The real cost of meetings
Is this what every person should bring to each meeting? Photo by Sharon McCutcheon on Unsplash
I work with individuals, teams and organisations to help lift their performance. One thing that I am spending a lot of time talking to people about is their meetings. I am convinced that meetings are one of (if not the #1) underestimated spends in an organisation. In this post, I'll help you get a better understanding of the real cost of meetings.
Before you continue, I'd love for you to estimate how much your team meetings are costing you each year. Write it down somewhere and see how close you get.
The hard cost
The 'hard' cost of meetings is actually the easiest one to figure out. Harvard Business Review have put together this really handy meeting cost calculator. Have a go and put in the details for your team meeting. You may not know everyone's salary, so if you aren't sure, take an educated guess based on your own.
Got the number? That's one meeting.
The HBR tool uses a multiplier of 1.4 to account for benefits. My guess is that in many settings, the multiplier is higher to account for meeting related expenses including 9.5% (in Australia) for superannuation, the cost of the real estate or telecommunication software, electricity and so on. For now, let's assume that the smart people at HBR got it right.
For the year, multiply that number by 50 if it's a weekly meeting or 25 if it's fortnightly and 12 if it's monthly.
If you haven't been playing along, let me give you a sample representative figure. For a weekly Leadership Team meeting with 8 people on an average manager wage of $100 000 (for the ease of using a round number, many will be over this), then the cost is:
$ 28 000 per year.
Just for one recurring meeting in your calendar. If you spent that money on anything else, you'd want to make sure that you were getting a pretty decent return.
The opportunity cost
Another cost that is clear (although often less easy to quantify) is the opportunity cost of a meeting. In other words, what are the people in this meeting not doing because they are in that meeting? Depending on your role and type of company, this might be a bit easier to calculate. For example, if you are in the habit of charging for your time (like many lawyers, accountants and advertising agencies), you could simply add the hourly charge out rate for each person in the role. As one person I spoke to recently about this said..."yeah, not sure I want to think about that too much". I'd say think about it - ignoring things very rarely stop them from being true.
For example, if members of the leadership team above were able to charge $250 per hour (very cheap for some lawyers or advertising types!), the opportunity cost of that meeting (on top of the hard cost) is $100 000 every year!
The people cost
The third type of cost for your team is the engagement of your team members. Atlassian recently did some research and found that 47% of people say that that meetings were the #1 time-waster at the office. This same research suggested that 50% of meetings were considered a waste of time.
This is what people say - and they will only put up with it for so long. They daydream, they send other emails, the sleep and I wouldn't be surprised if they also hit Seek! I recently spoke to someone who described a meeting that she didn't need to be in as the final nail in the coffin for her time at the company. The next day she resigned - it was her breaking point. Not the only reason that she left, but a symptom of the fact that she was spending too much of her time at work not doing meaningful work. Speaking to more and more people about this, I hear this repeated as variations on the same theme. People's energy, attention and time are valuable and wasting these resources is a dangerous game to play.
I want it to be clear that I am not beating up on all types of meetings (I'll write more on that next week). What I am saying is that meetings are a huge cost on teams and organisations. When the spend delivers a return, it's a wise investment and when it doesn't, it's a waste. So, my questions for you this week are:
What are meetings costing you and your team?
Are you getting a good return on that spend?