Sister Cos. Pool Spend, Save

One of Canada's largest financial planning and mutual fund companies has saved more than 15 percent of its meeting and travel budget during the past three years by centralizing meetings and consolidating its meeting and travel volume with two sister companies for the purpose of contract negotiations.

Winnipeg-based Investors Group Financial Services Inc. also has developed a tool to comprehensively document return on investment for each of its 12 large and 30 smaller meetings and events, allowing the company to monitor savings, consolidate volume, measure meeting effectiveness and create a history for each event, said director of travel and meeting management services Angie Pfiefer.

Investors Group and two of its sister companies, London, Ont.-based London Life Insurance Co. and Winnipeg-based Great-West Life Assurance Co., also combine their volumes to negotiate a single contract with their preferred airline and hotel partners. All three companies are subsidiaries of the Winnipeg-based Power Corp. of Canada.

The result, Pfiefer said, is a better contract through leveraged volume.

"The idea to consolidate our volumes from a tri-party perspective came up in partnership with our travel agency of record," Pfiefer said. "Through their role as strategic partners and their industry experience, we worked with them to develop a cost-benefit analysis to determine the potential savings." The savings, negotiated with its agency American Express, were significant, but the last contract with primary carrier Air Canada was negotiated when the airline faced competition from Canadian Airlines. The airlines merged in April 2000.

"Air Canada is in a good position, but there is competition from WestJet," Pfiefer said. "However, we have a significant piece of business for Canada and we have 90 percent compliance."

Employee compliance, including use of the meetings department's services, is realized without the implementation of a hard mandate, said Pfiefer, who is responsible for Investors Group's corporate travel, conference and meeting management and rewards and recognition programs. Pfiefer's department has taken steps to quantitatively prove its value to both senior management and internal meeting sponsors, as the company maintains departmental budgets from which meeting expenses are paid.

"We track every meeting through a spreadsheet," Pfiefer said. "We record room rates at the time the RFP is sent compared with the rates we actually receive. We record food and beverage expenses and savings and gifts and amenities received as well. Senior management doesn't necessarily know what we have, so we have to focus on showing that value."

The spreadsheet is not the extent of ROI documentation. Investors Group also determines written goals and objectives before each meeting, and surveys participants before and after the event to determine the extent to which they were met. With the spreadsheet, the ROI surveys—which include meeting planner remarks concerning the logistics of the meetings—serve to create a detailed history of each meeting, allowing planners to maximize savings and adjust content for future, similarly themed events.

Investors Group's internal meeting sponsors have some flexibility in choosing the logistics of their meetings. When registering an event with Pfiefer's department, the sponsor is asked for three destination choices, property type, goals and objectives and proposed budget. Planners can respond with more than one proposed site.

The company began consolidating its own travel and meetings volume in 1999, Pfiefer said. She created a business plan that included how such a move could generate the proposed savings and presented it to senior management, before approval to begin the process was granted.

"The case for consolidating meetings came from two things," Pfiefer said. "We had credibility with senior management because of a proven record of success and experience. Secondly, the financial analysis I presented to senior management demonstrated the potential savings by centralizing and having other departments focus on their core competencies, which is not meeting planning."

Recently, Investors Group reconsidered its roster of preferred suppliers, including American Express, which it retained, and taking a second look at its travel policies to find potential cost-cutting opportunities. "We've gone back to our vendors and reevaluated who to use and why," Pfiefer said. "We need to know if we are getting the best discounts for our volume. Like many financial companies, we are hurt by the recession and Sept. 11, so we have had to work smarter and be much more aware than we ever have been before."