One of the most common refrains from meeting planners and suppliers in the last couple of years has been that corporate procurement departments have been getting more and more involved in the process of choosing suppliers and venues for meetings, incentive trips, corporate events, and even trade show exhibitions. Generally, those comments are delivered in a tone that ranges from weary resignation to repressed anger. That doesn’t really surprise procurement people.
“In most companies, whether it’s IT or meeting planning or anything else, most people don’t like procurement coming in and telling them how it’s got to be done,” says John Sorci, who retired last year as vice president of global operations of Mountain View, CA-based Symantec Corporation, a Fortune 500 maker of consumer and corporate information security software, best known for its Norton AntiVirus and Internet Security programs. His responsibilities included travel procurement, but not within the meeting planning department.
“Anybody who’s using a supplier for some service or product, especially if they’ve had a good experience over the last couple of years, wants to continue to use that supplier,” says Sorci, who now works as a consultant. “He doesn’t want someone else coming in telling him to use somebody else.”
This is an issue that Wendy Dell, director of business development, strategic meetings management, for Chicago-based BCD Meetings & Incentives, understands well. Having started out in procurement before becoming a corporate meeting planner and moving on to a third-party meetings management firm, she says planners “really do get emotionally tied to events, there is this perception that procurement and meeting planners have conflicting objectives, that procurement sometimes treats events as widgets, and so, the meeting planners don’t want to allow procurement to be part of the process.”
That suspicion of procurement is common to all areas of the business, according to Sorci, who says that when wearing his operations hat, he wouldn’t have wanted anyone telling him which third-party manufacturer to use. “At Symantec, we always said that we are not going to tell you who to use,” he says. “Our job is to go to that marketplace and get competitive bids, and ensure that they’re apples-to-apples bids, and present the information. But [the planners are] the ultimate decision makers. They might decide that company X, who they’ve used in the past, is worth the 5 percent more than company Y, which is an unknown. If you got something on the cheap, but the company doesn’t achieve its goals, it probably wasn’t worth it.”
Which is to say, the goals of both the planning and procurement departments are really the same, says Steve O’Malley, senior vice president of St. Louis-based Maritz Travel and executive sponsor of Maxvantage, Maritz Travel’s alliance with American Express focused on meetings management solutions.
“The objectives of the event planner are about designing and executing a program that drives greater results for the company,” O’Malley says. “When you think about the overarching goals of procurement, it’s about improving the results of the company through streamlining and alignment of how things are bought, supply chain standardization, and making sure there is a clear view as to how dollars are being invested.”
The Benefits of Working Together
Even when procurement doesn’t have the final say in which venues, suppliers, and third-party partners the company’s planners hire to host and run their meetings, procurement’s involvement in the bidding process can be very beneficial.
Sorci points to a fight he had with Symantec’s planning department — never more than a few people strong during his tenure — over the third-party company hired to do Symantec’s site selection and contracting, among other tasks, at large shows like Symantec’s annual Worldwide Sales Conference in Las Vegas, which had 5,000 to 6,000 attendees.
“They had a favorite company they used, and we didn’t have an issue with that as long as there was a competitive bid,” Sorci says. “We forced that issue, because no one can really logically argue we shouldn’t bid this out, if for nothing else then to keep the most-favored group honest. We found the group they liked was very expensive. They ended up going with them anyway, which was fine, but [the third-party planner] lowered their price quite a bit and made a lot of financial and other service-related concessions. So, I think that was a win for us, but it was a hard-fought battle.”
It was also one that left Symantec’s planners with more of a budget to spend on attendees. Not all meetings departments can force the issue, however.
Planners have a lot to gain by working with procurement, says Terri Scheer, the associate director of meetings and events for Cognizant, a Fortune 500 business and technology services firm based in Teaneck, NJ. Her firm’s global travel department “doesn’t determine whom I contract with for a conference but I do try and keep their goals in mind,” says Scheer. “It’s more or less the other piece, us working together when planning events to take advantage of the best rates on airfare, and working with the travel and hotel vendors.”
Because the travel procurement division handles the individual business travel for the firm’s roughly 140,000 employees, that department can add a lot of clout to Scheer’s interaction with hotels and airlines. “Procurement is able to better track, across the globe, how much meeting spend and air spend we have, so [they are] more aware of how much spend we have with a particular hotel chain,” Scheer says. “This knowledge sharing helps me during negotiations.”