Grow a Spine for Pricing: Measuring the Maturity of Your Pricing Practice with Tim J. Smith

Our guest on our recent episode of Pricing Heroes is Dr. Tim J. Smith, a foremost thought leader in the pricing community. Tim wears a variety of hats in the pricing profession. He is the Founder and CEO of Wiglaf Pricing, an Adjunct Professor of Marketing and Economics at DePaul University, an academic advisor at the Professional Pricing Society, and the author of four books on pricing, including Pricing Done Right and Pricing Strategy. Those of you who are active on LinkedIn may know him as the brains behind the Pricing Spine-o-meter.

Tim dives into evaluating pricing teams, explains why technology alone can’t tackle today's most pressing pricing challenges, and explores the positive role pricing can have on public perception and social equity. Tune in to learn how you can take your pricing strategies to the next level.

Check out these resources:

• Pricing Strategy (book)
• Pricing Done Right (book)
• Wiglaf Pricing Missives (Pricing Spine-o-meter on LinkedIn)
• Certified Pricing Professional (CPP)

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Get your free copy of Get Ready for the Future Of Pricing with our A-Z Guide.

You can access all of our Pricing Heroes episodes featuring our interviews with retail pricing experts at https://competera.ai/resources/pricing-heroes.

Interested in joining a dynamic community of pricing experts? Check out the Retail Pricing Community on LinkedIn, where you will find a community of professionals sharing their expertise and discussing the latest trends.

For more information about AI pricing solutions, visit Competera.ai.

Transcript

Aaron: Tim, to start, you have something of an unorthodox background for a pricing professional. You have a PhD in physical chemistry and began your career as a research scientist in quantum mechanics. Would you mind sharing a little bit about yourself and how you found your way into pricing?

Tim: Well, the key link was the mathematics related to quantum mechanics. I also have an MBA from Booth in strategy and marketing, and taking my journey. At one point, I read Holtz's book on options, swaps, futures, and other financial derivatives, which explained to people how to actually price an option. And when I started teaching, and getting into pricing, I realized that that book was missing for the field of pricing—there was no equivalent resource text for teaching people how to actually do the job of pricing. As a result, you have a lot of what I'd call charlatans out there preaching lies about how to optimize pricing, and there was a need for improving the quality of thinking around this area which led to writing *Pricing Strategy*. Part of the pathway was I was a salesperson immediately following getting my PhD. And in software because I'm getting my PhD, you write code. If you can write code, you go into a software company, and then software companies always need salespeople. And I'm good at sales as well. And at some point, the intersection of math and selling clarified that pricing was my path. So those two areas brought me here.

Aaron: Would you say that those skills are pretty transferable from quantum mechanics to pricing?

Tim: There's actually a contingent of people in pricing with PhDs in quantum mechanics. It's not an unheard-of thing.

Aaron: Wow. But the scientist in me makes me like, on the spectrum somewhere, and you have to learn how to also deal with people. And that's the other key source; you have to be able to do math, but you have to also communicate with salespeople and finance people as to why this mathematical analytical result makes good sense.

Tim: Right. That makes sense.

Aaron: As mentioned in the intro, some people may know you as the creator of the Pricing Spine-o-meter. Can you explain what the Pricing Spine-o-meter is and your motivation for creating it?

Tim: Years of working, not professional life, outside of academia, I have tried to explain how to do pricing to an analyst. That's a pricing strategy. I thought that was the thing that was missing for making this field go off, is people didn't know the analytical tools. So let's provide the analytical tools. That helped. People became much more competent in that field, but that wasn't quite working. So the next part was *Pricing Done Right*, which was a book aimed at CEOs to explain how pricing fits within the organization and the importance of that pricing function and functionality. That helped—people liked that book, but I'm looking at this and it's been 20, 30 years. I'm not the first person to start moving down the pricing area. It's been around, the field has been around for 40 years and you still have a lot of firms with absolutely no pricing department whatsoever. And you're like, how do you actually determine the price on these products, on the offerings? How do you make those decisions? How do you shepherd them? And I got a little angry and my best creativity always comes from a bit of anger. And uh, so I started creating pricing speedometers. And I would just tell the ties on a one to five scales how many vertebrae they have in their pricing spine. And there's been some ones.

