Managing Meetings At: Philip Morris Management Corp.

To gain control over meeting expenditure data and contracts, rather than logistics, the Philip Morris Management Corp. in June mandated that all meetings held by its operating companies register events with the parent company's meetings department.

The move, which follows the development of a consolidated PMMC meetings department in 1999 and the dedication of a corporate conference center in 2000, allows the company to consolidate its hotel volume and limit contractual liability without claiming ownership of each aspect of every meeting, said John Lowry, manager of meeting planning and the hotel program for PMMC.

"We've mandated meeting registration to track data rather than control everything, so we can see contracts before they're signed," Lowry said. "If, as a consequence, they use our services, that's fine, but it's not our primary goal. We want to leverage our whole hotel business, and avoid cancellation and attrition." In theory, the company's accounts payable department would not be required to pay bills for unregistered meetings, but Lowry said a more likely consequence of noncompliance would be a warning.

The shift, the latest in a series of changes PMMC has made to its program, comes at a time when the company continues to increase its meeting expenditures. Lowry said this year's meeting volume is running about 20 percent higher than last year.

The decision to mandate meeting registration at the operating company level sprung from conversations held among the meeting planning, accounts payable, legal and financial departments with senior management, and was bolstered by the management corporation's own three-year-old mandated registration program.

The primary benefit of that move, which only increased the meetings department's business by 12 percent, was the streamlining of the meeting expenditure payment and reimbursement process, Lowry said.

"After the mandate, the process was linked to the accounts payable department," Lowry said. "With pre-approval, it allowed accounts payable a single source of information."

One year after that mandate, PMMC converted office space into a conference center in New York, and it has become a popular destination for internal groups holding single-day meetings, leading to cuts in hotel expenditures.

"Anybody can use it and though we have senior management buy-in to encourage its use, we haven't needed it: It runs higher than 90 percent occupancy," according to Lowry. "We recouped the expenditures in 10 months, and now the savings have far exceeded the cost of the renovation."

Employees holding meetings at the conference center pay for food and upkeep, Lowry said, but those expenditures are still a far cry from commensurate hotel bills.

Despite Lowry's desire to measure total hotel volume, he has no plans to draft a combined transient/meeting contract, even though some hotel chains have expressed greater interest in crafting such longer-term contracts (Meetings Today, July 15). "There will be separate contracts," he said. "I'm not a fan of total account management. There are very different skill sets for meeting and transient on the sales side, and you can't do both at the same time."

The PMMC meetings department recently also has refined how it measures return on investment, which Lowry said is focused less on overall savings than on attendee satisfaction and achievement of meeting goals and objectives.

"We track savings through cost avoidance and savings per event and we benchmark against third-party costs, but it's not our primary goal," Lowry said. "We've just started to take surveys to qualify each event: Did the venue do a good job? We try to get the internal client to think in terms of ROI. Was there anything else we could have done, or done differently, to make the event more productive or more interesting?"

That includes the possible incorporation of more technological tools into the meetings themselves, Lowry said, particularly Webconferencing. Lowry's group has Webcasted long opening statements for company meetings, he said, and the company will continue to explore the technology. "It's a pretty simple tool," he said. "We're always trying to find ways to improve, and there's nothing we won't do."

One technological aspect of the PMMC meetings program Lowry may have to alter is the company's use of embattled attendee registration application Event411, which was acquired by group housing provider Passkey last month in an asset foreclosure proceeding (see story, page 19).

"We only use about 50 percent of Event411's capabilities," Lowry said. "We used the attendee registration, and people liked the Web invitation service, but we used it for time savings and we didn't put those savings into dollars."