One of the most innovative pricing strategies that should be in every firm’s pricing stack is the TIP clause. Most feedback that firms receive on pricing is negative (“Your price was too high”). Or it is ambivalent: “Your price was just right.” No customer ever discloses how much money your firm left on the table. Innovative pricing strategies, such as the TIP clause, are outward focused and attempt to capture more of the value created for customers, in extraordinary engagements. Having more accurate cost accounting or better project management won’t help you capture this level of value, which is why pricing is the main driver of profitability. You don’t want to miss this show as Ed and Ron share stories from around the world of firms that have successfully implemented the TIP clause.
The Soul of Enterprise: Business in the Transformation Economy by THRESHOLD