Aaron: So how do you select which companies you analyze?

Tim: Examples for creating these case studies. So I'm going through the Fortune 500s, focusing mostly on the industrials, the consumer products, um, In other words, I'm avoiding a couple of areas, the energy, because they're the pricing of, let's say oil is really based upon a market. It's not a big negotiation type problem of pricing, uh, like an iPhone. And I'm also avoiding the finance industry as well, because again, the pricing of those industries, there is some overlap. But generally, it's a different approach when pricing financial instruments and insurance products. So anything industrial, anything CPG.

Aaron: So what measures do you use to assess pricing operations?

Tim: Well, I'm looking at the CEO, he or she, and her understanding of the needs that she has to drive her business forward for the next business cycle. What level of transactional pricing needs to be managed, either through pricing, giving salespeople price guardrails? Or some other forms of statistical analysis and maybe a level of optimization. How are we actually setting the prices? Are we doing conjoint? Are we doing, economic value to customers in a B2B environment where you can't really do conjoint and you're doing something else, which is a price expectation measurement, not a willingness to pay measurement. You know, how are they setting up to do the new product development pricing? How are they set up to do the price adjustments over the course of the year? We had a period of high inflation, which caused people to freak out about prices. It's like, it's inflation. Turkey, Argentina, they've been doing this for decades. Come on, we, we know if you work in a global environment, you should have examples of how to manage inflation. A lot of companies did not. Then I'm moving on up into the pricing strategy area. Do they, is their business model changing? Is there a lot of dynamic industry strife that causes a greater need for pricing and economists to participate in these decisions? And how does the macroeconomic environment work? How is it impacting their decision making? If you're a global company like Stanley Black and Decker, you got to deal with the pricing down in Brazil. They still do business in Venezuela. I can't get over that, but you know, you gotta manage that hyperinflation environment in Venezuela. And other places. So how are you doing that? Do you have what are the requirements to manage pricing well in a global organization like Trane or Metronix? What is required? Reading the financial reports, reading the executive's statements in the earnings calls, studying their business as to what they sell, where they sell it, and how they operate. Because every country has a different marketing approach that's necessary to succeed. The United States and Germany are different. They really are. Okay, so looking at those, you get an idea of the need, the requirement, and you also have some basic industry benchmarks, like there should be one pricing person for every 100 to 500 million in revenue, and the variation is purely based upon complexity. So you have an understanding of what kind of needed resources are required to execute pricing well within that organization. You have an understanding of what the CEO thinks about pricing from reading their statements. And then you actually look. And say, well, do you have what it takes to succeed in this field? And some do, and some do not.

Aaron: That's really interesting. I wonder, do you assess the capabilities around its technology? Perhaps the company's tech stack...

Tim: I do not, I do not have access to that data. I'm only using publicly available resources. So I'm not violating any antitrust issues or privacy issues. I'm using publicly available issues...

Aaron: I'm curious whether or not the advancements in some of the technologies, make assessing the size of the pricing team a little more difficult, because I assume that some of these tools enable smaller teams to operate more efficiently at scale.

Tim: Yes, but no. When I went into this area, I really thought that if I taught people how to do the math, they could just do the pricing on their own. I have become convinced that is not sufficient. Most people will never understand the mathematics behind these different tools. What they're trying to do is understand how to use the tools to manage the right questions. So you still need the people component along with the tool component to drive performance. People without, I started saying this many decades ago, uh, people without tools are just simply underpowered. Tools without people are useless. You can't do anything. Now, if you have both parts, you can do better jobs. And there's a lot of great software tools out there for managing these questions.

Aaron: I'm wondering, are there specific qualities that you've noticed across businesses that serve as clear indicators of high or underperforming teams?

