Tag Archives: finances

Feedback from You (yes, you): 9 Words That Describe the Nonprofit Arts Issues That Are Placing You at the End of Your Rope

rope

This blog, as most are, is pretty much one-way.  I share experiences, advice, consultation, and observations; you read ’em.  I can discuss 1,000 issues that affect nonprofit arts organizations.

But that’s me.

What keeps you up at night?

What concrete issue (not just “there’s no funding for…”) is fraying your rope?  Or better, what issues are figuratively tying a noose around the end of your rope?

Here’s your assignment.  In 9 words (no more, no less), write that issue and send it to info@137words.com.  That’s it.  Beginning in August, we’ll periodically take each issue and I’ll give my take.  Then we’ll open up the discussion to everyone who reads 137 Words.  Let me know if you’d like your name in or if you’d like to be anonymous.  And if you’d like my help privately, let me know that, too.

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Talk to Me Like I’m 10: a Lesson in Long-Term Planning for Artistic Directors and Board Chairs

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Does long-term planning cause a rift between your artistic director and those other people?

Does it cause discord between your board chair and those other people?

Seen all the time among arts charities:  carefully (and successfully) executed annual development plans reduced to rubble after the board institutes a high-priced capital campaign.  The capital campaign sucks up all in its path, causing 5 years of stakeholder repair.  Indispensable Chair happy.  Staff leaves.

Artistic directors substituting their taste for vision and their personal and professional relationships for core values.  Idiosyncrasy obviates mission.  Indispensable AD happy.  Board leaves.

Both cases: company imperiled, stakeholders leaving.

Time to create an action plan, written at a 5th grade level.  Make it about impact rather than income.  Test the theory that your arts nonprofit is indispensable.  Make sure that your most important stakeholders don’t leave.

Nonprofit Arts Executives: After the Ask (for anything, actually), It’s Fast “Yes,” Slow “No”… Try a Slow “Yes” Instead

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If you don’t hear right away, it’s probably “no.”

That goes for asks, offers, hiring, and anything else you require.

And that goes for you, too, when your stakeholders ask, offer, hire, and anything else they may require.

Reflection is the predictable path toward rationalization to the “no.”  This is why the phrase “upon reflection” is almost always followed by a version of “we’ve decided not to change.”  After all, as a rule, it’s easier not to change than to take a risk.

Many arts charity executives preach the glory of “managed risk” (an oxymoron, of sorts) and value fiscal responsibility above social impact.  To be clear, social impact is central to the success of the mission; fiscal responsibility is a valuable business practice.

If “yes” leads to greater impact, then stop saying “no”… especially upon reflection.

Artists and Non-Offensiveness: The Tyranny of Over-Sensitivity, Feelings, and Participation Trophies

safespaces

There’s a troubling trend.  There’s an absurd unwillingness to offend that seems pervasive among arts creators.

Not that creators are creating “Pleasant Art,” per se.  Writers and artists are creating lots of work that is designed to make audiences uncomfortable.  Which is good.  The work may be about single issues and not terribly complex, but it’s good.

However, there are too many artists raised in atmospheres where everyone wins, even when they lose.  In the name of inclusion and self-esteem, they live in a world where, like toddlers, “feeling bad” is simply unacceptable.

They believe they’re special.

To these artists:

  1. You are not special.
  2. You do not deserve success.
  3. Sometimes you lose.

It’s what you do with that information that defines you.

If you believe that nobody should ever have hurt feelings, you’re not doing your job.

Face-palms in the arts world: Oh, somewhere in this favored land the sun is shining bright; the band is playing somewhere, and somewhere hearts are light

Head in Hands

Somewhere…

  • A managing director is face-palming because the budget draft is still a departmental wish list;
  • A marketing director is face-palming because the artistic director decided that he knew more about marketing than the marketing director;
  • A development director is face-palming because the board chair has fashioned a multi-million dollar “capital” campaign (actually, a “get-out-of-debt” campaign) with no feasibility study, no regard to the annual development campaign, and no accountability to anyone else;
  • An artistic director is face-palming because the plays she wants to do don’t jibe with the mission of the company;
  • A board member is face-palming because every meeting is about reporting, money, by-laws, and the gala;

And somewhere, performing arts audiences and constituents are collectively face-palming, hoping against hope that the arts folks in their region remember that for them, it’s about the art.

If You’re _____________, Then Your Nonprofit Arts Organization is Probably Unsustainable (with apologies to Jeff Foxworthy)

Single woman sitting lonely in an empty cinema or theatre

  • not paying your executive director because s/he is independently wealthy and actually donates 6 figures to the company;
  • working 70 hours/week every week and see nothing wrong with that;
  • hiring part-time employees and expecting them to work full-time free of charge;
  • of the belief that your employees are less important than your equipment or your building;
  • insisting that anyone besides your marketing director is the final word on your marketing;
  • keeping your artistic director away from donors because s/he doesn’t know how to interact with them;
  • in the mindset that any of your people are more important than any other of your people;
  • playing “Dialing for Dollars” to meet your payroll;
  • arguing that “keeping the base” is more important than expanding the audience, while…
  • thinking that you can do both;
  • sweating a little right now after reading this post.

