Automated MFN Clause Analysis in Price Management
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Solution Overview
Problem
In integrated price management systems, obtaining and managing information related to Most Favored Nation (MFN) clauses across multiple deals is challenging, making it difficult for sales forces to determine the potential system-wide impact of granting MFN status, which can lead to delayed or incorrect pricing decisions.
Innovation Solution
The system provides methods to maintain and display the lowest price status for products by searching the price management system for deals with the lowest price, computing revenue impacts, and triggering alerts when proposed prices are lower, ensuring that all products with MFN status are priced at or below the current lowest price, thereby ensuring timely and informed decision-making.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Measurement precision
If manual tracking of MFN clauses across multiple deals is used, then data accuracy may be maintained through human review, but the time required to obtain and analyze MFN information increases significantly
Solution Approach 1:
The patent replaces manual mechanical tracking of MFN clauses with an automated computer-based system that automatically searches, retrieves, and analyzes MFN information across multiple deals. The system uses software algorithms to scan deal databases, identify applicable MFN clauses, and calculate revenue impacts without human intervention, thereby maintaining accuracy while dramatically reducing the time required.
Solution Approach 2:
The system enables self-service by automatically performing the entire MFN analysis process without requiring sales personnel to manually gather information. The computer system autonomously queries the deal database, identifies relevant MFN clauses, computes potential revenue impacts, and presents results to users, allowing the system to serve itself in gathering and processing MFN data.
2Reliability
If comprehensive MFN impact analysis across all deals is performed, then informed pricing decisions can be made, but the system complexity and computational requirements increase
Solution Approach 1:
The patent segments the complex task of MFN impact analysis into distinct modular components: (1) searching for deals containing specific products, (2) identifying MFN clauses within those deals, (3) determining whether products are priced at lowest price, (4) calculating revenue impacts, and (5) presenting results. This segmentation allows each function to be handled by separate software modules, making the overall system more manageable and less complex while maintaining comprehensive analysis capabilities.
3Productivity
If real-time MFN status monitoring is implemented, then pricing decisions can be made immediately, but the computational resources and processing power required increase
Solution Approach 1:
The system performs preliminary actions by pre-identifying and flagging MFN clauses within deals during initial system setup or periodic updates. This preliminary classification means that when a pricing decision needs to be made, the system does not need to search through entire deal texts but can quickly query pre-identified MFN clauses, thereby achieving real-time monitoring with reduced computational resource consumption during actual pricing operations.
Data Source
AI summary
The present invention presents systems and methods of future-pricing in an integrated price management system. The invention provides a method of maintaining at least one deal with a lowest price status for at least one product in the price management system by inputting a proposed price for product; searching the price management system for deals having the product with the lowest price status; defining a current lowest price as equal to the price of the product; and, if said proposed price is less than said current lowest price, then computing a potential revenue impact of lowering the price of said product to the proposed price.