Back to Business

Okay friends, I did take a hiatus as a blog writer. Thinking time is important and I needed it. And, truth be told the combination of such giant changes around us combined with the winter months where as a Mom I spend every Saturday and Sunday (at least) getting our sons to some ski hill somewhere in the western US for USSA races….well, blog time got back burnered. You can see why…

But today is the first day of Spring! Let’s get at it.

First off, rumors of the demise of the arts are, to paraphrase the line, very premature. Yes, layoffs and cut backs are real and horrible. My heart goes out to every organization and every individual impacted.

But the arts are not impacted more than the rest of society. Is there an untouched industry out there – particularly one where consumer spending is involved? No. Have we gone through serious recessions before and come out strong? Yes, if you remember 1992, 1982, or 2001.

But let’s use this as a chance to do some real rethinking about our field. I still have my copy of William J. Baumol and William G. Bowen’s classic Performing Arts: The Economic Dilemma. (Cambridge: MIT Press) 1966. It is tattered, and it still rings true. In 1966, they laid out the reality of the structural deficit that defines the performing arts. (Add the visual arts, too.) Since 1966, our field has sought ways to pretend that structural deficit doesn’t exist. Public and private sector funders have sought to support the field around programs and projects, but still haven’t been able to fill the gap that is operations and overhead.

I was so excited when the NEA announced its stimulus funding of staff positions – finally a response to the realities Baumol and Boman mapped out 43 years ago. The unfortunate downside is the temporary nature of the funding – it doesn’t address the long term need that funding has to fill. From my little corner of the blogosphere, I’d champion this as a time for more funders to once and for all address the structural gap. It hasn’t gone away, and it won’t. No amount of project funding or new commissions or special initiatives will cover up the issue.

Other musings…

At the same time as being grateful for the stimulus funding from the NEA, I am terrified – as I hope you are – of Congress’ anti-museums, parks, zoos, botanical gardens stance on stimulus funding. Where did all that vitriol come from and why didn’t we anticipate it? When folks are really strapped for money the way most are today, seniors, families, and young adults flock to free days at museums and free concerts in parks, among other things!

Could it be that we have tried to over-sell the economic benefit argument and have forgotten to mention that cultural gathering places are what hold us together as civil society, bring us together in shared experience, and bring us a combination of civic pride and social engagement?

Or could it be that the arts have a stronger advocacy base to carve out their share of the funds? Despite all the work that scholars have done in the field of cultural policy, and all the applied work I do and so many others do in “cultural development” we still don’t have a cultural sector that works together to advocate for all that is culture. In this time of societal change, what would it take to create that sector, to build our strength, and to finally look at our field as a whole rather than competing interests?

And finally…

If you think that the arts aren’t getting some of the stimulus funding, check out Stimulus Watch and the other on-line listings of projects put forward for the funds. There are a number of mayors around the US that have inserted very significant capital development projects in the arts. I’m seeing hundreds of millions in arts capital projects, and the roll is growing by the day. So, at the local level, the belief in major civic arts projects as important to our future remains strong.

Happy New Year! The trends for the year will be…

May 2009 be a good year for everyone. We’ll be in tight financial times until mid year, at least, according to the leading economists. But then growth will gradually start. Historically, we’ve seen that recessions are an excellent time to plan and prepare for that new growth. So that means the next six months are very important for any type of planning.
* For feasibility studies, this is the time to get your homework done. Feasibility studies done now will likely focus on more doable structure than at the boom time of the market, which means these projects will be seen as viable by more funders. While capital is not out there right now, projects looking for land may find this is a sweet time for deals.
* For strategic plans, this is the time to think deeply about entirely new operational models, finance models, efficiencies and structure. We think the market has been overly flooded by entertainment options in many places, and that a little correction along with leaner operations may be very good for the long term.
* For policy plans, this is an excellent time to take the long view and focus on: 1) strategies to help organizations think about new business models that may create efficiencies while building market share; 2) strategies to build(rebuild) market loyalty by audiences; 3) helping organizations rebalance their financial models and expectations. Gaining audience loyalty this year will likely require deep discounts and price realignment in tickets and admissions, so budgets will need major reworking; 4) building for stability for the long term. During sobering times, we all do a better job of focusing on the real priorities.
* For marketing plans, this is an excellent time to focus on customer service and building customer loyalty. Marketing media continues to evolve at lightening speed. The Obama campaign organization showed us the incredible value of text messaging: this is a key time to build your own text messaging capacity. You’ll also want to build your CRM capacity, to target market as effectively as possible. And don’t forget the increased role that social networking plays in linking your audiences together.
* For cultural development in general, this is the time to think about how to benefit from the stimulus packages that are already moving through the pipeline. Programs like the federal WIRED grants have been around for a few years and will now get much larger, and offer opportunities for arts jobs the likes of which were last seen in the CETA era.

This is exciting. There is a lot of good, proactive work to do that will profoundly advance thinking about the mechanisms, support, and market for arts and culture. Let’s get to it! Happy New Year!

The Arts, Automakers, and Newspapers…

As if the auto industry bailouts and now the bankruptcy of major newspapers such as The Tribune Company aren’t enough…

Today’s news of the Baltimore Opera bankruptcy is the latest in a series of worrisome similar stories. Our good friends at Buffalo’s Studio Arena faced the same sad situation not long ago, closing the doors on a major regional theatre. Last week, the Virginia Symphony went on the record that it may be close to bankruptcy. And there are rumors of more institutions facing similar fate.

For an industry that long considered itself unique, bankruptcy and bailouts show striking similarities between the auto industry, newspaper industry, and the arts.

Haunting similarities…

1) A lot of product out there, some of it of variable quality that left enough people unhappy with past purchases that they stopped new major purchases. (See GM’s apology yesterday about expensive cars and trucks that were variable quality. Think of people dropping their Trib subscription because of spotty quality.) Applicable to the arts, yes, often enough to create ripples in subscriptions and donations. Applicable in people pulling back, purchasing less often, not donating.

2) High labor costs leading to inflated purchase prices. From Detroit, to Chicago’s newsroom, to backstage at a professional theatre – the issues are one and the same. Sky high fixed labor costs and contracts. The arts aren’t unique.

3) Growing debt, lack of funder confidence, and inability to leverage more financing. When funders voice lack of confidence, the ability of nonprofit arts to get new lines of credit just about vanish in the best of times. In the worst of times, forget it.

Is there a silver lining? Let’s pray that an outcome of this will be radical rethinking about the industry, our needs, and above all the accountability to which we hold our industry. The past few recessions haven’t been deep enough or hurt enough to force real change.

I remember working with a group of civic leaders after the last recession to create a firewalled endowment that couldn’t be touched, that required high accountability on balanced budgets, and would have been salvation to that community’s arts in today’s economy. Those civic leaders ditched the concept when the arts groups backed away because easy money started flowing. Too bad. They wouldn’t be facing a local arts crisis today.

This month’s Harvard Business Review includes a superb article on nonprofit accountability. It claims that nonprofits do well when they “are much more explicit about the results they intend to deliver and the strategies and organizations they’ll create to achieve those outcomes.”

Explicit accountability. That’s our new arts era. Let’s use it wisely, and emerge stronger for the long term. We need this silver lining.

Never Waste a Crisis, and Always be Thankful

I enjoyed reading Saj-nicole A. Joni’s Third Opinion on Forbes.com yesterday, detailing how businesses should approach the turbulent times in which we find ourselves. She aptly quotes Rahm Emanuel’s quip, “never waste a crisis.” We in the cultural field should take heed. This is a time for examination, change, refocus and relignment.

Saj-nicole summaries four steps for businesses, which I’ve briefly applied to the cultural nonprofit field:

1) Figure out how to survive.

Change. Cut. Add. Reprice. Restructure. Do what it takes to stay viable.

2) Figure out what you can do now that you couldn’t do before.

A cut in next year’s calendar of events may give you the much needed time to build the back office infrastructure you need to eventually support new growth.

3) Listen for market transitions.

Take the time now to listen and learn, and tool up for the future.

3) No whining.

Our field, like every other, will change. There will almost certainly be less product being presented as we right size. There will be new consolidations and operational models that lower operating costs. Marketing the arts and culture will continue to rapidly evolve. We need to be stimulated by the changes ahead, and ready to grab the opportunities.

That leads to my last point:

4) Be thankful.

As we reflect on the bounty and the challenges, past and present, we have so much to be grateful for as a field, and as a people who are enriched by art and culture. We live in a country that created as its First Ammendment to the Constitution the Right to Free Speech that has granted us the precious right of expression central to art making and sharing. We live in a country with a bountiful and diverse cultural landscape. We live surrounded by art and the work of artists who challenge us every day. We have witnessed enormous growth in our nonprofit and civic arts and cultural institutions over the past thirty years. We work within a wonderful community of people who believe in the value of arts, culture, and creative expression as fundamental to a healthy society. We are challenged, daily, with new opportunities to connect this work to a broader public.

Tomorrow, let’s pause to reflect. Friday, let’s roll up our sleeves, and meet new challenges.

