Move along, people – nothing to see here.

You didn’t know that Mellon’s Orchestra Forum had a newsblog? That’s
probably because they didn’t until a few days ago. The very first post was about the
Flanagan Report. I guess Mellon didn’t know that it was going to be
released either – which would be odd, considering that they paid for it.

What did Mellon’s Elephant Task Force think of the report that they commissioned?

… there is a quantitatively small but statistically significant trend improvement in the overall financial balance of the average orchestra in the sample. Flanagan calls this a "gentle trend towards surplus," but cautions that this trend may be overwhelmed by small adverse cyclical effects…

Out of the sense of urgency to assist orchestras in addressing financial deficits, the ETF’s work grew to a focused consideration of how their orchestras might envision themselves in the future.  What began as a response to fiscal exigency-coping with financial deficits-evolved over five years to a call for orchestras to create for themselves both a vision of a sustainable artistic endeavor and the innovations necessary to achieve that vision.

Today, the ETF stands for the proposition that orchestras should re-examine devoting huge energies to short-term coping strategies to address weak bottom lines. The ETF has concluded that coping mechanisms such as unsustainable draws from endowments, underfunding pension obligations and reopening contracts to seek concessions, are recipes for failure.  Rather, orchestras are best advised, after carefully weighing costs and benefits, to engage in risk-taking experimentation to find innovative ways of addressing the inevitable challenges embedded in a changing environment.

The ETF hopes that people who care about the future of their orchestras will undertake the self-examination of their individual orchestra’s circumstances, and use the ETF’s work, which will be shared with the full Forum in May 2008, as stimulation for vigorous, cross-constituency internal debate, on their own terms, about the appropriate choices for their orchestra.

Short version: the financial condition of orchestras is not deteriorating industry-wide, and the response to short-term problems in individual orchestras should be innovation, experimentation, and imagination rather than simply cutting costs or raiding endowments.

That’s a little different than Flanagan’s own take on his report:

"The industry should realize that there is an inherent long-term economic challenge," said Robert J. Flanagan…Although recessions exacerbate their woes, Flanagan said many symphonies have financial troubles even in good times. Attendance has been declining for most types of concerts, and orchestras may not be adequately scrutinizing the returns to their expenditures on marketing and fundraising, said Flanagan… many symphonies have a bias towards revenue growth strategies and a bias against cost-cutting strategies," Flanagan said, adding that nonprofit board members often shy away from conflict. "It’s not clear that they’re willing to be as tough minded about costs as directors in the private sector."

I think the elephants won this round, at least on substance.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: