First off a confession: I hate meetings…vehemently, passionately, fervidly. I avoid them whenever possible, and am often conveniently working from home on days when big ones get scheduled. Whether a conference call, a one-on-one, or a group gathering, if my presence isn’t absolutely critical I do anything I can to bow out. My standard response to a co-worker asking to “put some time on my calendar” is to ask them to just drop by for a couple of minutes when I’m in the office. My usual response to an outside vendor requesting a meeting in person or via phone is to send an email. A typical meeting request is for 30 minutes, a time slot that is inevitably filled regardless of whether it is needed; while I can almost always dispatch a satisfied customer with a five or ten minute chat or a short email.
I pride myself on prolific productivity, and a meeting is a sure fire way to slow the output tide. Luckily, those I regularly work for and with not only understand this character (strength/quirk/flaw?) but they also support it—so if I do get roped into a meeting, there is typically a true need for my expertise that could not be obtained by another means.
As a small business owner, you are probably facing similar meeting dilemmas– Do you spend too much time meeting with your team? With your customers? With your vendors? Are those meetings productive and a good use of your time (which as we all know IS MONEY)? Do you even know how much those meetings are costing you each year? You should.
The following resources will help you understand the impact meetings have on business productivity and how they directly affect your bottom line, and provide tips for how you can make your small business meetings more effective.
Statistics on Meetings
On average, meetings cost more than we think, are less productive than we think, and affect your company in ways you likely don’t realize. And, according to this post we hold a bunch of them: On average 11 million per day in the US alone. That adds up quickly to 55 million meetings per week, 220 million meetings per month, and over 2.6 billion meetings per year.
That can also add up to a lot of wasted time. For example, a 2014 report published in the Harvard Business Review and conducted by Bain & Company that studied 17 large companies found that, “senior executives rated more than half the meetings they attended as ‘ineffective’ or ‘very ineffective.’ Yet few organizations have established mechanisms for assessing the productivity of individual gatherings, not to mention clear penalties for unproductive sessions or rewards for particularly valuable ones…It’s hard to know exactly how much of this squandered time could be rescued. But our data suggest that most companies have an opportunity to liberate at least 20% of their collective hours by bringing greater discipline to time management.”
Other interesting statistics on meetings:
The Expense of Ineffective Meetings cites research findings that:
- 91% of people who regularly attend meetings admit to daydreaming during meetings.
- 73% of people who regularly attend meetings admit to doing other work during meetings.
- 39% of people who regularly attend meetings admit to sleeping during meetings.
- Professionals lose 31 hours per month in unproductive meetings (roughly four work days)
- Professionals attend on average 61.8 meetings per month and over 50% of this meeting time is wasted.
How much does your meeting cost – really? The $1 million question calculates the cost for a number of different meeting scenarios. One interesting finding is that a mid-sized company will spend $13M per year to fill 180 job openings. While your small business likely hires less than a tenth of that number each year, it can still be unexpectedly expensive—about $130k/year for 18 hires, using the same formula.
New Office Flashpoint: Who Gets the Conference Room? from the Wall Street Journal reports that 40% of employees waste 30 minutes per day searching for open conference rooms for meetings, due to less than ideal scheduling systems.
- 63% of meetings are conducted without a pre-published agenda
- The most popular time for a meeting is 11 AM
- The average meeting has 9 participants and takes between 31 and 60 minutes.
- The most common complaint people have about meetings is that they result in no decisions being made; and the second most common complaint is that people arrive at meetings unprepared.
Tracking the Spiraling Cost of Meetings
According to the 2014 Bain study published in the Harvard Business Review, in large companies senior executive meetings typically have the unintended effect of causing a “ripple effect” of downstream meetings and meeting preparations that can significantly magnify cost in terms of both time and dollars.
“On average, senior executives devote more than two days every week to meetings involving three or more coworkers, and 15% of an organization’s collective time is spent in meetings—a percentage that has increased every year since 2008,” the authors note. They go on to illustrate exactly how one large company spent 300,000 hours per year to support a weekly executive committee meeting.
While your small business may not be large enough to generate a 300,000 man-hour spiral, it is important to account for all meeting related costs. Additionally, in most cases your business will be small enough so that all key players can join one meeting and not get bogged down in wasteful layers of managerial hierarchy.
Meeting Cost Calculators
The hard dollar cost of a meeting takes into account the cost of attendees’ time and expenses related to travel, food, and venue.