The Real Power of a Cultural Plan is Who Uses It

One of the biggest problems in cultural planning is figuring out who is supposed to use the completed plan. Who is the steward who moves it forward? Who leads the charge? Who monitors its accomplishment? Who keeps all the competing interests aligned?

We’d all like to believe that a cultural plan is implemented by all those organizations and interest groups that care about arts and cultural development in their communities. An arts council takes one role, a foundation another, a government entity yet another, and so on. Sometimes this indeed happens, and the outcomes can be fabulous. More often, it doesn’t happen. The steering committee members go back to their own organizations and priorities, and all those good ideas become a wish list rather than an action plan.

A great way to make sure this doesn’t happen is to call the document “a plan for cultural development” and note from the get-go that the plan is a policy document to guide a particular agency or funder in achieving key outcomes. There has to be an entity that fully implements the plan, that takes it and runs with it, and that has the full support of the power-brokers (funder/s) in making the plan happen.

As a policy document, the plan has to guide the actions of the implementing agency. I believe that internal agency planning has to be an integral component, to fully align the arts council or economic development agency or foundation – whatever entity is going to do the plan – to get the plan done. That agency plan, in turn, has to be supported in full by the agency hierarchy – the mayor, the county executive, the economic development agency – all those whose support is essential to turn policy into action. There has to be an infrastructure behind it.

Within the plan, there have to be policy priorities. Basically, what will the lead implementing agency focus on for the next two or three years that will have a specific outcome, responding to specific findings from the cultural development planning work? As a client once told me, if there are so many goals that you can’t remember them all, the plan will not get done. If yours is the lead agency, you want a plan with outcomes you can deliver. Keep your eyes on the priorities and know that you can accomplish the most important developmental work.

So just what is the creative economy?

One of my goals whenever I work on a cultural plan is to establish a baseline of the area creative economy, and then to identify ways to grow that economy.  Too often the creative economy – at least in the US – is  narrowly defined.  (Americans for the Arts has done a fabulous job with the conservatively defined arts-centric part of the creative industries, but I think their creative industries data under-represents reality.) (See blogroll for their 2008 update.)  On the other hand, some define the creative economy as anything based on intellectual property, which might be too broad.  ( My geologist friends develop a great deal of intellectual property, but does that make the mining industry a part of the creative economy?  Doubts.) 

So just how do we get to a viable baseline?  Americans for the Arts uses Dunn & Bradstreet as their data source.  In my own searches, I begin with the North American Industrial Classification System, or NAICS codes.  NAICS codes are assigned to every enterprise in North America, and from this we can assess the enterprise impacts, the jobs, the value added, and their total economic value.  As such NAICS can be the key to assessing the bgroadly defined creative economy.  But there are many judgement calls to be made, and this offers an interesting discussion for the arts/cultural development field.  Wouldn’t it be great if we had a standardized way of defining what codes belong to the creative industries and which codes don’t? Something bigger than what we see now from AFTA, but realistic extractions out of NAICS?

Each creativity-based element of NAICS has three components: education and training, jobs and the creation of economic value, and impact – audiences, buyers, users, and those touched economically and socially.  Think about the case we could make if we would work toward a true definition of the worth of our industries.

The first three sets of NAICS codes – ag, mining, utilities – don’t have any sub codes that really seem a part of the creative economy.  The forth, construction, might have a few.  By the fifth, manufacturing, you get into some interesting judgement calls.  For example, I would include the Manufacture of Fine China, Earthenware, and other Pottery; and the manufacture of Pressed, Blown glass, and Glassware in my creative industry profile of a community.  (AFTA includes individual artisan work, but not manufacture.  But many artists and artisans are employed in the manufacturing process, so I’d opt for the larger definition.) But should the manufacture of other glass containeers be included?  Book printing, yes, but should Quick Printing be included?  How about clothing manufacturing?  Do we include it all, or just sub-parts – for example, manufacturing of Schiffli lace?  Or what about food manufacturing?  I guess you would include specialty cheese manufacturing – my neighbor who makes artisan cheeses would argue for that - but what about fruit and vegiatable canning?  Include piano and musical instrument manufacturing – yes.  But what about photographic equipment? (AFTA includes photographic equipment, but excludes musical instruments.)   

 I’d be likely to include all of the economic activity of NAICS code 51 – Information – which in addition to  sound recording and movies includes telecommunications.  

Code grouping 54 codes professional and scientific enterprises.  From these, the normal picks include graphic design, interior design, photographic studios and the like along with the standard inclusion of advertising agencies.  But how about custom computer programming? (That’s where some computer game enterprises can be found, and these are largely considered a part of the creative industries.)  Most defitions already include architectrual and landscape architectural enterprise, but how about mapping? 

