What is product hierarchy in SAP CA-FS-PO - Price Optimization for Banking?

SAP Term: product hierarchy

• Component: CA-FS-PO

• Component Name: Price Optimization for Banking

• Description: The organization of all products and their characteristics according to how a business organizes its pricing segments.Indicates which groups of products exhibit similar demand behavior and cannibalistic behavior.

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• Key Concepts: 
  Product hierarchy is a feature of the SAP CA-FS-PO Price Optimization for Banking component. It allows users to create a hierarchical structure of products and services, which can be used to define pricing strategies and optimize pricing decisions. The product hierarchy is composed of nodes, which represent different levels of the hierarchy, and edges, which connect the nodes. 
  
  How to use it: 
  The product hierarchy can be used to define pricing strategies for different products and services. For example, a user can create a hierarchy of products and services that are related to each other, such as different types of loans or different types of insurance policies. The user can then define pricing strategies for each node in the hierarchy, such as discounts or special offers. 
  
  Tips & Tricks: 
  When creating a product hierarchy, it is important to consider the relationships between the different nodes in the hierarchy. For example, if one node represents a type of loan and another node represents a type of insurance policy, it may be beneficial to link them together in order to create a more comprehensive pricing strategy. 
  
  Related Information: 
  The product hierarchy feature is part of the SAP CA-FS-PO Price Optimization for Banking component. This component also includes features such as price optimization algorithms and analytics tools that can be used to analyze pricing data and make informed decisions about pricing strategies.