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Chicago, IL - August 6, 2019
Business Travel Trends and Forecasts Toronto
Westin Copley Place - September 10, 2019
About a decade after the phrase "strategic meetings
management" entered the parlance of the business travel industry, nearly
nine of 10 respondents to a recent Business
Travel News survey indicated their companies have policies limiting
stakeholder options in meeting planning and sourcing processes. However, far
fewer believe their organizations have a strategic meetings management program
in the United States.
The new BTN study
of 295 corporate travel and meeting professionals, conducted from March to May
in conjunction with sibling publication Meetings
& Conventions, helps to quantify the current state of strategic
meetings management, the multi-pronged approach that blends policy and
technology implementation with advanced sourcing practices to govern meetings
expenditures throughout an organization or business unit.
[Please click here to view the digital edition of the 2012 Strategic Meetings Management survey,
featuring all charted data, downloadable as a pdf.]
For many years, corporations with varying degrees of success
have attempted to establish structured processes around meeting planning, not
only to rein in spending and leverage volume from multiple events during
supplier negotiations, but also to avoid damages from underattended or canceled
events in contracts often negotiated by nonprofessional planners. Up until the
late 1990s, this process frequently was termed "meetings consolidation,"
a phrase more or less supplanted in the past decade by the more comprehensive "strategic
Today, the SMM concept has won many adherents—notably in the
heavily regulated pharmaceutical industry—who have deployed technology and
developed processes to document spending, limit the authority to sign meetings
contracts and source with an increasingly procurement-based bent.
Few would argue that the process is simple. Developing and
deploying a broad-based SMM initiative hardly is confined to a corporate
meetings and travel department; information technology, human resources,
training and internal communications departments all likely are involved in the
project's creation and rollout, as are sales and marketing departments that
often sponsor the lion's share of a corporation's events. There's an inevitable
layout of front-end cost, and developing the case for SMM to receive senior
management approval is a must.
In late 2008 and early 2009, the concurrent global financial
industry meltdown and well-publicized furor over largesse at some financial and
insurance industry corporate meetings—most notably an AIG incentive
event—triggered a wave of interest in SMM procedures, at least among those
companies that did not decimate their meetings programs and expenditures, said
StarCite vice president of enterprise strategy Kevin Iwamoto.
Today's industry faces renewed economic uncertainty. Add the
new federal meetings regulations triggered in part by a controversially
extravagant General Services Administration event, and SMM again is at the
forefront of many corporate initiatives, Iwamoto said.
"I see the North American market maturing rather
rapidly, and the financial and recessionary situation accelerated that,"
he explained. "It's a catalyst for [corporations] to hurry up, get their
act together and get an SMMP in place so they can have greater visibility
around the spend."
A December 2010 PhoCusWright survey of 630 meeting buyers
found that 6 percent of represented companies had not implemented any of the
seven planks of a strategic meetings management program as defined by the
Global Business Travel Association: central registration of meetings, mandated
or formal hotel requests for proposals, meetings policy or formal guidelines,
preferred suppliers, automated processes, data analysis and reporting, and
formal return-on-investment metrics. On the other hand, 28 percent said they
had deployed all seven, including 6 percent that had done so enterprisewide for
all meetings. (PhoCusWright since has been acquired by BTN parent company Northstar Travel Media.)
Among BTN survey
respondents, 36 percent indicated their companies have strategic meetings
management programs in the United States. A far higher percentage of
represented companies have at least some aspects of an SMM program in place.
Specifically, 88 percent of respondents said their
organizations had policies in place that govern aspects of the meetings
management process, although no single policy listed in the survey garnered a
majority of those respondents. The most frequently chosen response, at 47
percent, was policies that require the use of onsite meeting space, when
feasible. Other options chosen by at least two of five respondents included
requirements for senior-level approval of individual meetings and limits on
contract-signing authority. Many analysts view the latter as a key proviso of
any comprehensive SMM strategy, given the risk that a rogue contract can pose,
particularly in terms of attrition and cancellation damages.
"You're not going to get around it unless you force
people to go through the process and use the addenda created by legal and
procurement," said Iwamoto. "That piece, you have to regulate, and it's
probably easier to regulate under the guise of needing to have consistency in
contract execution ad language to protect the company."
While insurance firm Chubb & Son has a contract-signing
authority in place, the company has no other mandates with regard to its
strategic meetings management program, said assistant vice president and
manager of employee mobility management Sheri Bonsall. The company may explore
stronger policy language around meetings, she said, but noted the success of
corporate transient policies in driving behavior without mandates.
"We're not a mandatory company," Bonsall said. "On
the corporate travel side, we have 95 percent adoption of online booking. We
have the credibility to implement a program that has strong compliance and
leads to savings. Without mandates, this is what we're getting. With strong
leadership support, we should be able to get that kind of strength."
