Continuous monetization as the operating model

The frame

The staged changes behind you were decisions. Continuous monetization is the operating model we built for what comes after. Pricing runs as a function of the company, revised on the cadence your team ships capabilities, with your closed deals as the evidence. The model most companies inherit is the redesign, a project every few years that produces a new model and a launch date. It decays from the day it ships, because the costs, competitors and usage it was calibrated to keep moving.

The function has a loop: define, deploy, defend. Define settles the three decisions, licensing, packaging and pricing, with evidence. Deploy puts them into the pricebook, the list of prices and rules reps quote inside, and into the systems that enforce them. Defend holds them against the market and the deals as both move. Two failures kill pricing between a decision and a deal. The implementation gap: the decision stays in the deck and never reaches the quoting tool. Pricing risk: the chance a change turns out worse than planned because buyers, reps and discounting respond at once. Risk is managed, never eliminated; each pass of the loop moves less and reads sooner.

You were probably handed a date. The rate of change in your market now sets your pace: capabilities ship, model costs move and competitors reprice while a project is scoped. Continuous monetization argues that pricing is product development. The software pricing redesign argues that the periodic project decays on ship day. How continuous monetization works sets out what define, deploy and defend each produce. Managing risk in software pricing argues that the three decisions do not hold equal risk, and that the order you move them in is itself a decision.

When the change in front of you ships, who reads your pricing next, against what evidence, and what tells them it is time to move again?

Three things to say in the room this week

• Our pricing is a function we run, and the redesign project is what we do when we have stopped running it.
• A pricing decision that never reaches the pricebook and the quoting tool was never made.
• The market moves on its own schedule, so our pricing review has to move at the pace we ship capabilities.