Friday, September 17, 2010

A Scalable Recipe for Getting Out of Financial Trouble

THE ARTICLE I JUST READ ABOUT THE COLUMBUS SYMPHONY ending its season just a hair's breath in the black is cause for celebration in many ways.  As symphonies across the country struggle, merge or outright die, the Columbus Symphony turnaround is worth taking a look at.  What was the secret from going from a projected deficit of more than $1 million to a surplus of $200,000?  Were there lessons for the rest of us embedded in the experience?
In a nutshell, here's what symphony leadership did:
  • secured major corporate/foundation support, admittedly much of that was already in the pipeline, but the lesson here is that you don't give up on fundraising in a tough economy, you work the hell out of it
  • secured municipal support -- a tough sell right now, but one likely built on strong economic arguments.  Do you know how much your cultural organization contributes to your local economy? If not, you're overdue in pulling that information together.
  • musicians are now in their third year of pay cuts.  The typical salary for musicians went from more than $50,000 to $35,000.  Ouch.  They also gave up paid vacation this year.   Sharing the pain must encompass managerial and executive staff, too, not just your program staff or the pain you inflict cuts that much more deeply.
  • combined administrative functions like accounting, ticketing, etc. with a performing arts association.  Doing so reduced the symphony's office staff by two-thirds.  More of us have to be on the lookout for cost-sharing opportunities -- it's probably easiest with back-room functions, but there may be lots of synergy to be had by sharing program staff and, hmmm, maybe an executive or two.
  • and speaking of executives, the director of the performing arts association is serving as the volunteer managing director and CEO of the symphony.  Interesting concept, but a lot harder to pull off than sharing ticketing functions.  What could make this work for your organization?  (A tightly drawn job description is one key.)
There you have it, that's the published recipe.  Pretty simple, really.  It's a recipe many can follow.
What's the big lesson here?  Repeat after me:  NO SILVER BULLETS.  That's right.  If your organization is in financial trouble, it probably didn't get there in a day or a week or even a year.  It took a while.  And it will take a while to get out of the mess.  And it will take hard work and, yep, everybody gets to pitch in.
Is it scalable to organizations of varying sizes?  I think yes, mostly.  I think yes, definitely, if you're willing to put the sacred cows on the table along with the more obvious stuff and to accept that the solution, whatever combination of ingredients from the basic recipe you choose to use, will require months if not years of commitment.

Photo:  Columbus Symphony Music Stand from lottadot via Flickr

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