DMO Organizational Review and Optimization for Next-Generation Destination Marketing

1. Kathleen Frankford > NEXTFactor Enterprises Defending Your DMO

2. ABOUT NEXTFACTOR ENTERPRISES: NEXTFactor Enterprises Inc. is a consulting company in the tourism and transportation industry that provides strategic planning and marketing services. In 2014 NEXTFactor led a ground-breaking initiative on behalf of Destinations International called DestinationNEXT.  NEXT Generation Destination Marketing and Management | 2

3. When is the last time you truly assessed your organization in a deep and meaningful way? NEXT Generation Destination Marketing and Management | 3

4. Impetus for an Organizational Review • Various stakeholders share concerns that the DMO is not bringing a “business mindset” or “lean mentality” to the operations. • Poorly run • Overstaffed and highly paid executives • No ROI for work produced • Not enough resources allocated for marketing and sales • Continued assurance DMO will hold up to scrutiny New DMO leader – help expedite acclimation to new role Help DMO optimize resources and operations NEXT Generation Destination Marketing and Management | 4

5. Engagement Purpose FOCUS ON: • CULTURE • ORGANIZATIONAL STRUCTURE • FUNCTIONAL POSITIONS • SYSTEMS AND MAJOR PROCESSES • RESOURCE ALLOCATIONS • INTERNAL CAPACITIES AND OUTSOURCING OPPORTUNITIES • Review and assess current revenue streams and, to the extent possible, the profitability of each revenue stream. • Assess operations and processes utilizing comparisons to Destinations International studies, other highly regarded Destination Marketing Organizations, and/or best business practices NEXT Generation Destination Marketing and Management | 5

6. The Purpose is NOT • To serve as a “witch hunt” or embarrass the DMO • Focus solely on examples of solid management. By design the focus needs to address areas that provide opportunities for improvement or greater impact • The organizational assessment should be designed through a combination of: • The needs of the DMO • Industry best practices NEXT Generation Destination Marketing and Management | 5

7. The Structure • Determine needs and pain points • Define Process and Deliverables • Communicate Observations • Make Recommendations NEXT Generation Destination Marketing and Management | 5

8. Determine Needs • What are your most scrutinized areas? • Staffing levels and salaries • Allocation of funds • Financial integrity • Processes • Optimization of existing resources • New, former or existing special projects • Business model NEXT Generation Destination Marketing and Management | 5

9. Process and deliverables • Analyze all revenue and expense categories (line item detail) • Assess staff time allocated to specific operating areas • Analyze total compensation and benefits by staff member and specific operating area • Review and compile vendor contracts including terms and conditions and annual budgeted cost NEXT Generation Destination Marketing and Management | 5

10. Process and deliverables • Produce easy to reference “Fact Sheets” and develop for key areas in question: • Building • Visitors Center • Company vehicles • Compile a salary comparison of top 5 compensated positions • Destinations International • Chamber study • Published market studies (or conduct separate study) • Compile staff benchmarking • Destinations International • Area organizations – Chamber, EDC Community Foundations NEXT Generation Destination Marketing and Management | 5

11. Process and deliverables • Compile trend data • Salary information • Full and part time staffing • Interview and summarize interviews with Executives at high performing Destination Marketing Organizations • Interview staff members to understand time spent on high value items, culture mentality and areas of opportunity NEXT Generation Destination Marketing and Management | 5

12. Process and Deliverables • 11. Analyze and, where appropriate, provide recommendations on: • Performance Review Process • Compensation • Job Descriptions • Organizational Structure • Expense Reimbursement Process • Vendor Selection Process • Vendor contracts • Assemble a comprehensive information packet and presentation for key stakeholders • Present overview of findings to designated key stakeholders NEXT Generation Destination Marketing and Management | 5

13. Potential Observations • Allocation to program expenses • Integrity of budget and financial processes • Advertising shifts and impacts on key revenue streams • Membership growth or decline trends • Staff Observations • Financial and marketing impact of special projects NEXT Generation Destination Marketing and Management | 5

14. Potential Recommendations • Convene a Task Force of Board and Non-Board members to complete a comprehensive strategic review of key areas in question • Visitors Center • Building • Business model • Special programs and grants • Review and develop an updated compensation policy and consistent review process • Consider hiring an outside consultant to assist with culture development and shaping • Work with the staff to develop an ROI mindset for all positions, projects and initiatives NEXT Generation Destination Marketing and Management | 5

15. Potential Recommendations • Implement a time-tracking tool such as Harvest to accurately allocate employee time • Develop a consistent bidding process • Realign budget • Conduct annual financial audit • Human Resources • Filing systems • Hire HR consultant • Designated staff member NEXT Generation Destination Marketing and Management | 5

16. Research and Data Lends credibility to the DMO and CEO Shuts down claims made by your opposition Eliminates the need to be defensive Promotes confidence and transparency NEXT Generation Destination Marketing and Management | 4

17. Questions? Kathleenfrankford@nextfactorinc.com