Soapbox: "Don't be fooled by claims of cutbacks"

Lending companies have invested in corporate hospitality throughout the recession. Wise SMEs should do the same

There is no doubt the companies that have survived the economic downturn took a proactive approach to cutting back and evaluating their expenditure. Unnecessary expenses were curtailed and those that couldn’t be cut completely were reduced. However, as well as playing a genuine role in business survival during the recession, restricting company outgoings also took centre stage in the communications strategies of big firms.

The business pages became peppered with stories of how company incentives were, one by one, being sacrificed as a result of the recession. News of struggling City restaurants were backed up by firms explaining to press that entertaining clients and staff was a key area for expenditure culling. During the past two festive seasons, the death knell also resounded for the office Christmas party. One after another, hard-hitters of the business world confessed the recession had forced them to cancel the customary turkey lunch and cheesy disco for their employees. There was even talk of regular office fruit and water deliveries for staff being cancelled due to |budgetary concerns.

It made sense for company PRs to communicate cutting staff and client incentives. For years, the image of corporate hospitality has been set by a tiny proportion of the UK workforce drinking Cristal in Michelin-starred restaurants or being rewarded with trips on private jets. It is, in short, an easy target. But it’s also an incongruous one when you consider how much the average Christmas party for staff costs in the scheme of a company’s annual expenditure. Shouting loudly about cancelling your team building activities or office water coolers avoids bringing up any contentious issues for shareholders, and it successfully communicates a timely “batten down the hatches” attitude.

But our experience suggests there was a discrepancy between what was being publicly communicated and the reality of the situation.

Our Corporate Cookery Centre experienced an increase in companies using us for client events at the height of the global downturn. Between December 2008 and March 2009, we experienced a 73 per cent year-on-year rise in the number of client events hosted at the centre. We also experienced a 54 per cent increase in enquiries from corporate hospitality agencies whose clients were rejecting showy branded boxes and requesting ideas for more low-key events. It seemed big companies were still spending thousands on keeping their clients sweet, but were keen to keep this under wraps. Our centre, tucked away from the City, provided the perfect solution.

This secret business as usual approach also seemed to apply when it came to the Christmas party season. Of the 97 companies booking us for their office Christmas last year, 30 asked us to keep it confidential. Almost all of these were large corporate firms. Mirroring a “stealth” spending trend, first identified by The New York Times, companies were still investing in their client and staff relationships. They were just doing their best not to be noticed.

Despite the genuine need to re-evaluate expenditure, it is worth noting that big, international businesses did not view events for employees, at Christmas or otherwise, as something they could afford to cut. Teambuilding events and Christmas parties at the end of the year were as important as corporate communications as they had a quantitative, positive influence on their workforce.

On the surface, taking part in a pursuit out of the office looks detached from business life. However, people often have their best ideas in the strangest of places and find solutions to problems when they are not even looking. Time and again, insightful managers report that a trip to our cookery centre has resulted in far more than just a delicious meal.

Suited and booted, a City worker arriving in our homely kitchens with their Blackberry flashing might wonder what adorning a sea bass with capers and piping meringues has to do with the mountain of paperwork they have left behind on their desk. Time away from the office probably seems like something they can’t afford, especially when they have to spend any “fun” time with that irritating new PA. However, back at their desks the next morning, the worker faces their huge “to do” list with a new vigour after being refreshed by an evening that was novel and hugely enjoyable. They greet their PA with a smile after realising they had completely misjudged them and, for the next week, receive their status reports typed up without asking and the meeting rooms set-up ahead of time.

Don’t be fooled. Successful, multi-national businesses have been treating and investing in corporate hospitality during the recession, and wise SMEs should do the same.

Anna Venturi is managing director of Venturi’s Table Corporate Cookery Centre. For more information, visit venturis-table.com