Financial Management of MICE Events PDF

MICE REVIEWER The method to be chosen will depend on the CHAPTER 7 FINANCIAL MANAGEMENT OF nature and level of the event, the finances, There are several agencies that MICE MICE and pe...

MICE REVIEWER The method to be chosen will depend on the CHAPTER 7 FINANCIAL MANAGEMENT OF nature and level of the event, the finances, There are several agencies that MICE MICE and personalities involved. It is important to organizers can approach for funding such FUNDING – is essential for a successful event. have a clear structure for financial processing as: The biggest mistake of event and control. Everyone must know who organizer is to host an event without manages the money and who authorizes and 1. Local authority leisure department; adequate financial support. Result of controls expenditures. 2. Education authority; failure event. 3. Local or national sports council; BUDGETING – estimate of income and CONTROL - of financial transactions is a vital expenses. aspect of MICE management. 4. Local or national arts council; It is necessary to budget carefully to Control system are necessary to 5. Foundation for Sports and the Arts; find out the funding needed by the keep spending within agreed 6. Local or national tourist authorities; event and to provide monitoring limits. 7. Sponsorship agencies; system in planning and Failure to implement proper 8. Business agencies; implementation of the event. control over budget will lead to 9. Professional institutes; confusion. 10. Hoteliers; Each activity should be analyzed as follows: The following are practical steps to follow 11. Heritage agencies; 1. The specific activity to be undertaken for effective financial control: 12. Local or national charities; 2. The estimated cost of each activity 1. Limit the number of people who can incur 13. Voluntary agencies; and 3. The benefit of each activity 14. The National Lottery. expenditure 4. The income from the activity 5. The necessity of the activity 2. Keep accurate records of all income and expenditure In addition, MICE organizers can produce 6. The place of the activity in the budget 3. Use appropriate record-keeping methods income from various activities such as: priority 7. How the expenditure of the activity can be monitored to keep financial information correct, current, 1. Franchising: 8. How the income will come in and how and readily available 2. Ticketing: certain it is 4. Ensure that relevant structures channel 3. Entry fees; financial commitment through financial 4. Fundraising; FINANCIAL STRUCTURES – simple with 5. Donations; treasurer controlling all finances or it may record keepers 5. Ensure that financial information is widely 6. Programs; very complicated involving several committees and even paid staff to manage the circulated to all those who require it 7. Raffles; finances. 6. Produce systems and information that are 8. Souvenirs; Finance as a free standing committee; clear and understood by everyone involved 9. Catering; every one request money and awaits 10. Advertising, their decisions. 11. Licensing (logos, etc.); SOURCES OF FUNDING – mice organizer Each committee or subcommittee has 12. Trade exhibitors; a treasurer to look after its allocated should identify possible sources of income and how to obtain funding for them. 13. Participant contributions; budget. 14. Sales stalls;  15. Bar; and 4. Professionals such as lawyers and 9. Check existing sponsors - find out what 16. Corporate hospitality. architects; 5. Participants and their personal active companies are already sponsoring. contacts; 10. Get media support - the support of the SOURCES OF FUNDING 6. Libraries-local, regional, and national; media is needed to attract sponsors. 1. Republic of the Philippines 7. Market research through learned centers, 2. Philippines Sports Commissions consultancies; HOW TO MAKE THE SPONSORSHIP WORK 3. National Commission for Culture and 8. Partners that have supported previous The technical skills and knowledge of the the Arts events; and organizers must be used in the planning and 4. Department of Trade and Industry 9. Existing sponsors. delivery in order to make the sponsors 5. Professional Regulation Commission support justified. 6. Tourism Infrastructure and SOME TIPS ON LOOKING FOR Enterprise Zone Authority SPONSORSHIP THE BIDDING PROCESS 7. Philippine Charity Sweepstakes Office 1. Use imagination and innovation - a new Is a proposal to host an event. 8. Cultural Center of the Philippines idea might convince a person to be a potential It is the most critical marketing tool in sponsor. obtaining business. FUNDRAISING – can produce significant 2. Put in the marketing effort - be sure that Should answer all the needs and amounts. the product and price are correct, and the requirements specified by an Several projects need some kind of quality of the event is widely known. organization in a clear and concise fundraising 3. Clearly define the type of market - manner. Some Suggestions: specify the type of market - it the participants May be presented to an individual, a 1. Sponsored runs, swims, and cycles are rich, middle-aged, or young people. small committee, a board of directors, 2. Dance and Discos 4. Consider changing the nature of your or a general assembly of hundreds or 3. Marathon swims and walkathons activity, event, or promotion - adapt the even thousands of people. 4. Lotteries and raffles event to suit the sponsor's idea, desires, and The presentation may take place 5. Gambling evenings such as casino requirements. when decision-makers visit the city, nights and race nights 5. Access your sponsors through the Chamber or it may take place in another location. SPONSORSHIP – is a mutually beneficial of Commerce or the Rotary Club. The presentation may be given to a business arrangement between the sponsor 6. Assess respective images - sponsors must client who is well-known by the and sponsored in order to achieve the agreed be compatible with the event and the bureau or to a relatively new client. objectives. participants. Each bid presentation will have its Information about possible sponsors may 7. Approach unlikely targets - approach own unique character depending on be obtained from: somebody who has not sponsored an event the potential client and the character 1. Yellow pages and telephone directories; before. of the bureau. 2. Local and national newspapers; 8. Do the necessary research - do detailed 3. Business organizations such as Chambers research using the media and the local of Commerce library.  