Why you should spend €50M improving your meetings
I was talking to a client recently who had been given the job of looking at how they could improve their meetings. Meetings are where most collaboration happens, and meetings also drive a lot of travel and they are where decision-making happens. If we can get our meetings to work then we have an impact on all of these three important areas.
I put together a sample business case for the project.
- This company has 40,000 employees of which around 25% attend meetings regularly = 10,000 people.
- The average total cost of a managerial and professional person in Europe is around €100,000 per year.
- We know from past projects that on average people spend 40% of their time in meetings and half of this is wasted (time when they don’t think they need to be there to do their jobs ) = 20% waste. In fact the client felt that this percentage was significantly higher.
- We know that the knock-on effect of meetings is at least 50% more than the time of the meeting spent in preparation and/or travel time and cost.
Put this together and you have a cost of around €300M per year, just for the unnecessary meetings. Now I don’t believe you can eliminate all of this but half would be a good target, so let’s aim in our business case for savings of €150 million per year.
This is a significant business project and definitely worth doing something about. How would we treat a project like this in other areas of the business?
- First let’s consider a marketing investment? How much would you be prepared to spend to generate an additional profit of €150 million per year?
- Or a capital spend in manufacturing to reduce your manufacturing costs by €150 million per year
The businesses I worked for in my corporate career tended to be looking for an internal rate of return of 40%, another way of putting this is a payback in 2 ½ years.
So it seems in these areas we would have been happy to spend €375M to deliver this.
Can you imagine your business investing the €375 million in improving your meetings? Me neither! But why not?
Is it that we don’t believe that the savings can be delivered? As someone who has worked in business planning and in manufacturing I can tell you that the ROI assumptions we make on capital and market investments are often guesses. Marketing investments in particular are often made on educated guesses about customer acceptance or market needs that are often beyond our control rather than internal spend such as meetings where we can at least control our own destiny.
Most internal cost saving projects are justified to some extent on labor cost savings because people are expensive.
Quite often when we have conversations with clients they are looking for a training course or some materials that they can send people to help them run better meetings. In many cases this approach has been tried in the past but hasn’t worked.
Our approach can of course incorporate training and guidelines, but if you ask most managers they already know how to run the perfect meeting, it’s just that they never do and they never attend one that is perfect. It’s not a lack of knowledge; it’s a lack of application of good practice consistently over time.
It’s also tempting to jump straight to improving the facilitation of the meetings without asking what meetings and topics should be eliminated and what participants don’t need to be involved. Our research shows that around 41% of meeting content is unnecessary and that 19% of participants shouldn’t be there – and it’s very easy to identify which is which.
It’s also important to deal with some of the underlying corporate cultural issues. If your culture equates status with being invited to meetings, thinks everything needs to be done face-to-face and stresses the importance of networks but doesn’t give other opportunities to build them outside meetings – then it is going to be hard to stop meetings unless you put alternative mechanisms in place to satisfy these needs.
So let’s forget our unrealistic €375M budget to do with this and pitch for just €50M.
If you could deliver €150 million of savings per year for only €50 million in upfront cost wouldn’t you be a business hero? Wouldn’t that be the best investment your company made this decade? Payback in four months!
Think about the scope of project this would enable.
- You could put all of your 10,000 people through consistent training.
- You could put meeting coaches into your high-profile meetings to embed best practice and support implementation.
- You could offer online meeting tools to help people plan and facilitate better virtual and face-to-face meetings.
- You could have major change project with communication and stakeholder management.
- You could study and tweak your corporate culture in ways that support the initiative.
- You could run a recognition and celebration project for meeting heroes
- you could offer a prize of €1M to the team that improved the most
You would probably still be struggling to spend €5 million. You could spend some of the surplus celebrating your success.
So why have I kept going on about big budgets?
- First it’s a major change project, not just a matter of a few workshops so we should resource it accordingly.
- Second it’s a signal of intent and importance. If your marketing head or manufacturing director came to you and offered to save €150 million per year by spending 5M would you believe them? Would this even be worth discussing at your leadership team meeting? If they told you they could do it with a half-day workshop would you believe them?
- Third it positions this project both as a major saving opportunity and as something that requires significant resources and attention
So if you have a project to reduce the volume and improve the quality of your meetings do the business case first. You won’t make a change in this pervasive challenge just by running a few training courses. If you can build understanding amongst your stakeholders of the scope of the change and invest accordingly then you have a real chance of delivering significant savings to the business.
If you’d like to find out more about how you can really change your meetings culture, give us a call.
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