Performance KPI vs. Process KPI

Both belong on the dashboard. Only one protects the other.

FRIDAY EXERCISE

Go to your most reliable source.
Pull % of orders shipped below floor price for last quarter.
Calculate the gross margin $ impact.

Call it 20% and about $2M gone.

Would your KPIs have told you why?
Is that a sales problem… or a system problem?

• Vendor price increases buried in inboxes
• Customer-specific discounts in a branch manager's head
• Cost updates lagging weeks behind
• Reps overriding because "it's faster"

These aren't sales problems. They're system problems.
We know these problems exist. We just don't measure them.

The Pricing Truth Stack

I call this the Pricing Truth Stack. This is where performance dies when process fails.

• At the top are outputs like margin by product and margin by customer dimensions.
• The middle is full of untracked process failures such as manual overrides, offline quote calculators, and trust-but-verify workflows. Each one is a silent leak.
• At the bottom are root causes like cost data maintained in disconnected spreadsheets across 12 branches.

The average distributor runs dozens of shadow pricing tools to compensate for system gaps. Each one is proof your actual system has failed. But each one also shows your team's creativity in serving customers despite the gaps.

This isn't about blame. It's about giving pricing leaders the ammunition to get the resources they need.

Start Here

If you want your margin to mean what the dashboard says it means, start here:

Measure

• % of quotes where cost data was less than 30 days old at the time of pricing
• % of orders that shipped without a rep touching the price
• % of vendor price changes live in the system within 48 hours of receipt
• % of customer-specific pricing rules documented in the system (not in someone's head)

If those numbers don't improve, you're not measuring margin.
You're measuring fiction.