Mindful Pricing: Transforming Organizations Through Value Based Pricing

Abstract

We address the following paradox: most scholars consider value based pricing as superior to cost and competition based approaches in industrial markets -yet, few firms use it. Semi-structured interviews with 44 managers of small to medium size U.S. industrial firms revealed key characteristics that are common to the firms who successfully implement value-based pricing: the ability to face deep transformational change, the role of champions as transformational leaders, the creation and diffusion of organizational mindfulness, the building of organizational confidence to fuel the transformation, and the design of center-led and specialized teams of experts supporting the firm’s pricing process. Our data demonstrates that value-based pricing is not simply adopted but internalized through a long and purposeful process supported by a mindful, experiential and transformative learning environment.