The codes (71) for arts, entertainment and recreation are particularly frustrating for those of us in the arts field.  For example, how are we to break out the enterprises/occupations from the grouping “promoters of arts, entertainment and sporting events?”  Does that mean a local NFL franchise and Symphony are in the same code?  (Yes.  AFTA has broken these out using D&B data.)   How about food services codes?  Do we include chefs/fine dining, but not the coffee shops offering up custom lattes? 

The point is, creativity, innovation and foundational arts thinking can be found to shape and influence hundreds of industry classifications, and thousands of job types.  The arts field is even broader than  represented by AFTA’s ground breaking analysis.  And, if as a field we had a broader definition of what is in and out of the “creative industries” of NAICS – which opens the door for many detailed economic profiles at the local level - we’d be better positioned to make the case for what the arts really mean to our economy and our communities.  We’d be able to work toward a far more holistic approach to educating for the creative sector.   And we’d come even closer to assessing the real value of the economy driven by creativity.

Thoughts on Developing a Cultural Plan

I am starting a new cultural planning process for Mercer County, NJ, and thought it would be interesting to use this as an opportunity to go back and pull out a copy of the Community Cultural Planning Work Kit, which I wrote on commission from the NEA back in 1990.   I thought I’d return to it and see if it still holds true as a guidebook to the process.  (Good news, it does.) 

Here are some thoughts from it that ring true:

1) A community cultural plan should become the blueprint for building livability into an area. 

2) It should mesh with all other community masterplans, and in its pages detail how culture plays an integral role in shaping the community’s look, feel, spirit, and design.  Other civic plans, in turn, should reference the cultural plan’s role and responsibilities.

3) The planning process iteself should allow each community to define those aspects of cultural development that are most appropriate and essential to its own way of life and future growth. 

4) A classic planning error is to develop a good solution to the wrong problem.  Before a plan is developed, problems, opportunities, and needs must be identified, and perferred solutions or scenarios identified.

5) Don’t confuse planning with a needs assessment process.  The assessment is the process of investigating the community’s cultural needsd, priorities, strengths, weaknesses, and potential within the context of the community’s general economic and social conditions.  The assessment is conducted to provide a frame of reference for decision making – planning. 

6) A plan is more than recommendations.  It is the outcome of a public process that develops vision, goals, and workable strategies, and that identifies how those strategies will be accomplished.  Open meetings that allow the community to hear proposed goals and respond with their own views are important. 

7) The key to turning a plan into reality is the buy-in of all those involved in implementingt goals, objectives, and strategies.  If there are goals or strategies that require the support of groups or decision makers not represented in the planning process, it will be necessary to take the rough draft of ideas to them and to seek their involvement.  Before you begin a plan, meet with all the community agencies, civic leaders, and government agencies likely to be touched by a cultural plan.  Let them know how important their input is to the development of a realistic and workabple plan.  Incorporate them into the planning process.

8) You will need to provide your community with a framework of expectations as to the outcome and value of the plan.  

9) You will need to determine the resources required to implement a cultural plan.  But, a cultural plan isn’t just a plan or a new strategy for funding the arts.  A real cultural plan specifically addresses how your community can and will be transformed and improved through vital arts and culture.   

10) Cultural planning isn’t a one time deal.  Every five years is a good rule of thumb. 

11) The agency plans of implementing organizations – local arts councils, community foundations, civic arts commissions as well as school districts and municipal offices - should continuously respond to cultural plans, taking their cue on priorities and timelines from the overall plan.

Cultural Planning in a Recession Economy

The days ahead look challenging for arts and cultural development. Does it mean this is time to stop planning?

It is the VERY time to plan.

Resources are tight.
There are tremendous shifts in financial systems and attitudes.
Priorities change.
Urgency to focus on successful outcomes is increased.

These are key reasons not to put off policy or cultural development planning in challenging financial times. With limited resources, we need to clarify absolute priorities for cultural development action, policy, and related funding. And, we need to listen to changed perceptions and attitudes from community leaders and residents.

What are some of the important tasks in immediate cultural development planning?

First, focus on success. We’re in for a very different number of years. What will success – a vibrant cultural community, healthy cultural organizations, engaged creative businesses, engaged audiences – look like in this different economic world? Don’t shape policies on staving off crisis. Shape policies for a new reality, and yes.

Next, focus on the key outcomes that need to be in place within the next 12 months if the successes you outline are going to happen. What are the policies, the programs, the support systems that need to be in place? These may be radically different from what are now in place, so be prepared for real changes.

