by By Michael J. Shapiro | May 01, 2009

defend insideIn early March, Las Vegas reported 340 group cancellations for the year, at an estimated cost to the city of more than $131 million. That's but one city. Seventy-six percent of meeting planners polled by M&C in late March have had to defend meetings or events scheduled to take place this year or in 2010. (See News Research for the full survey results.)

The need to prove a meeting's value clearly has been established, and not just for the 500-plus recipients of Troubled Asset Relief Program funds, which must adhere to Department of the Treasury guidelines and set policies on "reasonable" spending for entertainment, meetings and incentives.

At a time when all spending is facing intense scrutiny, measuring return on investment is increasingly crucial. However, relatively few meeting planners calculate ROI by any formal methods, as M&C's recent survey also illustrates. One possible reason for their reluctance: It's extra work they hadn't planned on doing, says Dr. Jack Phillips, chairman of the Birmingham, Ala.-based ROI Institute and co-developer of the Phillips ROI methodology. For many, he says, the process "takes them out of their comfort level. They're not so good at this, and haven't thought about it, and don't really want to go there."

Others are afraid of the consequences. "There's always this fear of 'Oh my God, our event is going to be killed,' " Phillips says. Planners worry that measuring value will only prove that the investment in the meeting doesn't pay off. But in the vast majority of cases, he says, "there's more value than the organizers think there is. In about 80 percent of the studies we do, we find a positive ROI." In other words, the dollar equivalent of the meeting's benefits exceeds the cost.

Furthermore, planners shouldn't assume a negative ROI is the kiss of death. "Of the 20 percent that are negative, we estimate that only about 10 percent of those are discontinued," adds Phillips. Rather, negative results reveal opportunities to  make adjustments and changes.

Parsing the process
A positive ROI is like a stamp of approval, a tangible number that helps substantiate an event's purpose. "I don't want to be the voice of doom, but I do think that the industry is at a very precarious place," says Ira Kerns, managing director of GuideStar Research and developer of MeetingMetrics software, a measurement tool used by the industry (see "Measuring the Metrics," below). People must think about measuring meeting value to protect and preserve meetings, notes Kerns.

The ROI Institute offers certification courses, so planners can become adept at measuring ROI. Or, a full ROI analysis can be outsourced, either to consultants, a meetings management company or an organization like GuideStar. But regardless of whether a comprehensive study is planned, the ROI Institute recommends certain steps be taken for every meeting to ensure that it drives value.

The following process is based on an ROI Institute hierarchy that places business impact and ROI at the top, above more easily measured parameters. A number of software tools, designed to help collect and process the data, are based on this methodology and hierarchy -- including MeetingMetrics, Knowledge Advisors' Metrics that Matter and Gaelstorm's SeseiROI.

Think strategically. Gauging a meeting's value requires identifying needs and objectives -- and doing so from the outset. The earlier this begins, the easier it is to measure the results. In some cases, this can be a challenge.

"Not all meeting planners have the wherewithal, or even the opportunity, to question the strategy," Phillips says. This is particularly true of those whose roles are logistical rather than strategic. His advice: Try to change that. In his seminars, Phillips typically finds only two or three people out of a few hundred who say they have no influence at all over the meeting content or objectives. "If you're in a position where you cannot affect either one of those, then you're going to have a hard time driving business value, let alone evaluating it," Phillips says. (For advice on this challenge, see "Get Strategic.")

Identify the need. For corporate gatherings in particular, make sure there's a legitimate reason for meeting. Too often, the reason is "we meet every year."

Define objectives. Determine specific goals for the meeting, not just the topics that will be covered. The ROI Institute breaks down these objectives into four categories, which correspond to the levels of their measurement hierarchy.

Particularly important at this stage is defining success, explains Cordelia Hecko, CMP, a Certified ROI Professional and project manager with Concepts Worldwide, a strategic meetings management provider in Carlsbad, Calif. "What would success look like?" asks Hecko. "If we had 50 percent of the people saying they felt motivated, would that be success? It's really getting a more specific goal." Objectives break down into four levels, as follows.

• Level 1: Reaction objectives. How do you want the audience to react? Do you want them to feel motivated? Do you want them to deem the content relevant and useful to their jobs?

• Level 2: Learning objectives.
What knowledge will attendees gain? This could be company information, an understanding of new technology, new skills or even meeting new people. The takeaways are the real business value.

• Level 3: Application objectives. What do you want attendees to do the day after the meeting, or the next week or the following month? Often, solid expectations are associated with a meeting, according to Phillips, but they might not be clearly written or defined as such. "So let's put it in there as an objective," says Phillips. "That keeps the speakers focused on that application; it keeps the participants clearly informed about what you expect them to do; and then it gives us a hint about what [data] we might need to capture if we want to follow up and see what they've done."

• Level 4: Impact objectives. If attendees do what you want them to do, what impact would that have on business? The objective for a sales meeting would likely be for the salespeople to sell more. In a customer meeting it might be for customers to buy more. These objectives often relate to sales data, market share data and the like. Or, they could involve less obviously quantifiable data, such as employee productivity or brand awareness. Hecko notes, "If you've really got clarity on your objectives, then you're going to do a good meeting, whether you measure it or not." The measurement, she adds, only proves it.