Pascal Yammine is CEO of Zilliant, a leader in price optimization and management software for business.
Every company has a pricing strategy. Most believe they’re executing it, but the reality is messier.
When executives think about pricing risk, they tend to focus on the headlines: an annual price increase, a tariff response or a competitive repositioning. Boards debate these decisions, but the real damage rarely comes from a single bad call. Instead, it arises from dozens of small, disconnected decisions that no one tracks until the margin is already gone.
The Compounding Problem
Here’s a scenario I hear repeatedly from customers and prospects. A procurement team renegotiates a supplier contract that shifts material costs by half a percent. Separately, a sales team launches an aggressive growth campaign and starts discounting by two percent. Neither team knows what the other did.
Each decision, in isolation, seems minor, but they compound. By the end of the fiscal quarter, the CFO is staring at a margin gap and trying to trace where it went. The explanation is a chain of small decisions, made across functions, without visibility into their collective impact.
A recent survey from my company found that 34% of manufacturing and distribution executives cited inconsistent discounting as a primary source of margin leakage, 29% pointed to inconsistent governance, and 27% to siloed decision-making across teams. These are all symptoms of the same fragmentation.
Nobody Owns The Whole Picture
Part of what makes this so difficult to solve is that pricing doesn’t sit cleanly in any one function. Finance wants to protect margin, sales wants competitive flexibility and product and marketing have their own views on positioning. Everyone has an opinion on pricing, but very few have visibility into how their decisions interact with everyone else’s.
That’s one reason CEOs are getting pulled into pricing. It’s not because pricing should be a CEO function. It’s because the C-suite isn’t confined to a single part of the organization. In our survey, many executives said they now place pricing accountability with the CEO, CFO or CRO. Yet the execution remains fragmented across teams and systems.
When pricing governance exists only at the strategic level—a pricing council, a quarterly review or a governance board—it often stops short of where the real decisions happen. When a sales rep in the field overrides a price because it feels too high or a regional manager approves a discount to close a deal before quarter-end, they aren’t acting out of defiance. These are rational responses from people working without the full context. Unfortunately, they erode margins just the same, and the CFO typically doesn’t find out until the next quarterly report.
The Confidence Gap
Most executives don’t realize how exposed they are. We’ve found that while many pricing leaders remain optimistic about maintaining profitability, they can still struggle to effectively execute their pricing strategy. Meanwhile, leaders are losing customers due to pricing changes and reworking their pricing decisions sometimes three or four times per year.
That gap between confidence and control is where margin erosion happens. Companies believe in their pricing strategy. They just can’t enforce it consistently across the organization.
What Actually Works
There’s no single fix, but the organizations that manage this well tend to have three things working together.
First, a single source of pricing truth. When pricing data lives in different systems across sales, finance and operations, conflicting decisions are inevitable. Unifying that data makes governance enforceable.
Second, cross-functional alignment that reaches the field. Governance boards and pricing councils matter, but they have to connect to the daily decisions that sales, procurement and operations teams make. If the framework stops at the executive level, the fragmentation continues beneath it.
Third, real-time visibility into how decisions interact. This is where AI and predictive tools can play a meaningful role in identifying risk faster. If a pricing change creates downstream exposure, teams should know before the end of the quarter, not after. AI can surface those connections and model the ripple effects of a cost change or a discount campaign before the impact hits the books. But it can’t create organizational alignment on its own. Layered onto fragmented systems, AI produces faster decisions, not better-controlled ones.
Small Decisions, Big Consequences
Years ago, early in my career, I worked on a distributed engineering project where teams around the world were designing different components of the same engine. One team changed the size of a single screw by a millimeter because it made their work easier, but the change threw off a component that another team was building in another country. When the engine was assembled, it failed. This was another single small, reasonable decision with no visibility into its downstream impact.
Pricing works the same way. Strategic decisions get the attention, but it’s the small ones—made rationally, in isolation, without the full picture—that compound into the margin gaps companies spend the next year trying to close. The hard truth: lost margin is lost. You can fix the process going forward, but you can’t recover what’s already gone.
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