Now, put resources where they will really make a difference. What are the two or three most important and substantive outcomes you have to see to get to success? Put your resources squarely behind these.

And, keep your eye on the long term. Position things now to be ready for opportunity when the financial world pulls out of its slump. Remember, cultural entitites and projects that have succeeded in the years sinc 9/11 were those that had planned and prepared during dark times so they could move forward as soon as confidence was restored.

Don’t stop planning. This is the very best time to plan.

The Culture in Cultural Development

Culture is everywhere in the news. The culture of Wall Street investment banks. The culture of American political views. The culture of change. The Gen X culture versus the Baby Boom culture. The culture of greed versus the culture of giving. The very polarized high art versus real life culture that author Lee Seigel described in the Wall Street Journal last Saturday (September13) talking about a new round of culture wars in America. (Heaven help us!)

So what kind of culture do I focus on when talking about community cultural development? How do communities actually go about planning for culture? If you are doing cultural planning, how can you steer clear of culture wars and instead focus on doing good civic planning via culture?

There is plenty of “culture” included in cultural development planning. A few of the keys…

- The culture of place
- The culture of community identity(ies) and values
- The culture of the arts and artistic/creative expression
- The culture of heritage, history, and tradition
- The culture of the natural and built environment
- The culture of aesthetics
- The culture of education

Can you plan to facilitate the expansion, strength, and utilization of these cultures as a part of community planning? Yes.
In furthering these, can you develop strategies for the resulting “culture” to play an increased role in economic development? Yes.
Can you develop a democratic community consensus on cultural priorities within these? Yes.
Can you budget for cultural development, and determine a return on investment scenario? Yes.

Coming into a new town, I’ll often te told, “we don’t have much culture here.” Ah, but you do. It is who you are, where you are from, your hometown pride or lack thereof. It is what you value and what you teach. It is how you celebrate your creativity and how you recreate. It is how you keep reinventing your communities to keep pace with tomorrow’s generations – or how your communities stagnate and disappear. It is the choices you make for community investment. It is your world view, the way you view your neighbors, and how you want the world to view you.

This is what makes cultural development planning so challenging to do. It is why cultural development planning requires lots of diaglogue, lots of community input, a many divergent views. And it is why the goals and desired outcomes from cultural planning deserve a place in overall civic master plans. The cultural goals that we as communities can agree upon are too important not to be right up there in master plan documents. Coming to demographic agreement on civic cultural development priorities should be an essential task for every community, everywhere. Healthy culture isn’t someone else’s culture – the Gen X culture or the Western culture or the New York culture, etc. Heatlhy culture is about us, who we are as people and communities. Our own back yard.

Preparation for Cultural Planning

I’m often asked, “How to we get ready for cultural planning? What questions should we be asking? What homework can we do before we engage a consultant?”

Here are some of the questions I ask communities to explore before I come on site the first time. Try this as a good preparation for any cultural development, cultural district planning, or overall cultural planning.

Exploring Cultural Development
Preparation Questions

1. What are your community’s cultural assets? These may include any/all of the following:
a. Organizations
b. Civic offerings and services
c. Educational, school and youth focused programs, and life-long learning opportunities
d. Individual artists and crafts people
e. Creativity based businesses and enterprises
f. Heritage and historic assets
g. Festivals and celebrations
h. Facilities and sites

2. How do these currently support and further community health and well being?

3. Use a SWOT analysis (strengths, weaknesses, opportunities, threats) to describe the condition of the cultural assets. Include the financial conditions including financial assets, participation counts, geography or communities/neighborhoods served, facilities and other measurables in this.

4. Use a Gap Analysis to consider missing or limited cultural assets; use a GAP analysis to consider unmet community needs or population segments that aren’t reached by the cultural assets.

5. Create a vision statement for culture and the arts in your community. What is the completed or achieved vision like? How do people engage and benefit from arts and culture in the achieved vision? What tangible and intangible differences are there from the present cultural profile?

6. To achieve this vision, it is likely that many players will need to work together in partnership. What are the existing and prospective partnerships and alliances that can be developed working toward further developing your community’s cultural vitality? Who should be at the table?

Now that you have a sense of where you want to head (the vision), and who should be engaged, you can begin to shape the assessment (needs) and planning process. In preparation, think through the following:

1. What documents do you need to use as a foundation?
2. What community input process is necessary and important?
3. What kind of consulting assistance, if any, would benefit the planning process?

With this work completed, you’ll know what to seek in counsel. You’ll be able to engage in a cultural planning process that will win community enthusiasm and investment and gain significant outcomes!