Corporate Culture

Either that, or learn how to host a truly festive event

It's a dirty little yuletide secret: company holiday parties are a hassle. Too often, they turn into expensive logistical nightmares. And no matter how well you plan them, people wind up complaining.

Wouldn't it be tempting just to skip the whole affair? Some entrepreneurs try that. Brian Quint, CEO of Aqua Quip Pool & Spa Inc., an $8-million retailer and supplier of pool products, wanted to include the families of his 65 employees in the Seattle-based company's festivities. "It's important to keep the spouse enthusiastic about the employee relationship," says Quint. But when he invited kith and kin to a holiday party, many were so busy with other events that they couldn't make it. So last year Quint abandoned the whole idea of a Christmas party. Instead, he hosted a companywide bash in the fall.

But old traditions die hard. This year Quint will host not only his fall soiree but also--you guessed it--a holiday party, in this case to celebrate reaching some corporate goals. Quint isn't alone: despite the headaches, many business owners end up throwing some kind of December shindig. If you're one of them, you might as well do it right.

David Mueller finds that the key to a successful bash is surprise. Mueller, the CEO of Valley Staffing Services, a temporary-staffing business in Visalia, Calif., tries to do something unexpected for his holiday party. One year he gathered employees in a restaurant for a seemingly ordinary dinner, only to reveal a mock-up of a Jeopardy!-style TV show, with a set, a host, and prizes. Another year Mueller invited his staff to his home. Thirty minutes into the party, limousines appeared and, to the employees' surprise, whisked the partygoers off to a local country club. The club was the first of three additional locales--one for each dinner course.

Of course, when you feel the need to always top the previous year, your holiday party can quickly become a very expensive tradition. But Mueller, whose company has 20 full-time employees, argues that his offbeat celebrations wind up costing him less. "Going the typical route with the band and the caterer--sure, that's the easy way," he says. "But if you're creative, you can actually spend less and make it even more motivational."

That's especially true if you get employees involved in planning the event--which also helps silence the complainers. "You always get grumblers, even if the party's good," says Ben Chase, CEO of Cablelink Inc., in Salt Lake City. "You hear, 'Pepsi? Why'd you get that? Why not Coke?' " To avoid such gripes, Chase lets a committee of employees plan the holiday parties. He has found that his staff typically spends less than he used to. "The last party I planned was the most expensive thing we ever did," he admits.

Joseph A. Lamberger Jr., CEO of $2.6-million Eclipse Consulting Inc., in Noblesville, Ind., knows the feeling. At one point, he realized he was spending more than $160 a head for his holiday festivities--once he'd calculated the cost of food, alcohol, and gifts. So one year he instead offered a one-day holiday escape to the Bahamas for his employees and their spouses. "The trip came out to $199 per person," says Lamberger, whose computer consulting company has 41 employees. "I spent a little more money and got something totally different." He claims that such unusual parties are good for employee retention and recruiting--and that's key in the field of computer consulting, in which competition for talent is intense. "I get more résumés from and comments on the Bahamas trip than on anything else," he says.

On the other hand, money you don't spend on a party can be used elsewhere. Rob Stallings and the staff of Envirotech Services Inc., a $2-million civil-engineering firm in Enid, Okla., gather on Christmas Eve just for an informal company-sponsored lunch. Stallings says he puts the money he saves toward year-end bonuses. "I haven't heard anything about someone missing any big party," he says. "If you ask our employees, they'd rather have that money for Christmas."

Christopher Caggiano is a staff writer at Inc.

Now What? How to Limit Your Party Liability

These days, the Grinch must be a lawyer. Concerns about liability for alcohol-related incidents, sexual harassment, and workers' compensation claims have led many companies to forgo holiday galas entirely. Anil Khosla, a lawyer at Boston-based law firm Peabody & Arnold, reports that many companies he works with simply give bonuses rather than host a social function--and many others are having alcohol-free parties. If you do plan a party with alcohol, consider these steps:

Distance yourself. You may have heard stories about party hosts' being held partly responsible for car accidents caused by inebriated guests. In many states that liability applies to "business hosts" as well, particularly if courts find that a company failed to supervise its party adequately or prevent excessive drinking. The more the event is tied to the business, the greater the potential liability. To distance the business from the party, make it an entirely social event, don't invite clients or vendors, and make sure employees know that attendance is voluntary.

People drink. Plan accordingly. Hold your gathering off-site, if possible. That may shift some of the potential liability to the hotel, restaurant, or caterer. If you must have an on-site party, hire an independent caterer. Don't permit anyone from the company to serve alcohol, and instruct bartenders to stop serving anyone who seems inebriated. Lawyers advise avoiding an open bar--or, at the very least, limiting it to the first hour. Even having a cash bar, however, won't shield you from third-party liability. "You're still providing the venue and the liquor," explains Khosla. Close any bar at least an hour before the party ends.

Give people rides. Consider providing transportation to and from the event (although that creates the potential for liability if there's an accident). Make sure that cabs will be available, and appoint someone to suggest cab rides home for people who have had a few too many. And then there's the method used by Douglas Ranalli of Unifi Communications, in Lowell, Mass.: he reserves a block of hotel rooms and encourages his employees to use them.