Tim: I am looking at the size of the team and also the seniority. If you have a global business and the highest level pricing professional is the manager, you've got a problem there. If the revenue metric says that you should have 50 people in pricing and you only have 3, there's an obvious disconnect there. And I have seen places with 200 people focused on pricing. For instance, like at Republic Services. It's a garbage company, a garbage company. Okay, just being clear. They pick up garbage and then they put it in a landfill. There's a few more steps to that. They have hundreds of people focused on pricing, picking up our garbage in this great country of ours called the United States. And what's, why do you have all these people doing pricing? This is a valid, serious question. Well, the CEO, himself. It's a him right now. Uh, he did actually come from the pricing department there at, or the pricing revenue management department there built up the team. The team, think about garbage collection as a, in a capitalist society. A city, like Jackson, Mississippi, will have to contract with Republic Services for a 10 year, 5 year, long term contract, right? And that city wants to know the price they're going to have to pay. Well, in 10 years, the price of fuel goes up, the price of labor changes, the price of cars change, you know, our trucks, right? Let's say Republic services has to use indices, appropriate objective for enabling the city to compare their bid against say West management or some other garbage collection company. Okay. And that's, that's, that's a difficult job. And that's separate from pricing the value of the landfill management, which is a huge asset. Very important, and it's a limited resource as well, because we don't want garbage collecting everywhere in this country, so it, it, it's a complex problem, and they have to do it for every single municipality that has a garbage collection in the country. That's a big job. They have to guide those salespeople as to what to go after. They'll look at annual renewals and they know how does that work out. And then you got the private ones where they're picking up at buildings rather than picking up the city. How do we manage those contracts separately? It's not an easy question and they have a big team. To manage the complexity of those questions that arise every day.

Aaron: So that actually dovetails into my next question you often highlight the composition of the pricing function within an organization. Is there an ideal structure to the teams? What the roles entail, capabilities, size, reporting structure. What does that look like?

Tim: Yeah, there is and I've alluded to that already I'm looking for numbers like, you know one for every 100 to 200 to 500 million in revenue I'm also looking at roles. Do they stop at manager? Do they get to director? Even better, do they get to vice president? I remember hearing a few years ago that there's no vice presidents in pricing. My evidence, my research demonstrates clearly that's false. There are lots of organizations with vice presidents of pricing. Okay, pricing and revenue management or just pricing itself of that nature. So we have the titles and yes, titles matter. Because if you think about what pricing does, It's managing the inherent conflicts between the sales department, the marketing department, and the finance department and helping the organization move forward with a rational decision that makes everybody more profitable or meets the metric of the, of the, If I'm going to manage or counter a salesperson's demand that we give this discount to this customer, I need to have the power to say no. That means I'm relatively their equal, not just simply somebody who takes orders from them. And similarly, I've seen a new product development where they're doing a pricing and said, yeah, 5 percent we did last time we had a new product. It's like, but have you looked at the value of your delivery? Have you done the research? If you, if you take a look at the value of your, your, your delivery, your price increase should not be that 5%, it should be 50 percent and there should be a completely different product line than what you currently were selling. Maybe you sell that to a different group. So how do you actually counter with a product manager, their way of thinking about the market, so it's more aligned to where things are going. And I see this mostly with the tech companies. Where if they're in the new space, they don't know how to price. They're trying to price based upon seat or based upon, uh, asset, cybersecurity, or based upon website. It's like, it doesn't make sense. We need to price based upon something the customer understands. Maybe it's employee count or revenue or assets under management, just something more rational to help these companies move forward. And if by doing so, I can segment the market better. Now that counters the idea of simplicity because I'm doing segmentation. But the segmentation makes sense. So it becomes something it's all sorts of things we have to look at here.

Aaron: I'm curious, and I want to ask this followup. Have you noticed a correlation between those companies that have VP roles and pricing and their performance in terms of bottom line metrics?

Tim: I cannot comment on that.

Aaron: Okay. I guess for our listeners, there's no way of telling whether or not investing in the VP role will, pay dividends.

