Journey towards value-based pricing

Challenge

• VTT – one of Europe’s leading research institutions – was looking ways to move towards value-based selling and pricing of its services to companies
• Historically, VTT’s pricing was mostly based on cost plus approach
• Theory of value-based selling and pricing is generally known, but it needed to be planted into VTT’s unique business and culture

Brave the future

• August supported VTT’s management in designing new pricing practices for commercial research projects
• New practices aimed at implementing a systematic and harmonized pricing process, improved value capture of VTT’s unique capabilities and impact sharing between client and VTT (whenever possible)
• After the blueprint definitions, VTT continued in customizing supporting tools and in training teams into the process

Impact

• A year after the definition phase, new tools for price setting and reporting have been introduced and trained to relevant people
• There is an improved understanding in the organization on the customer value and business impact created in the projects and in several cases impact-based pricing and value sharing is applied
• New pricing approach has led to a better focus on value creation and improved pricing performance

“August brought a lot of practical experience on pricing development and helped us formulate an ambitious, yet implementable pricing approach. Happy to recommend August to anyone in need of real experts”

– Mika Toikka, EVP Commercial Operations, VTT