Commentary: Broadway needs to rethink its financial model

Michael Taustine, B.O. treasurer at Broadway's Lyceum Theatre, on his personal blog, 3/3/13

The clues are piling up. Yankee Stadium is plagued by empty seats in sections where the most expensive seats are. At Met Life Stadium, many season tickets are held by speculators who make seats available to every game, often at a loss. The Metropolitan Opera attributes a recent attendance drop to [too-high ticket] prices. There is clearly something in the air. What of Broadway? After decades of mistaken calls of its imminent demise, [it] continues to [post] impressive yearly grosses. But if the industry's foundation was ever on uncertain shifting sands, it is now. Most of the gains in dollars are not coming from increased attendance, but from higher prices. How long can this trend continue? The answer is unknowable, but it can't go on forever. Ask the Yankees or the Met Opera. The new breed of [Broadway] producer has ratcheted up the "greed is good" maxim to the max. Squeezing every last penny out of ticket prices may make sense as an intellectual exercise, but in practice, there are other costs to contend with. There is no goodwill left among theatergoers. They are resentful and angry at the arrogance of Broadway pricing policies. That's not the way to build customer loyalty, or foster a habit of theatergoing in what one might hope will be new generations of frequent Broadway attendees. The simple act of buying affordable theater tickets [is] excruciating. So, what's really new? Broadway has survived countless calls of its impending demise. [However,] as the country emerges from five years of economic dislocation and wealth destruction, there has been a "re-set" of the economy, a "new normal" of lowered expectations and slower growth. There has been no such re-set on Broadway. The situations at Yankee Stadium, Met Life Stadium and the Metropolitan Opera ought to be instructive. If producers think that Broadway is and will be forever immune to this tectonic shift in the public's response to ever-higher prices, they may well be in for a most unwelcome and most unsatisfying of second acts.

Commentary: The arts need to rethink the rigidity of the cultural workplace

Claire Hodgson on The Guardian's Culture Professionals Network blog, 3/15/13

Culture jobs are advertised as either full-time or part-time, but rarely as flexible. What would happen if we didn't measure jobs in terms of days worked but in terms of tasks completed? What would happen if we gave people completely free reign to deliver those tasks in a location and time of their choosing? Workplaces with a high-trust, high-freedom ethos get good results. The start-ups of Silicon Valley have reaped the rewards of giving employees a long leash -- Yahoo's Marissa Mayer aside -- in entrepreneurial approaches and project innovation. But for a "creative" industry such as the culture sector, we have very uncreative workplaces. Many of our organisations have high core costs because they employ a lot of people in large offices with high overheads. I'd also argue that they are not recruiting the talent they require, because many experienced people can no longer work in this way. Working consistently long hours is counterproductive. A long-hours culture kills creativity of thought. But in our sector, flexible work arrangements are currently associated with a lack of commitment. Here's a new approach: let's pay people leaders more money and ask them to work fewer hours, and in a way that suits them both in terms of geography and when and how long they work. Our current culture promotes underpaid and overworked staff, relying on our passion for what we do. What we need is a wholesale reimagining of the workplace. Business is changing because it recognises the rewards of a diverse workplace, yet most arts organisations mimic business environments of 20 years ago. These are challenging times and we desperately need the most talented people who can advocate for the arts and reimagine its financial models. In order to attract this talent, we also need to reimagine the cultural workplace.

Commentary: More and more arts funders want to support flexibility

Steven Dawson on the Americans for the Arts blog, 3/15/13

There are only so many contributed dollars out there for the arts. The trend of continued marketplace crowding will eventually lead to organizations relying quite heavily on earned income to meet budget. And many organizations must keep prices low (affordable) in order to fulfill their missions. Put those two factors together, and it doesn't add up to success.  But some organizations are creating their own remedy for the situation. Program partnerships between organizations with similar missions are sprouting up all over, and outright mergers are becoming less and less surprising. On top of that, Marilyn Struthers notes that foundations and other funders are no longer interested in funding "stability" and are now interested in funding "flexibility" in arts organizations. My own experience writing grant proposals in the past year supports this. Every proposal instruction packet specifically asked how the organization could handle changes.

Commentary: The nonprofit sector needs to rethink how it reports financial info

Cinthia Schuman Ottinger on Philanthropy.com, 3/10/13

This winter's flu epidemic would be stronger and deadlier than ever before, the Centers for Disease Control warned Americans months ago. Armed with this knowledge, older Americans, people with small children, and others at increased risk moved quickly to get flu shots. What would happen if nonprofits were hit by an epidemic? Suppose they faced an acute shortage of volunteers or record nonprofit layoffs. Or what if nonprofit revenues took an unexpected dive? Would nonprofits have at the ready the knowledge they need to take precautions against such an epidemic? Unfortunately, the answer is most likely no. Most nonprofit statistics, if available at all, are almost two years old or more. That is way too late to deal with problems as they arise or to signal to nonprofit leaders, donors, and policymakers that a crisis is on the way. While a growing number of organizations and researchers are trying to find ways to help nonprofits get better information, one of the efforts that could be especially helpful focuses on Form 990. The tax forms are not perfect, but they are one of the best sources of information available on the nation's nonprofits. Yet, as a new report released by the Aspen Institute's Nonprofit Data Project details, the system for delivering Form 990 data to the public is hardly efficient, cost-effective, or timely.  But imagine what would happen if the 990 data were free, downloadable in bulk, and easily searchable. "Liberated" 990 data, sometimes combined with other data, could produce truly useful information for everyone who cares about nonprofits. It could:

• Show nonprofits, donors, and policy makers the real effects of the economic downturn.
• Help state charity officials identify fraud by making it easier to locate potential problems.
• Help individual donors understand the flow of charitable donations in their communities, answering questions like, Where are the needs the greatest and what is the best use of my contribution?
• Track information such as salary, expense, and revenue data, helping nonprofit leaders gauge where their organizations stand in comparison with others in the field.