DEVELOPED IN PARTNERSHIP WITH MEETINGS Safety and security concerns emerge—the strongest yet in the history of MPI’s Meetings Outlook survey—as cautious optimism and growth continues in the industry. 2016 WINTER EDITION MOWinter2016.indd 59 1/22/16 10:56 AM COMBATING % TERRORISM 44 of industry professionals anticipate changes to the meeting and event industry due to the increasing prevalence and threat of terrorism. Following are the ways in which these organizations are focusing their efforts. 15 % MORE DESTINATION RESEARCH AND COMMUNICATIONS REGARDING RISK MEETINGS 5 % MORE ATTENDEE SCREENING By Elaine Pofeldt I n the wake of the terrorist attacks in Paris and San Bernardino, Calif.—both of which involved meeting and event venues—Lori Hedrick, CMP, CMM, MHA, CSEP, is introducing brand new educational programming to the MPI Carolinas Chapter. It’s about security. Risk management is not a new topic for most meeting professionals, but this time Hedrick plans to bring in local law enforcement and the Red Cross to address questions about what to do if the worst happens. For instance, she’d like them to answer: What do you do in that minute before help arrives, with the people with you in the room? “Who would have thought two years ago you’d be worried about doing triage in the middle of a meeting,” says Hedrick, vice president of education for the MPI Carolinas Chapter, as well as a meeting professional with the Burroughs Wellcome Fund in Research Triangle Park, N.C. Hedrick is not alone in her concern. In the latest Meetings Outlook survey, 28 percent of meeting professionals said they are making changes in how they run meetings in response to the recent terrorist incidents. “The vast majority of people are taking a very sober and thoughtful approach to ways to improve security without alarming the attendee,” says Bill Voegeli (MPI Georgia Chapter), president of Association Insights, the Atlanta-area research irm that conducts the survey. “I just planned a ilm festival in Arkansas, and it was very much part of the discussion—working with police, having an evacuation plan,” says Bethney Ruggiero, CMP, founder and principal of Strategic Event Design, based in the New York City area. In addition, 48 percent of respondents said they expected the costs of meetings to rise, because of the need for greater security. Supplier costs are already ticking up, the research found. Some meeting professionals reported meetings were being cancelled, at a cost to both planners and suppliers. 19 % PROVIDING MORE EMPLOYEE TRAINING TREND FORECAST 60 MPI MEETINGS OUTLOOK: 2016 Winter Edition MOWinter2016.indd 60 respondents expect the costs of meetings to rise 48% ofbecause of the need for greater security. 1/22/16 10:56 AM “Who would have thought two years ago you’d be worried about doing triage in the middle of a meeting.” SECURING EVENTS LORI HEDRICK, CMP, CMM, MHA, CSEP MPI Carolinas Chapter Meeting professional with Burroughs Wellcome Fund UPDATING PROCEDURES AND CONTINGENCY PLANS 15% 9 % ADDING MORE SECURITY STAFF W WORKING WITH LOCAL AND FEDERAL LAW ENFORCEMENT 5 % 14 % DEVELOPING NEW SECURITY PLANS 27 % PREDICT NO CHANGES DUE TO INCREASING THREAT OF TERRORISM Respondents agreeing to this statement most often explained that they believe their current actions are sufficient to keep them safe, that they are statistically unlikely to be victims or that their locations and events are of little or no value to terrorists. With big global events on his agenda, Bruce Johnson, manager of business development and events for manufacturer Emerson Electric in Round Rock, Texas, has given careful thought to how to keep attendees safe from terrorism. The company’s Global Users Exchange conference—held in October 2015 in Denver—took place before the recent wave of terrorism. But the next iteration of that conference is slated from Oct. 12-14, 2016, in Brussels, Belgium, at the Square Brussels Meeting Centre, where many in Europe are especially on edge about the Paris attacks. “Right now, we are being extremely cautious there,” Johnson says. “We’re monitoring all registrations on our visa screening. We are doing double and triple checking to make sure people are who they say they are.” Emerson Electric is a multinational that makes products ranging from food-waste disposals for sinks to technology solutions related to heating, cooling and refrigeration. With seven hotels booked in Brussels, Emerson Electric’s team is putting very tight security in place that will identify everyone on its team and all attendees, collaborating closely with the hotels. “They’ll look through their housing list to make sure those people have room,” Johnson says. “We’ve asked if they could provide additional security to screen the other tenants in the hotel.” Even prior to the terrorist attacks in Paris and San Bernardino, Calif., Emerson Electric had a key-employees policy that does not allow more than five senior managers to be on the same flight at any given time. “We loosely enforce that normally,” he says. “We’re closely watching that now.” Developed in Partnership with VISIT DENVER MOWinter2016.indd 61 61 2/10/16 11:34 AM Meeting professionals’ concerns about terrorism are contributing to an overall mood of caution in the industry— one that also extends to projections about budgets and business conditions. SECURITY 2.0 BUYING POWER PINCH A stress between rising budgets and faster rising costs was inferred last quarter. It is expressed this quarter as an observation that increasing budgets are even tighter than before. The latest statistics bear this out: Spend is projected to increase by 1.6% (down, statistically, over last quarter), but prices are projected to increase by 4.1% overall. On average, this is a 2.5% decline in buying power. Although security is