In-house or outsource? Which meetings management functions associations outsource--and how--is often a matter of time, money, and management philosophy.

WHEN STEVEN C. DRAKE WAS BETWEEN JOBS 12 YEARS AGO, HE HAD NO IDEA HIS transition would result in forming his own association management company. A former number two association executive looking to fill a CEO spot, Drake received a call during the interim from Monsanto Corporation asking him to plan four major meetings ranging from 250 to 1,700 participants. Those successes led to a renewed meetings contract from Monsanto and the gumption to scout for associations whose projects and services he also might manage on a fee-based structure. Drake's CEO search ended shortly thereafter, when he secured a management contract to manage Alpha Zeta Fraternity.

Today, St. Louis-based Drake & Company is a full-service AMC with 20 staff members who, among other things, annually orchestrate upwards of 147 board and committee meetings and 12 conferences and conventions for the company's nine association clients. "When I worked for a large association, the tendency was to do everything in-house," says Drake. "Today there is a much greater willingness to send things out." As downsizing, mergers, and consolidations continue across industries, members are putting greater pressure on associations to find ways to economize, explains Drake.

Cost is certainly a key outsourcing consideration for many association executives. So are time, expertise, and comfort level--how much control executives are willing to entrust to an outside entity. Occasions also exist when you should not outsource and when bringing something back in-house may make the most sense. Careful analysis of particular tasks and potential partners can help executives determine whether outsourcing is a good move. (See sidebar, "Outsourciug Needs Assessment.")

When it comes to meetings and conventions, associations are outsourcing everything from high-level site selection and trade show management to the grunt work of printing name badges. Outlined here are some of the reasons why association executives do and don't seek outside assistance with their meetings management.

Staff time

Linda S. Chreno's four-member staff at the Florida Society of Association Executives, Tallahassee, continues looking for ways to more efficiently handle meetings-related activities.

While FSAE staff coordinates selection of speakers and keynotes, an outsourcing partner follows up regarding speaker travel, audiovisual needs, handout collection, and on-site room setup, says Chreno, CAE, FSAE executive vice president. "Our outsourcer is also the on-site point of contact for technical and logistical concerns so that staff members can truly interact with attendees," she says.

New York City-based American Group Psychotherapy Association has at least 20 outsourcing partners to handle aspects of the association's meetings, publications, data processing, fulfillment, public relations, and development activities. Strategic planning efforts in the late 1990s led AGPA to adopt an outsourced management model that Focused remaining staff on senior-level tasks while turning over the logistical legwork that was eating away at the association's energy and time, says Marsha S. Block, CAE, the association's CEO. Mostly through attrition, her former 14-member staff is now a solid six full-time employees.

Among the meetings functions AGPA outsources are data entry and registration, on-site logistics, and continuing education accreditation. "When I think back to the days when we did registration in-house, and of the rising stress levels in the office when the printer wouldn't work to print badges and packets, I realize how wonderful it is to no longer feel drained by the things we could have given away but didn't," says Block. "That's not to say that outsourcing is always a perfect arrangement. We may need to massage and tweak those relationships. But no one wants to bring those functions back in-house."

Of the variety of outsourcing partners an association might choose, association management companies represent a viable outsourcing outlet. And sometimes even the outsourcer becomes the outsourcee, says Rick Dungey, a Drake & Company account executive. For Drake & Company, it's most often a question of staffing requirements and work flow. "If we recognize that we don't have the staff time to take 1,000 registrations for a conference, but that hiring someone based on three months of work doesn't make sense, then finding a vendor to do the work more quickly and less expensively ultimately saves out-of-pocket costs for our clients," says Dungey. "And those savings allow our clients to pay us to do higher-level work."

The meetings functions Dungey has outsourced on behalf of Drake & Company clients: pre- and on-site registration, audiovisual services, and the solicitation and collection of abstracts for conference proceedings, among other things. "We also typically outsource the design and printing of conference materials such as programs, schedules, and signage because we simply aren't equipped to do those in-house," says Dungey.

Staff expertise

If staff time is one criterion by which associations determine an outsourcing need, staff expertise is another. Some associations send certain activities out because they lack a particular proficiency or capability in-house. But where that expertise exists, other associations may find it doesn't make sense to pay someone else.

