Meeting planners must accept—and even embrace—the role played by their procurement departments if they are to survive the scrutiny of their CFOs. That was the consensus of the 100-plus attendees of the First Annual Trends Summit, held June 28 to 29 at the Mohegan Sun Resort & Casino, Uncasville, Conn.
"CFOs and CEOs are scrutinizing cost savings on all levels, but meetings have gone unscathed—so far. That is changing, and CFO scrutiny of meeting expenses will be the trend of 2004," according to keynoteEd Rigsbee, president of Rigsbee Research, Thousand Oaks, Calif. Sponsored by the Goodman Speakers Bureau, Mohegan Sun and Meeting & Conventions Magazine, the conference focused on the issues facing meeting planners.
According to research conducted in August 2003, only 32 percent of top executives think that the internal meeting planner role is essential to developing and executing successful meetings that are important to the company. In other words, Rigsbee said, "Sixty-eight percent think meeting planners are not important."
Given these trends and attitudes, consolidation of the various meeting activities is inevitable, as is the involvement of a procurement department. These trends are savings-driven and technology-enabled. Rigsbee advised planners to learn from the top-flight practitioners of procurement. "Think of Wal-Mart, where the goal is to drive cost out of the supply chain." Ultimately, Rigsbee said, meeting planners will have to learn how to work with procurement—beginning with an understanding that "it’s more important to get things done than to be right." In other words, former assumptions and procedures may get jettisoned under the new regime—and that may not be a bad thing.
After a ceremonial smoke blessing by Mohegan Tribal Pipe Carrier Two Dogs, who called for an amicable and productive meeting, Summit attendees heard research findings and case studies presented by planning and procurement experts. All argued for the acceptance of procurement partners within the organization.
"Over the past 10 years, the role of procurement has increased dramatically. With strategic procurement, an approach has evolved that has broad buy-in, mostly because of its problem-solving aspects," said Dick Zeller, vice president-consolidated business solutions, Maritz McGettigan, Philadelphia. "Measuring the value to the organization had been lacking, and it [strategic procurement] has helped this change by raising the level of discipline. Meeting groups tend to think more tactically; procurement groups help them to apply the discipline to think more strategically."
Panelists were asked by moderator Scott Shuster, former editorial director for Business Week, to discuss how they prove the value of meetings to their organizations; specifically, he asked how and what they measure.
"Financial benchmarks are relatively easy to establish and track," Zeller responded, but he cautioned, "If you are tracking savings, apply methodology that is consistent across the organization." Measuring service is less straightforward, he admitted. "We’ve developed a scorecard that we use when surveying our customers. As a service provider, this is hugely important to us. The scorecard helps us to identify and address problem areas.
Cost must be weighed against value, said Mike McMahon, chief procurement officer, Deloitte Touche, Wilton, Conn. "We’re seeing more sophisticated companies look at bothand off-shoring the meeting planning function, taking it out of the internal planning setting. Any activity that is technology driven—for example, registration—could be off-shored."
Deloitte Touche spends some $400 million on travel each year, McMahon said, "And that has had procurement’s attention for some time, long before meetings did." Now that meetings are getting a closer look, he said, benefits are multiplying. "Let’s not lose sight of the fact that strategic procurement also makes life significantly easier for suppliers to large sprawling organizations like ours."
Kathy Deland, associate director of event and conference planning for MassMutual, Springfield, Mass., finds other benefits closer to home. "We’re fortunate that at MassMutual, the procurement group actually helps us to do our jobs better."
According to Deland, when she was told to begin working with the procurement department, she proactively invited her counterparts to a crash course in meeting planning. "We spent six weeks teaching the procurement folks about what we do—and they were like deer in the headlights! At the end of six weeks, they told us in no uncertain terms that they didn’t want to do our jobs. We’ve progressed from there. We have a great relationship."