, ABC, Budgeting, close, closing, Finance Analytics, plan, PRO, strategy, Operational Performance, Analytics, Business Analytics, Business Collaboration, Business Performance, Cloud Computing, Financial Performance, Accounting, CFO, pricing, Risk, risk management, costing, FPM, price optimizaiton, Profitability