"Show me the added value." That's what Patricia A. Hastings repeats in her head when scrutinizing the sales pitches from outsourcing companies that want to handle site selection or hotel room block negotiations for the Materials Research Society, Warrendale, Pennsylvania, where Hastings is director of meetings activities. She admits her job is made easier and that she has more negotiating leverage by virtue of the fact that MRS meetings stay put. The society's fall meeting has been booked in Boston for nearly 20 years and its spring meeting busted by San Francisco for 13 years running. "We have the benefit of long-term relationships and contracts, so in our case, there's really nothing an outside firm could do that we couldn't do as easily and cost-efficiently," says Hastings. "Plus, whereas an outside company would take its commission from hotel discounts, we pass along the full savings to attendees."

MRS has entertained the idea of moving its meetings to other cities. If that happens, Hastings would consider the services of an outsourcer--though even then, she would need convincing, "I'm really not a hard sell, but it's part of my job to negotiate meetings, and I know how to do that. An outside company might save me time, but they might not get the best deal," says Hastings.

Current strategic planning efforts may eventually translate into some meetings outsourcing for the 40-member MRS staff. A member task force is exploring the society's long-term meetings vision and whether MRS should offer additional topical conferences on a broader scale. As a result, the society is experimenting with smaller workshops geared to about 120 participants, says Hastings. "The task force could come back and say we want 30 workshops on 30 different topics offered around the country each year. If that were the case, we'd likely have to outsource some aspect of that simply because of the sheer volume."

Cost

Bear in mind, "No one outsources for free," says Robert F. Rowell, CAE, former executive director of the National Art Materials Trade Association (NAMTA), Huntersville, North Carolina. "You first have to make sure you don't lose money outsourcing and that your bottom line is not violated," says Rowell, now president and CEO of the Council for Art Education, Cornelius, North Carolina. At the same time, he suggests that association executives factor in hidden savings, such as time freed up for you and your staff to do other things.

For years Rowell outsourced site selection and rate negotiation of not only NAMTA's annual meeting and trade show, but also the association's regional training programs, board and committee meetings, and all business-related travel for Rowell and his seven-member staff. "When I lumped all these together, I realized we were saving about $15,000 a year by having our outsourcing partner handle all the research on properties and discount room rates and airfare for all our travel," he says.

Other associations have realized similar cost savings. Jeffrey L. Dean, CAE, remembers his amazement and appreciation when attending a post-conference meeting to review his association's master account and finding that the outsourcing company was able to remove $10,000 in expenses from the bill. "We're focused on the substance of the meeting and its content, so we don't have time to count bottles and heads in rooms," says Dean, executive director and general counsel for the International Society of Explosives Engineers (ISEE), Cleveland. "Functional aspects like that are critical, so it's important that someone resolves discrepancies." With a 10-member staff, he's glad to have an outsourcing partner he can trust to keep watch over those financial details.

Immediate need led to Dean's initial decision to outsource meetings logistics. When he came on board as ISEE's first paid executive director 16 years ago, he learned that the society's former volunteer managers had booked ISEE's annual meeting for New Orleans the following year. "They had only allocated 350 rooms, and we needed 650," says Dean. That in itself might not be so bad, admits Dean, if it weren't for the fact that the meeting was scheduled during Mardi Gras. "I almost panicked when I realized what I was saddled with," he says.

Fortunately, Dean had recently met an outsourcing representative with offices down the street from ISEE headquarters. "The company was able to negotiate with a new hotel opening near the airport, convincing hotel management to open a wing of the hotel early to accommodate our attendees," says Dean. He has been with the company ever since--though with a clear delineation of roles. "In essence, ISEE maintains control of program and substance, while our outsourcer handles meeting functions and logistics." Even then, it's teamwork, according to Dean. "I work closely with the account executive to locate and acquire sites and negotiate contracts. Then we turn things over to my meeting planner and the outsourcing company's account planner," he explains.

The ability to trust your outsourcer--and to know that your association's interests are a priority--is paramount to a successful outsourcing relationship, says Dean. He suggests that association executives develop checklists for each outsourced function to ensure proper oversight. For instance, be clear about the association's criteria for meeting location and facilities, for contract specifications, and so forth. "This is not a slight against the outsourcing company, but no one will look out for an organization in the same way those within, the organization will," says Dean. "Associations need to be watchdogs in the process, with clearly defined policies and procedures that you live by in your outsourcing relationships."

