14 February 2008 | David Taylor
David Taylor explains the 10 easy steps to buying meeting space
Requirements for business meetings can range from a one-off annual conference to regular events.
Hundreds of firms are involved in the management of meetings including specialists in meetings management and hotel booking agencies. Many travel management companies (TMC) now have venue placement capabilities too.
But, as with all things, one size rarely fits all. Here are some suggestions to help you choose the right partner...
1. Define the specification
Like all procurement, it starts with a brief. Those involved in the tendering process need to know what you want to achieve and how you propose to achieve it in a clear and concise format. Use these questions to help you ascertain what you want:
What are you trying to achieve?
For example, lower costs, more simplified processes, better staff productivity, better use of internal meetings space, compliance with corporate social responsibility (CSR) policies, a reduction in your organisation's carbon footprint associated with meetings, the introduction of alternatives such as video-conferencing, or to be able to quantify the value of meetings.
What services do you want?
The full service - strategy, implementation, organisation, co-ordination - just venue sourcing and placement, conference or event management, or transient accommodation? Over what period do you need this service?
How much does your firm spend on these services?
Break down these figures into categories such as location, venue, country, year, average day delegate rate or 24-hour rate.
Do you want to work with an agency or deal direct with venues and suppliers?
If so, what type - a specialist meetings management firm, a hotel booking agency with venue placement capability, a TMC or event management provider?
How do you want bookings made?
By telephone, e-mail, online or via the company intranet?
And how do you intend to remunerate your agent?
A free service where the agency retains commission from bookings, a free service where it rebates some commission from bookings or a management fee?
2. Consider the technology
Advantages to be gained from automating your request for proposals (RFPs) into an e-RFP include improved workflow and greater transparency, but be warned - it doesn't work for everyone. There are plenty of e-RFP tools available, such as ETABid and ABC Connection's Request For Meetings (RFM) tool.
Technology for your meetings management programme should include:
Expense approval - with necessary authorisations and tracking of bookings outside policy.
Meeting registration - suppliers tracked in real time with expenses monitored against budget across departments, offices and countries.
Preferred venues - access to rates and inventory at these.
Benchmarking data - ability to mine the systems for extensive data including banqueting charges and audio visual (AV) costs.
Reporting - to see where money has been spent, by whom. Create budget templates for different stakeholders.
3. Request for proposal
An RFP will usually follow a request for information (RFI). Look for membership of the Hotel Booking Agents Association (HBAA), Meetings Professionals International (MPI), the Meetings Industry Association (MIA) or Eventia.
A well-prepared RFP will ensure you receive the service you want at the best available price. In the business travel sector a typical RFP can take up to 55 manpower days.
Before the RFP process begins:
Carry out an initial study. Draw up a budget for the RFP process (including implementation post-contract). Compile a list of prospective suppliers. Carry out an RFI if necessary. Research the names of those who should receive RFP documentation. l Set up an RFP project team including key stakeholders. Set a project timetable. Review requirements with the RFP project team.
Break your RFP into headings such as: project overview, business objectives, meeting programme requirements, management requirements, pricing, supplier qualifications and references, and contract terms.
You should also provide tendering agencies with: a company overview, business objectives, meetings programme objectives, performance measurement criteria, a detailed outline of your current meetings programme, the purpose and scope of RFP, RFP instructions, guidelines, timetable, evaluation and selection criteria, agency remuneration proposal, any additional services required and a confidentiality agreement.
4. Receive agency proposals
RFP responses need to tell you how the service will be delivered, their reporting capabilities (including Management Information Data (MI) formats), coverage provided (UK, UK/Europe or worldwide), technology capabilities, account management structure and offering, quality management processes, the proposed service level agreement, implementation plan, financial proposals, and their cost reduction capabilities. Look for different approaches adopted according to the size of the event, and find out what, if any, value-added benefits are being offered. Benchmark what you're being quoted by doing a spot check with the venues.
5. Draw up an agency short list
Once you have received the responses to your RFP draw up a short list of three or four suppliers to present their proposals to your RFP team.
6. Agency presentations
To get what you want from presentations, prospective suppliers need to know what it should comprise and to whom they will be presenting. Presentations should last around 60-90 minutes, including questions and answers. Ask how many people will be presenting and what their AV requirements are. Ensure key stakeholders are included in your RFP project team and meet before the presentations to be clear what you are looking for in the successful candidate and which agency best reflects your organisation's values.
7. Negotiation
Whether negotiation takes place before or after you've decided on your preferred bidder is a matter of company culture. However, if you want to avoid a Dutch auction it is far better to negotiate with the supplier who ticks all the boxes.
Effective negotiation is based on value creation and customer satisfaction rather than driving the price down. Cost reduction is an ongoing key performance indicator to be achieved throughout the contract period. Remember it is in your interests for your agent to be profitable.
8. Establish the contract You've made your choice and agreed terms with your new supplier. Explain to unsuccessful suppliers why they didn't win the contract. When drawing up the contract, the optimum duration is two to three years.
9. Execute the contract Obtaining buy-in from internal stakeholders is crucial if your meetings programme is to succeed. Make sure everyone who might come into contact with your new supplier is advised.
10. Assessment Monitor progress of the contract, whether by issuing a customer satisfaction survey for an event or for those booking and using the service. You can also benchmark cost reductions and compliance levels through MI reports. Assessment can be based on return on investment or return on objectives.
USEFUL LINKS
Hotel Booking Agents Association (www.hbaa.org.uk)
Meetings Professionals International (www.mpiweb.org/cms/mpiweb/default.aspx)
Meetings Industry Association (www.mia-uk.org)
Eventia (www.eventia.org)
David Taylor is sales director at Hotel Brokers International (HBI). This article is an extract from the 2008 HBI Meetings Industry Report
