Crise oblige? (iii) Management challenges



Photo © ORF (taken from http://www.kleinezeitung.at/)

What a great management lesson was the open letter of the music director of Liceu of Barcelona, Michael Boder, in response to the announcement of the administration that, due to financial difficulties, the theatre would close for two periods of one month each, between March and July (read here). And it was not just a management lesson. Boder showed a great sense of mission and responsibility, essential qualities for anyone who heads an institution and decides its course.

“Why do we exist?”, the music director asked Liceu´s general manager, immediately providing him with some answers: we exist to play, play more and not less; because, in moments like these, music carries a very important message; because music can move our inner selves; because, in times of crisis, a cultural institution can and should send a social message; because we are at the service of social cohesion; because culture brings comfort and gives ideas (read the open letter here).

But Boder raised some more issues in his open letter, related to the need to reevaluate the theatre´s inflated administration, the collective agreement and chorus and orchestra working hours, which he consideres insufficient. He didn´t hesitate to put on the table the theatre´s fixed costs in order to guarantee the continuity of the programming. Because he knows, just like the administration should know, that without programming an institution disappears from the 'map', that is from the heads and hearts of its audience; it loses its credibility and the prestige it took uears to build; it is sentenced to internal decline and demotivation; and it seriously damages its image, when the message it sends to society, especially in times of crisis and considerable sacrifices, is that the priority are the salaries and benefits of the employees (even if they have been ‘sentenced’ to inertia), and not the cultural offer, which is the main reason why it exists (in the meantime, the administration of the Liceu has revoked its decision for closure – read here).

In the last two years, the financial situation of many orchestras around the world was news. One of the most famous cases was that of the Philadelphia Orchestra, an orchestra with a reputation at an international level, which filed for bankruptcy almost a year ago. Nevertheless, the case I would like to concentrate on here is that of the Detroit Symphony Orchestra. Detroit is a city that gaine prosperity thanks to the automobile industry, which supported, among other things, a number of cultural institutions, including the orchestra. In the last years, a number of economic and social factors have dramatically changed the environment the orchestra is operating in: the decline of the automobile industry, the collapse of the stock market, the fact that the population decreased by almost 50% in a decade, but also aging audiences, a decrease in tickets sales, the debt still to be repayed for a recent auditorium extension. The administration went ahed with cuts, including a 23% cut in the salaries of the musicians (accepted after a strike that lasted for months and kept the orchestra silent for most part of the season). Nevertheless, cuts are not a guarantee for sustainability. Socio-demographic changes are a much greater challenge for this orchestra (and for cultural institutions in general) and its sustainability depends a lot on the way it will react and adapt to them. Operating now in an 80% afro-american city (there are only 4 black musicians in the orchestra), where the average income has drastically decreased, where there has been no musical education in schools for years, it is urgent to try and involve new, diversified audiences, representative of the population that now lives in Detroit and other neighbouring cities. One of the initiatives of the orchestra is playing in community centres, churches and synagogues, points of encounter with its new target audiences (read here).

The problems cultural institutions are facing nowadays in various parts of the world are not just financial. They are varied and they are connected. They relate to management, programming, education, communications. The world in which we are operating is different, constantly changing and developing.

With the aim to approach some issues related to management this time, I would quote once again Michael Kaiser, who says that, in the first place, we are facing a revenue problem (and not a problem of expenses, although that´s where we always start from). And the word ‘revenue’ specifically refers to: state and municipal investment; sponsorship money (corporate, foundations, individuals); revenue from rentals and other services; ticket sales (when applicable). In Portugal and other countries, after years of (almost absolute) dependence on the money the State was willing or able to invest, there is an urgent need to start looking for alternative revenue sources. And although the obvious option seem to be companies and foundations, we cannot fool ourselves. This is not a relationship that lasts for ever. These organizations invest their money because they want to see their name associated to a specific project; because this makes sense within their strategic plan. In the meantime, strategic plans change, they are orientated according to specific objectives and priorities, which don´t remain unaltered. Thus, the third revenue source becomes decisive for a sustainable future: the people, the individuals who relate to us and want to support us with donations, buying tickets and subscriptions or memberships. This relationship, yes, if valued and cherished, may last for ever. Even after death… One of the most touching stories I have heard recently is that of a man who left all his money to an orchestra - having set aside just the money for his funeral –, because he was homebound for years and one of his greatest (and few) pleasures in life was listening to the orchestra´s live transmissions on the radio (for legal reasons, due to the donor´s express wish, it is not possible to give specific information about this donation).

However, we do have cost problems as well. When we are forced to cut (due to a crisis, for instance), we are always capable of identifying those cases in which our financial resources are not managed in the most efficient way and we try to optimize them. This also involves managing human resources efficiently. In general, we are not prepared, or willing, to consider the waste of money not only on inflated teams, but mainly when the existing teams are not reaching their true potential. Michael Boder did not hesitate to admit that the number of working hours of the orchestra and the chorus were insufficient. In the case of many orchestras around the world (see links at the end of the post), musicians and other employees were involved in the process of ‘repositioning’, they did not consider their salaries and benefits to be ‘sacred’, they did not place them ahead of the need to continue playing, because they didn´t want to lose their place in the life of their audience. At the same time, I believe that employees are more willing to consider this kind of negotiations and to accept sacrifices when they feel that there is an honest and genuine wish, a determination on behalf of the administrations to find solutions that will allow organizations not only to survive for a little longer, but to create the conditions for a healthy and sustainable future for all.

In times like these, in cases like these, there is a greater need for cultural institutions to be managed by people who have adequate academic preparation and /or professional experience and training), professionals who will be able to drive the boat with competence, knowledge, discipline and with due sensibility towards the field´s especificities. Because it is possible to have financially healthy cultural institutions, they exist (read Michael Kaiser´s article here). Maybe once we manage to overcome the rhetoric regarding the “commodification of culture” (in which normally a cultural manager is the equivalent of a supermarket manager and his specialized work is seen as a terrible threat to access to culture for all), we might be more open to try and understand how and why others have made it.

We are used to saying that times are not easy. Have they ever been? Times now are ‘simply’ more difficult. To move out from our comfort zone, to overcome the sterile language of the manifestos which only complain but propose nothing, to look at the reality around us and confront it (in a responsible, realistic, knowledgeable and professional way) is a pemanent need. Perhaps more urgent at certain times. But permanent. As Russell Willis Taylor, CEO of National Arts Strategies, said in a speech that is worth listening to until the end, “There are no crises, only tough decisions”.

Still on this blog
La crise oblige? (I) Some questions
La crise oblige? (II) Programming challenges
Building a family: lesson from the social sector
On family: second week at the Kennedy Center
Changes: are we paying enough attention?


More readings
Philadelphia Orchestra players OK tentative contract with deep cuts
CSO posts a deficit for last year
Keeping the Lights On: Sacramento Opera Seeks to Remain Viable
Birmingham Symphony Orchestra pay cut