Managing Meetings At: Nationwide--Outsourcing Alters Program

In an effort to find the right mix of meetings management options to ensure high levels of service at a reasonable cost, insurance and financial services giant Nationwide last year outsourced to WorldTravel BTI some logistical meeting planning processes while keeping in-house its site selection and contracting operations. The move allows Columbus, Ohio-based Nationwide to retain direct control over some of the costliest aspects of meetings management and gives internal meeting sponsors a greater presence in handling event details.

The decision to outsource was Nationwide's second significant alteration of its meeting program's structure in five years. In 1998, the company centralized all meeting planning functions. "The goal is to determine the right blend of services, appropriate processes and insourcing versus outsourcing to achieve best-in-class status," said Nationwide director of corporate travel and expense management services Peter Welsh. "We kept the engine and the caboose, and we'll get some help for the middle."

Nationwide, which stages several hundred meetings annually, this past summer outsourced onsite and logistical meetings management to WorldTravel BTI. In late 2001, Nationwide had mandated the use of the agency for all corporate air fulfillment.

The impetus for the decision was a desire to change from a fully centralized meetings department, which after 1998 began to charge planning service fees back to the departments holding events.

"There was a reluctance to use the services because the individual lines of business were comfortable and felt they had the necessary expertise to do it themselves," Welsh said. The current structure, which is not mandated and does not include a service fee, allows internal clients to avail themselves of the company's site sourcing and contract negotiating expertise. As meeting expenses are borne by the hosting department, it often behooves sponsors less experienced with the nuances of risk management, cancellation clauses and deposits featured in meeting contracts to do so.

"We ask them what they want to accomplish with the meeting and what we should consider," Welsh said. "We won't overrule their preferences. We provide advice and help negotiate the contract. We're more aware of risk mitigation, and we have a base of knowledge about the industry, which helps negotiate the best deal for the company."

After the site selection and contract negotiation is completed, Welsh's department returns management of the event's details to the client. Should the client seek assistance, the use of BTI's services is encouraged, Welsh said. "It's their budget," he said. "We try to provide expertise and risk mitigation. We contact BTI and merge them with the client. We are the liaison through that process."

Though the reduction in the cost of meetings management was not the overriding reason Nationwide partially outsourced, that benefit, among others, may well develop, Welsh said. "There is an opportunity for expense optimization," he said. "There will be savings if clients go to BTI and utilize their skill sets and their volume and buying power. Plus, clients like that the fee-based structure has been removed. The contract process is the most important process to have under control, so we parroted the program down to what is most important. As with any new process, we'll keep evaluating the new model for the opportunity for cost savings and expertise."

The decision to change the centralized program was not made lightly, Welsh said, as options were studied for about 18 months before developing the "hybrid outsourcing" program.

"The industry changes," Welsh said. "It's just a matter of figuring out how to best deploy the services we have. It's an evolving process."

Welsh said Nationwide now is focused on how to capture and consolidate its meeting data. The company does not have an estimate of its meeting expenditures, but usually spends $10 million to $15 million in overall U.S. booked air volume, he said. As such, Nationwide is studying the meetings technology marketplace for consolidation tools and services. In addition, Welsh would like to incorporate online request for proposal tools into the program. "We are looking at some technology solutions to collect data and provide tools to help manage the RFP process for small meetings," he said. "That's the goal, and with control over our contracts, we are in a better position to move forward."