from other destinations. The positioning of a participate in the presentation. Have a local Preparation destination is essential to find out its member of the group open the presentation, importance as a good location for a meeting followed by the mayor or another high- 1. Ask for a copy of a "bid form" or convention, or trade show due to its being ranking local government official. Next, the information regarding the specific unique or unusual. bureau's sales executive should make, a short requirements of the organization. The bid but detailed presentation. The local members form is a document that gives a detailed will end the oral presentation. explanation of the requirements of the 9. Communicate with previous host cities and association in hosting a meeting. It could be request them to help you in dealing with the short or long. organization's planner. AFTER THE PRESENTATION Upon winning the bid, a 2. Research on the history of the association 10. Request local representatives to help you memorandum of agreement will be for the past four years. Examine if there are pre-sell your destination through letter- signed between the bid proponent, conflicts and clear them with the association writing, accompanied by several photographs which is the local association, and the planner. or pictures. international organization. Upon losing the bid, the proponents will revise the bid and bid again. 3. Evaluate the strengths and weaknesses of Presentation your destination from the point of view of the 1. Make sure that the presentation document planner. HOW TO BID FOR INTERNATIONAL is complete and easy to read without spelling EVENTS and grammar mistakes. For international events, it is the host 4. Find out how the bid will be made; federation or national governing body whether the association will accept an oral 2. Make the bid document personalized by that formally makes a bid to its presentation, a written presentation, or both. engraving the name of decision-makers on international federation to secure an the cover of the bid document. event. 5. Research the details of bid presentation such as location, date, and time. 3. Send a letter of invitation following the FINANCING OF BIDS AND EVENT protocol order to congressmen, senators, The cost of bidding and organizing 6. Meet the leader of the local district to governors, mayors, local members, and the international events can often be a discuss the strengths of the local bureau. financial burden to the host city. organization. Make clear the role of the local Many governing bodies require the leaders in the bid presentation. Find out if the 4. In case there is a "bid form" from the prospective host city to fund the bid neighboring areas will support the bid. organization, make sure that it is completely pro process and shoulder the total filled out and contains the necessary cost of the event. 7. Categorize the organization according to supplemental information. Include colored photographs and brochures that will sell your IMPORTANCE OF HOSTING kind-social, educational, political, scientific, INTERNATIONAL EVENTS etc. destination. The significance of hosting 8. Examine your market position. Find out 5. In case an oral presentation is needed, international events can be seen from what makes your John destination different prepare the scripts of every person who will  the way events stimulate the local There are many reasons why an event must economy through multiplier effects. comply with existing laws and regulations. Protecting One's Financial Investment These events can contribute The four primary reasons are: significantly to a city's overall Practicing thorough legal, ethical, economic regeneration plan. 1. To protect one's legal interests; and risk management proactiv The expenditures in the city by 2. To abide by ethical practices; measures may help the event participants, spectators, officials, and 3. To ensure the safety and security of the produce greater revenues. visitors will boost the local economy. event stakeholders; and Lapses in legal, ethica and risk Hotels, restaurants, clubs, shopping 4. To protect one's financial investment. management judgment may cause centers, and local transportation will not only loss of property, life, anc all benefit from the event. PROTECTING ONE’S LEGAL INTEREST money but also loss of the event's Preparing contracts, permits, and licenses good name. CHAPTER 8 RISK MANAGEMENT that are required and complying with other According to Dr. Peter Tarlow, risk legal requirements will ensure that the event Basic Components of an Event management and safety expert, all events may proceed without interruption. Management Agreement or Contract carry two risks: (1) the risk of a negative The event management contract shows the occurrence both on-site and off- site and (2) Adherence to Ethical Practices agreement between two or more parties the negative publicity that comes from this One of the requirements of a regarding their mutual interests as specified negative occurrence. profession is to follow a code of in the agreement. A binding contract must ethical conduct. contain the following basic components: the The concern for risk management and Event management has emerged as a parties, the offer, consideration, and other legal and ethical issues has modern profession, a code of ethics acceptance. increased due to the increase in the has been developed by the number of professionally managed International Special Events Society Parties events. (ISES). The names of the parties must be During the mid-1970s, most events clearly identified. The agreement were organized by amateurs. Ensuring the Safety and Security of Event must be described as being between Because of the lack of training in risk Stakeholders these parties and the names that are management there was a A safe event environment is one that used in the agreement must be corresponding interest by the legal is protected from future harm. defined. profession in bringing litigation The event manager is responsible for against negligent event managers. constructing a safe, secure Offer Professional event managers are now environment and sustaining it during The offer is the service or product becoming smarter with regard to the course of an event. given by one party to another. The legal, ethical, and risk management The event manager should not event manager may offer consulting issues. transfer the responsibility to others. services to a client, or a vendor may The event manager has a legal and offer products to an event manager. COMPLIANCE WITH EXISTING LAWS AND ethical responsibility to event REGULATION stakeholders to design and maintain a safe and secure event environment Consideration Arbitration harmless and to defend (indemnify) them The consideration clause defines what It is a common practice to include in against harm. one party will provide the other upon event management agreements an the acceptance of an offer. arbitration clause in place of legal Reputation judgment when both parties fail to Some event managers include