Why have a Christmas Party?

In the current economic climate, many company directors and owners may well be questioning the value of staging a Christmas celebration for their staff.

Charles Cotton, an independent expert from the Chartered Institute for Personnel and Development's expert on staff rewards, says

"As ever, employers need to think about why they are providing a Christmas party in the first place. If it is to recognise the collective contribution of their employees then what are the alternatives and are they more effective?"

If holding a Christmas party is the most effective way of achieving this then employers should be wary about scrapping them in response to the economic downturn because the long-term impact could be damaging on employee engagement and organisational performance.

The Christmas party is one way of reminding staff that they are part of a common endeavour."

And as the campaign Keep Britain Working has reported that more than half the UK's bosses have got worse at motivating their staff since the recession began, this could make the Christmas party even more important this year!

In the end, as with all business decisions, it will be the return on investment that many decision makers will focus on, so here are a few of our thoughts on the value of Christmas Parties and a few ways in which you can help in justifying the budget.

Although the cost may seem high, assuming an Xmas party costs say £80 per guest and the average salary in a company is £40,000, then this only represents 0.2% of the salary bill.

Many companies have found that the value in entertaining staff far outweighs the cost in terms of loyalty, networking, motivation, team spirit and enjoy a halo effect of higher productivity after such a Christmas celebration. (Most of the "Top 100 Companies To Work For" survey, carried out by The Sunday Times, invest heavily in staff communication and reward programmes.)

This value can be further enhanced by making sure that you take the opportunity for the MD to address the staff during dinner. This could include some annual recognition awards, which are a great way to celebrate success and encourage increased future personal performance.

To extend this idea further, many Christmas Party venues are ideally suited to staging an afternoon conference or presentation before the party to increase the business content of the event further. The party itself could then be run all evening with dancing, or converted into a more informal drinks and canapés or bowl food service, ending at say 10pm.

If costs need to be reduced, consider having a full or part pay bar or reducing the price by taking a Monday or Tuesday, where prices are often lower due to reduced demand for these dates.

In the current marketplace, when there may have been recent redundancies and/or pay freezes, a very extravagant Christmas party may well be viewed as inappropriate. We therefore recommend that any company in this position organises their party to deliver a great night without any unnecessary upgrades (ie Champagne, additional live entertainment or pre-dinner canapés).

Remember that as long as you have a beautifully lit and themed venue, great food and a DJ playing your kind of music, you are assured a great night!

We welcome your feedback or comments on this article.