Tim: Based upon what I just told you, I'm saying that the pricing department should report directly to the CEO. Plain and simple.

Aaron: Based on your experience, have you noticed that companies that have teams that report directly to the CEO tend to perform more seamlessly? Have you spoken with people who describe their experiences, perhaps as more efficient, more constructive?

Tim: You're on the right track. It is about being more, more constructive in the engagement and being able to actually get your job done. When I look at companies like Medtronic Genuine Parts Company, you may know them as NAPA. They have those kinds of roles. And it just enables those conversations to go faster for the pricing department to contribute and make the delivery of value higher. I believe, Iron Mountain has had great success. By empowering the pricing people to totally change the pricing structure, pricing metrics, and then drive value, meaning money, into the company from that new approach. And the customers are happier as well. So it's a win win.

Aaron: perhaps we can turn to some pricing news that made headlines recently, during a recent earnings call, Wendy's mentioned plans to pilot dynamic pricing and the company faced public backlash after the media construed, this, whether rightly or wrongly, as the food chain's intention, to engage in surge pricing, similar to that of ride share companies, PR missteps aside, can you speak to the pros and cons of dynamic pricing strategy in fast food?

Tim: Uh, in consumer product goods, dynamic pricing has been discussed in many other situations as well. I remember down in Brazil a few years ago, I don't know how long ago, Coca Cola Some executives were talking about changing the price of Coca Cola at the vending machines based upon the temperature. So it would go, you know, more expensive in hot weather and less expensive in cold weather. And they would also change the price based upon who was playing at a sporting match. So whoever was playing football would determine the price of the Anyway, it was a PR flop. And same with the Wendy's discussion, total PR flop. My simple solution was they should have, instead of calling it a surge pricing, they should have called it a surge discounting and just raise the list price and discount down to the Lower price during the non peak hours. A simple way of reframing the same dynamic. it was challenging for, Coca Cola, just as it was for Wendy's because of this perception of fairness and that perception of fairness was caught off guard in the, uh, psyche of the consumer base. They want to be able to know they're getting a fair deal. Everybody wants a fair deal. I get that. I'm playing. On the other hand, I also am well aware that all pricing is dynamic. Anybody who says we're keeping the same price forever is a person who's pledging to go bankrupt or to go out of business. Now, remember when Dollar General broke the dollar, went to 1. 25 per item. People were like, Oh my gosh, it's going to destroy the brand. It's like, I don't know. I'm old enough to remember five and dime stores. We don't have five and dime stores anymore. Now we've got dollar stores. And eventually the dollar stores are going to the 10 stores. I mean, these, these price barriers are constantly being broken. When I compared and contrasted Walmart versus Target, Or as I grew up calling them, tarjay. Walmart's customers are known to be less price aware than the general customer is. They are unaware of the specific prices of, let's say, a can of pork and beans or something of that nature. they just expect Walmart to deliver them an overall basket. That's at a lower price. Okay, target customers are no our price aware and their Merchandising person is talking about how we got a great value. We've got a great price. It's under five It's under 20 as if we have these magical price points. Well, these magical price points always are going to be broken It's just a matter of time. So highlighting them just it's also been proven highlighting price points makes your customers more price sensitive. You kind of want to avoid that conversation about what the price is. It's just simply a fact. It's, it is what it is. We're not discussing it. Pay this or leave. and what Wendy's did is just simply break all the PR rules and the advertising rules, talk about pricing and such, we are going to see prices of hamburgers change. We, they change all the time. Anyway. we used to have the dollar value meal. Now we've got the 2 value meal. Now we've got the 5 value meal, but it has more meat in it or something of that nature. Prices are always dynamic.

Aaron: Yeah, I, you know, I have to admit that, as soon as I noticed we had these electronic Menus, that drive throughs or in stores. I always wondered how often these prices change because I don't think I paid that close attention to, the tenths cent position of burgers or fries. So who knows? They may have been engaging in this the entire time. And it wasn't until, this unfortunate misstep by Wendy's that it was thrown out into the, public awareness. so are there any examples that you can think of, of fast food companies that have engaged in similar dynamic pricing, and have done so successfully?