Customer Service

For the Florida Society of Association Executives' Chreno, cost, staff time, and customer service dovetail when considering what and whether to outsource. "I can't separate one from the other, but it ultimately has to be in the best interest of our members," she says. "Outsourcing might save me money, but if it doesn't serve our members, it's not worth it."

Some outsourcing models may actually, improve an association's customer service to members and the community at large. The American Group Psychotherapy Association's outsourced management model proved this point for Block on September 11, 2001. On that day, with phone service largely unavailable in New York City, Block was at least able to send an e-mail message to the Maryland company housing the association's database so that members in turn could be contacted. As group psychotherapists, AGPA members were out in New York City and Washington, D.C., communities within 24 hours, providing services to victims, family members, and organizations directly affected by the terrorist attacks, says Block. She used her meetings outsourcer to organize days and spaces for different groups and her publications outsourcer to develop information materials.

In a situation where Block couldn't directly communicate with her members easily, she was able to pull from all directions to get 200 member clinicians into these communities for immediate crisis counseling in the days, weeks, and months following the attacks. "Functioning fully from one location isn't always the best solution," says Block. "If we had not been reorganized as we are, we could not have responded so quickly."

Technology

As are many association executives, Chreno is making greater use of technology to streamline meetings management functions--in her case, relying on outside technical assistance. This past year Chreno outsourced a Web-based evaluation sent on the heels of her conference. Participants received the form via e-mail once they returned to work but while the conference was fresh on their minds. "We made it simple, but we gave the opportunity for attendees to write comments--and people wrote paragraphs," says Chreno, who was also quite pleased with a 50 percent response rate and real-time tabulations on the ratings for each session.

While the desire not to house the hardware is a reason some associations send a particular function out, technology is also a reason more associations are maintaining activities within. Hastings, of the Materials Research Society (MRS), currently uses a vendor to print name badges, but even that will likely return in-house with the pending purchase of a new association management software module.

Data collection and information management are among the meetings-related functions more associations are likely to keep internal tabs on. MRS plans to keep its meetings registration process in-house because the society has invested in software to track member attendance, purchases, and preferences across the board. The goal of building an information powerhouse that will allow MRS to better serve its various member segments will influence not only meetings but the whole host of MRS member products and services.

Control

Beyond the professional expertise and technological efficiencies MRS has available in-house, an underlying reason for the society's direct management of the majority of its meetings functions is that it never again wants to lose control of a core product. MRS reorganized six years ago to bring its outsourced meeting planning position back on staff. "The society had to make internal changes because it was to the point where our staff members weren't allowed to speak directly to the hotels. Everything had to go through the outsourcing company," says Hastings.

However, outsourcing meetings management activities does not necessarily mean that you're giving up control. It's really all about partnerships. And while successful outsourcing relationships take time to foster, Chreno believes anything is fair game for consideration. "A good association executive keeps examining outsourcing possibilities and re-evaluating member needs--in large part because of continual changes in technology and within the larger socio-economic environment," she says.

Block concurs. She should know She has been AGPA's CEO for 30 years and has seen association core functions come and go. In terms of outsourcing, that means activities that an association previously thought should never be outsourced may, across time, make sense to send out. The key, she says, is to make sure you know the outcomes you desire. "You don't have to understand distance learning from a technical point of view, but you do need a solid idea of what you want as the end product," says Block. Some things you may need to handle in-house prior to sending out, she says. A call center, for instance, may be difficult to entrust to someone else until you know firsthand the nature of member questions and concerns.

Not every AGPA outsourcing relationship has worked. Block's first partnership with a full-service meetings management outsourcer lasted six weeks. "That company thought we were too labor-intensive," she says. That made her rethink giving the whole pie to any one company. She has since off-loaded aspects of her annual meeting to different groups. That may not work for everyone, says Block. "It all depends on the nature of your business and on finding the right partner."

Block abides by this rule: "Never assume that when you outsource something, you're getting rid of it. You need to provide oversight, though without duplicating the time and energy of your outsourcing partner." Otherwise, your costs can easily double, she says.

"Ultimately it's still your meeting," says Chreno. "Whether you outsource all or parts of it, you don't have to--and should not--lose control." AM

Karla B. Hignite is a freelance writer

based in Colorado Springs, Colorado.

E-mail: [e-mail].