Developing a Pricing Model, Profitability Analysis & Stakeholder Reporting
A worldwide company offering communications, entertainment and information solutions for off-the-grid customers (airlines, cruise ships, etc.) had made several recent acquisitions. As a result, the Company lacked a streamlined pricing strategy across regions and business units. Due to disparate systems, teams and data sources, reporting meaningful financial and operating metrics became a highly manual process. The Company also lacked visibility into business unit and customer level profitability because it never developed or implemented a cost allocation methodology. Accordion was engaged to address these challenges.
Actionable Business Analytics
Stakeholder Reporting & Strategic KPI Enhancement
Granular Margin & Growth Analysis
Working closely with the Company’s CFO, Accounting, Finance, Sales and IT teams and other relevant stakeholders, the Accordion Team executed the following:
- Built a synthesized Pricing Tool that integrated thousands of scenarios and dimensions across three business units and twelve product groups.
- Included a customer, business unit, product and contract level EBITDA profitability analysis (along with contract level returns analysis (IRR, NPV, etc.) to ensure that pricing aligns with corporate strategic and profitability goals.
Cost Allocation / Business Unit & Customer Level Profitability
- Developed cost allocation methodology by utilizing a variety of accounting approaches including Activity Based Costing (ABC).
- Built cost allocation model by navigating complex data challenges of recently acquired and not yet fully integrated business units.
- Cleansed, validated, and integrated disparate data from dozens of sources.
- Developed a detailed reporting and KPI package for stakeholders including Board, C-level, Business Unit, and Functional leadership
- Worked with business unit leaders to understand data availability and reporting requirements.
- Developed and refined report templates and outputs for use within existing IT infrastructure (i.e. Tableau, OBIEE, etc.)
Working with teams across business segments and geographies, Accordion developed a fully integrated pricing model which standardized pricing, maximized contract profitability, and streamlined the sales process. In addition, the cost-allocation model revealed business unit and customer level profitability for the first time, enabling the Board to review under-performing segments and customers and make data-driven capital allocation decisions. Finally, our management reporting tools and processes created an integrated reporting and analytics framework resulting in operating and financial visibility across the organization.