Tim: We'll flip it. And. change the way you're thinking about it. Every time you have happy hour at a bar, that's dynamic pricing. Every time you have the early bird special, that's dynamic pricing. So, companies and restaurants have been doing this for decades. It's just they've changed the way that they did it. Uh, the variable pricing, uh, I am well aware that in fast food, The individual price of fries is not what people are very concerned about. It's the total basket, and as long as that basket doesn't raise too much, they're relatively price insensitive.

Aaron: Yeah. So I think that the issue in the case of Wendy's versus the happy hour example is that, you know, there's this set around what the price will be every day at four or 5. Your local bar will have some special where you get 2 draft or, you know, maybe some dollar snacks or whatever. And it's predictable. And I think that's what the consumer enjoys. They think, Hey, we're getting a good deal. And I know every day at this time, I can get that deal where the fear comes in, I think from the public with the Wendy's situation is there was no communication about what would happen when it would happen and how it would impact the consumer and how the consumer could adjust their behavior to get the best deal. Possible. And so I'm wondering if, there other cases where this is, it's not an established dynamic price. It's more of a flexibility price based on demand other than say, Uber search pricing for rideshare or something like that.

Tim: Your comparison to Uber or the, it's not just yours, it's the press's comparison to Uber is, is well founded. And I would like to remind you that when Uber first came out with dynamic pricing and on New Year's Eve, you had people coming home with a $400 taxi bill, they were not happy. They received a lot of highly disgruntled customers. so we have that, so a good way of irritating your customer base. Now, if you're Uber, your alternative was a taxi, so at that time it wasn't such a big deal, because now it is. If you take a look at the price of Uber, now that they're trying to make money, you realize that a taxi cab is just as cheap. So it's questioned the entire business model to begin with. People expect prices to be within the frame of expectation. And if they're changing, they need to have a reason. And the surge pricing is known to irritate a set of the customer basis. So if you're going to roll out search pricing, you have to do it slowly to get the people accustomed to it. I'll give you an example of another change in price structure and changes in price structures of why you need pricing departments, uh, back around 2000. Back a decade ago, I'll just stick with that, right? Keep it general. The AT& T used to offer free unlimited bandwidth with their iPhone when the iPhone first came out. This wasn't a problem because it wasn't much to do with the iPhone. And then eventually people learned how to watch videos on the dot, and they suddenly had to charge for bandwidth. Now when they went from that charging for bandwidth versus not, there was a lot of that fear, uncertainty, and doubt within the consumer area. That usually dampens demand when you have fear, uncertainty, and doubt. That's why it's a good sales tool, um, against a competitor, that is. So what AT& T did is they came up with chart after chart explaining how this would only attack or only impact like five percent of the customers, those who are just abusing their service and doing nothing but watching videos on their phones all day. Most of us would be unaffected, they said. And at the time, that was true. Fast forward a decade, all of us just pay for phone service by the gigabyte. And, uh, yeah, we, we know we're paying to watch videos on our phone.

Aaron: So, I want to shift focus a little bit. I need to start calling this section of the podcast, philosophy corner because in a previous podcast, I. referenced Slavoj Žižek, which is an obscure reference. and today I want to turn to another philosopher. So I saw in a recent LinkedIn post of yours a reference to John Rawls, the 20th century American moral and political philosopher, best known for his book, A Theory of Justice. In the post you write, I love when price discrimination is used to increase economic welfare. It got me thinking about Rawls theory of justice as fairness and what its implications might be for pricing. Do you think businesses can implement effective, profitable pricing strategies that provide the greatest benefit to the least advantaged groups?

