Need help getting started? Author Kevin Iwamoto is leading a session, "Take the First Step to Managing Your Meeting Spend," at 2:30 p.m., June 29, 2022, at the Business Travel Show Europe
Meetings activity is surging across the United States, but the associated budgets and spend are quite possibly under greater scrutiny than ever, with intensified pressure to demonstrate value. Following the recent extended period of time in which companies saved money by not traveling and gathering, it is imperative that meeting professionals are prepared to account for all spend and show a solid return on investment.
What's more, meeting volumes have jumped significantly since the start of 2022. And one of the most urgent situational challenges, which we discussed this week at the Business Travel News Strategic Meetings Summit in New York City, is that company executives have made a decision to not rehire to prepandemic levels of staff nor outsourced help. This poses a real dilemma for travel and meeting buyers who are facing increasing demand but are handicapped by the inability to hire, either internally or externally.
Based on feedback from attendees at the Strategic Meetings Summit, meeting and travel buyers are looking at technology options, hiring a smaller number of outsourced support personnel, or doing a combination of both.
All of this makes for a perfect storm of challenges, and it's a good reason for leaders to revisit their strategic meetings management programs. If you weren't engaging in the practice before, now may be the perfect opportunity to begin. Here's a primer on the basics of strategic meetings management — what it is and what it isn't. I think you'll see why the arguments we made for the practice 18 years ago remain extremely relevant today.
Origins of Strategic Meetings Management
When the groups and meetings committee at the National Business Travel Association (now the Global Business Travel Association) created the term strategic meetings management in 2004, it was in large part a response to the confusing numbers we were seeing in our own periphery.
At the time, I was senior global travel commodity manager at Hewlett-Packard and NTBA's president and CEO. Many of our members were telling me that they had meetings added to their travel portfolio but they didn't have experience with nor knowledge of this category. So I created the meetings committee and tasked them with producing a white paper on the need to establish an enterprise governance model for meetings and events oversight.
In those days, it was incredibly common to hear "we don't spend anything on meetings." Compared to a $5 billion acquisition, sure, I agreed with that mindset — meetings and travel were a drop in the bucket. But when I stacked meeting costs up against rank-and-file procurement expenses, the pain was much more evident.
Companies were dumping millions into meetings, and the paper trail was flimsy at best. Event agencies were subsidizing phantom vendor expenses with hidden commissions, and clients (big corporations) were seemingly getting billed zero. CFOs and CPOs weren’t seeing the loss at all. They were just assuming their companies weren’t having many meetings, or they weren’t having expensive meetings, at least.
We needed governance and accountability. And that would mean a sea change for a lot of people in the industry.
What SMM has become since then is bigger — much bigger — and it continues to evolve. I’ve devoted much of my work life to SMM, not only as a marketable framework, but as a credo I instill in my own teams. As much as the meetings industry has changed, I stand by the core tenets of SMM — and I've seen its impact, not only on the bottom line but on finance and spending transparency industrywide.
What Exactly Is Strategic Meetings Management?
According to the original definition established by the GBTA groups and meetings committee, strategic meetings management is the management of enterprise-wide meeting-related processes, standards, volume, spending, suppliers and data to achieve measurable business objectives that align with the organization's strategic goals or vision and deliver value in the form of risk mitigation, quantitative savings and service quality.
Yes, it is a mouthful, and yes, that makes it seem complicated. But it's a good practice to keep that full definition in mind, as a reminder that SMM is a process and a framework for a full meetings program — and not simply taking a strategic approach to planning a meeting.
How Much Is Spent on Conferences and Meetings?
The average cost of a conference can be as high as 5 percent of annual sales, 25 to 30 percent of total T&E spend and 60 percent of air volume — that’s 3 percent of revenue, and that’s a huge number for enterprise corporations.
If your books are telling you something different, your organization could be unwittingly hiding meeting costs. If I were to talk to your people (the meeting and event mavens), I would ask them about average meeting costs and automation tools. If the question stumps them, that’s where I would start. Processes built around those two things are key in reducing unnecessary expenses.
What Is the Purpose of SMM?
SMM is the management of all meeting-related processes — not the actual meetings themselves.
We know planning teams work in silos without comprehensive event management, with limited visibility into meeting activity throughout the company. The procurement process becomes inefficient as a result of this. Event planners spend hours, if not days, redoing the work of their peers. For instance, you might be sourcing hotels and vendors without realizing that a coworker has just arranged a successful event in the same market and has lists of all the best venues and service providers.
You also risk missing out on savings because of a lack of spending transparency. In reality, this remains one of the largest categories of unmanaged spending for many businesses, as they do not have visibility into small or simple meetings or they simply don't include meetings spend at all at the enterprise level.
The absence of meetings management protocols can expose companies to multiple risks, including security breaches, lawsuits, and high attrition and cancellation fees.
Who are the SMM Program Stakeholders?
The management, planning and execution of events continues to be a complex process. The concept and governance model involves internal stakeholders (decision makers, managers, etc.) and external parties (event planning industry specialists). And those parties have different agendas — meaning they handle money, theirs and yours, differently. An SMM program, in its purest state, is created to align the interests of both internal and external stakeholders, while also taking into account regulatory compliance, cost and risk mitigation.
A meetings program often consists of four primary roles:
- Event planning and management
Event management and planning is one of the most basic and well-known applications of an SMM platform. An SMM program assists firms in planning a variety of activities, from meeting scope to hotel and flight bookings.
