Imagine you could save your company millions of dollars every year. That’s the savings large companies let fall through the cracks by under-leveraging their total meeting spend.
How to stop all the waste you’re probably wondering? The key is to think differently about an often-overlooked part of your total meeting spend – small meetings.
These are the more intimate, off-site gatherings your company has throughout the year for training employees, recruiting talent, clinching deals, celebrating team successes, etc. Individually, small meetings may get little notice. But taken together, they make up the biggest category of unmanaged spend, often comprising 70% – 80% of all meetings (Carlson Wagonlit 2017 Meetings and Events Forecast).
In many companies, planning these smaller events is a decentralized operation. Work is done on an ad hoc basis by executive assistants, managers and just about anyone else in the organization who has the need to call a meeting. With different departments and regions working in silos, data is scattered across the company, leaving travel professionals with a lack of visibility into the spend.
You don’t have to look far to know small meetings today are on the rise. Fully 91% of planners report their number of small meetings increased or stayed the same in 2016 compared to 2015, PCMA’s 2017 Meetings Market Survey found. Almost all planners (97%) expect to hold the same number of meetings or more this year over last.
Clearly, small meetings are big business. Leveraging this spend across all departments and regions can drive millions of dollars of savings for large companies. Here’s how you can gain control over spend in this large – and growing – slice of the group travel pie.
- Centralize data
Start by focusing on your biggest opportunities to reduce costs. According to the Global Business Travel Association, 80% of all meeting savings is realized during the venue sourcing process.
It’s tough to manage costs when you don’t know what employees are spending. That’s why online booking tools are crucial. Using sourcing technology, you capture data automatically and gain a comprehensive picture of your organization’s spend.
Find a solution that offers a simple and seamless user experience to ensure broad adoption, while also capturing and aggregating the data you need. Your platform should loop in executive assistants, sales staff and others with meeting arranger responsibilities. Plus, it should be easy enough for them to start using immediately. No training required.
The latest sourcing solutions do more than simply serve as RFP tools, which focus primarily on the venue search and bidding process. New platforms automate the entire booking path, including stakeholder communication, venue negotiations and contracting. As a result, they automatically capture 10x more data.
Automating the sourcing process also gives planner efficiency a boost. eRFPs have come a long way since they made their debut more than a decade ago. Today’s next-generation solutions cut sourcing time in half and generate responses in roughly one business day.
You get a bird’s eye view of each planner’s sourcing activity in real time. That means instant visibility into spend and savings – companywide as well as by user, department and division.
- Start adding it up
With a clear line of sight, successful travel and event leaders leverage their company’s total event volume to negotiate from a stronger position collectively than on an event-by-event basis. Here’s how you can use your company’s buying power to drive significant savings in venue negotiations.
- Analyze spend by brand. Look at hotel brands in active negotiations throughout your company. The data might show that you have dozens of meetings in the works with one brand. You can now go back to the brand and negotiate a better arrangement based on volume.
- Create standard concessions. To avoid leaving money on the table, a set of standard venue concessions is a must. Technology makes that easy. Some platforms even auto-populate company concessions, applying them universally to every RFP in the system. You’ll be amazed at what you can save.
- Check savings-to-spend ratios. Now, see what your company spends with each brand for every dollar it saves. Savings is the trickier part of the equation to handle. Start by seeing what your company saves through concessions. Then, open a dialogue with brands that don’t offer enough value. Shift share around to maximize brand leverage from the company’s total spend.
- Set compliance goals for your preferred brands. Develop a policy to ensure you can maximize buying power with preferred brands. No preferred brands? Pick the two brands you use most and work to get as much meeting volume to them as possible. This will help you tee up a conversation with them to get preferred pricing and possibly GSO/NSO representation
- Reduce Risk
Risks associated with meetings come in many forms. The stakes are especially high for companies with little knowledge of who’s planning and booking events. To mitigate risk, create a standard meetings management process and house all planner-related information in a single portal.
- Focus on duty of care. New solutions automatically aggregate all company meetings on a global calendar, including participants’ names, event dates, location and venue. In a crisis, you can instantly identify employees at risk.
- Create a core set of contract clauses and lock them into every RFP created in your platform. Make sure cancellation and attrition penalties are reasonable and applied consistently on each contract.
- Redeem canceled meeting penalties. Companies lose hundreds of thousands of dollars annually from meeting cancellations alone. Develop a cancelled meeting redemption process to recoup lost deposits.
- Share intelligence. Using a centralized platform, planners can share feedback on providers and easily flag those who put your company at risk.
As you can see, managing small meetings has a big impact.
Recent innovations make it easier than ever to gain visibility into this previously unmanaged spend. A step at a time is all you need. As you begin to track small meeting spend throughout the organization, your data will become more accurate and up-to-date, creating a virtuous circle: The smarter your company is about leveraging its data, the smarter the data it will have on hand to leverage.
Once you take the first step, you’ll quickly see you’re increasing planner efficiency, reducing risk and driving more savings companywide.
Written by: Mike Mason