Strategic meetings management makes sense
18 DECEMBER 2013 8:39 AM
Strategic meetings management is a tool that could lead to cost savings.
Editor’s note: This is the first column of a three-part series addressing strategic meetings management. The second part will explore the challenges of SMM programs, and the third part will discuss the global view.
In October I talked with Debi Scholar, travel and meeting industry thought leader on strategic meetings management, about my next topic for Hotel News Now. For me, the effectiveness of strategic meetings management became first choice because, while so much focus is on measuring the business of revenue per available room, data technology, real estate investment and profitability in a hotel, there is another side to the coin: the business of meeting management.
I invited Philip Eidsvold, account director at Aimia; Debi Scholar, management consultant, author, speaker and founder of SMM Benchmark and T&E Plus; Shimon Avish from Shimon Avish Consulting LLC; and Darell Stokes, strategic sourcing specialist for global meeting services, to talk about their defining roles and share their industry experience in SMM.
One thing I have learned from these interviews is that when it comes to SMM there are no two vantage points alike. It depends on the title and responsibility one holds, the company one works for and how one interprets SMM. As far as formal process and implementation are concerned, that’s a whole other story.
Meetings are going on everywhere all the time. We come to your hotel and take it over for a few days, eat your delicious food, go home and pay the bill.
In simpler times, an administrative assistant would be asked to find a hotel, contract it and make the arrangements. The only part anyone was really interested in choosing were the menus. Things have changed.
Where did SMM come from?
The first whitepaper on SMM was issued in 2004 by the Global Business Travel Association’s Groups and Meetings Committee, citing the need for accountability and a value-measuring business model for the meeting industry.
By GBTA’s industry standards, the definition of SMM is: “Strategic meetings management is a disciplined approach to managing enterprise-wide meeting and event activities, processes, suppliers and data in order to achieve measurable business objectives that align with an organization’s strategic goals/vision, and delivers value in the form of quantitative savings, risk mitigation, and service quality.”
SMM is not an industry-mandated policy. It is a voluntary, flexible and effective cost-savings management tool that just makes good sense. The degree of implementation and effectiveness is subject to what is best for the particular company and its culture. Some will say, “This is basic accounting; we have been doing this all along.” Others will see a bigger picture being tied together with eye-opening data.
“When some companies recognized the opportunity to save money on events and Sarbanes-Oxley started requiring stricter financial controls, a new management discipline called strategic meetings management was born,” Scholar said.
The SMM legacy seems to lead back to 1989 when Bristol-Myers merged with Squibb and Lynn Ridzon, global meetings management director at the time, identified the need to take meeting costs beyond being a mere expense to proving it to be a strategic role that defines, in business terms, the value of meeting management.
When I was technical director for an event management company in the ‘80s, we had to be responsible for the budget proposed to the client. SMM was inherent to being a supplier.
“The pharmaceutical industry has been very instrumental in driving the development of SMM programs. Between pharma codes, compliance, the mandated FDA Sunshine Act of 2007, accountability for the health care professional spend and reporting is required,” Eidsvold said. This information gathering can easily cross over to other important attendee data that relates to hotel charges and meeting spend.
Database technology companies began to automate meeting processes in the 1990s, including attendee registration and cost profit/loss per meeting. With the advent of excellent meeting database management platforms, such as Cvent and StarCite, capturing the information needed is relatively easy, especially when mobile apps came onto the scene.
Avish explained how these now accepted industry-wide databases, along with their inherent methodologies, helped bring SMM into what it is today.
“About 17 years ago (1996), there was a consolidation of travel management agencies that propelled attendees into using a single travel supplier. Before then, they were free to call any agency they chose and submit their receipts later,” he said. All attendee travel records could now be tracked under one source for hotel, air, travel and car rental, allowing for better control over meeting travel reservations. Costs became easily transparent and accessible.
“As this new model emerged, Fortune 500 companies began to look to agencies for business solutions for their procurement and travel departments, and companies such as American Express and Carlson Wagonlit Travel rose to meet the challenge and demand,” Avish said.
At the same time, the need for a disciplined approach and formal process was being recognized internally by corporations. While there have always been meeting planners who meticulously budgeted and accounted for their meeting costs, internal business units and brand managers were not necessarily focusing on that. As we learned from Donna Richardson, senior sales manager at Doral Arrowwood, in my previous article on contract negotiations: “It used to be that corporations did not look too carefully at contracts and would pay whatever the bill was.”
During the first decade of the new millennium, SMM began to take hold and really evolve.
“When I was the meetings director at (PricewaterhouseCoopers), I had a large team of internal planners that worked for me. The CFO wanted to know our total meeting and event spend, how much each business unit was spending on meetings, which business units and meeting sponsors were consciously trying to reduce costs, what risk exposure our firm may be exposed to, and of course, did we have the right number of resources to source and plan over 2,000 meetings each year that we had forecasted,” Scholar said.
“Whereas the meeting planners on my team were focused on delivering high quality events, my role was to provide a strategy, plan and reporting capabilities to oversee those 2,000 meetings,” she added.
Where to begin?
SMM is about containment of costs and proof of savings. But how do you do it? Where do you begin?
“To be clear, SMM is not for everyone. It should exist within the practical realm of your corporation,” said Stokes, who proved a $2-million savings for a leading hi-tech company in its first year of implementing an SMM program.
“A good SMM program gains control of unmanaged spend and risk. It should be about solidarity and standardization and following the same principles and technology,” Avish said.
Andria Goldin specializes in meeting marketing and hotel relationships. She provides collaborative, trusting partnerships with the corporate client in full meeting services and shared meeting knowledge training modules. Her specialty niche is marketing and managing a hotel renovation. Her Hotel Renovision™ programs are custom designed for the particular brand or boutique hotel. You can reach her at www.meetingknowledge.com or firstname.lastname@example.org.
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