And the program is over. Michael Kaiser gets a standing ovation.
Question and Answer session
Question: It seems that people are not interested in arts thanks to the internet, YouTube, etc. How do we get the next generation excited about the arts?
Answer: Too many arts organizations try to trick people into coming with promotion materials that look trendy. Do the work that matters to you. Through education programs and activities, you can get people involved in the art.
Question: What is the appropriate role for an endowment?
Answer: I love an endowment. If someone gives one, I’m thankful. But too many people think endowments are essential to a healthy arts organizations. If you have an endowment, you’ll just make your budget bigger. An endowment is not a safety net, but will not provide security. A successful arts organization does great programming and markets that programming aggressively — that must be protected at all costs.
Question: You talked about programmatic collaboration. What about other types of collaboration? How do you overcome objection that there are social service organizations to donate to?
Answer: Collaborations are about building relationships. 65% of all funding comes from individuals. Present yourself as a social service organization. I’m sure you’re doing great educational programming at your organization — make sure to talk about that and connect donors to that. Arts education is a crucial topic — we need trained, educated people for our country to succeed. We tend to approach fundraising from a moralistic standpoint too much, and that is not a compelling argument.
Question: Our organization is selling $23 tickets, but still not filling the theater.
Answer: What are you doing to get people to be excited about the institution? What joint ventures have you done? Where have you gotten press? Let’s talk more offline. I don’t believe you have a pricing problem, but a visibility problem. That is my guess.
Question: Do you have advice for how you handle disgruntled staff or board who are asked to leave?
Answer: The noise goes away after a while if you have something fun and exciting to talk about. Keep talking about the programming you have coming up. I’m constantly celebrating, and the naysayers just lose their potency.
Question: What are your thoughts about more collaboration and mergers between small organizations?
Answer: I’m a huge believer in joint ventures. If there’s a big project you can’t do alone, find a partner. Joint artistic and educational projects give you a huge advantage. However, I’m skeptical about organizations merging. I hear a lot about this economy thinning out organizations, but I’m worried that the financially weak ones are the ones that will be squeezed out. There are enough resources for everyone — the question is not about too many organizations, but about too little marketing.
Question: Many orgs are consolidating positions. Managing and executive director, marketing and fundraising; and so on.
Answer: Many organizations are certainly different. It’s often dangerous when organizations try to combine different types of expertise in a single person. Many organizations are already so small, but don’t skimp on marketing.
Question: I believe there are a lot of similarities between starting a new org, and org turnaround. Expand on how you manage such limited resources.
Answer: Be clear about what you’re going to do. Have a plan for the next two or three years. Make sure you build on everything — everything you do must build to the next thing you do. Capture the people who come to a performance so you don’t have to start over at the next performance. Capture every expression of interest. Capture email addresses. In three or four years, you’ll have built a sizable portfolio.
Question: Governments at no level seem to be able to stay within their budgets. How will this affect contributions?
Answer: Inflation is problematic, especially in this economy. Large deficits have a huge impact on the arts. Inflation is problematic for arts organizations because higher productivity lessens the impact of inflation. We can’t play a Beethoven symphony faster, or cast a Shakespeare play with fewer actors than when it was first written. So inflation has a much bigger impact on an arts organization than on for-profits — the gap always gets bigger. By raising ticket prices to fill the gap, we’ve disenfranchised audiences and made ourselves less relevant to communities.
Question: Please take a moment to comment on the Arts in Crisis program.
Answer: The program began a year ago. We saw many organizations that were cutting programming and decided to begin offering free consulting. Volunteers have signed up to be mentors in the program.
Question: Expand more on the need for leaders to leave at some point.
Answer: I was so scarred by the bad moments in the time that I led, but there’s also a time when you can make an effective transition.
Question: How do you deal with abusive relationships between board members or staff? People get into temper tantrums, “you’re destroying the organization… etc.”
Answer: I don’t put up with abusive board members well. Spend a lot of time with them before board meetings, before important votes, before important discussions. Let the abusive board members vent their frustrations to me. I’m willing to have those scars. In the presence of abusive board members, the rest of the board stops doing the positive things. Also, try to get the abusive board member excited about one project. When they get excited and “adopt” that project, they feel closer to the mission and tell others about the organization.
Question: Would you suggest a term of office for board members?
Answer: I have a different point of view than most. I don’t like term limits. Some say limits help you get rid of the bad board members. But good board members are precious — when their terms end, they look for other things to do. I’m hard-nosed about getting rid of bad board members, but I ask gracefully.
The Q&A begins. Lisa Cremin begins with the first question: Tell me more about turning around an organization for a large institution vs. a small institution.
Large orgs have more resources have a big advantage in who they can approach. Small orgs have the advantage of focus.
Boards must be open to being restructured.
Boards must be introspective. What change needs to happen, and how will we make that happen? Never add a board member to a board that’s not functioning well. But get several at the same time, and have them talk to one another before their first board meeting.
Also, your organization must have the discipline to make the change that is necessary. Many begin a turnaround, but will quit after a week or a month. It’s also important to leave an organization once it’s turned around.
