What Associations Need to Know about SMM

Strategic meetings management principles can help you leverage your organization's buying power, control costs, increase efficiency, and more.

Karl Kirsch, CAE, had heard about strategic meetings management — or SMM — for years at industry meetings, but he wasn't completely sure what it entailed until he attended a session at a meeting management conference. While listening to the presenter, Kirsch, vice president, Meeting Expectations, an Atlanta-based association management and meeting planning company, came to a realization. “We already kind of do that in the association world. We just don't call it that,” he says.

SMM typically is associated with corporations that have decentralized departments planning hundreds of meetings from a variety of locations — not associations, which usually have one central office and a smaller number of meetings. But Kirsch saw there were some elements of SMM that associations do practice. That's why he believes it's important for association planners to understand the principles of SMM, so they know how it can benefit their organizations.

Which Type of Associations Might Benefit From SMM?

What is SMM? It's a detailed process that allows organizations to track, centralize, and manage all of their meeting expenditures in order to leverage buying power, control costs, operate more efficiently and effectively, mitigate risk, and measure return on investment. The National Business Travel Association has been a key driver of strategic meetings management programs and recently launched a certificate program in SMMP.

Since meetings are crucial to the average association's bottom line, association planners generally are focused on expenses.

For example, the first step in SMM is to have a process in place to register and approve each meeting, Kirsch says. Associations typically do that during their annual budgeting process to prepare for the upcoming year. “Its just part of their natural strategic planning and budgeting. They'll say, ‘These are the meetings we are going to run. Here are the budgets. Here are the expectations,’” Kirsch says.

But do associations include all board meetings, retreats, and smaller activities in that process? If it is a large association with multiple chapters, does it route, register, source, and plan all the chapter meetings through a centralized office? If not, then the organization may want to consider SMM, says Gary Shirmacher, senior vice president, strategic account services at Experient, Twinsburg, Ohio, which manages association meetings.

Tracking and Leveraging Spend

Another tenet of SMM is to have a centralized sourcing and procurement department that maximizes the organization's buying power with hotels and other meeting vendors.

Many large associations and third-party planning companies such as Meeting Expectations and Experient already do this. Meeting Expectations has a group of site-selection professionals who write the contracts and negotiate for cost savings. They are able to leverage their spend not only across all the meetings for a particular client, but across all association clients, Kirsch says. They can use their collective buying power to get good deals and write contracts that protect the client.

Large associations can do the same thing, but smaller associations don't have the same buying power. That's one reason why large associations with a lot of meetings are the best candidates to implement this SMM component, experts say.

Another step in SMM is payment and reconciliation, which most associations have down pretty well, Kirsch says. “Because they have such thin margins, associations tend to track all the hard expenses in all the different categories,” he says. “Most associations really excel at that.”

However, do they have a system to measure how much staff time it takes to plan specific meetings and events? And not just the staff time on site or the two weeks leading up to the meeting, but through the entire 12- to 18-month (or more) planning cycle leading up to the meeting?

“If you don't capture all that effort, you may be spending way more resources on a meeting than you think,” Kirsch says. This type of reporting allows associations to see the true return on investment of a meeting. For example, if a meeting of 50 people that breaks even takes as much time to plan as a meeting of 1,000 people that generates revenue, then changes should be made in planning the 50-attendee meeting.

This type of tracking can be done manually or through the use of software — it doesn't have to be fancy, Kirsch says. “We use a software program here. It's almost like a law firm — you track your hours per client and then your hours per job or function or task,” he says. “Then we know how much we are spending to produce the meeting.”

Associations also excel at data collection and analysis — that is, conducting post-event surveys, gauging attendee and exhibitor satisfaction, looking at financial measures, and determining ROI. But Kirsch stresses the need to measure staff time as well as hard costs, because it's part of the ROI equation.

Why Consider SMM?

Why is it so important for nonprofit associations to streamline costs? It's true that they don't have shareholders to report to or earnings estimates to meet like corporations do, but meeting expenses are very important to an association's bottom line. For most associations, revenues generated from meetings — including registration fees, exhibition fees, and sponsorships — are the largest source of annual revenue.

“Every ounce of cost efficiency they can drive into their operation and their budgeting for their conference is going to make the biggest difference when it comes to generating revenue,” says Kevin Iwamoto, vice president, enterprise strategy at StarCite, a technology company that manufactures SMM software. This is particularly true during a recession when meeting attendance and revenues are down.

While associations may not have shareholders, they do have membership to report to, Iwamoto says. The more efficiently meeting spend is managed, the more bang members will get for their conference registration fee.

“Membership is looking for efficiencies and process and wise stewardship of the money they have given to their association,” Iwamoto says, particularly in a recession, when members don't have as much money to spend on attending a meeting.

Of course, there are challenges in implementing SMM, Shirmacher says. It takes time and resources to establish process and policy, money to create tools and reports, effort to require compliance, and commitment from leadership. But he is seeing more interest among association leaders in the concept.

Learn More

Is your association interested in learning more about strategic meetings management? Visit our Special Report to read case studies and learn how to implement SMM: meetingsnet.com/corporatemeetingsincentives/strategies/ [3].