specific clause Acceptance agree. that recognizes the importance of the When both parties accept an offer, The use of arbitration may save both purchaser's reputation and states that the they execute or sign the agreement parties substantial costs over event manager will exert his or her best confirming that they understand and traditional litigation. efforts to protect the purchaser's reputation agree to comply with the terms during the event. agreement. Billing Many events involve entertainers, the The Complete Agreement Other Components agreement must define how entertainers will The complete agreement is the final clause be listed in advertising and in the program. which states that the agreement constitutes In addition to the key components, event the full understanding of both parties. management agreements usually include Time is of the Essence other clauses or components. The most The time-is-of-the-essence clause instructs Other Agreements typical clauses are: both parties that the agreement is valid only There are other management agreements if it is signed within a prescribed period of aside from the main event agreement. These Terms time. are: The terms clause defines how and 1. Consulting agreement - an agreement in when the funds will be paid to the Assignment which one party, usually the event manager, person making the offer. Agreements should contain clauses indicating agrees to give consulting services to another that the contract may not be assigned to other party. Cancellation parties. The cancellation clause usually For example, if Mary Santos has defines under what circumstances executed the agreement on behalf of 2. Employment agreement - an agreement either party may cancel, how XYZ Company, the agreement may not in which an employee agrees to particular notification must be provided, and be transferred to Santos's successor if terms of employment. what penalties may be required in the Mary Santos leaves the XYZ Company. event of cancellation. 3. Exhibitors contract - an agreement Insurance between the exhibitors and the sponsor of an Force Majeure (Act of God) Agreements usually detail the type and limits exhibit to rent a booth at the exhibit. In the force majeure clause, both parties of insurance that must be in force by both agree on which circumstances, deemed to be parties as well as a requirement that each beyond their control, will allow an event to be party co-insure the other. 4. Hotel contract - an agreement between canceled without penalty to either party. the hotel and the organization holding an These occurrences may include hurricanes, Hold Harmless and Indemnification event to furnish rooms, function space, and earthquakes, floods, volcanic eruptions, In the event of negligence by either party, the food and beverages services for a particular tornadoes, wars, famines, or other negligent party agrees to hold the other party event or several events. disasters.  6. Non-compete agreement - an Synergistic Relationship of Contracts, many sponsors can reduce the risk of failure agreement in which an employee Permits, and Licenses to generate the needed revenue. agrees not to engage in a contract in a Contract permits and licenses have legal, particular industry for a certain ethical, and risk management effects. To Risk Control Measures period of time after the conclusion of produce positive results, event managers employment. The following are the risk control measures: should cooperate with the concerned agencies. 1. Elimination plans-for example, removal of 7. Purchase order - an order to a seller dangerous children's equipment to supply products or services. Risk Management Procedures 2. Substitution plans-for example, replacing When people gather together for celebration, 8. Sponsorship agreement - an slippery tiles in the restroom with non- reunion, and business or education purposes, agreement between a sponsor and an slippery tiles there is a corresponding risk of losing life or event organizer in which the event property. Several accidents have happened at organizer agrees to give marketing 3. Isolation plans - for example, isolating events. The effects of these disastrous services to the sponsor for specific dangerous or noisy equipment happenings are increased expense, loss of payment. money, and loss of business. Experts in risk management have established basic rules to 4. Engineering controls for example, using 9. Vendor agreement - an agreement manage risks during events. These are: fences to prevent access to busy roads between the seller and the event manager to supply particular services 1. Avoid or diminish the risk each 5. Administrative controls for example, or products for an event. circumstance should be assessed for possible using warning signs, trained staff, and well- risks. These risks should be determined and developed procedures Meaning of Permits avoided. Permits are issued by local governments. They allow the event manager to hold event 6. Contingency plans for example, 2. Transfer the risk - for risks that cannot be evacuation as a contingency plan in case the activities. A permit is issued only after the avoided and for which the event manager necessary documents have been submitted risk cannot be completely avoided should not be held liable, the event manager and the necessary payment has been made. should review and check whether they are the responsibility of someone else, as in the CHAPTER 9 THE ROLE OF ETHICS IN THE Meaning of Licenses case of a delegate slipping on a wet floor in MICE INDUSTRY the restroom. Suppliers in events are Meaning of Ethics A license is issued by a government agency or required to share in the liability for the event. According to the New Encyclopedia by a private association. It allows the event manager to hold a particular activity. Britannica, ethics is a discipline concerned There is a slight difference between a 3. Devise backups and alternatives - with what is morally good and bad, right and permit and a license. There are strict alternative plans should be ready to be put wrong. requirements for obtaining a license into place. The word ethics comes from the than those required for obtaining a Greek word ethos which means permit. 4. Distribute the risk - obtaining various "character" or "guiding beliefs, sources of revenue for an event including  standards, or ideals that permeate 7. An increased reliance on government In the MICE industry, there are plenty of society." which has decreased the individual's sense of opportunities for unethical behavior. There The Role of Ethics in Society responsibility for himself or others (Keiser, are certain practices within the MICE 2005, p. 342). industry that are more likely to lead to The government is haunted by the unethical unethical behavior. The following are some of behavior of past officials. Corporations are the practices: suffering from allegations of misconduct. The question that needs to be answered is: Individuals are faced with personal decisions How can we correct the problems with 1. Familiarization tours about ethical behavior. James Keiser gives the society's ethics that are very prevalent in 2. Overbooking following reasons for the current interest in today's business world? 