Tempe, AZ June 19, 2002 Management consulting firm A.T. Kearney and supply chain software company Manugistics Group have teamed up to market and implement the solution provider's pricing and revenue optimization (PRO) applications.
Manugistics said its PRO solutions can help optimize a company's value chain, including pricing and promotions activities, by balancing the trade-offs between profits and other strategic objectives, such as market share, thereby leading to higher revenues. The solution provider said its applications can forecast the response of different customer segments to prices of products and services throughout their life cycle, factoring in such variables as product availability, customer demand and competitor price actions to produce specific price recommendations.
For its part, A.T. Kearney, a division of EDS, brings to the table its management consulting experience, including its understanding of organizational and pricing dynamics. The new partners initially will target their joint offerings at the two companies' existing client bases, as well as at new prospects in industries that include automotive, communications and high technology, consumer packaged goods and retail.
Dietmar Ostermann, A.T. Kearney CEO, suggested that Manugistics' PRO solutions place a timely emphasis on optimizing profitability. "Our research shows that a 1 percent increase in top-line price can translate into as much as an 8 percent increase in the bottom line, Ostermann said. Working with Manugistics enhances the revenue growth strategy services that we provide to our clients.
AMR Research has reported that up to $95 billion in annual incremental operating margin in the U.S. manufacturing economy alone could be generated through the use of solutions that help companies attain the right pricing mix. Manugistics asserts that its PRO technology can enable executives to get the mix right despite complicated customer and competitive dynamics.
Our companies are well-positioned to help our clients with the challenging science of pricing and turn it into a competitive advantage for them, said Greg Owens, chairman and CEO of Manugistics, speaking of the new partnership.
Under the terms of the agreement, A.T. Kearney and Manugistics also may work together to jointly develop offerings. The companies will train consulting and sales forces to jointly market, sell and deliver the A.T. Kearney/Manugistics solutions.