Meetings can cost an organisation millions of pounds. While the way companies book air travel or accommodation has been scrutinised closely to cap spending, monitoring outgoings on actual meetings is taking a little longer.
“Three or four years ago, most of the companies we worked with would admit that they did not know what their meetings spend was and could easily be 50 per cent out when putting a figure against it,” says Des McLaughlin, managing director at meetings agency Grass Roots HBI.
Fay Sharpe, managing director of venue finding and events company Zibrant, agrees. “Meetings spend is a maverick area and not easily controlled because there are so many people in a business who plan meetings, so budgets are held in different pockets around a company,” she says.
Strategic Meetings Management (SMM) first emerged about a decade ago. Put simply, it is about having an organised and structured way of booking meetings. It was pioneered by companies with large sales forces and multiple product lines, often those from the pharmaceutical and technology industries, which necessitated more frequent or large-scale meetings.
Compliance to regulatory laws and guidelines, particularly for the pharmaceutical industry, led to demand for more auditable meeting processes. And SMM has picked up momentum in the wake of the recession, as the driving force behind its implementation is often the need to cut costs. Procurement departments are increasingly more involved in the process of controlling meetings expenditure.
“The main reason a company develops an SMM programme is to create savings,” says Mr McLaughlin. “If a company is spending in excess of £2 million on meetings, for example, then it should be looking to save 30 per cent by putting an SMM plan in place.”
SMM programmes require a company to collect data on meetings and events spending by registering it through a centralised system or individual. Instant reductions in costs can be made by consolidating suppliers, while a preferred venues list can mean that a company is less likely to be exposed to financial risk because it is able to negotiate volume discounts and more favourable contract terms.
Put simply, it is about having an organised and structured way of booking meetings
Following an SMM policy also allows companies to communicate guidelines employees must follow in terms of brand image. Zibrant’s Ms Sharpe says that this is of particular concern for companies in the financial sector at present. She adds that in sectors, such as oil and gas, health and safety is another reason for developing an SMM programme as it means companies can monitor where employees are travelling.
SMM is not without its challenges. One issue can be around compliance, with some employees who are charged with planning meetings reluctant to work with centralised booking processes. Ms Sharpe also says there has to be a consideration for the culture of an organisation and recommends that those tasked with streamlining a global business’s meetings spending start on home turf to be able to demonstrate the immediate benefits.
For companies that hold one-off creative events, such as car companies staging product launches, then working with preferred venues and suppliers might not be appropriate. But the framework of an SMM programme still ensures companies are considering the reasons for staging events more carefully.
“Central to SMM is knowing what drives the business. Without this approach, most people do not spend the time trying to understand what it is they want to achieve. SMM starts by asking the why, rather than the how,” says James Wilkins, managing director at communications agency Logistik, which organises events for clients including Marks & Spencer, Lloyds Banking Group and the Post Office.
The term SMM is often used inappropriately to refer to the strategic delivery of meetings and events, rather than the company-wide processes and standards that mitigate risk and result in cost-savings. And, although SMM will result in more careful consideration of what the company wants the outcome of a meeting to be, measurements relating to SMM policies will be linked to the delivery of the event, not the impact of the meeting.
Providing you have commitment from senior management and end-users, SMM should give a very good idea of w hat a company is spending and saving. “Companies that have an SMM policy in place will know exactly what they are spending on the hotel or venue, which accounts for about 60 per cent of the meeting cost,” says Mr McLaughlin. “What they might not know is the exact spend on auxiliary services, such as flowers, speakers or AV . That’s the next step for SMM.”