3. Commissions business ethics: At present, an individual has to make 4. Gift-giving choices based on profit, promotion, or 5. Employment, rates of pay, and working personal gain at the expense of long- 1. A drift toward materialism and greed, conditions a tarnished public image. term quality gains. Angelo and pushing people to acquire wealth or status Vladimir (2005) state that although beyond their real needs and to want more individuals have different personal Familiarization Tours regardless of what it takes to get it; values and morals, they should Familiarization (FAM) trips are recognize that there are some frequently abused by both organizers 2. The deregulation of some industries, universal principles that all religions, and suppliers. intensifying competition and encouraging cultures, and societies agree upon. It Organizers should only accept a FAM managers to cut corners; is upon these principles that one trip package if there is an intention to should build his or her own personal do business with the supplier at a 3. The growing size of business enterprises code of ethics for an ethical decision- future date. which dilutes and spreads personal making process, it is impossible to responsibility for unethical acts; expect business employees to be able to make ethical decisions. Overbooking The supplier of the hotel is guaranteeing a 4. A growing hedonism, leading people to be product that it knows may very likely not be more concerned with their own happiness According to Solomon and Hanson, there are available to the customer. Although this than responsibility to others; three reasons why ethics is important. conduct should be interpreted as an unethical 1. Ethical errors and careers end more decision, failure to overbook may lead to a quickly and more definitely than any other number of unsold rooms resulting in a loss of 5. A lack of moral leadership among mistake in judgment or accounting profit. The desire to make a profit often prominent people and abundant examples of 2. Ethics provides the broader framework outweighs an individual's or company's code people who prosper from moral laxity and within which business life must be of ethics. More recently, the practice of greed; understood. overbooking has expanded to convention and 3. Nothing is more dangerous to a business meeting rooms. 6. The breakdown of the family and the sense than a tarnished public image. of familial responsibility traditionally Commissions transmitted to children; and Unethical Practices in the MICE Industry Clients should be made aware of the commission, and reference about it should be made in documentation such as invoices and The major role of technology in the MICE Real-time data processing updates contracts. industry is to gather, store, and provide data transactions instantly, providing MICE Gift Giving to the different levels of users. The significant managers with real-time access to sales, advantages of technology over manual income, and inventory data. It enhances Giving gifts within the MICE industry is systems are: control and efficiency but is more expensive common. Gifts may be a simple basket of due to continuous updates and advanced fruits, a bottle of champagne, a room upgrade, systems. This approach is favored by mid- or an expensive piece of jewelry. 1. Opportunities to use data in a more sized and large MICE companies for its effective and appropriate way; responsiveness and integration capabilities. Employment, Rates of Pay, and Working 2. Greater dependability; less possibility of Conditions human error, Hardware Configuration The MICE industry employs a large number of 3. Harmonious operations; Many types of hardware configuration are part-time and casual employees. Ethically and 4. Safer data; and common in the MICE industry. These are: legally, it is importarit to ensure that working 5. Real-time analysis and review. conditions and company agreements 1. online systems; establishing stanard wages are strictly 2. PC systems; and implemented and that the employees are not Data Processing Systems 3. distributed data processing. taken advantage of. Data processing systems are divided into three types: Online Systems The Importance of a Code of Ethics 1. Batch processing Online systems are unique because each Ethics is a way of life that depends on 2. Online real-time processing transaction is entered via a communication honesty, integrity, and courtesy. Individuals 3. Time-sharing and service bureaus device connected to a computer. should develop their own personal code of A good example of such systems is ethics. They must determine what exactly Batch Data Processing magnetic cards. they believe in and what truths govern their Batch data processing systems handle Online systems may or may not be lives. Based on these truths, they can develop transactions in groups, such as processing all real-time systems depending on their own personal code of ethics. They must daily sales as a single batch. This approach is whether transactions are processed then judge all actions based on this code. simple, reliable, and cost-effective, as it and updated as soon as they occur. MICE organizations need to develop and eliminates the need for immediate network Electronic data interchange (EDI) is maintain both good business and ethical backups and extensive employee training. being adopted by several large MICE practices. Professional associations related to However, it lacks real-time data updates, companies. EDI is a computer-to- the MICE industry have developed codes of which limits access to up-to-date information. computer exchange of intercompany ethics for their members to adhere to. As a result, batch processing is uncommon information and data in a public among larger MICE companies but remains a standard form. CHAPTER 10 TECHNOLOGY FOR THE MICE practical choice for smaller and medium- The direct method connects the INDUSTRY sized ones. computer system of a MICE company The Role and Scope of Technology in the with a major client or supplier, which MICE Industry may be a major beverage supplier as Real-Time Data Processing seen in Figure 10.1.  (LAN) or a wide area network (WAN). Networks are used to give PCs the 1. Wide market reach ability to communicate with each 2. Ability to update information other and share workloads. quickly and easily When a MICE company adjusts its attendance numbers, the system 3. Ability to gather data about informs the supplier which helps Access Control potential customers remove inventory shortages. Access should be limited only to 4. Ability to decrease marketing The indirect method uses a network authorized persons in order to of several computers of companies prevent unauthorized use and change A website can be an excellent means for that provides a "mailbox" to be used of files and data. collecting information about existing and by all (see Figure 10.2). Passwords are codes used to access potential clients. MICE companies usually ask several parts of a database. Some their site visitors to register and give their passwords allow the examination and email addresses, areas of interest, geographic recovery of data. data, and other materials. This information t is important that at least two people can be used as a customized database of have master access to the database so clients. The website can also be used as a tool that if a person with master access is for customizing services. not available, the operation of the company will not be affected. MICE Industry Database The advantage of this method is that the A major problem of MICE companies is how Interactive Web to keep their database up-to-date. Very often sender can transmit documents to several receivers without changing the format. The websites are used to attract a number found in a catalog has already been potential customers and can serve as changed when the number is dialed. Internet a good marketing tool. databases are the most reliable in the MICE Distributed Data Processing To attract potential customers, MICE industry. are often connected to a mainframe companies register the site with computer which is located at the several search programs such as office headquarters of a MICE Google, Altavista, Yahoo!, and HotBot. A database has two major criteria. company as seen in Figure 10.3. Once a website is registered with all The first is its resources. The more major search instruments, it will be resources a database has, the more available to a potential client who is reliable it becomes. Because conducting a search. In conducting a resources are collected over time, search, keywords such as event young databases often contain less management, or just event, are data than older ones. usually used. The second is its search features. A The more general the keywords, the database can be searched in many more potential matches will be ways such as alphabetically by region, In addition, they can be connected to produced by a search program. The by services offered, by price, and by one another through a networking following are the advantages that a age. The more criteria a database has, system such as a local area network site can provide to a MICE company: the more reliable it becomes.  The development of the Internet has supervision of events through the opportunities to see new and given new opportunities for the MICE Internet. A MICE company in the interesting sites and opportunities for industry such as information United States can produce an event in relaxation and self-reflection. databases, interactive databases, and England or vice versa without Third, attendees expect the commercial databases. relocating its staff or setting up an convention or event to provide a high Content can be updated online, and office. level of service. They expect that users can have access anytime. Search In using technology, especially the organizers of conventions and events criteria can be customized and Internet and other networks, all train their employees to provide changed much easier than in the processes should be available to the hospitable service to their clients. paper version. participants. If one partner has a very The search itself can be customized. slow Internet connection, the entire Changes Affecting Host Cities In electronic databases, users can network should be designed in such a enter keywords and the database will way that the user with a slow Cities need to implement the conduct a global search based on connection will be able to receive the necessary changes that will make these words. same service as the others. their communities easily accessible to group business. They also need to look at their Trends in Technology CHAPTER 11 CHANGES AFFECTING THE intercity transportation systems to The software development market MICE INDUSTRY IN THE NEXT make sure that groups can move will become more competitive, MLILLENNIUM easily in and around the city. services more user-friendly, and Existing tourist attractions need to be prices more affordable. Expectations of Attendees best promoted and other tourist An important innovation in the global attractions have to be developed to In the future, there are three specific areas high-technology revolution is the make the city attractive to group that attendees will be looking at to determine development of the wireless business. whether or not they will attend a convention application protocol or WAP. Cities that have developed their or event. WAP was developed within the facilities have obtained huge returns wireless industry from companies on their investments. such as Nokia, Phone. com, and First, they expect the event to be Ericsson. The WAP serves Internet productive. They expect it to benefit Professional Education the Next content and services to wireless their business and to provide an Millennium clients with the use of WAP devices adequate return on their investment. such as mobile phones and terminals. Second, the attendees expect that the Professional education has played an The cell phone is an indispensable event will allow them to do serious important role in the past and will tool in the MICE industry. WAP business and at the same time enable play an even more important role in technology makes it easier, faster, them to grow personally. They expect the future. cheaper, and more profitable to that the convention or event will Members of professional connect with others locally and provide time for physical activities organizations have learned through internationally. such as aerobics or beach walks as apprenticeships with master Developments in technology enable well as provide workshops for craftsmen, attending professional MICE companies to conduct personal development. Attendees meetings, reading professional registration, planning, control, and expect the event to provide  publications, and participating in Marjina Kaplan highlights three key 4. Expositions professional certification programs. considerations for organizing international a. Meeting place for suppliers These associations aim to improve the events: and buyers professionalism of their members by b. Education providing continuing education 1. Demographics: Understand opportunities. c. Entertainment participants' profiles to meet their Many professions have developed needs and expectations. 