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CEOs and Prices: Engagement Pays Off

The authors also note that previous studies on marketing capabilities—of which pricing is one of the most important subsets—have used much narrower survey questions and rating scales. They believe their more comprehensive approach captures all the complex processes and company-wide routines that affect pricing.

“By investing to build pricing capabilities that generate a sustainable and inimitable competitive advantage,” the authors conclude, CEOs who champion pricing “forge [a] shared vision, a collective can-do mentality, and a sense of resilience in the firm that lead to superior levels of organizational efficacy…and superior outcome.”

Bottom Line:
Firms experience increased performance and organizational capabilities when their CEO takes an active role in supporting the processes used to set the prices of goods and services. CEOs’ involvement in this aspect of marketing also helps foster organizational awareness and more rational decision making.

Author Profile:

  1. Matt Palmquist is a freelance journalist based in Oakland, Calif.


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