Team Building & Corporate Event Budgets: The Perils of Being Penny Wise and Pound Foolish
Unfortunately, we’re hearing it again. The “R” word is being used in news stories for Canada as well as some countries in Europe and Latin America.Canada, where I am based, is facing the double whammy of an erosion in its value against the U.S. dollar.
As we learned during the 2008 global economic meltdown and the 2002 – 2004 recession, this is never good news for team building consultants and corporate event planners.
For too long, the lines between bottom line oriented team building and strictly recreational events have been blurred.
(I mention consultants and planners of social events as, for too long, the lines between bottom line oriented team building and strictly recreational events have been blurred. I’ve long sounded the alarm about the risks this presents.)
One of the important take-aways from past recessions is that it is critical to connect the dots, monitor economic trends and proactively manage spending.
Executives are penny wise when they continue to spend heavily on strictly recreational events instead of pulling teams together to generate solutions to business challenges. They’re pound foolish when they overspend on recreational and social activities during turbulent times. They’re also pound foolish when there is a knee-jerk reaction and the very initiatives that can help organizations become more effective are preemptively chopped.
The need to become more bottom line oriented should have been a major take-away from past recessions.
With the very real danger or massive chops in mind, I recently wrote a post for a client’s blog.
By scrutinizing budgets and proactively designing strategies to deliver programmes in a more cost effective manner, perhaps much deeper cuts can be avoided down the road.
(I almost thought that it was a no-brainer and feared readers might roll their eyes and dismiss the post thinking “tell us something we don’t know”.)
Pitfalls of Being Pound Foolish
Then, came the reaction from a Twitter follower. (I’ve removed the name to avoid embarrassing the follower:
I’m fine with people having a point of view that is different from my own. After all, discussions would be snooze-fests if everyone agreed. So I checked, perhaps I had missed the mark. Here were my tips:
I’m not sure how that will reduce meeting effectiveness unless you park participants in their seats and have a parade of talking heads drone on until everyone is comatose, the session will be long and ineffective. This approach won’t work even if the session is of short duration.
If content is engaging and one gives participants regular breaks and uses effective energizers, there is no reason that this strategy will undermine effectiveness.
Then, I looked at tip 9. Had I missed the mark?
The tweet seemed to be based on the assumption that quality is based on flying high priced speakers in from some far flung location. No destination has a monopoly on excellent speakers. If an event or meeting planner does their homework, they will find effective speakers closer to the meeting location.
Liz King, who can be counted on to be the voice of reason responded and I agreed with her.
Chefs are finding that they can significantly improve their offerings by creating dishes that showcase fresh, local seasonal ingredients. Savvy event planners take steps to reflect the destination in menus, decor, and entertainment. When budgets are tight, the creative use of talented local facilitators and speakers may be just the added touch that makes executive retreats, team building sessions, conferences, and meetings both memorable and engaging.
It is unwise and very risky to continue current levels of spending until the CEO decides to make massive budget cuts and begin lay-offs.
Is the best plan to continue to spend at previous levels on high priced recreational events at expensive venues?
From where I sit, by being proactive and demonstrating value to the C-suite in a cost effective manner perhaps the massive cutbacks of past recessions can be avoided. It’s worth a try.
The need to become more bottom line oriented was a major take-away from past recessions. If it wasn’t, that does not bode well for corporate budgets. It’s important to manage resources effectively and demonstrate value as a contributor to the bottom line rather than a line under “Expenses”on financial statements.
Your Turn: What steps can team building consultants, meeting and event planners take to manage resources effectively?
More tips for delivering cost effective team building:
- Should companies cut team building during a recession?
- Team Building During a Recession: Stretching Your Budget
- Who Loses When Companies Overspend on Team Recreation?
Pull corporate teams together through projects that generate solutions to real-world challenges and demonstrate bottom line value.