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1. 1181119 RB Approach_Commercial Steering.pptx
Trends
Are you sure you always get the
biggest bang for your commercial buck?
Source: Roland Berger
COMPANIES NEED TO RE-GEAR COMMERCIALLY TO STAY ALOFT AS MARKETS EVOLVE
DIGITALLY – COMMERCIAL SILO EXCELLENCE ISN'T SUFFICIENT ANYMORE
Problem
Execution gap
on profitable
growth
Only 1 out of 10
companies
actually achieve
this over 5+ years
Solution
Integrated
commercial
steering to
achieve and
maintain
profitable growth
in the long-run
Often focus solely on cost reduction
and exposed to volatile top lines –
"Shrinking to greatness"
Complexity and speed in markets
grow – value chains transform into
value networks
Commoditization pushes
"ancillaries" upwards on commercial
agendas
Customer acquisition gets
fragmented and volatile, while its
relevance for gross profits increases
Success factors
Enable to manage topline with
same stringency as cost
Allow for targeted heuristics and
latitude – Informed by analytics
Shorten lead times and allow
for latitude for decision-making
Ensure end-to-end
view on profit contribution

2. 2181119 RB Approach_Commercial Steering.pptx
Source: Roland Berger
INTEGRATED COMMERCIAL STEERING BRIDGES THE GAP BETWEEN FUNCTIONAL
EXCELLENCE AND CROSS-FUNCTIONAL AMBITION ON GROSS PROFIT
Integrated commercial
steering
Control P&L impact of measures
Prioritize and manage topline measures
Adapt to challenges and opportunities in flexible teams
Re-allocate tactical budgets fluidly
Optimize for end-to-end profit contribution
Apply simple rules to sense check gross profit trading
1
2
3
4
5
Benefit 2
Overall
management
for gross
profitIntegrated steering
Ancillary
products
Pricing
& Distribution
Yield
ManagementSales
Streamline functional excellence towards joint gross profit target
Benefit 1
Aligned
targets and
excellenceCommercial functions
6

3. 3181119 RB Approach_Commercial Steering.pptx
Source: Roland Berger
Integrated commercial steering
What's needed? Key success factors
to get this in place
Top-management sponsoring
Clear scope and ambition level
Value based design of use cases
and incremental implementation
Ownership and involvement
of all commercial teams
Financial linkage and support
IT involvement from the start
Sense for value creation
and commercial operations
A WIDE RANGE OF REQUIREMENTS NEED TO BE IN PLACE TO RUN
INTEGRATED COMMERCIAL STEERING ROBUSTLY AT SCALE
"Simple rules"
KPI logic
Commercial
levers
Topline impact
("Gross profit")
System support
Organizational anchor
P&L linkage
Commercial alignment

4. 4181119 RB Approach_Commercial Steering.pptx
Source: Roland Berger
INTEGRATED COMMERCIAL STEERING YIELDS TANGIBLE BENEFITS
AND BREAKS UP SILOS ON THE JOB WHERE NEEDED
Results
> Infuse end-to-end responsibilities and break up silo mindset
> Management by results rather than isolated process
> Agility – rather than alignment in budgeting
> Flexible teams, adaptive for challenges and opportunities
Organizational
change
(on the job)
> Targeting aligned and broken down into actionable rules
> Tactical spend optimized across commercial functions
(e.g. online mktg. easily 2x pricing impact)
> Initiatives assessed and prioritized by end to end profit contribution
> Partner management based on value contributions
Commercial
management
> Transparency on commercial costs
(broken down, standardized, and linked to P&L)
> Impact of commercial initiatives on P&L cost items
> Targeting and framework for stringent management
Cost
management
System supported controlling of measures and P&L impact
Reduction of >1% of
overall commission
costs across B2B
partnership portfolio due to
renegotiations based on
value creation mapping
Commercial cost >1 bn €
for major European airline
broken down into 20+
positions for end-to-end
cost management
Due to aligned profit
targets, increase of 15%
revenue growth and 1%
gross profit margin
realized at major travel
company
Exemplary results and achievements