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April 16, 2008

Chris Elmitt: The economy - threats and opportunities

After several years of healthy expansion, it’s hard to predict whether the events industry will suffer or thrive if the threatened economic downturn should come to pass. We know from experience that events are among the first ‘luxuries’ to come under scrutiny when the economic pressure bites. For the moment, though, the market remains buoyant and signs are that while spend may be reduced, events will not be cancelled altogether.

Agencies and their corporate clients might nevertheless be under pressure to deliver more for less, and this will have interesting implications for the approach to return on investment (ROI). Over the last few years we have advanced in leaps and bounds in measuring event effectiveness, but as the pressure on budgets increases, will corporates take the more pragmatic approach of: "Let’s just put on the best event we can with the little we have been allocated to spend."?

I for investment
Unfortunately for the events industry, some organisers will argue that the easiest way to achieve ROI is to make the "I" as small as possible!

The counter argument is that budgets will exist as long as planners are able to justify their event spend to stakeholders, linking spend to clear event objectives, followed by measurement and evaluation, will play a key role in that process. It’s just possible that the focus on ROI, or at least ROO (return on objectives) will intensify as corporate belts tighten.

And event objectives should certainly receive greater attention when organisations have unhappy news to impart. It’s not too much of a challenge to win applause after presenting expansion plans and upward-slanting graphs, but it’s much harder to inspire and motivate when the messages are about controlling costs in unpredictable market conditions. Planners need to be clear on how their event can best contribute towards the introduction of new strategies , the management of organisational change and the communication of subtle and complex messages.

Winning loyalty and respect
Such circumstances tend to sort the wheat from the chaff in terms of communication. I have had experience of leaders who fudged the issues and evaded difficult questions when conveying bad news to their staff. Such treatment invariably fosters an atmosphere of insecurity, distrust and despondency, and is unlikely to achieve any of the event’s objectives. On other occasions, I’ve witnessed CEOs win the loyalty and respect from staff who were facing challenging circumstances, because those leaders were completely up-front and sincere about the company’s situation and invited feedback and discussion.

Current thinking is that the increasing complexity of the business environment calls for a more holistic leadership approach within organisations. This entails going beyond the strategic planning models applied historically, and inviting innovative thinking from other sources. And what better medium than a large group event to generate multi-directional discussion?

We in the events sector may just find that there is newfound respect for our business, as leaders seize the full potential that the communication medium offers. Through genuine information sharing, organisations are already discovering a more fertile means of solution-finding, and this trend will, ultimately, extend to the traditional show-and-tell communicators.

Chris Elmitt is managing director of events services company Crystal Interactive.

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