Generally, more BTN
survey respondents indicated their companies have policies that govern demand
management and internal procedures than do external relationships with
suppliers. For example, 38 percent indicated the presence of policies requiring
use of videoconferencing when applicable, and 32 percent require all sourcing
be conducted by the company's procurement, meetings or travel department. On
the other hand, fewer require the use of preferred meeting suppliers (27
percent) or transient suppliers (17 percent), while 20 percent require use of a
standard request for proposals and 18 percent require at least three bids for
Should a planned event reach a size threshold at
pharmaceutical firm Novo Nordisk, the use of one of a few approved meetings
logistics companies with which the firm maintains master service agreements is
required, said associate director of meeting management Tom Torvé. The firm
also mandates contract-signing authority. "We're not going to let an
administrator with no meetings experience handle the planning of a departmental
offsite for 200 people for two nights in Vail," Torvé said, adding that
the policy allows him to approve exceptions.
For others, policy mandates are wider. John Touchette,
director of meetings and special events at Raytheon, in March during a client
conference for meetings technology company Cvent said the defense contractor
was on the precipice of issuing a newly mandated policy as part of an existing
"In October, our chairman said, 'You've done all this
in a non-mandated environment, how do you take it to the next level?' "
Touchette conveyed. "He said, 'Let's do an audit and see where we're at
and let's put policy in place.' Luckily, we were working on policy and were
almost ready to go, and I'm happy to announce we're going to launch in two
weeks in a mandated environment."
That said, companies that attempt to install meetings policy
mandates may find securing compliance easier if the justification isn't cost
savings, Iwamoto said.
Noting a "slight" move toward mandated policies in
general, Iwamoto said, "What really drives this is the risk-mitigation
piece around duty of care, knowing where your people are and how you can assist
them if they're stuck. The cost savings won't get you closer to a mandate, but
the duty of care will. Cost savings is not strong or compelling enough,
depending on the company, to get people to comply."
About two-thirds of those respondents who indicated their
companies have strategic meetings management programs said they have
implemented meeting attendee registration mechanisms. That leads the list of
most frequently applied SMM aspects covered by the survey, along with the
presence of cost-reconciliation processes.
"Pretty much everyone is in the registration and
attendee management space," Iwamoto said. "When you ask about the
procurement piece or meeting logistics or data management or payment, and
having the technology to enable, that's when you see the list drop off."
More than half of survey respondents indicated their
companies have event registration and/or online meetings booking systems in
place, and indicated they analyze and report meetings data. But fewer than half
noted their companies track compliance, use meeting cards for payment or have a
meetings pre-approval process.
Iwamoto's point about strategic meetings management programs
not necessarily applying procurement philosophies is reflected in BTN survey results.
Less than half of all respondents indicated their companies'
procurement departments were "very involved" or "somewhat
involved" in meeting management, while three in 10 indicated they weren't
involved at all. Additionally, two-thirds of respondents indicated that
procurement's level of involvement in meetings management during the past two
years has been static, with about 26 percent noting increased involvement.
"We're seeing increasing involvement in procurement
globally," Iwamoto said. "When they get involved, that's when the
discipline and the process and policies become formalized and ingrained into
the DNA of the company. Often, because the spend has been so hidden and so
decentralized, they need to be a driving force to consolidate and standardize
One potential benefit of involving procurement in meetings
management is the ability for corporations to negotiate more broadly for
meetings services, as part of a multi-meeting strategy or tied with transient
volume. According to survey results, 24 percent of all respondents indicated
their companies have centrally consolidated all meetings purchasing functions.
Of those, more than half said they have gained the benefit of leveraged volume,
and more than four in five indicated they have a higher degree of budgetary
No single response dominated as the rationale for not
consolidating meeting expenditures. About 40 percent cited the decentralized
nature of their companies, while more than 20 percent cited territoriality
issues and/or a lack of senior management backing.
For some buyers, though, senior management can be the
impetus behind creating a strategic meetings management program. Bank of New
York Mellon strategic meeting program manager Mary Beth Jenson during the Cvent
conference said she received a call from the company chairman "right after
AIG was dinged, asking us, 'Where are we? Where are events in the next 6
months? I need to know in the next 5 minutes.' Right then I knew we were in
trouble and we needed to have more visibility. I couldn't supply information to
the chairman when he wanted it. Starting was [about] gaining visibility
"Europe is on fire. Companies are grasping every little
piece to save money," Iwamoto said. "It takes a major impetus to get
those companies to move, and the financial meltdown over there has really
forced a lot of discipline around saving every penny. Meetings are no longer a
Globalizing SMM programs has proven challenging to many
corporations, but Iwamoto cited an increase in electronic RFPs submitted
through StarCite's technology as evidence of a rapidly maturing European
Financial firm ING is just embarking on a European SMM
effort, said Jeroen van Hek last month during a BTN Group conference in
Amsterdam. Beginning this year in his base in the Netherlands, van Hek will
roll out a meeting policy to ING offices throughout the continent. "The
idea is to roll out the program country by country, because in each country
have to look at nature of demand and determine what kind of suppliers you can
use," he said.
Speaking at the same conference, Credit Suisse global head
of corporate travel and events Bernadette Basterfield called the financial firm's
meetings policy "very robust."
