Your Budget is Missing an Entry!

If you are properly preparing for an event, one of the first things to do is to create a budget. Creating a good working budget before doing any other work will allow you to visualize all of the elements of the event in one place. It allows for tinkering with both spending and income goals to make fast adjustments on your strategy.

But if your company or organization is spending time on the event, do not forget to budget in the expense of that time!

Here is an example to demonstrate the importance of this point…

Company A has a staff of 20. The CEO and COO are technical experts who have successfully transformed into effective leaders and business owners. They employ a staff of highly qualified administrative and technical professionals to run their company efficiently. Most days, everyone leaves the office having plenty of work to face the next day and beyond. The company’s leaders have done their best to be sure that no staff member is ever idle, nor overworked to the point of serious stress. The team works well both as individuals and as a high-functioning collection of experts.
Company A decides to add an event to its annual plan. This event might be a gala dinner, an anniversary celebration, a product launch, a trade show or staff retreat. Great! This event is bound to be great for marketing, visibility, outreach and morale! So, since Company A has no FTE devoted to event planning, they form a committee to do the work required to create a highly effective and memorable event.
This committee and its members are likely not event pros and will spend many hours meeting about–and then accomplishing– the required tasks. How much time is being spent by the staff members working on this project? Is their diversion impacting their availability to work of their own projects? Will their lack of expertise produce an oversight or less-than-optimal quality event of guest experience?

Let’s calculate the cost of the staff time for this example:

Six, 1-hour meetings including CEO, COO, Office Manager and one technical staff member.
CEO hourly expense:              $87.80
COO hourly expense:             $58.54
Mgr hourly expense:               $35.12
Tech hourly expense:              $29.27
Total Hourly                           $210.73
Six meetings                           $1,264.38**

Company A must include this number in the expense side of their ledger. It does represent lost productivity and we all know, time is money!

Even if your company is having an Administrative Assistant make all of the plans and arrangements, a huge number of hours will be devoted to making the arrangements. Total the cost of the AA’s time and add this figure to the budget. 

A couple of other important notes:
Corporations hire professional event consultants for the same reason that Brides hire professional Wedding Planners. 1) Brides know that professional planners know exactly who to call, where to go, and what to look out for, to make a wedding extremely special, and 2) Brides want their family members and friends to enjoy their special day, not run around working to be sure that the caterer is setting up, the musicians are properly mic’d, and the bar is stocked.
Your corporate event deserves that same expert handling and your staff deserves to be able to enjoy your event too, not work at it.

 

**CEO: $150K/Annual + cost of employment/payroll est. 20% ($30K) = $180K / 2050 annual hours = $87.80/hr. Same calculation for COO at $100K, Mgr. at $60K, Tech at $50K.

 

Leave a Reply

Your email address will not be published. Required fields are marked *