Just a quickie...

This will be a short post. I haven't written anything since October but I have a good excuse. On November first I underwent surgery for a total (left) knee replacement and have since been undergoing rehab. Those of you who have taken that elective procedure  (what a friend called "a  self-inflicted wound") know that the operation and hospitalization are the easy part.. it's the weeks and even months of rehab that try the soul. I am one month out and things are going pretty well. But if there is any test for the old saw "patience is a virtue" this is it.

I am writing for two reasons. First is to be true to my inner pledge, taken when I started this website in April 2011 to post monthly. Here I am  just under the wire for November 2013.

Secondly is to wish everyone a Happy Thanksgiving, with the hope that the "weather event" wasn't too disruptive. We are expecting 10 for dinner...it may end up being less. I know we all have much to be thankful for. True to the purpose of this site, I want to offer thanks for all those people - paid  and unpaid - who work for, or contribute to, nonprofits. They - you -- mean so much to the health of this sector, which in turn, makes up a  critical part of the fabric of  the  nation. I know some of you who toil in the nonprofit vineyard may not agree with the health description above, given the vicissitudes of the financial environment. Nevertheless despite all  the challenges, nonprofits press on doing wonderful work.! Thank you for that.

More substance in December. Gobble,gobble.

Shutdowns

The news, as I write this, is all about the shutdown of the federal government precipitated by a small number of Republican congressmen obsessed with Obamacare. I won't tarry on this subject, as opinions and reports are legion elsewhere. I want to concentrate on two other important shutdowns- those of the New York City Opera and the Minnesota Orchestra.

Although the orchestra is still in business technically, it is frozen in a labor dispute that has  dragged on for a year. The  issue of course is money. On October 1st the musicians rejected the latest - and fourth- offer from management. Furthermore its music director since 2003,  the highly respected Osmo Vanska resigned - as he promised - if no agreement could be reached in time for the orchestra to prepare for concerts at Carnegie Hall this fall. The orchestra  cancelled  its 2012-13 season and won't open its 2013-14 season in Minneapolis  scheduled for October 4th. Even the solution offered by the renowned mediator, former Senator George Mitchell, failed.

Mitchell, who had helped broker peace in Northern Ireland and been a special envoy in the Middle East, ran into the special environment that exists in labor negotiations in non profit arts organizations. Many years ago (40 to be exact) I wrote my thesis at the Harvard Business School on collective bargaining in symphony orchestras. My professor, James J. Healy was a nationally known arbitrator in numerous labor-management disputes. In discussing my paper with him, he shook his head and said: "My goodness, I've never run across anything quite like these situations."

Here's a current example. There is now  a dispute between the management of the San Francisco Ballet and its dancers. The  dancers, in a recent statement, said they are seeking "provisions that
demonstrate a sufficient level of respect" and "protections against bullying by the artistic staff." You can write in salary and benefit provisions as well as basic work conditions, but it is difficult to craft language that will successfully guarantee respect. 

In Minnesota, according to The New York Times, players called the last management proposal "artistically unsustainable" referring to the concern that too low salaries (latest proposal was an average of $104, 500 a year) would mean the orchestra would not be competitive in the market for the best players. Well, unless the sides can get together, there won't be an orchestra.... period.

[Speaking of average annual salaries and labor disputes, the stagehands union on October 2nd  struck New York's Carnegie Hall, causing cancellation of the opening night gala with the Philadelphian Orchestra. At Carnegie Hall, the average  total compensation for a stagehand is  over $400,000 a year . No comment.]

The October 2nd  announcement of bankruptcy and folding of the New York City Opera is a very sad story This company, now in its 70th year, was started as "the people's opera" and was housed for years in the relatively small  City Center. Offering lower ticket prices and often more adventurous programming than the august Metropolitan, it also was the starting stage for the likes of Beverly Sills and Samuel Ramey. In 1965 it moved to the State Theatre in Lincoln Center, across the plaza from the Met. Here is where some think the trouble began. The theater was much bigger with more seats to fill, higher fixed costs and poor acoustics to boot..  Deficits began to mount.

In 2009 the theater renamed the David H. Koch Theater began a long-term process of renovation.. In 2011, City Opera management decided  not to produce a season there, electing rather the next year to perform in a number of venues elsewhere in the city. To finance  the "dark" year, the endowment was raided to the tune of $ 24 million. The number of performances fell, as well as the size of the audience, along with the finances. A last minute fundraising appeal failed. At the time of declaring bankruptcy, City Opera was earning more from its thrift shop than from its endowment.
Clearly along the way there were strategic errors on the part of management, compounded by the effects of  the "Great Recession."

In both the cases of the Minnesota Orchestra and City Opera, their shutdowns mean a slice of a city's soul is removed. We need all the soul we can get these days. The arts and music give us solace; politics, especially in D. C,  provide the opposite.
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Summer Idyll for a Nonprofiteer

I began writing this in the kitchen of a family house on an island in Penobscot Bay, Maine where we had been rusticating the first two weeks of August. It was raining, otherwise I'd have been outside, on the water or the 9 hole golf course. There is no TV, lots of books and we were largely free of the endless streams of information and commercial entreaties experienced elsewhere in time and space. Pausing to reflect on the past year since last on the island - as the non-profit world continues its struggle with  the effects of the recession and faces challenges of internal governance -  I realize that since late July I had been on an idyll. It's a word little used these frantic times. It means experiencing a period of calm and contentment.