Tim: Absolutely is the very short answer. Absolutely. I'm going to switch philosophers for just a second, then go back to Rawls. So Amartya Sen, great Indian philosopher who's still alive today, talks about how in a democratic. country. We have never had a famine. The functioning capitalism, the functioning government ensures that everybody is left better off. Well, that's part of the goal of economics. Honestly, I'm saying that. People like to think about Adam Smith and the Invisible Hand and how we're just trying to, uh, you know, everybody's greedy and then they get to think about Gordon Gekko and it's a movie where greed is good. Flip the change or drop that. That's, that's not a useful way of thinking. Instead, think of it as, you know, A statement by Adam Smith of a truth. People are greedy. You can count upon that. Not that greed is good. It's not a virtue. Or that's a ridiculous statement. It's a statement of fact. It's like staying in physics. Entropy increases. Yes, entropy increases or stating here on earth gravity will pull you down to earth, which is good. Could you imagine not having gravity? Anyway, so it's just a fact. It's just how people operate. Now in Rawls theory of justice, one of the goals is to leave the worst off better off than any kind of way of thinking. Now the basic concept of trade, And we teach this. When I teach this, when I'm teaching economics, is that in a free trade, where you and I are choosing to trade, as opposed to a forced trade, where you are not given a choice, the only reason why we're trading is that it leaves both of us better off. So even if the rich person is getting richer in a trade, The poor person is also getting richer in that trade. Maybe not as fast, but they're still left better off. So by Rawls theory of justice, free trade encourages justice, justice as fairness. But I did not answer your question though, Aaron. Now the question, now that I've hit upon the economic concept of why we should be Rawlsian economists rather than Benthian economists, Benthian, you know, utilitarian, just maximize utility. For some people, that's one group of thinking. It's kind of can lead to some really distorted outcomes. And I don't want to go into that. This is not a political issue. The Rawlsian approach says I want to leave everybody better off. Well, economically price discrimination can leave everyone better off because it enables more people to have access to whatever it is you're delivering. So price discrimination. is a positive social justice Rawlsian approach. I'm making the people who are willing to pay and have the money pay more, and those who can't, they pay less, but they both get the same offer.

Aaron: So do you have any examples of price discrimination that benefits all in mind? Any businesses that you know of that, engage in, a similar pricing model? Maybe not, maybe, maybe nonprofits, maybe not, necessarily for profit businesses.

Tim: I would say a lot of your medical businesses, uh, with their programs of saying if you qualify, you can get your drugs for as low as ten dollars a month. That would be a simple example. medical devices as well. Do that. Yeah.

Aaron: I think that makes sense too, right? Because oftentimes those programs are backed by, uh, federal or government subsidies, and that's part of the whole construct of, The Rawlsian thinking of how, society should be structured. Many people think that Rawls's theory, played out is actually sort of like what we think democratically elected free market societies embody today.

Tim: Something that I've been working on and has come to fruition in the past, uh, around 2020, 2021 was the certified pricing professional designation. And that has really improved the quality of designation of rigor behind saying, I am a professional pricing person and in doing so, I've seen companies send their entire pricing department to get this, designation and it's been useful. when I go, talk to people at meetings. On every occasion, I hear about how somebody got a job or promotion because they completed that certification and they applied the principles. One of the challenges that I've been addressing is, is pricing marketing? Is pricing Finance is pricing. Sales is what is pricing? Is it economics? Is it accounting? And the truth is, it's all of those things, and it's its own thing. We use in pricing, often something called a profit bridge that or a revenue bridge that describes changes the revenue to impacts of price mix. Or volume. Well, that's an accounting tool. And the typical one that's taught in the CPA exam is the wrong accounting tool to use in a, uh, pricing analysis. from this approach, you can also tease out the corporate level elasticity. Now, basic economist says you should never price in the inelastic range. So if I tell you teased out the, the elasticity by looking at the change in volume versus the change in price mix, and I find that I'm inelastic or worse, they both went up. There's only one clear answer. The company is still priced too low or it's. Deliberately pricing low because it wants to save its pricing power to be used at another time? I don't know. But it becomes part of that management decision making that needs to be brought up. So now I've done accounting. I've done economics. This is totally separate from doing market research. To set pricing with a new product development and product management and it's totally separate from managing that price variances Which is normal in every b2b market or even consumer goods selling into retail channels You have that price variance and I might using my statistical tools, my, my customer product, and situation type variables well to tell salespeople why the price should be up or down and provide that kind of predictability. It's a lot of, a lot of things that need to be done. Anyway, the CPP helped, uh, professionalize the field. I'm seeing other things also helping to professionalize the field. I'm hoping my pricing spinometer series will have a direct impact. I saw that back in 2022, I wrote that Kraft Heinz was missing a few vertebrae in their pricing spine. I read in the Wall Street Journal just last week that Kraft Heinz is now investing in revenue growth management. So maybe I had an impact. I don't know. But yeah, it's happening.