"Anything over 5,000 Swiss francs will be tracked, and
for any event above 30,000 Swiss francs, my team will actually plan the
logistics from end to end," Basterfield said. "So we actually don't
engage event management companies as such. We do everything internally at fixed
cost to me. As you might imagine, with the challenge of the times, the question
is always asked of me, 'With headcount as a fixed cost, how can we better
manage that?' However, in terms of the events we deliver and the control we go
into around policy, it requires that internal focus."
SIDEBAR: 2012 DEMAND
OUTLOOK OPTIMISTIC AFTER SOFTER 2011
After a year in which nearly as many BTN survey respondents indicated their companies' meetings volume
decreased year over year than increased, more than 60 percent this year
forecast spending increases. On average, they expect 2012 meeting spending to
rise by about a 12 percent, precisely the average percentage decrease forecast
by the 33 percent of respondents who anticipate lower spending.
While some of the projected spending increase undoubtedly is
due to higher prices, some also appears to be an increase in meetings and
attendees per meeting. Most respondents (54 percent) anticipate 2012
per-attendee spending to increase from 2011 levels. About 31 percent expect
per-attendee spending to drop, while the remainder sees such spending as
Forty percent of respondents reported that their companies
spent more on meetings in 2011 than they did in 2010 (with an average increase
of about 15 percent), while 36 percent reported a year-over-year decrease (with
an average decrease also of about 15 percent).
Cutbacks were most apparent among surveyed companies that
spent less than $1 million on meetings last year. Of those, 28 percent reported
a year-over-year spending increase while 46 percent reported a decrease. A
little more than half of those small-market respondents expect per-attendee
volume to increase this year, close to but lower than the overall average.
SIDEBAR: SURVEY SHOWS
HOTEL MARKET STEADY
Several hoteliers this year have called corporate meeting and
group demand a pleasant surprise and raised expectations for 2012 group
revenues. But the seller's market hasn't meant smaller negotiated discounts for
most BTN survey respondents, with the
possible exception of some of the smallest spenders.
Among 211 meeting and travel professionals who compared
current hotel meeting discounts to those received 12 months prior, about seven
in 10 indicated they were about the same. Eleven percent indicated they were
smaller, but that increases to 17 percent among those respondents from
companies with less than $500,000 in 2011 meetings volume.
Overall, about 14 percent of respondents indicated their
discounts this year are better than last. Roughly 4 percent noted that no
discounts were available to them.
Marriott International CFO Carl Berquist in April said group
bookings both for business during the first quarter and throughout 2012 were
higher than expected. He added that attendance at booked meetings also was
above Marriott's projections while cancellations were below. As such, CEO Arne
Sorenson acknowledged that a few meeting planners have complained of limited
availability for larger events.
Meanwhile, respondent companies in 2011 on average booked
about 49 percent of their meetings at preferred transient or meeting venues.
More than a quarter of respondents reported that their companies booked at
least 75 percent at such properties.
While many buyers and analysts reported difficult
negotiations with hoteliers for 2012 space, 57 percent of survey respondents at
least were able to leverage meetings volume with transient volume in those
talks. That figure increases to 75 percent among companies that spent at least
$6 million on meetings in 2011.
The BTN Group in conjunction with fellow Northstar Travel
Media publication Meetings &
Conventions and research firm Equation Research conducted online surveys of
travel and meeting professionals from March to May 2012. Invitations to
participate were sent to subscribers of several publications produced by The
BTN Group (Business Travel News, Travel
Management, Travel Procurement and The Transnational), subscribers of Meetings & Conventions, members of
The BTN Group Research Council and members of an Equation research panel.
The research was sponsored in part by The Active Network's
StarCite and Carlson Wagonlit Travel Meetings & Events.
A total of 295 respondents qualified by indicating that they
have decision-making responsibility for at least one of several listed
meetings-management functions: selecting a meeting hotel, conference center or
other facility; selecting the location of a meeting (city, area, country,
etc.); negotiating hotel contracts; approving hotel contracts; selecting ground
transportation; planning meeting agendas; selecting meetings technology;
deciding to hold meetings either on or off-premises; establishing meeting
objectives; establishing/approving meeting budget; selecting agency,
destination management company or events company; approving air contracts; and
negotiating air contracts.
Equation tabulated all results.
Unless otherwise noted, data displayed in this report have
been rounded to the nearest whole number and in some cases may not total 100
percent. Several questions asked respondents to select all applicable answers.
Represented companies in 2011 on average spent $10.7 million
on meetings. However, of those respondents who said they knew their company's
total 2011 meetings volume, about 63 percent indicated it was less than $5
The most represented industries were financial and insurance
(19 percent), manufacturing (18 percent) and technology (14 percent). About 10
percent of respondents worked for pharmaceutical companies. Of the remainder
who identified a sector, 8 percent worked in consulting and accounting firms,
followed by communications and entertainment (6 percent), aerospace and defense
(5 percent) and chemical and petroleum (4 percent).
About half of all respondents indicated their companies had
neither a meetings manager nor a meetings department, while 38 percent had no
travel manager or travel department.
The report originally
appeared in the June 18, 2012, issue of Business