Managing Meetings At: Procter & Gamble Co.

<B> Managing Meetings At: Procter & Gamble Co.</B>
<I>P&G Outsources Its Program</I>

By Chris Davis

Faced with a rapid increase in its internal meetings, the pharmaceutical division of Procter & Gamble Co. mulled the possibility of adding several planners to its group travel department--and instead decided to outsource and consolidate its meeting spending with McGettigan Partners of Philadelphia.

Where the three-person meeting department headed by Marybeth Roberts, operations manager of scientific events and conventions, once planned about 500 meetings a year, that number has climbed at the rate of 30 percent a year for the past four years. To keep the program entirely in-house, the department would have needed to at least double--and training newcomers would just have added to the burden.

Roberts recommended to her supervisor, the director of pharmaceutical and scientific relations, that the company consolidate and outsource all meetings. "I documented how many additional people we would need and how unrealistic it would be to double our staff and train all of those people internally," she said. "I also talked about the cost savings we could realize."

To handle the business, McGettigan created an onsite office staffed with three employees at the division's Mason, Ohio, headquarters, and is using the CORE Discovery software system to capture and report meeting data. The pharmaceutical division expects the consolidation to reduce its annual meeting spend by 15 to 19 percent.

The fact that the division's meetings program already was highly centralized, and that Roberts' department already was compiling spending data after every meeting, made it possible to realistically estimate the savings that consolidation could achieve. Senior management agreed with her assessment and approved the plan.

Internal meeting sponsors, whose attendees usually include both employees and outside scientists, have not seen any dramatic changes in their day-to-day dealings with the group travel department. That's because Roberts has encouraged a centralized structure in her 16 years at Procter & Gamble.

"We probably handled a little more than 90 percent of their meetings," she said. "There is no mandate that they come to us, but they know me and like the services our department has to offer. If I hear of an internal client going to an outside group, I tell them that we do this kind of thing and we can save them a lot of money."

The primary difference now is that internal clients see charges for McGettigan's services on their bill. But Roberts eased the transition by approaching her largest clients in advance of the consolidation to explain its benefits.

"We told them that the bottom line is they'll make out better financially," she said. "We showed them documentation of how much we think we can save them, and now that we've been through a couple of months we are able to give actual amounts of what we saved. They're doing well."

Roberts' department continues to survey both internal clients and external attendees to monitor the program. Also under scrutiny are the cost savings, though Roberts said her department does not have a specific dollar benchmark in mind. "There are not specific goals, but we want to make sure we aren't spending more than we're saving," she said.

Beth Truett, senior vice president of McGettigan's Midwest Customer Business Unit, said the division's food and beverage expenditures are projected to decline 22 percent in 1999. And since McGettigan's hotel program will combine P&G's volume with that of other customers to decrease costs, hotel spending is expected to decrease 16 to 24 percent. "We have internal benchmarks in all these areas, and that will lead to more leverage for the division in negotiations," she said.

P&G's pharmaceutical division was a good candidate for consolidation because it often holds meetings with similar programs and purposes around the globe. "They'll hold the same meeting in San Francisco, Chicago, Oslo and Lisbon," Truett said. "The leaders of the meetings change, as do some objectives, but because they were able to be categorized by type into predictable segments, they have more leverage than if they negotiated their meetings on a one-to-one basis."

For McGettigan, winning the division's account gives it a hat trick of major pharmaceutical contracts over the past three years, following deals with Eli Lilly & Co. of Indianapolis (<I>Meetings Today,</I> Feb. 23, 1998) and Bayer Corp.'s West Haven, Conn.-based pharmaceutical division last June.

"Pharmaceutical companies are good candidates for consolidation because there's a good opportunity for leverage," Truett said. "It's a very competitive industry, they have large sales forces that hold a large number of meetings, and they're looking for ways to redirect money into research and development without cutting staff or meetings.