The Future of Meetings in a Post-A.I.G. Economy

Not a day goes by without more negative news about the state of our economy. While economic losses mount and layoffs multiply, a number of companies have garnered headlines focusing on corporate extravagance, namely the now-infamous AIG retreat at the St. Regis Resort in Monarch Beach, Calif. (For those who need a refresher, the luxurious affair coincided with AIG’s federal bailout in the amount of $85 billion.)

Event and meeting professionals immediately knew that while AIG was roundly decried (“When the going gets tough, the tough get pedicures,” wrote Los Angeles Times columnist David Lazarus), this event must have been planned months or even a year in advance, that most of the event had to be guaranteed with upfront payments, and that a short-notice cancellation would not have saved much of the cost.

However, obviously, in the current business climate, the event and meeting industry must undergo significant changes. Meetings and events indeed serve purposes beyond pampering and executive indulgences — so how can the industry refocus its strategies to prove it? We asked three executives — in the meetings industry and outside of it — to weigh in.

Lorraine AguilarLorraine Aguilar

Why do companies need to have meetings or events now?
“Given the changes in the economic climate, the need for corporate events has become critical for a company’s survival. Now more than ever, corporate leadership needs to regroup, re-strategize, collaborate and plan for the worst-case scenarios as well as new opportunities.

The biggest misconception around corporate events is that the money goes to excuses for parties or golf. I can honestly say that in the 10 years that I’ve been running corporate events, most of them have been focused on getting out of a painful situation by creating strategies for survival and success.”

What changes should be implemented? What should meetings achieve?
“All companies, but especially publicly traded or regulated companies, have an obligation to be financially responsible and not extravagant with other people’s money. Having said that, it is still important for people to get away from the work place and day-to-day urgencies to really focus on the big picture. At a minimum, they need to develop a contingency plan for worst- and best-case scenarios. They need to do a hard-core analysis of all business and financial data to find out how far they can draw down their business line of credit. How can they keep their money safe? Analyze! And look for opportunities. Keep a close eye on competitors. What are they doing?

This all requires people to come together to plan. This does not happen in day-to-day business stuff. Remember the California Gold Rush? Who really made the money? It was not the miners. It was Levi’s! They saw an opportunity in a time of major change.”

Lorraine Aguilar is president of Working Harmony Inc., which designs and runs collaborative leadership programs for large corporate clients such as United Nations agency programs and Southern California Edison.

David LoganDavid Logan

Are meetings still important at this time? Can a company justify the expense?
“Some meetings, and I would go as far as to say 60 to 70 percent of them, are pointless.

In the old days, business consultants created the meeting content and hospitality experts created entertainment. Frankly, it serves no purpose for companies to send their employees and consultants off on golf games. We want to see the hospitality industry take greater ownership of meeting content and bring that to the site to enhance the value of the meeting.”

What is your advice to hospitality companies?
“Create synergy between the meeting room and the outside events. Focus on why the organization is having the off-site event. Why are they coming here? How does the meeting benefit the company? How can we partner?”

What advice do you give companies at this point regarding meetings and events?
“There are two reasons only to have outside events and meetings. Strategic planning is one; building a culture in a group is the other. There is no reason to meet off-site if it can happen in a boardroom. But off-site, something new happens. When we have meetings at USC, the mentality changes and learning sets in. The venue lends itself to a different sort of conversation.”

David Logan is on the faculty at USC’s Marshall School of Business and is a senior partner at management consulting firm CultureSync. USC’s business school also hosts corporate meetings and provides outside services.

Janet ElkinsJanet Elkins

How can event companies adapt to a rapidly changing economic environment?
“We’ve adapted by understanding that our clients are more cost-conscious on various levels. They are concerned about the appearance of spending money as well as actually spending it on events. As a whole we are recommending cost savings to our clients that still allow the creation of an effective meeting. EventWorks tries to incorporate cost and ecological consciousness. We use recyclable items for many decorations; it saves money and reduces waste by reusing decoration elements. We are able to change their appearance and give them a fresh look each time with lighting effects.”

How do you deal with the image problem of corporate events during a recession?
“Events are necessary to business. At the core, they are business meetings camouflaged as events. There is a tangible need for them. At events people learn from each other and they learn more about the corporation’s goals. They learn about and from competitors. Events and meetings are still vital for the business world.

There is a lot we as the event producer can do to help with the image issues.

To give you an example, we use potted plants for decorations instead of cut flowers. These plants then get donated to schools or senior citizen homes. We connect the event with a charity. Guests get involved by making a donation, maybe a toy or a financial contribution. We create a dual purpose for the event. Besides fulfilling the business need, the attendees do something to enhance the community as a whole.

We are seeing cultural mores changing in front of our eyes. Lavish spending has gone the way of deep tans and smoking. However, companies still need to get their employees excited about selling their products. The best event companies will evolve with the times and change their strategies accordingly.”

Janet Elkins is president of EventWorks Inc., a Los Angeles-area special events company with nearly 30 years in the business.