5. Sporting Events certification courses which aim to 2. Objectives: Ensure the event’s goals a. Super Bowl maintain certain levels of excellence align with an international setting. b. World Series among its members. 3. Benefits: Evaluate how attendees c. Masters Golf Tournament Many corporations and professional gain value, such as learning industry 6. Social Life Cycle Events associations are leading the way in practices, adopting new technologies, a. Weddings educating the workforce. and sharing knowledge across They are educating the workforce b. Anniversaries cultures. through the use of conventions, c. Birthdays meetings, and expositions. These factors are essential for successful d. Reunions Professionals in the MICE industry international conventions and events. 7. Meetings and Conventions must be aware of technological and a. Political National Conventions educational changes in order to CHAPTER 12 SPECIAL EVENT b. National Restaurant facilitate continuing education. MANAGEMENT Association Convention They must understand the impact of Definition of a Special Event c. Professional Convention continuing education in their area of expertise and do everything they can According to the Convention Industry Council Management Association to provide the services needed to (CIC), a special event is a one-time event that Annual Conference improve adult education. is for the purpose of celebration; a unique 8. Retail Events As the workforce continuously activity. a. Long-range promotional changes, training and retraining of events adults is a must. Meetings and Kinds of Special Events conventions are a perfect forum for b. Store openings this type of education. 1. Civic wants c. Celebrity appearances d. New a. Centennials product rollouts The Impact of Globalization on the MICE b. Founders Day 9. Religious events Industry 2. Mega-Events a. Papal inaugurations a. Olympics b. Hajj (Mecca) The convention and events market is evolving b. America's Cup c. Easter with global communication and increased c. World Fairs travel, creating opportunities in multicultural settings. MICE industry leaders must 3. Festivals and Fairs History and Background of Events understand diverse cultures to facilitate a. Community Events Special events have been part of human effective communication among participants. b. Fairs (not-for-profit) history for centuries, celebrating milestones c. Festivals (for-profit) like births, weddings, and large gatherings other arrangements and should contact state such as the Olympic Games. The term "special or federal government protocol officers for event" was popularized by Robert Janni, a specific information on the protocol. Disney imagineer. Faced with the challenge of keeping visitors at Disneyland after hours, In addition to government officials and Janni proposed the "Main Street Electric members of parliament, the involvement of Parade," a nightly event with lit-up floats. The the following personnel and officials would parade successfully kept visitors at the park require research on the protocol longer, and when asked what to call it, Janni requirements: referred to it as "A Special Event." Since then, special events have become a key strategy to 1. Diplomats and foreign officials attract and retain crowds. 2. Religious officials 3. Military personnel Event Protocol 4. Academic officials Meaning of Protocol 5. Nobility The term protocol is used to describe the 6. Royalty traditional form of behavior in a ceremony Dress for Formal Occasions and etiquette observed by diplomats and Titles heads of state. The term is also used to The appropriate dress for formal occasions describe a code of correct conduct. Functions Style guides, which are available in most should be included in the invitation. This may where protocols need to be used are: public libraries, provide guidelines on the include morning dress for formal day correct titles for people such as Prime functions or black tie for formal evening 1. Civic receptions; Ministers and Ministers. If high-ranking events. Protocol also needs to be observed 2. Formal parade; overseas visitors are attending an event, the with regard to the correct insignia to be worn 3. National day receptions; event organizer should contact the relevant at ceremonial events. 4. Citizenship ceremonies; and embassy to get information on the table of precedence and the titles to be used. Protocol for Speakers 5. Private functions. Speakers should be briefed in advance and Styles of Address provided with a list of guests to be welcomed Sources of information on protocols are: 1. Libraries; Styles of address for foreign dignitaries are in the order of precedence. The timing and summarized in Table 12.1. Style guides can length of speeches should be discussed with 2. Internet: the speakers before the event. help with this form of protocol as well as the 3. Federal, state, and local government form of address for the clergy. protocol departments; and Seating Plans for Formal Occasions 4. Office of the United Nations. Correct seating arrangements for awards ceremonies and formal dinners must be Order of Precedence observed by the event organizer. The guest of An event planner should consult the order of honor always sits at the right of the host. If precedence in order to make seating and other government dignitaries are present, the order of precedence is outlined in Table 12.1. with flags from other countries, the give the event manager an If dignitaries are males and accompanied by Philippine flag should be in the position of opportunity to know the tasks that their spouses, the plan is outlined in Table honor. When carried in a procession, the may have been overlooked at the start 12.2. In general, those with higher rank sit Philippines flag should lead. of the planning process. closer to the official party and the guest of 3. Policy statements should be made to honor sits at the right of the host. guide in the decision- making process. Planning Tools for a Special Event Policy statements give a clear Special events management requires understanding of commitments and planning tools. The first of these tools is a how to achieve them. Examples of vision statement of the event. The vision commitments are human resources, statement should identify the who, what, sponsors, security, ticketing, when, where, and why of the event. Though volunteers, and paid employees. involved, the event should focus on the vision. Dining This can be done by continuously monitoring, evaluating, and measuring the progress Understanding Community Infrastructure The event organizer should plan the style of food service according to protocol. Formal toward the goals of the