More Exec. Board Meetings, Less Time To Plan Them
<B>More Exec. Board Meetings, Less Time To Plan Them</B>
By Chris Davis
Amid the frenetic pace of today's business climate, with ever accelerating consolidation, globalization and automation, the number of executive board meetings has increased while the average amount of lead time to stage them has shrunk.
And with the limited logistical needs but high budgets of these meetings, hotels and resorts are fighting to create good buying opportunities.
Since many executives and board members are accustomed to meeting in luxury and seclusion, more resorts and boutique properties are hosting a number of executive meetings and often charging high rates for the privilege. But with the short lead time associated with many of these meetings, buyers are finding that any property with state-of-the-art business and technological amenities can come into play, furthering a competitive atmosphere.
"There are absolutely more of these meetings popping up, especially between the boards of more than one company," said Tohnia Miller, director of sales and marketing at L'Auberge Del Mar Resort & Spa in Del Mar, Calif. "Between the volatility in the marketplace and all the mergers and acquisitions, there's a need for boards to meet frequently, which really impacts lead time."
But even in the extreme short term, corporations won't just place their meeting and pay what they have to, Miller said. "We're still seeing a bid process, even in the short term and even with the highest-end meetings," she said. "Corporations are still accountable, but it goes both ways--we can reject the business too."
Miller also sees such ad hoc meetings moving away from larger, downtown properties to smaller, more exclusive ones. "The expectations are high, because they're used to staying in the finest hotels for business and leisure," she said.
That attitude can lead to a conundrum for executive board meeting buyers, who are expected to provide high-quality accommodations and amenities for their attendees but often have so little lead time that they end up with a pricey bill from a boutique property or resort. As such, well-traveled executives are finding they're doing more board business in downtown or even airport properties.
"Companies will generally pay for the luxury and lifestyle the directors live," said Patti Roscoe, chairwoman of San Diego-based PRA Destination Management. "They want the same things in their meetings and guest rooms that they can get in their offices or planes. But our lead time for executive board meetings averages about 30 days and it's constantly getting shorter," said Roscoe, adding the caveat that executive board meetings planned in conjunction with annual shareholders' meetings involve much more lead time.
"These meetings usually involve only about 20 or 30 guest rooms and a conference room," Roscoe said. "They're not particularly complex, logistically, so we can get lucky with finding the right property at a good rate even in the short term. But we've even booked airport hotels if we've had to."
But while the rapid change and expansion of today's business world has lined many a corporate pocket, it also has robbed executives and directors of some of the time they previously dedicated to leisure and networking.
"These meetings used to be fairly lavish affairs, but they seem more business-focused now," Roscoe said. "It might be the effect of technology, since every board has to address it, but it takes time to do so. But they don't seem to go all out anymore."
Sometimes--and this tends to be indicative of the specific industry the executive board attendees are from--this doesn't pose a problem. Many executive board attendees from technological companies are very accustomed to extensive travel and long, intensive work hours, so the location of the property and its leisure offerings are lesser issues.
Technological firm executive boards like to incorporate some leisure time as well, but it isn't quite the priority it was in years past. "While both business and leisure used to receive 10s on a one-to-10 scale of importance, now business is a 10 and leisure an eight," said Elizabeth Zielinski, president of Fairfax, Va.-based meeting management firm Meeting Horizons. "They're still interested in leisure activities, but they're not heartbroken if it doesn't get equal priority as business."
Many corporations in other industries, however, still are willing to open the checkbooks for exclusive and luxurious sites for their board meetings. Executive boards of pharmaceutical corporations often prefer small boutique properties to resorts for their meetings, said Dawn Pratt, vice president of meeting and incentive sales for Owings Mills, Md.-based meeting and travel management firm Travel Destinations Management Group, but that is a preference that comes with a price.
"Executives like the privacy that boutiques can offer, and they can feel lost at a large resort," Pratt said. "But it can be very difficult to find space at a boutique in the short term, and they're usually not flexible in negotiations. Resorts usually are."
