CESSEoutsourcing04

Outsourcing – Lessons Learned: 

Outsourcing – Lessons Learned Session Chair: Dana Pless Chief Financial Officer SAE International

Panel: 

Panel Connie Eren, SAE International Tony Keane, Optical Society of America Darlene Waychoff, SAE International Bill Briscoe, Helms-Briscoe

Outsourcing at SAE International: 

Outsourcing at SAE International Presented by: Connie Eren, CMP, CMM Manager, Corporate Services SAE International

Outsourcing Decisions: 

Outsourcing Decisions No simple yes/no answer Decision should be tied to your mission, strategic direction, core competencies or a business decision on what types of staff positions your association should and should not have

When Do You Outsource And Why?: 

When Do You Outsource And Why? If your supplier has more experience or technical expertise than you If you gain access to world-class resources If it will provide you with more efficiency and productivity gains If it saves you money and improves your bottom line

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If it allows your association staff to pursue their core competency activities and create revenue from new products and services If it empowers your staff to focus on the bigger picture of bringing in new members, developing new programs and accomplishing the mission of your organization If the function is too difficult or labor intensive to manage yourself

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If it will help you reduce your time to market If it will augment your staff and add bench strength to your organization

What Associations Are Outsourcing: 

What Associations Are Outsourcing Call centers Public relations functions Graphic design Printing and reprographics Certification programs Recruiting, placement and outplacement Benefits administration Payroll

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Exhibit sales Event planning/event management IT functions Marketing And much more

What SAE is Outsourcing: 

What SAE is Outsourcing Information technology management Facilities management Investment management Order fulfillment and returns processing Copy centers and digital printing Shipping/receiving Records management

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Training Market research Security Travel Shuttle services Event housing Registration and lead retrieval And more

If You Decide to Outsource: 

If You Decide to Outsource Make sure the supplier you choose Understands your market and your industry Is a leader in the field Has a proven track record Take your time and make sure you create a very thorough RFP

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Be realistic about how things will go during for the first 6-12 months

Lessons Learned: 

Lessons Learned Manage the relationship and be hands-on for at least the first year Clarify with expected outcomes, results, timetables and budgets Schedule regular progress reviews Evaluate regularly Be open and candid Allow mistakes and learn from them

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Consider them an extension of your staff, your partner Treat them with respect Don’t assume that your way is the best or only way

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But be aware and alert to possible pitfalls. In the July GWSAE Bottom Line Briefing, an article indicated that a survey of 182 buyers of outsourced services revealed that 26% of respondents were unhappy with their outsourcing efforts. This is why you must ensure a smooth transition.

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A successful outsourcing relationship must be well developed actively monitored, and maintained by a management team that plays an active role in choosing the supplier, monitoring the provider’s daily operations, keeps an eye out for internal changes that may affect the agreement.

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Be proactive at resolving disputes quickly Measure regularly in face-to-face meeting (monthly is preferred) Communicate both the positives and the challenges to your provider and to your internal executive staff

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It’s not painless, but it’s worth it, if you execute it well

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Good Luck and Thank you.

CESSE 2004: 

CESSE 2004 Outsourcing Experiences Tony Keane, CAE

Experiences: 

Experiences Accounting Information Technology Management Customer Service Magazine Publishing

Purpose: 

Purpose Continuity during staff turnover Depth and Experience of Management Resources and Leverage Efficiencies Concentration on Centers of Excellence Training Staffing Issues

Accounting: 

Accounting Management and Staff Turnover Prepared monthly financial statements Bank Reconciliation Audit Preparation

I/T Management: 

I/T Management Oversight Supervise Staff Technology Strategies Participate in budget development

Customer Service: 

Customer Service Entire Department On premises Management Participated in Management Team Mtgs. Included Mailroom

Magazine Publishing: 

Magazine Publishing Advertising Sales Function Production Editorial Worked with Editorial Board Royalty arrangement

Lessons Learned: 

Lessons Learned Clear understanding of expectations documented in the contract Make sure you have an exit strategy Performance Measurements Know who you will be dealing with Manage the relationship Understand the impact on internal staff

Lessons cont.: 

Lessons cont. Avoid over scrutinizing performance Include in staff events of organization Communicate Make sure your staff is providing the information to the vendor Don’t set it up for failure – if the process is not working now don’t expect it to work with the vendor without changes

Questions?: 

Questions?