event. The main component in planning a service for a sit-down dinner may be The "who" of the event are the people successful event is an understanding appropriate for an occasion involving local or organizations who would like to of the community infrastructure. The dignitaries. If there are many visitors from host and organize it. infrastructure may include the CEO of overseas, a buffet may be a more suitable The "what" is a parade which the company, politicians, prominent option. demonstrates the pride and local business leaders of the community, tradition of the people of the city. civic and community groups, the The "where" of the parade is the media, and other leaders of the Protocol for Sporting Ceremonies community. downtown area of the city with the There are a number of formalities for floats and bands marching down the The role of business leaders is to sporting events including the awarding of main venue. provide sponsorships, donations, trophies or medals at the ceremony held after The "why" is the tradition, fun, pride, staff, or a workplace for the event. the event is finished. Traditionally in team and tourism that promotes the city Frequently, community groups serve sports, the press interviews the team captain and brings revenues to local as volunteer workers for the event. of the runner- up before the winner is businesses. They provide not only financial announced. Different sports have different commitment but also physical and protocols. emotional commitment. The following are some management tools that are used in staging events: Rules on Flag Flying Merchandising and Promotion of Special There are many rules in flying the national Events Merchandising and promotion of 1. Flow charts and graphs are used for special events are other planning tools to flag and the flags of other countries. For scheduling such as the start of the attract attendance and increase the example, in an international sporting event meeting, the time for coffee breaks, profitability of the event. The two main held in the Philippines, the Philippine flag as a time for the meeting to resume and to objectives of a special event are profit for the national emblem should take precedence end. vendors and a memorable experience for the over all flags of other countries and should 2. There should be a well-defined set up attendees. always be presented properly. When flying and break down schedules. This will  The elements of the promotional mix Users can participate and change the form for successful special event and content information they receive. management is shown in Figure 12.1. Unlike traditional forms of marketing F. Personal Selling - is a form of person-to- which are one-way forms of person communication in which a seller tries marketing, this type of media allows to help or persuade prospective event users to perform several functions. It attendees. Group tour sales are personal enables users to receive and modify selling of a special event. There are many tour information and images, make companies that buy a large number of tickets These are advertising, direct marketing, inquiries, answer questions, and make for special events. interactive or Internet marketing sales purchases. Personal selling is more appropriate promotion, publicity or public relations, and and feasible by meeting face-to-face personal selling. with a group of representatives D. Sales promotion is defined as those instead of meeting face-to-face with marketing activities that give extra value or each individual prospective attendee. Distinctive Roles of the Promotional Mix incentives to the sales force, distributors, and Model consumers to encourage sales. A popular Sponsorships for Special Events Advertising - is any paid form of form of sales promotion is the coupon. Sponsorships are an innovative way nonpersonal communication about the event. Several events use a two-for-one coupon to for event organizers to help in paying Nonpersonal advertising involves mass media encourage attendance particularly on slower expenses of a special event. such as TV, radio, magazines, and days. Sponsorship should be regarded as newspapers. more than just a charitable activity for a company. They can be a strong Advertising is a well-known form of E. Publicity and Public Relations - are two marketing tool. promotion because it is very separate components. persuasive especially if it targets mass Publicity is the component that is not consumers such as a home or garden Company sponsorships have increased due to directly paid for and does not have an show, It can be used to create brand the following: identified sponsor. Publicity is images and can produce immediate regarded as a credible form of 1. Change in the economy responses from the prospective promotion, but it is not always under 2. Power to attract several groups of buyers attendees. the control of the organization or host 3. Power to evaluate outcomes of the event. However, the opposite is 4. Disintegration of the media B. Direct marketing is a form of advertising also true. Planners have little control over the result. 5. Increase in the number of several groups of that communicates directly to the target people consumer in order to get a response. It involves various activities such as database The purpose of public relations is to management direct selling, telemarketing, plan and distribute information The reason why sponsorship changed direct response ads, the Internet, and several systematically in order to control or from sports events to arts and music broadcast and print media. manage the image and/or publicity of festivals is because companies are an event. It has a broader objective now convinced that sponsorship is a than publicity because its aim is to powerful instrument to achieve the C. Interactive or Internet marketing - marketing objectives of the company. allows a back-and-forth flow of information. establish a positive image of the special event.  In selecting the sponsorship for a 2. Friday is the best day of the week to c. Sanitation permits special event, organizers must be attract the news crew. The reason is d. Sales permits or licenses certain that the event is suitable for Friday is an appropriate news day e. Fire safety permits the company. because many stations do not have Sponsors have two kinds of many news crews who work during audiences-the internal and the weekends to cover an event. 