Organizational Health Can Be Measured by the Number of Donors Who Don’t Have to Give to Your Arts Organization

sparse crowd

How many non-board (or non-ex-board) members give to your arts organization?

How many non-staff members?

How many non-parents (if you do activities that include children)?

How many people who don’t attend your gala or other special event?

How many people who refuse donor benefits?

In other words, how many people donate simply based on your mission, programming, and activities; or by trusting a stakeholder of your mission, programming, and activities without expectation of a return?

Count the households of donors who donated all on their own.  If the number is small, create a special campaign to draw them in, even if the donation is a simple $50.  And thank them – they’re giving for no reason at all, except for unconditional love.

Ultimately, the health of your organization is measured by the number of those who unconditionally support it.

The Christmas Arts Season is Almost Here: Time for Much Mooing and Missions Drifting Higher than the Plowed Snow Blocking your Driveway

cashcow

Once there was a theatre company that produced new plays.  However, during the holiday season, they produced “A Christmas Carol.”

Foundation leaders that supported this company asked one day, “Why do you produce ‘A Christmas Carol’ when it has nothing to do with your mission or the rest of your activities?”

“Because,” said a truthful board president, “it’s our ‘cash cow.’ And we need to milk it for all its worth to pay for everything else we do.”

“Oh,” said the foundation leaders.  “Does it?”

“Yes,” said the president.  “It’s a good thing, too.”

The leaders huddled together.

“That’s wonderful,” they said.  “It follows, then, that we can now fund companies whose mission aligns with ours.  With your ‘cash cow,’ you don’t need us.  Thank you!”

And then they cut funding to the theatre company to zero.

Differentiating Between What’s Great About the Arts and What’s Great About YOUR Arts Organization

economic impact argument again eecard

You can look anywhere to discover what’s important about the arts.  Try here, here, here, here, and here for starters.

The key to “sustainability” (which, as previously written, is not “survival”) is proof that your particular arts charity is achieving specific community goals.

Each social service and social justice charity measures its results toward the execution of their mission.  Those results have a direct link to funding and community support.  Your arts charity, then, must find results that apply specifically to your organization.

Charitable results cannot be measured by paid attendance or positive economic impact.  Those are commercial results and byproducts — data used by sports teams to get cities to build them stadiums or by entertainment conglomerates to allow regions to let them build casinos.

So what makes your arts charity charitable?  Answer that and you’re 99% there.

[A Performance] Space: The Final Frontier – Don’t Own It and Find Someone to Donate Some

Don’t own your own performance space.  It’s a liability, not an asset.  Balance sheet be damned.

An asset is something you can sell.  No one wants to buy a theatre…unless it’s to tear it down.  And if it’s an Historic Building, run like the wind.

This isn’t just avoiding an “Edifice Complex.”  Unless, of course, you adore unending capital campaigns to rebuild the defects your company “cheaped out” on.  Find funding for what you do, not where you do it.

That said, one of the most overlooked ways in which a board member can help an organization is to provide eternal, free nearby office space for the company (there’s never enough inside the theatre).  It’s a major tax deduction and the perfect in-kind gift – one that actually removes a necessary expense from the budget.

The Psychology of Being Last and 4 Other Ways to Level the Board Meeting Room Table

boringspeechBoard meetings are often reporting festivals.  Endless polite reports reminiscent of “what I did last summer” essays from the first day of elementary school.  It’s too bad.

Calculate the hourly consulting rate of the people in the room (for example, 15 board members x $100/hour = $1,500/hour).  At $1,500/hour, do you want to talk about the past or the future?

Board members, inside the meeting room…

  • Never do what the last person in the conversation advocates. It’s a trick manipulative people do.
  • Consensus is not unanimity; votes needn’t be unanimous. After the decision is made, however, everyone needs to back it.
  • No devil’s advocates; take responsibility for your disagreement.
  • Read the ED’s report beforehand. EDs: issue your report at least a week before the meeting.
  • Your ED is not responsible for writing and executing your strategic plan. You are.

“In This Scene, Could You Be a Little Funnier?” – A Perspective on Performance Reviews

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“Fire ’em the first time you think about it.” This was the mantra of the board chair of a company with which I was affiliated. I’ve always appreciated the portion that means that I should know when things are not working with a company or individual – from the perspective of employer or employee.

Which brings me to performance reviews. Gack. Many formal performance reviews within arts organizations waste time and energy and breed unnecessary anxiety.  That’s not to say that you shouldn’t do them – but do them continually rather than once a year or when a contract demands it.

If your company has a horrible work environment, a performance review is about as helpful as a Band-Aid on a heart attack. Similarly, if the environment is open-minded, so should your inter-reactions.  You’ll know if it’s working out.