Outsourced Functions at SAE: 

Outsourced Functions at SAE Presented by: Darlene Waychoff Manager, Events & Travel Operations SAE International

Outsourced Functions: 

Outsourced Functions In the events and travel arena, SAE outsources numerous functions including: Shuttle services Housing Travel management Registration and lead retrieval

City-Wide Shuttle: 

City-Wide Shuttle For SAE’s largest event, our World Congress, several types of shuttles are required City of Detroit provides shuttle service to contracted hotels SAE hires a transportation company to provide shuttles to and from several local malls

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That same provider also runs shuttles from the largest employers of SAE attendees, what we call, corporate shuttles and shuttles to and from our Automotive Headquarters where hundreds of our committee meetings take place all week

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Proposed to City that they manage all of the shuttle service In 2004, the City of Detroit took over the management of all shuttle services for us and SAE saved an additional $10,000 Service was not diminished Easier to work with one source for all transportation needs

Housing: 

Housing SAE began using an exclusive third-party housing company in 1995 for approximately five large annual events Their services included: Act as an advisor to SAE and help us negotiate hotel contracts Assist in securing hotel accommodations appropriate to size of event

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Negotiate directly with airlines and car rental companies for convention discounts and comps Manage all of our blocks and provide regular reporting on block status Telemarket to VIPs and exhibitors Manage room inventories to maximize usage and reduce cancellation

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Provide coordinated management of airline, hotel and car rental Effectively service exhibitor requirements Produce and share detailed reports and compare from year to year

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In 2003, SAE’s business model changed and required an on-line housing solution for all events SAE’s housing needs were: Offer on-line booking but also offer phone/fax/email options

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Streamline our internal processes by Managing housing reservation process for all conferences (15-25 per year) Managing VIP, exhibitor, attendee and staff blocks Provide real-time web reservations and confirmation numbers

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Provide reciprocal links between registration and housing forms Produce user-friendly and regular usage reports Allow us to track where customers are staying Reduce attrition concerns

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New housing supplier for 2004 Transition has been extremely smooth A per reservation fee is paid and is usually negotiated into the hotel contract Housing company manages block and provides SAE the reports we need Can now easily cross-reference housing list to registration list

Staff Travel: 

Staff Travel Prior to the Fall of 2002, SAE had a top travel agency in-house for several years Paid for two staff members on-site Monday thru Friday during business hours Paid all operations costs for the travel office Service was good and travel agents knew staff personally

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Travel budget was a large portion of the overall budget Need to look at ways to save in this area An RFQ was initiated and a new travel agency hired

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Our expectations of the new travel company included: Reduced costs Book lowest fee without comprising timing of flights or major inconveniencing of staff Build relationships with SAE staff Provide high-level customer service 24/7

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Offer user-friendly on-line service Produce regular reports Enforce SAE’s travel policy and make recommendations to the policy Coordinate all financials with our internal payment process Communicate and inform staff of travel notices, advisories, airline policies, etc.

Registration/Lead Retrieval: 

Registration/Lead Retrieval SAE has used a third-party registration company for large events for the past 12 years. Registration service was outsourced for approximately five large events and three medium sized events

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Initial criteria using an outside company was: 2,000 + attendees, and/or Lead retrieval service requirements

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Early objectives included: Managing pre-registration system Servicing customer inquiries Producing and providing user-friendly reports Managing the on-site registration system and processes Managing lead retrieval services

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Transferring data to SAE Recommending new and innovative services to our customers each year Reducing costs of registration/lead retrieval

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Partnering with a registration company requires a lot of time due to: Establishing several categories/roles which differ from meeting to meeting Offering different entitlements for different categories Integrating data between two systems (theirs and ours)

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Understanding each other’s organization, services, and staff Building a system in the organization to meet everyone’s needs Traveling and busy work schedules for both teams Developing group/exhibitor registration Consistently monitoring service levels

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In 2003, SAE moved pre-registration processing in-house Took staff more than one year to develop a new pre-registration system Goals of the in-house system: Requiring individual registrations Capturing demographic data in our customer management database Reporting accurate attendance numbers

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Reducing the cost of outsourcing registration by taking on the pre-registration piece Providing better customer service Having a user friendly system and a call center to answer all questions and concerns

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Lead Retrieval Keeping lead retrieval with your registration company keeps costs lower We receive thorough and useful traffic reports generated from the leads/data captured through these units.

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Has provided SAE with significant useful data to better market and help the customer determine their ROI

Benefits: 

Benefits If you’ve picked the right provider, they are willing to customize their service and products for your specific needs and wants

Lessons Learned: 

Lessons Learned Time consuming to compare similar services when outsourcing Difficult to estimate final costs Always compare apples to apples – avoid apples to oranges Lots of communication time for two-way feedback

Summary: 

Summary Form a small team of appropriate stakeholders to take on the outsourcing project Know your objectives and prioritize/weigh each of the objectives Prepare a thorough RFQ and timeline Compare proposals in one document to see similarities, unique offerings, and evaluate evenly

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Track service and costs following each event Develop service level agreements Challenge company to bring new services, new technology, and savings to the table Learn from mistakes Don’t be afraid to try it

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Thank you.