It’s possible to do a turnaround in a bad economy. It’s more difficult, but organizations that are today sticking to great art are doing well today, even in this economy.
When you’re at death’s door, you can’t afford to focus on the $10 or $20 donor. Kaiser is not against the small donor. Find an amount that matters, but that the board is comfortable asking for. Don’t ask for that ridiculous sum ($1 million or more), but don’t spend too much time pursuing the really small gifts, either.
Challenge gifts are also important because it gives an incentive for people to give more.
There must be only one spokesperson, and the message must be positive.
Many organizations are in the habit of airing their dirty laundry. Money comes to those organizations that people feel are well-run. Money doesn’t come by whining. Rather than talking about the problems, start talking about the exciting things you’re doing.
Next rule is differentiating between two types of marketing: programmatic vs. institutional. Insitutional marketing is at the heart of building a vibrant company.
“My job as executive director is to make my board not embarrassed. Make them so proud that they want their friends to be associated with us. Any arts organization can find ways to make people think that they’re vital. Let people know about the work that you do and get them excited about your company as an institution.”
What’s the difference between risky programming and risky operations? How do you encourage one and discourage the other?
A lot of 5-year plans leave the art out. How can an organization do that? What makes an organization successful is the art that gets people excited — that’s the type of art that must be planned five years in advance. This also helps improve your fundraising dramatically. Go to donors and listen — they will let you know what sorts of projects they like to fund. That’s not to say you have to do as the funders say, but you can get a good idea of coming up with what will get your funders’ attention.
Sometimes there is tension between artistic directors and executive directors. The solution comes in getting the artistic directors to come up with those five-year plans, big exciting projects.
The next rule is to focus on today and tomorrow, not yesterday.
Too many companies spend time looking backwards. Whose fault is it? People spend time arguing over history, not solving the problem. Figure out what you’re going to do about the problem and move forward.
By the way, the best way to work with creditors is to get them excited about where the organization is moving. They have an interest in seeing you succeed.
“A lot of people are concerned that I spend money I don’t have, but that is not the case.”
Art doesn’t just refer to the artistic work, but to all the programming of the organization. Sometimes as a last resort, you have no other choice but to cut some of the programming, and Kaiser says he respects that. But too many companies cut programming as a first resort.
Kaiser related the story of a company whose budget relied on bequests. As long as people died every year and left money to the company, they survived. But that was not a sustainable budget strategy. Indeed, one year, no one died, and the company had to cut programming to survive.
Good art, well marketed. What is meant by that?
We rely on the good will of so many people, both inside and outside the organization. We need the support of all these different people who need to think well of us. Healthy arts organizations are the ones that are always welcoming new people. The unhealthy ones are holding on for dear life to the few people who love them.
Kaiser is troubled by arts organizations that take the safe road. This is the time to do those big, transformational projects. Even if you can’t do it today, plan it 3-5 years out. The biggest irony is when arts organizations need to get their creativity beaten out of them. If we’re just doing the same work over and over, we become a dull industry. Those who are the best competitors for funding are the ones who do the best art. The health of the arts comes from having the best art, not on having the best promotional materials.
“We wanted to give you southern weather, and we’re sorry we couldn’t accommodate that request.” People are still filing into the auditorium.
The first rule is getting everyone to agree that one person needs to lead a turnaround, and everyone else needs to put their trust in that person. Did Kaiser understand that rule at the Kansas City Ballet, his first turnaround?
Answer: We have to instill hope through a strategy that people believe will work. Kaiser came in with the point of view that the company was better artistically than the local community appreciated, so there was great potential. They eliminated their debt in 9 months.
The reason one person needs to lead is because there are separate factions of people who think they have the answer. The person coming in must have a plan with specific things that need to be done.
Cynthia Benefield is up at the podium to introduce Susan Weiner and Michael Kaiser. Weiner is the director of the Georgia Council for the Arts. Kaiser is president of the Kennedy Center for the Arts, and has been dubbed “the turnaround king” for his record of turning around arts organizations in trouble.
Show of hands. About 50% of the crowd is on the staff of arts organizations. 40% are volunteers or on boards of directors. About 20% are artists. About 20% identify above themselves as none of the above, but believe arts are important.
The conversation will last about an hour. Afterward, there will be a Q&A. Up next is Cynthia Benefield.
And we begin. George Thompson, director of the Ferst Center is welcoming everyone. “I’m looking forward to an exciting, vibrant conversation.” And with that, he introduces Mistress of Ceremonies Lisa Cremin of the Metro Atlanta Arts Fund.
The crowd immediately started to pour in as soon as the doors opened. These are the early folks. Are we all bleary-eyed this early in the morning, or is it just me who is bleary-eyed?
Doors will open in about 10 minutes. Final sound checks are under way. The stage is set up quite gracefully, with two chairs on either side of a small table, all on a Persian rug. There’s a podium off to the side, and a nice stool in the wing. Three mics are set up at the front of the auditorium, just waiting for the Q&A session.
First update 8:50:
Alright… here we are. It’s about 8:30. Check one two.