on the minds of many meeting professionals, how their organizations react to the recent terrorist attacks is all over the map. “We see very little indication people are saying this is someone else’s problem,” Voegeli says. “They temper that awareness with a variety of factors that are applicable to them.” The irst step for many organizations, especially large ones, has been to more rigorously evaluate the threat level at their destinations. Both large companies and the meeting and event professionals who serve them are turning to security agencies, Voegeli says, though some such respondents were reluctant to share the names of their providers. Some organizations are also re-evaluating corporate travel plans. That is the case at telecommunica“It’s not just having people at the registration desk tions irm CommScope Inc. of North Carolina, but having a bit of heightened security on site. You where Paula A. Klinger have a larger security detail that is checking badges and (MPI Carolinas Chapter) works as a corporate making sure the people that are in various areas of a hotel meeting and event planor convention hall have the credentials to be there.” ner. Though the company has large facilities in China, Klinger says she would be cautious about taking a large team on a global BOB WALKER trip. MPI Dallas/Fort Worth Chapter “We’ll really think that through seriously now, with the SVP of client solutions at Freeman situations that are happening,” she says. “Not that it can’t happen here at home—we know it can.” Klinger also anticipates it will be more dif icult to get visas processed for her team than in the past and that air- pursue opportunities to host events,” she says. Some organizations are amping up already tight seport security will become more of a factor. “We’ll need more planning for our international team to curity, particularly at events where controversial topics might be discussed. Freeman, a Dallas-based integrator of come in to us,” she says. Other organizations have become cautious—in the solutions for live events, took that approach at an autumn wake of the attacks—about trying new destinations. When conference in Houston that attracted a number of enerVanessa Whitehead, CEO of Global Organization and Plan- gy-related speakers. While there has always been a need ning Services LLC in Newark, N.J., attended a presentation for diligence, the carefulness is even more important now, in December about pursuing business in Africa and the according to Bob Walker (MPI Dallas/Fort Worth Chapter), Caribbean, attendees at her table discussed their leeriness SVP of client solutions at Freeman. “It’s not just having people at the registration desk but about traveling overseas at the moment. “If folks are leery, they are pretty much not going to having a bit of heightened security on site,” he says. “You TREND FORECAST 35% 62 MPI MEETINGS OUTLOOK: 2016 Winter Edition MOWinter2016.indd 62 of respondents believe room rates will increase by 6% or more over the next year. 1/22/16 10:57 AM Projected Price Change Over the Next Year F&B/Catering 4.6% Audiovisual 3.6% Air Travel 4.2% Room Rates 4.5% Meeting Space 3.3% Business Conditions for 2016 OVERALL, RESPONDENTS PROJECT A POSITIVE 3% CHANGE IN BUSINESS CONDITIONS—DOWN FROM 3.8% LAST QUARTER. 68 % of respondents predict FAVORABLE business conditions 24 % of respondents predict NEUTRAL business conditions 8% of respondents predict have a larger security detail that is checking badges and making sure the people that are in various areas of a hotel or convention hall have the credentials to be there.” Freeman has also encouraged attendees to keep an eye on the environment at events, something Walker has seen happening throughout the industry. “I see more and more events suggesting to attendees that if something seems to be wrong, let us know,” he says. The concern goes beyond terrorism. “Some deranged person could walk in with an automatic weapon and just start iring,” he says. “It’s up to us, as those who plan these events, to put some procedures in place.” Although these procedures exist now, he has found, that recent events highlight how much more important they’re becoming. But other organizations are sticking with their existing security plans. “Some companies have always done threat assessments,” Voegeli says. “Those companies say nothing has changed for them.” That’s been the experience of Timothy Neill (MPI Oregon Chapter), whose employer is not changing its security plans as it evaluates what the recent terrorist attacks mean for itself, its clients and attendees of events in which it is involved. “We have a risk assessment we do with virtually any event we’re involved in,” says Neill, rental sales manager for AV Rental Services, a division of Henry V Events in Portland, Ore., as well as ship and store manager for Henry V. NEGATIVE business conditions Projected Budget/ Spend Over the Next Year 55 % of respondents predict FAVORABLE budget/spend 29 % of respondents predict NEUTRAL budget/spend 16% of respondents predict NEGATIVE budget/spend Developed in Partnership with VISIT DENVER MOWinter2016.indd 63 63 2/10/16 11:37 AM TREND FORECAST 31% of respondents say their organizations’ numbers of full-time employees are increasing. DEMOGRAPHICALLY BALANCED STAFF A significant need brought out is that of identifying, training and retaining the right demographic of employees who can embrace the “new” meeting and event industry—helping to support some of the experienced professionals who are unfamiliar with emerging expectations. That is, the more seasoned professionals may not have the socio-technological anticipation of newer professionals; newer professionals may not have the experience needed to develop broad new business strategies. Each side is discovering they need