Commentary: Measuring impact can make business sense out of opera economics

Keith Cerny, General Director/CEO of The Dallas Opera, TheaterJones.com, 7/8/12

Opera economics are becoming increasingly dependent on donations and endowment draw, rather than ticket sales. [It] is not uncommon for opera companies to receive up to 65-75% of their operating [budget] from annual giving and endowment draw. This shift in economics has not only made a major change to the operating model of a modern opera company, it has also transformed the mission of many companies as well. I believe that opera companies must earn the right to rely on this level of public support by maximizing their community footprint. And, like many executives, I believe that measurement drives organizational behavior very powerfully, so that it is important for opera companies to measure this impact rigorously. We include three primary elements in the definition of The Dallas Opera's community footprint. The first is our core product, mainstage and chamber opera. The second is music, theater and opera education. The third area is community events, which includes free public simulcasts, free or deeply discounted public concerts, and the like. In round numbers, this works out to around 50% of total contacts made in an opera house or theater, another 20% through free public simulcasts, and an additional 30% of all contacts through various educational activities. While every organization must decide its optimum balance for immediate impact as well as the potential for future growth, this distribution fits with our strategic goals for the company -- although we hope to boost simulcast attendance still further in seasons to come. I am passionate about the impact of free public simulcasts, and the impact that they can have on audience development. One key issue to consider is whether simulcasts have a direct economic return as a stand-alone project. In 2006, Kenneth Feinberg, then the President of Washington National Opera noted, "There's a central question here...Will these new technology initiatives raise revenue, or is revenue not the primary goal?" While the jury is still out on this question for many opera companies, San Francisco Opera has recently pointed to a direct return on its simulcast investment in ticket sales. My own view is that while these types of performances are typically not moneymakers when viewed on a narrow return-on-investment basis, they remove opera from its pedestal, build future audiences and secure vital community support -- particularly important in a world where donations make up such a large proportion of total operating budgets. At TDO, we are already beginning to invite simulcast patrons to free summer events, and, as time passes and we track conversion of simulcast attendees to single ticket buyers (and, hopefully, subscribers), we will be able to answer this question for ourselves. In the meantime, the simulcasts and expanded education programs make powerful additions to TDO's changing community footprint, giving us the chance to make our mark on successive generations of audiences while constructing a broader-based foundation of future support for the arts in DFW. By anybody's yardstick, that's what we call a "win-win."

Commentary: The slippery slope of measuring the cost-effectiveness of museums

Lee Rosenbaum, ArtsJournal.com blog Culturegrrl, 7/7/12

In all my years covering museums, I've never heard the kind of rhetoric applied to museum practices that Eli Broad employs in his Op-Ed piece for [yesterday's] LA Times. I've also never seen a "life trustee," who is not even a voting member of the museum's board, become the sole spokesperson for that institution during a time of crisis. The Times published Broad's comments in an interview with Mike Boehm. Eli explained the "forced resignation" [as Boehm termed it] of chief curator Paul Schimmel this way:

"They [MOCA's board] knew that Paul was from the old culture and was not getting along with the director. And although they had a lot of respect for his curatorial ability, they thought it was time to move on, especially some of the newer trustees [at least some of whom were appointed under new director Jeffrey Deitch]."

But the most telling revelation that MOCA's "new culture" has become corporate appears in Broad's Op-Ed piece:

"Over the years, MOCA has mounted many great exhibitions. However, the museum has also curated a number of exhibitions that were costly and poorly attended, often exceeding $100 per visitor. In today's economic environment, museums must be fiscally prudent and creative in presenting cost-effective, visually stimulating exhibitions that attract a broad audience. There has been much confusion about Paul Schimmel's departure....Paul is a brilliant curator, but the board members recognized the director's right to put his own team together."

So we go from "great exhibitions" conceived by a "brilliant curator" to "cost-effective, visually stimulating" ones, with broad popular appeal. I have never heard a museum professional use the strange metric of cost-per-visitor to assess an exhibition's merits. Prioritizing attendance and "cost-effectiveness" over curatorial brilliance is a very slippery slope. In his new self-congratulatory book, The Art of Being Unreasonable (which I have read and enjoyed), Broad writes (p. 136):

"When we make grants to arts organizations, we expect increases in their audiences and museum traffic."

But this successful businessman's bias towards quantifiable results and number of customers misses the important difference between cultural institutions and corporations: The driver for museum programming should, first and foremost, be quality of exhibitions, acquisitions, education and scholarship, not how many people walk through the doors. The budget must always be in service to the mission, not the other way around. The first responsibility of a museum director is to ensure that those priorities are kept straight, particularly among the members of the board of trustees. As a first-time museum director and former commercial dealer, at an institution that is beholden to Broad (scroll down) for its financial survival, Deitch is not well positioned to assert the needed authority.

Commentary: The arts, culture and measuring the value of things

Barry Johnson, Oregon Arts Watch, 7/6/12

In a society obsessed with assigning a dollar value to everything, we naturally attempt to tease out the monetary value of the arts. Or maybe that should be "unnaturally." A recent study by Americans for the Arts, for example, determined that non-profit arts groups generate $253 million in annual economic activity in the Portland metro area. [If] we added for-profit arts and culture activity into the mix... the number would be [even larger]. And what if you tossed in arts-related businesses, design firms of all sorts? As my mentor in these things, John Dewey, points out, in the age of industrialization (and post-industrialization), we tend to think of the arts as "independent and esoteric." In fact, they are dependent (meaning "connected") and everyday. Various studies show how Portland's economy has grown, driven by high-tech and the creative economy. Would Intel be here without First Thursday? It's at least somewhat interesting that the two started here around the same time, but I'm not making that claim here. I'm not privy to Intel's thinking when it established its first beachhead here, though I'm sure that some combination of abundant water, cheap hydro electricity, tax breaks, proximity to Silicon Valley, and a relatively well-educated work force had more to do with it than First Thursday ever could have. But once Intel was here and opened research facilities and kept expanding... now, we're in that place where it's hard to tease out specific effects. Arts shape the culture; Intel shapes the culture; they both shape each other through the culture. And in Portland, that culture values creativity of various sorts very highly (also: environmental awareness, democratic processes, cooperative enterprises, "balanced" living). I see all of these expressed in the arts community here, to varying extents. In the late '90s, for example, I started seeing lots of artwork by younger artists that focused on the environment and environmental problems, and then soon after, I realized how deeply that value had sunk into our local culture, where it continues to guide our practices -- transportation, building, waste disposal. And when I see a Portland band on one of the late-night television shows (as I so often do, now much more than ever before), I'm struck by how "out there" they seem (in instrumentation, musical exploration) than the other bands that turn up on those programs. I think they succeed because they are more adventurous, more creative, than bands are in most places. And in turn, they inspire us (meaning, me) to be more creative, too, to push our thinking in our various enterprises further than we have before. Culture is entanglement; it's engagement; it's give and take. Even in the simplest human societies it's hard to establish cause-and-effect relationships or measure degrees and extents of influence, let alone in the complexity of the 21st century city. The arts, which Dewey considered to be our highest achievements as humans, are pervasive. They are also useful in ways we can't begin to calculate, even if we are economists... or arts writers.