For example, this post calculates that a small business with two local sales reps, each making $80k per year, and each traveling a combined 400 miles per week to make 10 sales calls, will generate a total, cost including gas, wages, food etc., of $138,667—and that’s for just local travel. The post goes on to calculate that your customers are likely spending $1,200 each year to pay their low-level staff for meeting with your sales people once per month. That’s a big investment on both parts—and it becomes an even bigger investment when high-salary executives (or perish the thought—consultants or outside council) are involved in meetings, or when meetings are not local.
Of course, it is hard to generalize meeting cost from one company, or even one group, to another. And, costs can be curtailed by holding meetings in your offices and skipping the snacks (which helps keep waists in check as well). Try one of the following calculators to determine how much meetings are actually costing your small business.
Trackmeet Meeting Cost Calculator
This calculator provides a fast and easy way to get a rough cost estimate for an internal meeting. Select meeting time and number of participants, then use the slider to select the average group salary. The meeting cost will be dynamically updated based on your selections. For example a 4-person, 60 minute meeting for a group with an average salary of $80k/year costs $215.
The Harvard Business Review Meeting Cost Calculator
This calculator enables you to get more granular with meeting cost. After entering meeting duration and number of attendees, you select the salary for each attendee and it dynamically updates to display meeting cost. If the meeting looks too expensive, you can remove attendees, or replace high-price attendees with lower cost ones.
The Plantronics Meeting Cost Calculator
This calculator takes exposing meeting costs one step further than the others. Not only can you calculate the cost of a single meeting, but you can also calculate annual costs for weekly, monthly, and quarterly meetings. You can also use the “delay” setting to calculate the cost of wasted time for late starts or run-overs, and for frivolous or otherwise dysfunctional periods in meetings.
A Comedy of Meetings
Whether in person meetings, video conferences, or telephone conference calls a dysfunctional meeting is no laughing matter for your business, but it can be hilarious when dissected and exposed. The following shorts humorously illustrate familiar problems with meetings of all types:
A Conference Call in Real Life
NOTE: I first shared this video two years ago in Why Sitting on Your Feet While On a Conference Call Is A Bad Idea, and Other Conference Call Tips.
A Video Conference In Real Life
Every Meeting Ever
Making Better Meetings
All laughing aside, there are things you can do to improve your small business meeting strategy, short of eliminating them all together. After all, meetings done right can be highly productive and can help your team work together with each other and with customers, partners, and vendors to help your small business thrive.
Start with simple no-brainers like insisting upon agendas so participants come to meetings prepared and ready to make important decisions, enforcing start times and end times (or even better ending meetings early when their purpose has been accomplished), and policing participants to stay on topic.
Other common meeting strategies include replacing sit-down snack-filled meetings with shorter stand-up, or even walking meetings, and making sure that each and every person invited to the meeting is truly needed. As the calculators noted above clearly prove—eliminating a mid-level employee from an in-house one-hour meeting can save about $50. Over a year, that can really add up.
One more suggestion, from personal experience living in Denver, is that if you have a geographically diverse team keeping time zones in mind is critical to a productive meeting. While it might seem completely reasonable to schedule a conference call at 9AM Eastern Time for someone based in New York City, the participant in San Francisco will likely not be at their best at 6AM in the morning, and may go into the meeting feeling resentful at the coordinator’s lack of courtesy.
Other interesting suggestions come from the the 2014 Bain study:
- Create a Zero-based annual time budget for meetings.
This tactic entails setting an annual time budget for meetings just as you do a dollar value for expenses. Under this system, the company cannot go over the allotted time set aside for meetings, and if a new recurring meeting is added, another must be removed to keep the time allotment balanced.
- Flatten the organization to increase information flow.
While this suggestion is clearly more relevant to large companies, it can help even small companies combat fiefdoms and information road blocks. According to the study, “We have found that on average, adding a manager to an organization creates about 1.5 full-time-equivalent employees’ worth of new work—that is, his own plus 50% of another employee’s—and every additional senior vice president creates more than 2.6.”
- Decrease default meeting times.
Many meeting scheduling systems default to one hour meetings, and people tend to leave a default settings without thinking. Simply changing this to 30 minutes has the potential to significantly reduce time spent on meetings.
- Require upper management to approve significant meeting investments.
When just anyone can schedule a meeting, they tend to proliferate with no one accountable for results or lost productivity. The study suggests requiring upper management approval for any meeting that will last over 90 minutes or require more than 7 people. Such meetings can cost thousands of dollars a year, particularly if they are recurring. As a business owner you would likely not allow a low-level employee to approve a purchase order for that amount, so why would you allow that employee to spend that much in your time?
For other suggestions from small business owners like you, check out 10 Entrepreneurs Share Fail-Safe Strategies For More Effective Meetings from Entrepreneur magazine.
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