Again, another from a few years ago, now more than ever this is relevant as budgets are slashed and tightened. One thing we have noticed however is an actual loosening of the procurement yoke as companies try and find less costly ways to produce their meetings and events.
The call comes down from on high, your company or client is now going to involve procurement in the planning, staging and production of events and meetings. UH-OH.
Yes, there is room to be concerned, but since you can not fight this one it is best to get on board early and learn the systems that will now be in place. We work with our clients who have implemented these strategies to keep costs down. In most cases, it has been painless, in others not so much.
The biggest effect we see as a third-party planning firm is that procurement departments treat events like widgets rather than living breathing things. Sometimes it is difficult to quantify the ROI of a particular event, things drastically change at the last minute or the scope of work gets re-written over and over. As planners, we already plan for this and adapt as required.
In order for the procurement solution to be effective across the enterprise, planners must be involved in the implementation of a procurement solution, not simply told that they must now adhere to new regulations. Procurement departments need to understand that we as planners take pride in keeping event costs as low as possible; in fact, we thrive on it. As successful meeting and event professionals, whether in-house or third party we are a company’s champion and look after its pocketbook and best interests. As a third-party planner, if OnSite Events comes in under budget while reaching the stated event goals, we keep the client. If an in-house planner does the same, they keep their job.
Procurement Managers need to understand that the widget model will not work and is sometimes counterproductive to a company’s best interests. If a company loses a venue, hotel location, or preferred rate because budgets are held up while awaiting approval, they are actually responsible for costing a company additional funds.
My two cents on the subject are this. Procurement is not our enemy, in the proper setting and environment they can actually be beneficial and help large organizations keep costs controlled across the enterprise. In order to be successful, they must include the planning experts at the earliest possible time. Remember, if you thought enough about an individual to hire them as an in-house planner, or enough about a third-party planning company to contract us, use our expertise to make your cost-wrangling goals achievable while keeping your needs, goals, and reputation intact.
Added note – One of the things that we have noticed in the three years since this was originally written is that procurement can actually make costs go up. Companies are now forced to work with preferred vendors rather than going to bid on every project. The preferred vendors (A small minority) realize that they have a minor monopoly and charge high fees for their services thus increasing actual meeting and event spend leading to the to the “government” effect of over-paying for services.