Corporations are most likely to approach a travel or meetings management company over independent planners or technology providers for help managing their meetings, according to an exclusive Meetings Monitor survey of 186 corporate meeting buyers. Buyers said they often take a hybrid approach to outsourcing, employing key internal staffers to oversee the initiative and using a third party to handle logistical details or negotiations.
According to the survey, 23 percent of respondents said they typically use a travel management company for meetings management, 13 percent of buyers said they partner with a destination management company and 17 percent use an independent meetings management company or individual planner.
The majority of respondents, 60 percent, said the extent to which their companies outsource meeting planning has remained constant during the past two years and 12 percent said outsourcing was on the rise. However, 23 percent of respondents said their companies used external meeting planning providers "much less" last year compared to 2004.
High-tech switch manufacturer Extreme Networks Inc. dramatically has reduced its use of external planners since adopting a meetings management technology tool, said Nancy Garner, global travel procurement manager for the Santa Clara, Calif.-based company.
Before adopting the DirectMeetings tool from Sabre's GetThere, Extreme Networks heavily used third parties but now only uses external planners twice each year for large incentive events provided by St. Louis-based meetings management company Maritz Travel. The external planners focus on negotiating with suppliers, while time-consuming logistical tasks are handled internally through the technology.
"It saves us quite a bit with the meeting tool because now all I do with the meeting planners is make sure they are getting the best costs," Garner said. External planners receive a percentage of the deals they secure in negotiations. "We're a midsize company, but you need somebody with the name recognition out there that has the alliance with the hotels," Garner said.
Garner oversees the meetings tool, which also allows her to monitor the work of external planners and ensure tasks are handled in a timely way. "We just hire them when we need them. We don't have to have a crew of people working here," Garner said.
According to the survey, the most frequent meeting planning tasks that are outsourced were onsite staffing and housing and registration services
Pamela Wynne, manager of corporate meeting planning for Princeton, N.J.-based Educational Testing Service, said the determination of which meeting planning functions to outsource depends on the company's culture.
"You need to determine what are your core competencies and focus on those," Wynne said. "For example, if you're in strategic sourcing, and strategic sourcing is your core competency but you don't have the time or staff to do onsite logistics, there are companies out there that are experts in onsite logistics."
Other factors in evaluating whether to outsource are financial, she said.
"You need to look at where the funding is coming from, how much is it going to cost, is it going to be more cost effective to outsource or more cost-effective to keep in-house and do you have experts that can do that job," Wynne said.
Much of the growth in outsourcing is among multinational companies that are looking for partnerships as they roll out global meeting policies and procedures, said Peter Moen, vice president of business development for Minneapolis-based Carlson Marketing Group.
"People are not afraid of going global anymore," Moen said. "They didn't think that it was possible before, or thought it was too much to bite off."
More customers are now asking for assistance in standardizing meetings management processes and technology across all company operations, he said. Carlson is seeing international growth both from existing clients as well as brand-new clients seeking a partner as they role out a multinational meetings program.
"They might have had regional preferences before and now they realize they need to get more of a global strategy to leverage spend and technology," he said.
Very few companies have a true "global" program though, as budgeting and policy is decided regionally. Carlson has opened more international offices to match their clients' growth, to better partner with regional managers. Europe, Asia and Latin America are hotspots for growth, CMG's Moen said.
Just as multinational corporations have begun to gain control over taking their meetings management policies overseas, the whole idea of outsourcing has evolved during the past three years.
"A couple years ago, there was a fear that consolidation or enterprise meetings management meant outsourcing," Moen said. "That prevented some of the potential progress."
Consolidation or strategic meetings management does not necessarily lead to outsourcing, he said. Drafting policies, building compliance and adopting new processes for meetings management are much more important.
"Today, I think the industry's matured so that people realize it's always going to be a hybrid. There's always some division, department or someone with internal expertise that is already there. At the same time, you need some enterprise leadership to help drive the solution globally," Moen said.
Companies also may outsource based on what type of event is planned. Some companies outsource management of small, ad hoc meetings, while others use outside planners for large conferences and events, he said.
"No matter what, it's usually a combination of insource and outsource to make it a fully comprehensive solution," Moen said.
It's when companies only adopt half a solution that they run into problems, Moen said. No matter what kind of meetings are outsourced, there should be a management process in place for all events.
When choosing a third-party meetings management provider, all companies need to ensure that their partner understands company culture and overall strategic goals, Moen said. CMG has had to be proactive on this front, as some customers may not realize exactly how important company culture is to a meetings management process.
"We absolutely have to take the initiative. It's normally something that's a concern for companies, but we recognize it as imperative for business success," Moen said.
The key value of in-house meetings experts is their familiarity with company culture, he added.
"We prefer having someone internally in the company that really owns this initiative, drives the strategy and drives the implementation. We provide our advice and expertise based on the experience we have, but it has to be customized," Moen said.
Angelo Rossi, group vice president of U.S. sales and customer care for New York-based Avon Products Inc.
(Meetings Today, March 6), said his company prefers a hybrid approach to outsourcing meetings management. Previously, the company has trained existing employees on meetings management, Rossi said, but now Avon is looking to train a meetings expert on company culture and goals.
Planners who focus on execution of meeting logistics are "a dime a dozen" Rossi said, but Avon wants strategists that are "prolific" with ideas on how to manage the program better. The expectations for meeting planners have changed, he said, as the company seeks to maximize return on investment.
"At Avon, our ultimate vision is to get a hybrid model of an expert in-house to understand direct selling, because it is a different model than in the general industry," Rossi said in January at a panel of senior executives at the Meeting Professionals International Professional Education Conference in Charlotte, N.C., "but also to have that competency with an expert outside of our company."