- Bringing diverse elements together
A meeting is made up of many people who are involved in the planning and implementation of the event. A corporation can use the SMM program to synchronize and connect these many partners by optimizing the resource procurement process. For example, a venue-sourcing tool, which is included with SMM packages, may be used to issue requests for proposal, which can aid with the quick sourcing of items like travel and lodging.
- Maintaining a financial checklist
One crucial benefit of an SMM program is that it helps people manage budgets. With an SMM program in place, an organization's decision-makers can know ahead of time how much an event or meeting will cost, helping them to determine which components to either add or eliminate.
- Risk Management
Strategic meetings management programs also tend to assist firms in mitigating risks, as I alluded to earlier. It helps keep track of contractual responsibilities to suppliers and vendors. They also help with schedule conflicts and event attendance.
What Are the Tangible Benefits of SMM?
Many of the benefits of SMM correlate closely with the functions or roles I mentioned earlier. Think of these as good talking points for any detractors.
- SMM increases your spending visibility
An efficient SMM program will give you more visibility and transparency into the costs associated with holding meetings, from an executive retreat to a global company conference. In general, with SMM the organization's stakeholders have access to consolidated spending information to see what a specific department is spending or where their funds are going.
- SMM can make compliance easier
All events must be compliant with both internal and external policies. Internal policies are company-specific rules established by company stakeholders, and they might range from the maximum budget allotted to the frequency of such meetings. External policies are specific rules for a sector, such as the United States Corrupt Practices Act or pharmaceutical industry compliance codes. Because SMM is integrated and transparent, it helps you to follow these regulations at all times, reducing the odds of hitting a compliance barrier.
- SMM helps mitigate risk
Having a strategic meetings management program allows you to effectively store and record all contractual responsibilities, permits and authorizations in a single central database, making it easier to access and analyze each commitment you have — reducing the chance of late or missed payments, as well as defiance of legislation.
- SMM can improve productivity and data quality
An SMM program can streamline processes by putting all necessary procedures of enterprise meeting management, such as procurement and proposal, transportation and selection, accommodation and approval, and so on, under one umbrella. This decreases reaction time, which increases productivity.
SMM automation saves analytics in a single central database, allowing it to detect and eliminate duplicates. That's called data hygiene, and your numbers people will love it.
- SMM leads to higher return on engagement
More immediately, SMM makes it simple for companies to get the best ROE by streamlining all strategic management procedures and minimizing the costs connected with them — ultimately boosting total company profitability.
How Do I Get Executive Buy-In for an SMMP?
As with all things, there’s a right way and a wrong way to advocate for (and implement) SMM at your company. Here are some approaches I’ve seen work in the past.
- Be open and honest
Make sure all of the information you discuss, both good and bad, is clear and straightforward. Lack of transparency is at the root of any problem you're trying to solve by implementing this.
- Be concise
The value and impact of SMM should be very clear. Estimate ROI and prepare answers for those tricky change-management questions that will inevitably come up. Keep the discussion on point, always focusing on the value of the proposal.
- Stay on task
It's common to develop ideas or solutions to unrelated problems during an SMM pitch. Other company weaknesses often come to light in these discussions. Make sure you politely "put a pin" in those gripes and validate the importance of those issues without losing sight of SMM objectives.
- Seek advice
Listen to every stakeholder: Inclusive agendas gain more momentum. If you seek direct feedback or ideas from specific attendees before you have the big talk, it will ensure everyone is heard and that all thoughts are expressed. Not everyone wants to go to the party, but they hate it when they aren’t invited.
What Does the Future Hold for SMM?
We’ve always considered SMM to be a perpetual work in progress. I’m confident that the key benefits of the program will remain even as the model continues to evolve.
- SMM will continue to take the guesswork out of preparing for events. Stringent role definitions spell out precisely what each planner is responsible for and how they should prepare.
- SMM processes give companies a leg up when it comes to ethics and reputation. The newest members of our workforce are known for being more values-driven, and they see accounting transparency as a critical attribute when they are job-hunting.
- SMM will keep meeting expenses under control and set a foundation of mutual trust. With SMM, management understands spending limitations, and executives ultimately know how much they can expect to pay for meetings of any size.
If you've worked with a strategic meetings management program in the past, or if you've already been employing key elements, there's no need to reinvent the wheel; just keep your eye on the wheel as it turns. The SMM framework can surely be adapted to address your current challenges. And if your company is having trouble tracking meeting and event costs, now is the time to invest in a good SMM platform and to put these practices in place.
The GBTA Academy offers the Fundamentals of Strategic Meetings Management course, a program with six modules that includes three 2-hour live sessions with an instructor. The course, which is $450 for members and $550 for nonmembers, will next be held October 14, 21 and 28, 2022. The deadline to register is Oct. 6.
Kevin Iwamoto is chief customer officer at Bizly and an expert in strategic meetings management, corporate travel, procurement and GDPR compliance. He was one of the creators and original pioneers of strategic meetings management as a business practice, which was developed while he was president and CEO of the board of directors for the National Business Travel Association, now called the Global Business Travel Association. He is the editor of Strategic Meetings Management Handbook: From Theory to Practice, and he continues to write on the topic. This piece is based on a longer reference article he wrote earlier this year.