Managing Meetings At: AT&T Corp.: AT&T Rings Up Mtgs. Savings

AT&T Corp. has slashed millions of dollars off its eight-figure annual meeting spend by mandating registration of events through a centralized meetings department, significantly restricting the number of preferred suppliers and rolling meeting planning functions into a companywide electronic procurement system.

The Bedminster, N.J.-based company now spends about $25 million on meetings annually, a number that has decreased by about 28 percent since 2001. That percentage includes savings incurred when AT&T sold its broadband services to Comcast Corp. in December 2001. However, those savings comprised less than 10 percent of the total.

AT&T's meeting philosophies evolved over a five-year period, beginning in 1997 with the construction of policy recommending, but not mandating, all meetings be registered through the company's meetings department. The policy was strengthened in 2000 to increase compliance, and the effort further developed last year when suppliers were restricted and included in the electronic procurement system, which does not allow for payment of bills to unauthorized suppliers. The system was put into place in October for most AT&T purchasing functions. In essence, authorized suppliers have the ability to access purchasing orders through the system, fulfill them and receive payment automatically.

"Anything we need to procure we can do through the electronic system," said Madlyn Caliri, AT&T global group travel and events manager. "Requests go directly to authorized suppliers that are already set up in the system with standard contracts and pricing. An order is placed and an invoice issued, and it is paid electronically."

According to Caliri, the electronic procurement system includes three meeting management suppliers: a large agency, a super-regional agency and a smaller company. Additionally, B-there.com of Westport, Conn., is included in the system to handle online attendee management needs.

Typically, an internal meeting sponsor will submit a meeting request into the system. Though some specific planning functions are handled by specific suppliers, including site selection, the planner can choose which of the three suppliers to use. "They will typically pick the most cost-effective option," Caliri said.

The suppliers in the system have posted an online catalog of their services and fees already negotiated by Caliri's team, allowing planners to choose exactly what they need for a set price.

Once the meeting is sourced and staged, all expenses are paid to suppliers through the procurement system. "There is no way to pay the bill if you don't use a supplier in the system," Caliri said. "It drives compliance very high." A planner's request to use a different third-party meetings management firm would be forwarded to Caliri's team, which likely would decline the request, she said.

The current system is the culmination of a long-running effort by AT&T to exert more control over the meetings management process. The large company is divided into several business units, many with their own meeting planners. After the first policy regarding group travel was created in 1997, about 50 percent to 60 percent of meetings were registered through Caliri's group, she said. Still, top AT&T management wanted higher levels of compliance, and in July 2000 sent a letter to employees stressing the importance of the policy. An outright mandate came first in July 2001, as the overall corporate meetings market began to weaken and AT&T banned all offsite non-training events without approval of the heads of its business units. That move severely curtailed offsite meetings and saved a significant amount of money. In January 2002, the company mandated all meeting requests be submitted through Caliri's department and restricted preferred suppliers to three as a precursor to the move to the electronic procurement system in October of that year.

Though Caliri's department reports through travel and to the company's CFO, the company handles its group and transient travel expenditures separately, she said. Both corporate transient airfares and group and meeting fares Caliri negotiates are made available to agencies so attendees may book the most cost-effective option. Caliri has multi-meeting fare agreements with two carriers, she said, but does not combine group and transient volume for the purpose of air negotiation.

"We still capture the volume, but the airlines approach it differently," Caliri said. "They're not quite as successful or ready for it. They still tend to have separate group travel desks."

Caliri also negotiates directly with hotels and reviews those agreements often. "We have a very tight relationship with hotels," Caliri said. "We look at volume, not on a meeting-by-meeting basis, but we do meet with hotel account managers to review activity and performance, including rate differences. We want to keep our relationships on the chain level."

The various moves have resulted in significant savings, and Caliri said AT&T's annual meetings spend would remain at about $25 million. "I think we'll stay level with that number," she said. "Now, it's essential to maintain customer focus areas and ensure there's not a lot of fluff."