3. Involve the necessary government external. The internal audience are agencies. For example, to use the city the employees. The company should recreation facilities, work with the 3. A special event should be given encourage its employees to Department of Parks and Recreation. advance notice. The reason is it is a participate in the event, particularly very important way to help in raising funds for charitable 4. Involve the health department if there will assignment editors. purposes. be food and beverage at the event. The kinds of specialty products are without limits and are very effective Target Market for a Special Event for advertisement. The sponsor may Target marketing is determining the 5. Meet all pertinent parties in person to clear designate a spokesperson who will be persons who would like to attend a up any misconceptions early on. in charge of radio and television particular event. interviewer. Target markets are the people who 6. Be aware of the complexities of dealing would like to participate in a specific with the public sector. Many times, public Media Coverage for Special Events event. agencies have a difficult time making A special event has an economic effect decisions. Media coverage for special events is a on a community and region. This is very productive tool to attract because cities compete with each participants. Event organizers would 7. Acknowledge the logistics that a other in attracting events. They use like to acquire free coverage for radio, community must contend with for certain incentives to attract attendees. television, and print. In order to types of special events such as street closures attract the media, an event organizer There are two important elements for a for a marathon. should know what good and bad successful event. radio, television, and print coverage First, the community brings the event to the city. 8. Establish a security plan which may include are. Second, the event satisfies the needs the security given by the venue and The following are some effective methods to professional law enforcement. attract radio and television coverage: of the buyers. 1. The best time to attract cameramen Preparation for a Special Event 9. Obtain liability insurance. The most and reporters is early in the morning. vulnerable area is the liability regarding The reason for this is the crew must The following steps need to be followed in liquor and liquor laws. be able to shoot the film and go back preparing a special event: to the studio, edit the film, and be 1. Choose a venue. ready to present it to the 5 or 6 pm 10. Determine ticket prices if the special news broadcast. 2. Obtain permits. event involves ticketing. a. Parade permits b. Liquor permits 11. Determine ticket sale distribution if the that a guard is stationed at the front and rear Talent Costs special event involves ticketing. entrances of the venue. Security costs will All special events use some type of talent or depend on the type of event. For example, a performance such as keynote speakers, a rock concert or a European football match band or orchestra, a sports team, a singer, etc. 12. Take charge of the following basic will require more security. Security cost will to attract attendees to the event. The costs businesses that support the function: depend on the amount of security needed. will depend on the popularity of the a. Accounting systems such as general ledger, performance. The talent fee of Madonna will financial reporting, accounts payable, Production Costs be much higher than that of an ordinary accounts receivable, and payroll singer. b. Human resources system such as Production costs are those that are connected recruitment, personal records, job with a special event. They differ depending on classification, and description the type of event. Before an event, it is the duty of the event For example, if the special event is a planner to do a projection of all costs and c. Registration large home and a garden show, there revenues. These projections are important for d. Ticketing which includes mail order, seat a community to decide whether to host are costs that are associated with the inventories, seat assignments, and gate sales another event. Repeat events are much easier setup of the trade show booths such e. Scoring and results which include to promote, especially when the organizers as elaborate garden landscape, scoreboard and displays have made a profit (see Table 12.3. The ABC electrical and water fees, signage or banners, and pipe and drape fees. Special Event). Budget for a Special Event A special event must be both successful and Labor Costs Breakdown of a Special Event profitable. Profitability requires an Breaking down the event usually involves The labor costs involved in the setup and understanding of the important areas various tasks that an organizer must breakdown of the event will depend on the involved in the cost of an event. These six complete. city where the special event will be held. In areas are rental costs, security costs, very strict union cities, labor costs will be First, the parking staff should hasten production costs, labor costs, marketing higher because of the higher wages of the the flow of traffic away from the costs, and talent costs. union crew. event. In some cities, the union allows the Second, a debriefing of the staff Rental Costs exhibitor to bring his own cart with should be made to find out what Renting a facility, such as a convention center brochures and merchandise. In other happened or did not happen at the or ground space to put up a tent, requires cities, exhibitors are not allowed to event. payment of a daily rental charge. Convention carry anything except their own The following sources may add centers sell space based on a per square briefcase. information to the report: footage used. Many facilities charge for space even on the move-in and move-out days. 1. Participants - interview some of Marketing Costs the participants from the event. Their Events can usually negotiate a discount. The marketing costs associated with perceptions and expectations may attracting attendants to a special event make provide valuable insight Security Costs up a large part of the budget (see Table 12.3). Several convention centers, rental halls, and hotels provide limited security. This means  2. Media and the press ask whether it was or was not a press worthy gathering. 3. Staff and management get feedback from the staff and management. 4. Vendors ask vendors how the event would be improved. The following steps should be taken in a final assessment of the event: 1. Complete the income and expense statement. Did the event make a profit, a break-even or experience a loss? 2. Finalize all contracts from the event. Compare final billing with actual agreements. 3. Send the media a final press release regarding the overall success of the event. Arrange interviews with the press. This could be newsworthy if the event generated high revenue for the community. 4. Send thank-you letters to the volunteers who were involved in the event. A celebration with the volunteers should be made. especially if the event was financially and socially successful.