Quantifiable Outcomes and Social Impact Applies to All Nonprofits – Including Arts Organizations

if-quantifiable-outcomes-arent-important-then-i-can-fire-my-whole-development-team-and-just-do-what-i-want-yay-me-7dc56

Oh, I can hear it now.

“See?” they’ll say.  “People don’t care about outcomes when they make donations.  The Washington Post said so.  Ergo: we don’t need outcomes.”

To come to that conclusion is just whistling past the graveyard.

Remember these hard facts:

  • The arts are not mentioned in section 501 (c) (3) of the US tax code (you know…the law). The arts fall under “charitable organizations,” which require a measure of public good.
  • Using the arts as a cover for an individual’s vanity vision is fine, as long as it’s a commercial venture. Once you pull the taxpaying public into it, ethics demand an outcome.
  • The arts can be transformative, both on a commercial and nonprofit level. What differentiates the nonprofit is that a measurement of positive change of the human condition is necessary to rationalize funding.

Don’t Be a Company with a Mission; Be a Mission with a Company

cart-before-the-horse

I’ve been reading a number of articles discussing arts charity marketing as a whole-company tool, not a ticket-sales tool.  Here’s one from TRG.

I was disappointed by Advancement Northwest’s Major Gifts Symposium keynote speakers’ idea of including donors within a charity’s mission.

I have been met with resistance from key artistic and production personnel who have been taught that “we do the art and everything else is a necessary evil.” (Actual quote.)

It’s just human nature for stakeholders to overvalue their contribution. Board members do it. Employees. Volunteers. Audience. Artists. Donors.

Here’s the thing: arts nonprofits that are created to solve a societal problem don’t have these issues.  These issues fester when the company is created prior to creating (and rationalizing) a mission.

Create your company as an answer and horses and carts will sort themselves out.

There’s Not An App for That

I want to donate to your theatre, not your CRM

There are an endless number of costly, effective CRM systems for the arts.  One costs hundreds of thousands of dollars and it’s superb at what it does.

One might say, “It had better be.”

Before that expensive, expansive piece of software, there were others.  Some great at some things, some at others.

Not one of these pieces of software ever raised a dime.  People do that.

Not one of these pieces of software ever performed, exhibited, or created a compelling artistic experience.  People do that.

Not one of these pieces of software ever governed, advocated, cajoled, or counseled. People do that.

Before CRMs that cost various ulnae, fibulae, and tibiae, there were inexpensive off-the-shelf database software solutions.

Before that, we did it all on paper.

Millions attended.  Millions still do.

And the best relationships are still person-to-person.

Aphorisms for the Modern Arts Charity Leader

Fortune Cookie

If it ain’t broke, break it. Then fix it.

You only read books in one direction.

Your legacy ends when you leave.

Institutional survival is not the goal.

Missions are gods; mission statements are bibles.

The best leaders are the best assistants.

Learn why before you continue.

Success is measured by impact, not excellence.

“Fiscal responsibility” is a business practice, not a mission statement.

Volunteers are employees who work for $0.

If your people are averaging 50+ hours a week, you’re failing.

Always use transitive verbs in your mission statements.

The cool kids are back in high school.

Sharpen your point of view; that’s why it’s a point.

Be completely, spectacularly wrong.

Treat candidates like employees.

Treat employees like human beings.

Treat human beings as though you are one.

Fire yourself regularly; interview yourself for your job.

Be funnier.

Omnibus Festa, Omni Tempore: Raising Money to Spend on the People Who are Raising Money to Spend on the People Who are Raising Money to Spend on the People Who are Raising Money…, etc.

Eating_money_large“You scrimp and save and beg and borrow and where does half the money go?  Down the throats of the organizing committee.”  — Athene Seyler, “Make Mine Mink”

The 1980s and 1990s were the golden years of galas for arts charities.  Mostly because there were fewer of them.  But also because high percentages of the money actually went to the organization.

Today, putting on massive galas to feed donors – netting scant revenue to the charity but plenty of “goodwill,” “friend-raising” and resume padding – are often construed as elitist, inefficient modes of raising income.

One annual gala, or perhaps groups of organizations sharing a larger gala and splitting the receipts, might thin out the calendar and make them more financially effective.  Hundreds of hours of employee and trustee resources might well be better spent on relationship-building, not napkin swans..

U-Better, U-Better, UBIT

Watching arts nonprofits seek funding in unusual ways leads to same old/new discussions on Unrelated Business Income Tax.

Taking a group of donors for a London theatre tour (even if all the finances are handled by an independent agent)…UBIT, you betcha.

The percentage of time spent in London at a lecture about your company’s particular brand of theatre…OK.

Selling t-shirts with just the logo of your natural history museum…UBIT, you betcha.

Selling t-shirts with dinosaurs on them at your natural history museum…OK.

Leasing part of your building to a separate business…UBIT, you betcha.

Items sold at a gift shop with a separate public entrance…UBIT off more than you can chew.

Items sold at a gift shop only accessible to ticket-buyers…UBIT only items not related to the tax-exempt purpose of the organization.

UBIT. Not just another 4-letter acronym.

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