Real and Practical Challenges of Revenue Management: From design to implementation
Foreword
While revenue management is familiar and widely practiced by many companies, when business leaders are tasked with designing and implementing a new strategy in practice, we consistently encounter the need to apply numerous changes, tweaks, adjustments and lessons that aren’t covered by standard “textbooks”. This experience spurred us to start writing in an attempt to consolidate the new knowledge we’d accumulated over time. But we failed – miserably.
Initially planning to launch in three months’ time, it would take three years to arrive at the present report, with the involvement of ten different leaders and input from many additional revenue management projects executed together with CPG companies across a broad range of portfolios, geographies and commercial models. The challenge lay in logically synthesizing these lessons, trials & errors and best practices for design and implementation in a structured way to support our clients.
Despite the time it has taken, the insights presented here are far from outdated. On the contrary, in today’s market context, they are more relevant than ever – with the benefit of having gone through countless rounds of refinement and reflection in the hands of experienced professionals who invested a great deal of care and attention.
This exercise led us to identify a number of key success factors:
- Having clear and aligned goals for the revenue management strategy as well as clarity regarding possible trade-offs
- Understanding the business context and reality in which these goals will be pursued
- Guaranteeing sponsorship from the leadership and internal stakeholders while respecting cultural aspects
- Considering the non-technical elements that are indispensable for effective strategy design and implementation
- Defining the implementation premises from the beginning considering trade-offs between speed and risk
- Establishing a governance model for staying on track and adjusting
The lucrative revenue road ahead
Our aim in this report was to move beyond a theoretical, textbook understanding of designing and implementing revenue management strategies. One of the key takeaways from our discussion is that serious and profound consideration of your business’ given reality as well as the individual human beings who collectively bring the business to life are just as important as the technical elements of the strategy.
The design of any revenue management strategy should always take these elements into account with regard to the 1) business context, 2) the company’s internal stakeholders, 3) external supply chain dynamics and 4) the right sell-in/sell-out mindset.
And that’s only half the battle: Success also rests on a well-designed implementation strategy along with a plan for executing it – a point where many consultancy textbooks stop. Implementation needs to go beyond a one-off strategy rollout and recognize that pricing is a living organism in constant flux. Long-term success and viability rely on having the right governance, rituals, processes and systems in place that allow your organization to quickly react to changes in the market and ensure that the strategy is being implemented correctly.
Taken together, this will pave the way for your business to enjoy a lucrative revenue road ahead that delivers long-term results.
Find out more by reading the full report
TALK TO US
André Farat
André Farat is a senior manager at Integration’s Finance & Management Practice and has been with the firm since 2013. He has over a decade of experience in organizational transformation across Brazil, Latin America, and Europe, focusing on organizational design and culture, as well as governance, structure, post-merger integration, and change management. He partners with [...]
Constanza Alves
Constanza Alves is a senior manager within Integration´s Implementation and Leadership & Organization Practices and has been working in the company since 2013. Her experience includes Change Management, Culture Transformation, PMO, Process Redesign, S&OP, PMI and Logistic Networks in sectors such as Retail, Consumer Goods, Healthcare, Technology and Industrials (Paper, Oil and Gas, Construction materials).
Diogo Selingardi
Diogo Selingardi is a director in the Finance & Management Practice and has been working at Integration since 2011. His focus includes strategy implementation, mergers & acquisitions, cost efficiency initiatives and developing management & governance models across the industrial, consumer goods, retail, private equity and financial market sectors. Diogo holds a degree in economic sciences [...]
Gauss Antar
Gauss Antar is a senior manager in the Finance & Management Practice at Integration, where he has been working since 2015. His main areas of expertise include go-to-market management, post-merger integration and market-entry projects in retail, industry and education. Gauss received a degree in economics from INSPER, including international experience at Queen's University in Canada [...]
Guido Solari
Guido Solari is a partner at Integration and the head of our LATAM offices. Guido joined the company in 2006 and is part of the Marketing & Sales Practice. He has carried out over 250 projects across Latin America, North America and Europe, serving clients in the areas of mass consumer goods, agribusiness, pharmaceuticals, media [...]
Jéssica Pavão
Jéssica Pavão is a senior manager in Integration's Finance & Management Practice and has been with the company since 2016. During her career, Jéssica has focused on leadership & organization as well as change management projects in the retail and consumer goods sectors – including post-merger integrations, organizational structure implementation, recruitment & professional development program [...]
Leticia Molina
Leticia Molina is a director at Integration's Marketing & Sales Practice and has been with the company since January 2023. Prior to Integration, Leticia worked as director of marketing and sales at Vitamina Children's Schools. Her experience includes structuring acquisition & integration plans in the school market and leading profitability & company restructurings. Leticia worked [...]
Marília José
Marília José is a Sr Director at Integration and has been with the firm since 2014. With expertise in Supply Chain and Finance & Management, she specializes in S&OP, retail supply chain, efficiency and cost reduction, and transformation projects. Her experience spans post-merger integration, strategic planning, organizational model development and process design, across the retail, [...]
Merina Moreira
Merina Moreira is a Engagement Manager at Integration, based in Germany, and has been working in the company since January 2021. She has experience in projects such as go-to-market and strategic planning/roadmaps in the FMCG, Food and Pharma industry. Prior to Integration, Merina worked as an intern at Kienbaum and Ernst & Young as well [...]
Rodrigo Seabra
Rodrigo Seabra is the partner at our Office in Munich. He joined Integration in 2006 in Brazil and led the Mexico Office, before taking on responsibility of the Munich Office. Rodrigo is part of our Implementation Practice, has amassed international experience in industries such as consumer goods, retail, food & beverage, pharmaceutical and healthcare and [...]
- On 15 April 2023
