The perpetual decline in corporate meeting lead times has continued unabated during the past year, burgeoned by shaky corporate finances, fewer meeting dollars to spread around and abundant hotel availability. Several corporations, acknowledging that short-term meetings are less a trend than the core of the new meetings landscape, have implemented specific processes to streamline planning functions and maximize savings opportunities when lead time is short.
The prominence of short-term meetings is undeniable. According to a Meetings Today survey of 101 corporate meeting buyers conducted in February and March, 67 percent of respondents indicated that their average lead time for meetings of 100 attendees or less is fewer than 90 days. In addition, 29 percent said the average is 30 days or less, a percentage that more than doubled from a similar March 2002 survey. These numbers are some of the most dramatic indicators of the new short-term landscape since Meetings Today began quantitatively documenting the trend in 1999.
Many of the forces at work behind the numbers have remained constant during the past few years—including a soft economy that has led corporations to cut meeting spending and hold meetings only when corporate profits permit—and have been bolstered by new factors that disincline corporate buyers to plan well ahead of time, including military action in Iraq and the revelation that short-term meetings may be a financial bargain, or at worst not a hindrance, at least as far as hotels are concerned
(see story)."About 90 percent of our meetings are between one week and four weeks," said Tom Smith, director of meetings and events for Woodland Hills, Calif.-based healthcare firm Health Net. "It has been moving in that direction for a few years. 2002 was a pop-up meeting year, with a lot of last-minute stuff. 2003, so far, has been a pop-up year with a capital P, and it's not just one division, it's companywide. Our company is busy, moving and growing, and there's a need to bring people together."
Pharmaceutical firm Schering-Plough Corp. of Kenilworth, N.J., recently has gone through significant internal changes, leading to a sharp reduction of meeting lead time, said director of travel services Mike Doran.
"The nature of our business right now is very short term," Doran said. "I don't know if it's an industrywide trend, but for us it's primarily due to internal business changes."
Though Doran's department welcomes requests for short-term meetings, one challenge he has found is the propensity of internal meeting sponsors to seek outside help when lead time is at a premium. "We've had to go out to meet with our folks because they assume that we won't be able to help them in the short term, and they go out and do it themselves," Doran said. "We show them that we can help. Short-term meetings are a lot easier for us to handle than it is for them. They have other jobs, but this is my team's job."
Several companies—recognizing the strain short-term meetings can place on corporate meeting planning staffs and the former conventional wisdom that such events could be financially onerous—have implemented procedures to lengthen the process. According to the survey, about 28 percent of companies in the past two years have instituted processes specifically to accommodate short meeting lead times.
Many of these moves incorporate some sort of communication to internal meeting sponsors, stressing the potential financial benefits that can come with the additional flexibility of more lead time.
Others take the notion a step further, instituting managerial control and requiring approval for meetings without a certain level of lead time.
While many corporate buyers said the reason is largely financial, there's something to be said for operational streamlining, given that meeting contracts often are not merely between sponsor and planner but involve procurement and legal personnel, as well as several levels of management. Additional lead time can limit the impact of chain-of-command delays.
Some of the companies that have made such moves, though, are reaping the benefits. Hartford, Conn.-based Aetna Inc. last year centralized its meetings department and mandated all meeting contracts be signed by professional planners, allowing the meetings department to provide service-level agreements, said manager of strategic sourcing and travel Deb Fouche. That, in turn, enabled the meeting department to offer proof that providing them with longer lead time could lead to lower expenditures.
"We're not being hurt financially by small, short-term meetings, and many of our meetings that used to have two months of lead time now have four to six," Fouche said. "Now, we're even booking events for 2004 and we're getting awesome rates."
The increase in lead time allows Aetna to negotiate prices for more than one meeting with properties, which, Fouche said, allows the company to save money without sacrificing service levels. "Communication and education are crucial," she said. "They're happy when they see the results."
The average meeting lead time at Austin, Texas-based International Sematech stands at six weeks to seven weeks, a timeframe that actually has increased of late, said manager of corporate travel and meeting services Bill Davidson. Though many meetings are recurrent and based on the status of various internal corporate projects, the department has pushed for increased lead time, if only to take advantage of lower advance purchase airfares for internal and external attendees alike. "It's tough, but our percentage of success is very high," he said.
Davidson's department has pushed to increase that lead time by implementing a policy that requires approval of the appropriate departmental manager should a meeting be requested with fewer than six weeks of lead time. "There's been a bit of a push from meeting services to adopt this as a rule, which has happened," Davidson said. "Now the project chairs understand what's required of them. Plus, you don't want to go after that approval too many times."
Still, there are those on the other side of the movement who deliberately have not adjusted internal processes, such as Health Net's Smith. Despite average lead time of less than a month, Smith said there's no cause for revising the process.
"It happens because we're able to pull it off and pull the rabbit out of the hat," Smith said. "They'll come back and do it over again. It's the nature of the business. We understand that they have tight deadlines and we serve as their partner and offer our support."
In the end, in many corporations, including Health Net, the responsibility for the meeting budget lies with the internal sponsor. "I could send out a communication that there's a new policy that we need so much lead time, but I don't think they need to hear that," Smith said. "They need to hear that we're here to help them."
The immediate future does not hold the prospect of significant changes in average lead time, at least according to the survey. About 82 percent of respondents expect average lead times to remain about the same throughout 2003 as they have been for the past six months. About 12 percent said lead times would shrink further, with a quarter of those respondents indicating lead times would be much shorter. The remainder said lead times would be somewhat longer, although not one respondent said they would be much longer.