Aaron: It sounds like they grew a spine. basically, you're saying that there's a trend in standardizing the pricing profession, which is great whenever it can be standardized. It should be. I'm wondering, are there any advancements in terms of, public policy or technology that you see that are also impacting the trajectory of the pricing profession?

Tim: I don't see much happening in terms of public policy. I am aware that the law changes all the time. What we call a monopoly is sort of a political hot button. And what we call a monopoly in the States is different from what we call it in Europe. Price collusion is another area where it's just political variation. Of course, it's illegal in the West, and it's actually encouraged in Malaysia and the Gulf Coast country. So it's a different space, and these kinds of legal issues are well understood from a marketing environment viewpoint. The technological issues also constantly varying. mark pricing as itself is working with those areas to, you know, drive performance and drive changes as well.

Aaron: Okay. So my next question, which I feel like you've already answered here a little bit, but I will ask it and see if you have anything in addition to add, can businesses or pricing experts begin to do now to future proof their pricing functions?

Tim: If you're an analyst, or a manager, make sure you get your CPP and actually learn how to do your job. All right. Or leave, you know, maybe it's just something that is part of a checking of your box and moving on with your career. And that's fine too. I accept that. I'd rather have you at least be exposed to pricing as you become a VP than not exposed. So I accept that. Um, if you're at the director or the VP level, you need to document and claim your value add and your initiatives very clearly. Uh, and that's not easy. I can point to a revenue bridge and I could, at times I can point to how pricing directly drove revenue up or profits up depends on what I want to do. and that's useful in certain cases, but we must be aware that pricing doesn't always, a good pricing department doesn't always mean I raise prices. There are many good reasons to lower prices, too. So we have to think about pricing as its function, more conceptually, as Liouzu or Nagel or myself would say, pricing's job is to ensure the company captures its fair share of value. That's part one. What I will also add is, and Pricing's job is to deliver predictability. Too often, Pricing does not deliver predictability to the sales, finance, and marketing departments, and then you get chaos.

Aaron: So final question. Can you recommend any books, podcasts or other resources to our pricing community?

Tim: You mean beyond this? Wonderful podcast right here. The pricing heroes.

Aaron: For the non philosophically inclined of our listeners, where can they go to get something more useful?

Tim: I really do suggest that they take a look at my textbook. If they're in pricing, price, pricing strategy. Uh, I've seen people form reading groups and try to perform the homework assignments at the end of that. That's a good approach. Get the CPP. And if you're managing pricing, but you're not actually doing pricing, then repricing, uh, done right. And think about the different areas of map out five different blocks of questions that you need to be managing. And ask yourself, how am I doing in managing each of these blocks of questions? How do I help improve my relationship with sales, with marketing, with finance, with product development, with the CEO?

Aaron: Great. And I'll provide links to those books and the resources in the show notes for our listeners. Well, Tim, thank you for being on the show and sharing your insights with us today.

Tim: One other book that should read, A Theory of Justice by John Rawls

Aaron: A Theory of Justice. Great book. It's a big book. Maybe they should read Justice is Fairness. It's a little shorter.

Aaron: Well, Tim, thanks again for being on the show today.

Tim: Thank you. Bye bye.