Managing small get-togethers can pose big challenges for corporations – but solutions are close at hand.
Who would have thought that planning a simple meeting of 10 to 50 people could be so complicated? It’s counterintuitive to say the least, yet the reality is that most simple meetings fly under the radar and end up being a significant part of a company’s unmanaged spend.
Meetings account for a noteworthy portion of the travel manager’s budget: a study by the US Travel Association found that of the $225 billion spent in the US domestic travel industry, 57 percent was for general business travel, and the remaining 43 percent was attributed to meetings. It also stated that:
• 1-3 percent of a company’s total revenue is spent on meetings & events
• 25-30 percent of total T&E spend
• 60-120 percent of corporate air volume
• half to one percent of annual gross sales
“Today, meetings in general are the largest area of unmanaged spend in a corporation,” notes Charles de Gaspe Beaubien, president and CEO of Groupize, a leader in the simple meetings and events space, located in Beverly, MA.
“The industry has struggled to get this under control because we applied SMMP processes (strategic meetings management – a top down approach) that were over engineered using legacy technology to try and fix simpler-use cases. The changing times in corporate travel dictate the need for modern technologies that offer a more up to date value proposition for the occasional planners and today’s stakeholders. Applying the same broken workflows that are used for complex meetings to simple meetings is a recipe for failure,” he says.Simple or Small?
Meetings can come in all forms, shapes and sizes. “You could have a small training for one day for 12 people that needs little to no assistance to plan or an executive retreat for 12 that requires a high-touch managed process,” says Shauna Whitehead, vice president, global account management at BCD Meetings & Event in Minneapolis. “You can’t count on numbers alone to classify this space. You need a combination of spend, numbers and profile of audience.”
“Simple meetings are not defined by size, but by complexity,” echoes Groupize’s de Gaspe Beaubien. “They represent 60 to 80 percent of the meetings in a corporation. They go well above and beyond 10 to 50 attendees, depending on the department and the corporation. Our solutions manage meetings of 3 to 2,000 people. Most simple meetings are still done via the phone, and 77 percent use the OTAs to do their preliminary site selection. Corporations do not provide efficient tools for their occasional planners – trainings, admins, recruiting, how to connect with hotels and promote their preferred programs. There is zero visibility into the process if the occasional planners don’t use any solutions.”Hidden Spend
“Unfortunately, there are still many organizations that don’t feel it’s worth the investment to put effort or resources against meetings as a category of spend,” states BCD’s Whitehead. “Its likely executives don’t even know these meetings are happening as the spend may not be large enough to hit their radar, hence there is no policy designed for people to follow, which leads to inconsistency around how and where these are sourced and managed,” she explains.
In addition, what can confuse executives who don’t “see” the spend on meetings is that this small meetings business may fall into that gray area of activity that sits between travel and meetings, and is therefore difficult to distinguish. Hidden costs can also show up as “marketing “or “training” dollars, or be masked under the predefined spend categories that each department manages. Furthermore, travel and procurement are likely unable to use this added supplier spend data to leverage current or new preferred agreements – hence losing the opportunity for enhanced savings/contract terms.
Today, small meetings fall under a category of spend that needs a new approach, according to Tony Wagner, VP of CWT M&E for the Americas and South Pacific Region, in Minneapolis. “Companies which are primarily decentralized in structure are having the toughest time getting enough visibility into their spend. Our call to action is to help them put together a meetings program by providing them the education, tools and skills to do so,” he explains.
“Determining the right level of spend threshold on these types of meetings to protect organizational risk is a good start,” says BCD’s Whitehead. “We typically see thresholds around the $10,000 mark and/or with a set amount of sleeping rooms attached.” Gaining visibility into spend can help turn small meetings into a more manageable arena because it provides data.Skill Set Gaps
The overwhelmed travel manager or the underexperienced admin is often contributing to the chaos. “Smaller meetings are often booked through nonprofessional channels, such as through a program manager who may have a different skill set and may not be as familiar with industry best practices. The result is typically a lack of centralization and coordination,” observes Olivia Nguyen, manager of corporate travel at Cvent in Tysons Corner, VA, a cloud-based enterprise event management platform.
“Office managers may not realize they have to adhere to any rules for a meeting of ‘only’ 10 people and can easily fall into noncompliance. Smaller meetings are harder for nonprofessional planners to leverage, as they are more concerned with details such as the agenda of the meeting and aren’t thinking about some of the more large-scale items such as contracts, penalties, catering, safety and risk management or even AV,” she adds.
Brand risk is also a factor. Today, meetings are a great opportunity to promote an employer’s brand, but often, admins aren’t trained to represent that brand properly. This skill set gap can lead to lost opportunity. “There can be leakage to preferred properties or chains if there is no structure or policy around these types of meetings, because the booker will go with his or her personal preference – with little to no consideration for company agreements or commitments to their supply chain,” Whitehead cautions.Marketplace Madness
While the problems of unmanaged spend, brand and contractual risk, and a lack of experience of the occasional planner are a big part of what makes small difficult to manage, they are by no means the end of the list. Other complexities that plague this category range from source selection to data management.