The problem is exacerbated by the frequent preference of executive boards to meet on weekends, leaving Pratt to fight with leisure travelers for the limited supply of boutique space.
"They rarely want to hold these meetings midweek," Pratt said. "If we were looking for a Wednesday or Thursday meeting, we wouldn't have any problem."
Once space is located and a site selected, difficulties recede, as most of Pratt's executive board clients are flexible with site and meeting logistics, including the size of the meeting room.
But not all executive boards prefer boutique properties. Zielinski said her technological clients have needs for their executive board meetings that boutiques can't necessarily address.
"Those meeting clients generally like service-oriented, elegant and progressive properties, but not necessarily boutiques," Zielinski said. "I can't justify booking a property without decent business center hours or guest room dataports, for example, which is not the general rule for boutiques."
Technological capability, high levels of service and quick response time are all key factors in Zielinski's site-selection process for executive board meetings, but property location and cost aren't primary issues.
"These clients travel constantly, so location is not nearly the issue that it is for some," Zielinski said. "And there aren't any substantial barriers to negotiations. My clients' first question is rarely 'what does it cost?' and it's often not even a secondary concern. Sometimes it's even an afterthought."
Some hoteliers agreed that price often is not the determining factor when it comes to site selection for these types of meetings. "There is less price resistance among planners, as they have somewhat higher budgets to work with," said Katie Callahan-Giobbi, director of sales at The Westin Century Plaza Hotel in Los Angeles, which is converting its tower into a separate St. Regis property.
"Planners tend to want upgraded guest rooms, occasionally suites, and high-speed access to the Internet and e-mail in the meeting and guest rooms," Callahan-Giobbi said. "It's a very important market for us, because it's a higher revenue market. But with that comes increased expectations on the part of the buyer, and there has to be a philosophy about how you treat their highest executives."
When price, or lack of lead time, becomes a major factor, some buyers are booking hotels in downtown areas or airports. Considering that executive board attendees often book high-end guest rooms, the competition among these properties for executive board meetings is strong, offering opportunity for the buyer.
"There's a lot of competition in this city for those types of meetings, but many boards are still looking at resorts or airport properties in San Francisco and Los Angeles," said John Koon, director of sales and marketing at the Serrano Hotel in San Francisco. "There's quite a buying opportunity here, as there are properties with deluxe business and technological amenities. But there's even competition with the other four San Francisco hotels of the Kimpton Group, our owners."
In essence, corporate executive board meeting buyers walk a thin line between the high expectations of their attendees and the desire to minimize the appearance of an open checkbook.
"Especially with boards of directors, there's a feeling of sensitivity to their companies' resources, but if they're looking for a pure business meeting, they're not likely to come here," said Kenn Stoner, director of sales at the Sunriver Resort in Sunriver, Ore. "We have that business and leisure mix, including private golf outings, but there are plenty of people who will shy away from true extravagance."
Executive board meetings play a significant role in generating revenue at The Sunriver Resort, so much so that the resort has constructed a 33-unit river lodge to sequester interested executives. These meetings' capacity for revenue is due at least in part to the fact that many are negotiated by executive assistants with little lead time.
"Many groups don't go through the whole process," said Sunriver executive destination manager Janice Rodrigues. "They hold these meetings in the short term, so they find the site, sign the contract and they're here."
Planners also must consider the changing nature of executive boards themselves. They're no longer exclusively male, and don't automatically want to spend half their days on the golf course.
While L'Auberge's Miller doesn't see any reduction in the amount of leisure time executives look to incorporate into their meetings, the structure of the chronology of business and leisure has changed. Many boards prefer to tack on a day or two of free time with their families at the conclusion of the meetings, which are dedicated to business, as opposed to the traditional half-business, half-golf daily setup.
"It seems they want to spend more of their leisure time with their families and not necessarily with each other," Miller said.
"The demographics are changing," PRA's Roscoe said. "Executive boards are younger and are including more women, so the days when corporations absolutely must meet at the golf course are not as prevalent. But that networking component at these meetings is huge, and a tremendous amount of it still occurs while playing golf.