Business Use Case Summary
Enhance Contract Renewal and Visibility with Analytics KPIs
This use case addresses the optimization of formula-based agreements to enhance business contribution margins, reduce manual errors, and prevent margin compression from outdated pricing. Agreement pricing is updated on a regular basis (weekly, monthly, quarterly, yearly), or ad-hoc based on open renegotiation windows and renewals dates. The goal is to improve long-term / renewal pricing for customer agreements. This is accomplished by using formula management and agreements pricing tools that allow for complex customer pricing that automate regular formula, cost, and market index changes and other related customer and market forces.
Dashboard analytics supports the stated goals by reducing the possibility of margin compression by missing renewal deadlines, failing to consider agreement renewal trends, and providing less than ideal strategies in regard to passing on market cost, competitive, or related changes. Improved visibility helps to identify timing and impact of renewals, provide context for market position relative to new agreements and renewals, and supporting action to stay in alignment with financial planning and generally avoid margin compression.
🎯 Business Objectives
Reduce risk of missing renewal deadline
Reduce risk of delay in price/margin increase
Increase margin with contextual support
Increased alignment between pricing and sales teams
⌚ Time Estimation
N/A
👥 Stakeholders
This use case primarily targets Pricing Analysts and Managers, with secondary relevance to Sales, Commercial, and Finance leaders.
Business Context (Use Case Description)
Analytics Views Workflow
Standard portlets - views
Spot Business Summary Total
The purpose of this analytic is to identify outliers especially for underperformance on non-agreement spot price revenue, margin, and volume
Summary of dashboard filtered context for total revenue, margin, and volume YTD in percentage and absolution value per currency selection
Trends on daily, weekly, monthly are not shown but should be configured to present a more detailed view. Spot price realization on a day over day / week over week is a common business case for configuration in process manufacturing.
Spot Business Summary
The purpose of this analytic is to give a next level breakdown of the summary total.
Detailed view per business unit product hierarchy, sales region, and other divisions.
Conditional formatting should be used to easily show and allow for filtering on increase and decreasing trending.
Margin Time Series
The purpose of this analytic is to provide a long term historical and potentially forecast trending view of margin, revenue, and volume. Time series bar chart includes margin. Chart can be configured to add others measures including revenue and volume with added 2nd axis if needed. Forecast data is required if future 12 months is to be shown.
Pie Charts
The purpose of this analytic is to identify outliers especially for underperformance on non-agreement spot price revenue, margin, and volume at the customer/product level. Three separate portlet pie charts are configured to show revenue, margin, and volume
Quartiles can be configured to represent desired breakdown. Recommended to use 3 breaks based on bottom 25%, middle 50%, and top 25% (as shown) or other standard views like 4 standard quartiles at 25% breaks.
Note: Drill down into pie charts is supported
Monthly Guidelines by Region
The purpose of this analytic is to provide monthly or similar financial reporting period changes in contribution margin and volume so that progress toward AOP (annual operating plan) is achieved. Summary of product hierarchy with customer and region added as needed to show current month volume, target CVM and actual CVM. It includes ability to have “totals” section.
Customer Monthly Guidelines (is a “drill down” connected to above guidelines by region)
The purpose of this analytic is to provide detailed context for the above monthly guidelines so that visibility into customer spot pricing (positive and negative) to target underperformance in the next opportunity for negotiation.
This table is a drill down. This means that the context is driven by the above chart based on the row selected. Data shown will only be for row selected to show “customer breakdown” of the same data.
Filtering & apply settings
This dashboard is defined with a standard basic set of filters. These standard filters require specific master data to enable content-based views of the data. It is recommended that additional filters are added as needed especially when the customer has defined segments, geographies, and other factors that would improve usability.
Save views
Exports & actions
Individual portlets can be:
Opened in a dialog box
Exported (PNG, SVG, JPEG, PDF, MS Excel)
Removed
Action created
Features and Capabilities (Overview)
Dashboard analytics support this by preventing margin compression, considering renewal trends, and providing strategies for market changes. It improves visibility into renewal timing and impact, offers market position context, and helps maintain alignment with financial planning. The agreement price setting dashboard presents common analytics views, offering insights into trends and opportunities in formula-based contract business. This dashboard serves as a starting point for visibility into pricing driven by Pricefx agreements capability.
Dashboard filters
Products
Customers
Start Date
End Date
Dashboard Portlets
Spot Business Summary Total
Spot Business Summary
Margin & Revenue Time Series
Pie Charts
Monthly Guidelines by Region
Customer Monthly Guidelines
Agreements Price Dashboard Views
Agreement business summary total
Agreement business summary
Margin, revenue, and volume time series
Agreement mix (cluster by region or industry)
Customer performance quartile pie charts (revenue, margin, volume)
Agreement performance, renewal stage, and approval
Agreements dashboard use case and above views seek to accomplish the following objectives:
Monitor YTD revenue, margin, and volume trending
Identify underperformance and prioritize action on the worst performing quartile segment
Identify agreement underperformance by customer segment and region
Provide negotiation guidance based on recently renegotiated agreement terms
Track renewal stages and confirm timely approvals
Prerequisites for PDR Implementation
There is some mandatory data that needs to be properly handled for the implementation of this use case.
To learn more about data readiness, click here.
Data descriptions
The data requirements for the dashboard depends on following Transaction Data:
Customer Id
Product Id
Net Price
Volume
Margin
Cost
Date
Industry
Region
Product Group Category
Customer Segment
Transaction Source (Contract or Quote)
Agreements Objects - Currently only gets Chemicals Agreements, but could easily be configured to get any
Agreement Term Type that has a Customer Group input on the header
Data per portlet
Agreements are included in the Contract Performance, Quarterly Renewals, Approved Contracts, and
Contracts to Be Approved portlets
Limitations and Risks
Dependence on accurate data
The effectiveness of analytical dashboards and performance benchmarks relies heavily on the accuracy and completeness of the imported master data. Inaccurate data could lead to misleading insights and poor decision-making.
Out of Scope
While many o the following can be configured with different levels of effort, for this particular use case, they are out of scope:
Reporting metrics beyond the ones explicitly mentioned
More metrics may be available, depending on your business needs but they must be discussed priorly, in initial phases of the project, as they require additional effort .
Any customization
This use cases uses out of the box capabilities and any further customization must be discussed in advance as it will be subject to effort and charge.
Additional filters
User entitlement of the dashboard
Data Integration
Any additional data transformations or integrations required to make data available needs to be considered as an additional configuration effort.
Terms and Definitions