The first area of concern is negotiations. According to de Gaspe Beaubien, a recent survey found fewer than one-third (30 percent) of respondents followed a required bidding process for simple meetings. These lax policies may prevent companies from making the rigorous comparisons needed to realize the full benefits of a managed meetings program, such as better discounts, improved duty of care and compliance with internal policies.
When sourcing simple meetings, only one out of five (22 percent) respondents used an e-RFP platform, which allows them to solicit and compare bids for their meetings. When respondents use an e-RFP tool, an overwhelming majority (72 percent) say it is their preferred method of submitting RFPs for simple meetings.
Whitehead agrees. “Missed negotiations are also a risk during contracting if simple meeting spend is not managed appropriately,” she warns. “By partnering with a specialized third party, negotiation best practice benchmarks can be shared and leveraged, and savings tracked to show value back to the organization. Similarly, best practice concessions and standard contract inclusions such as comped WiFi, F&B discounts and non-competitor clauses form can be part of the standard transaction.”
If negotiations are weak, it is likely that weakness spills over into the contracts. “So many admins sign contracts they aren’t entitled to and ultimately pay the price for their cancellations for anywhere from $25,000 to $200,000 attrition penalties,” says Groupize’s de Gaspe Beaubien.
Another area is performance measurement. Managing spend is only one component of a successful meetings program. It is important to focus on additional metrics such as attendee satisfaction and efficiency of internal processes, which can have a significant long-term impact on a company’s bottom line. According to Groupize, almost three-quarters (72 percent) of their survey respondents do not have key performance indicators to measure the success of simple meetings.Transient vs. Group
Compared to typical transient travel, meetings are a different animal. In terms of spend, duty of care, contracting and data management, this category is typically much more complicated, even though both activities often use many of the same providers.
“The convergence of transient travel into simple meetings, alongside simplification of technology that was built in 1990’s, is upon us,” says de Gaspe Beaubien. “The future will be the ability to book meeting space in real time, but the opportunity at hand is to merge transient rates and meetings rates in a hotel – providing full visibility into a program so the travel manager can consolidate buying power,” he notes.
“Transient travel is more transactional in nature; e.g. booking an airplane ticket or hotel room,” says Whitehead, adding, “Meetings are more emotive, because organizers have a stake in how well that meeting pulls up, and each meeting holds value for different items, some tangible like free WiFi or comped meeting rooms, others less tangible such as the attendee experience.
”Managing transient travel is a more mature discipline as well, Whitehead notes. “It’s a lot easier to track transient activity as this is seen as an essential component to organization’s procurement and as such, structure to track and manage has been in place for many years. Meetings is still a growing commodity, hence has a more limited and less mature structure still in many organizations.”
And of course, in today’s unpredictable times, duty of care has become a huge driver for adopting new ways of managing small meetings. As CWT’s Wagner notes, “It’s worrying that people can hold a meeting and/or sponsor a meeting with external attendees, with no integration into their own duty of care system. For small meetings, this becomes difficult when attendees – especially external guests – book hotels on their own or attendee data isn’t feeding into a central system,” he explains.
“For example, in many recent troubling terror or mass shooting events, many companies knew the whereabouts of their transient travelers but didn’t know who was traveling locally for meetings or ancillary activities. This information should be captured via the meetings/events registration processes, but isn’t always,” warns Wagner.Game Changers
In the small meeting space, technology is the key to the future. According to Cvent’s Nguyen, “The meetings industry is booming as we leverage more technology and interfacing, and with more touchpoints with our customers which makes it a highly personal experience. We will see more disruptors and competitors in this space that help enhance the user experience. We will also see more out of the box meeting spaces/retreat spaces, as opposed to traditional hotels.”
Wagner agrees. “Technology is the game changer. There is not a single technology that’s scalable today which allows meeting planners to book large volumes at hotels – in other words, there is a gap in developing live inventory links. We believe that in the next 12 to 18 months tech solutions will fix the gap, integration will occur, allowing us to search inventory, seal a contract, send out invitations to attendees (who then can accept or decline), all in one seamless process.”
Small meetings pose no small problems. As travel management practices change, so do small meetings and events, and a strong change management strategy may be required for the future.
The number of people involved in booking small meetings can be huge and may include executive assistants, travel managers, or may be a "side desk" responsibility for those in marketing, sales, and HR. As Whitehead sees it, when it comes to the critical tasks of meetings negotiations, contracting and spend, it’s easy for these activities to fall into unstructured categories.
“Internal folks who currently book and manage meetings may enjoy this part of their role and feel threatened that their relationships with venues may be encroached upon,” Whitehead notes. “A self-service tool can allow them to keep this part of their role while also allowing activity to be managed and tracked through appropriate organizational ‘guidelines.’ This will enable a better compliance to the meetings policy, visibility to spend and business analytics, and remove some of the barriers to following the most optimal process.”