each other. GLIMPSE AT CURRENT EMPLOYMENT TRENDS 54 62 32% FULL-TIME 31% 14% 7% % INCREASE FLAT DECREASE FULL-TIME FULL-TIME CAUTIOUS GROWTH Despite the pall that terrorism has caused, the fundamentals of the meetings and events market remain strong, Meetings Outlook found. That is true in areas such as employment growth, in lation, declining inventories and more competition. Still, there has been a slow cooling of growth projections. Budgets are rising, but expenses are skyrocketing so fast that budgets can’t keep up, the research showed. Overall spending on meetings will increase by 1.6 percent, but prices are projected to increase by 4.1 percent overall, Meetings Outlook found. This has led to a 2.5 percent decline in buying power, on average. % PART-TIME PART-TIME PART-TIME 46% CONTRACT 49 % CONTRACT 6% CONTRACT Some meeting professionals are responding by trying to lock in good deals now. “Because it’s more of a seller’s market, with groups booking further out, they’re booking multiple years at the same time to leverage rates as well as concessions,” says Doug Tewnion (MPI British Columbia Chapter), senior sales manager at Atli ic Hotels in Victoria, British Columbia, who solicits partnerships for the Victoria Marriott Inner Harbour. Other meeting professionals are now taking a very careful approach to spending on meetings. Klinger at CommScope has found that with the prices of both hotel accommodations and airfare rising, there is more cost-consciousness. If costs contin- 64 MPI MEETINGS OUTLOOK: 2016 Winter Edition MOWinter2016.indd 64 1/22/16 2:20 PM 0216_065.indd 65 1/21/16 1:34 PM TREND FORECAST 33% of respondents say online collaborative, interactive learning is very important. “We would definitely review our list of who really needs to attend more closely, now that expenses are rising—and looking at the executive team going back and telling their team members about their experiences, as opposed to adding more attendees. I think particularly as costs continue to rise, we will look at it and perhaps cut back on attendance.” ue to rise, the irm might reduce the list of attendees for whom it is mandatory to attend the irm’s global operations meeting, she says. Typically, 75 to 100 executives attend. “We would de initely review our list of who really needs to attend more closely, now that expenses are rising—and looking at the executive team going back and telling their team members about their experiences, as opposed to adding more attendees,” she says. “I think particularly as costs continue to rise, we will look at it and perhaps cut back on attendance.” The active mergers and acquisitions market in many industries has also been raising questions in meeting professionals’ minds about what the future may hold for existing accounts. That’s the case at Freeman, which is actively planning for potential changes. “Maybe we have companies we have traditionally worked with merging with other companies we are also working with,” Walker says. “Of course that brings about new questions about who is going to be in charge, who is going to be running their meetings and what meetings they are going to have us produce.” To prepare, Freeman has been working on putting continuity plans in place, he says. In the nonpro it sector, some meeting planners have found that their clients, feeling pinched in the current environment, are spending cautiously. That’s the case for Lisa Lipowski, CMP (MPI Ottawa Chapter), president of Curly Dog Communications, a healthcare conference management services irm. Lipowski has found that inancial support for meetings in the nonpro it sector has waned. “The healthcare system is really, really suffering,” she says. As a result, inding sponsorships for medical meetings has gotten tougher. “You’ve got to jump through more hoops from a sponsorship point of view,” she says. “Sponsors are very selective about what they choose to sponsor.” Some of her clients have, as a result, asked to hold events at universities, rather than hotels. “My experience has not been great,” Lipowksi says. “When you get into the nitty gritty of it, you can PAULA A. KLINGER ind it’s not as inexpenMPI Carolinas Chapter sive or ef icient as you Corporate meeting planner at CommScope Inc. thought. The level of service makes all of the difference.” Sometimes, the caution has prevented meeting organizers from making needed investments in a meeting. Whitehead at Global Organization and Planning Services recently worked with a nonpro it client that made a series of compromises that she felt hurt the inal quality of the event. For instance, the client said no to a backdrop that would have made the stage background look much better. “It was frustrating,” she says. “It would have cost a little under US$1,000. We knew that without it, the stage area would not look good. Most of the attention would be in that area.” The organizer expected the event to attract 150 attendees but it ultimately only pulled in 100, she says. With nonpro its, she notes, “the event helps sell your organization. The level of the event can make or break whether people want to participate.” For many meeting professionals, the challenge in coming months will be to balance concerns about lower spending power with the need to take advantage of current opportunities. It’s not an easy one to tackle, but clearly, it’s an increasingly important one to master. ■ Explore and compare the latest and all archived editions of Meetings Outlook at www.mpiweb.org/MeetingsOutlook. Meetings Outlook is developed in partnership with VISIT DENVER. Meetings Outlook is supported in partnership with IMEX Group. Research conducted by Association Insights. © 2016 Meeting Professionals International 66 MPI MEETINGS OUTLOOK: 2016 Winter Edition MOWinter2016.indd 66 1/22/16 10:58 AM