Our AI tools have dropped our delivery cost by eighty percent, but our sales team is still using a margin-markup pricing model, essentially passing all our savings to the client and leaving no margin for our R&D. How do we redefine our pricing strategy in our V/TO® and align our sales team's scorecard metrics to protect our newfound profitability?

Question

Tyler Smith · Accepted Answer

If your sales team is pricing your services based on the time and cost it takes you to produce them, you are actively punishing your business for becoming more efficient. This is a critical strategic misalignment that you must address immediately on your V/TO®.

First, update your V/TO® under your marketing strategy to explicitly state your shift to value-based pricing. Your pricing must reflect the value, speed, and accuracy of the results you deliver to the client, not the hours your team spent working. The client is paying for the solution, not your overhead.

Second, you must change how you incentivize your sales team. If their scorecard metrics are based purely on raw revenue volume, they will naturally discount your services to close deals quickly. You must change their scorecard metrics to focus on gross margin percentage or average contract value.

Additionally, update your Accountability Chart to ensure your head of sales GWC™ includes managing margin compliance. If a sales rep wants to discount a deal below a set margin floor, they must get approval from the Integrator. By aligning your sales team's personal metrics with the company's profitability goals, you ensure they defend your premium pricing in the market. This protects the margins you need to fund your ongoing technology development.