Being in beautiful places in Vermont, New Hampshire and then Maine helped. My wife and I were lucky to begin our idyll at Marlboro, Vermont where we visited friends and attended  two concerts at the Marlboro Music Festival. This event, held on the lovely campus of Marlboro College, has just celebrated its 63rd  season. It is devoted exclusively to chamber music and was founded by the great pianist Rudolph Serkin and friends. Its present artistic directors are the renowned pianists  Richard Goode and Mitsuko Uchida.

Marlboro Music is unique. Over a five week period there are only two public performances a week. The community of about 80 musicians, a mixture of internationally known older artists and younger performers are formed into 60-80 groups, which have the luxury of unlimited rehearsal time.  Typically only about 20% of works rehearsed are ever performed publically. Only those deemed to have reached especially excellent results will be programmed. As a result, the repertoire  and personnel are announced to the public only a week or so in advance.

Furthermore, the program handed out to concertgoers is a photocopied single sided  sheet,  simply listing the pieces and names of performers. There are no musicians' biographies and quotations from music critics. There is however a handsome booklet available that gives more information about Marlboro Music, lists of supporters, advertising, etc. The organization would appear to have a devoted following.

The auditorium is barn-like with superb acoustics. The audience sits on folding chairs. Ticket prices are reasonable. A  good seat can be had for $30. The atmosphere is informal, yet charged with the expectation of hearing great music performed impeccably. And that is the result.

Why, you might ask, would musicians of such high caliber spend most of their summer engaged in intensive rehearsal and study when  the chances of public performance are slim? The answer lies in the Marlboro tradition of community, collaboration and  learning. The focus is on music, not personalities. I could not help but notice a wonderful photograph tucked away in an auditorium hallway of the youthful (barely out of their teens)  James Levine and Van Cliburn seated at a Marlboro piano keyboard, score in view - had they any idea of the fame awaiting them?

The great music-making aside what struck me was the non-commercial aspect of  Marlboro Music. Perhaps purity is too strong a word but it comes close. What better way to launch an idyll than experiencing an organization that strips away the extraneous to allow performer and listener alike to focus on why they have come together...and that is for music.

I am back home now and the world has crept back into my consciousness - from the horrors of Syria to the perils of the Detroit Institute  of Art. My next blog post will doubtless be less idyllic, but  for now why not savor the memory of hearing Mozart in the mountains of southern Vermont and of enjoying Maine sunsets? Thanks for your indulgence dear reader.

Riveting Response to my Mr. X Post...

It would be helpful, but not necessary, if you reference the post of June 13 entitled:  "Mr. X's Dilemma -Stay or Go on a Nonprofit Board." You can access it on the Archives side of the Blog section (on the left).

I have received some great responses/suggestions from that post, about a new board member who was criticized by the board chair for asking a (good) question about board governance. Below is the most interesting. Read it - as it is a revealing and even disturbing piece of personal testimony by a reader from the "front lines." Note: by director is meant board member.

Please allow me to share ( anonymously) the story of a business person who recently sold his firm for over $10 million and who gave away 30% of that amount. These are not, I admit, Bloomberg numbers, but neither are they penurious - 30 donations of $100,000 would make a positive difference for a lot of nonprofits. But giving away this amount of money has not been a happy experience for me. Your blog post really hit a nerve, and if you think it is helpful, you are welcome to share it with your readers.

Twice in the past couple of months I've seen boards of venerable institutions alienate directors who might have been helpful to the long-term future - indeed survival- of those institutions. But before those directors could offer their wisdom and strategic insights based on decades of professional experience in the corporate and nonprofit worlds, it became clear to these directors that is was their bank account rather than their endeavors at serious governance, that was the subject of interest to the nonprofit organizations they had sought to help. In the short term this strategy might work. When operating deficits are mounting and many nonprofits have not recovered from the financial crisis of the past five years the quick buck has its appeal.

But the Sugar Daddy theory of nonprofit governance only delays the inevitable. Without accountability and standards, the hallmarks of effective governance in any organization and the essence of Geoff's blog post, the donors preferred by entrenched boards and nonprofit management will delay, but not avoid, the day of reckoning. Sadly, those donors who opened the door for consideration as board members, will find their advice is less valued when that advice is no longer accompanied by out-sized donations.

Here's a tip for nonprofit organizations who recruit people who have had a financial windfall, such as selling a business or cashing out of property and partnerships that were built over a career. When we "suddenly" - that is after 30 or 40 years of labor- become wealthy, we were happy to share that bounty with nonprofit organizations. Opportunities for board memberships soon follow. But while the financial windfall lasted only a few years, the judgment and insight that might have been of value to nonprofit organizations could have continued for a lifetime. Unfortunately it is very clear  that once these windfalls have ended - for me and for the nonprofits  to which I have been so generous - the invitations to board service have also come to a close. This is precisely the reason that many entrepreneurs choose to create their own foundations rather than become involved in those that already exist,. Our energies are perhaps best exerted. even in our 6th or 7th decade and later, in starting new enterprises rather than contributing to those that have as their primary interest recruiting people who are engaged primarily in sustaining the mistakes of the past,

Well, Dr. Geoff, that was certainly therapeutic for me. I hope it will serve some of your readers. If nonprofits need board members and leaders who are capable of building organizations and sustaining them through difficult times, then they might start by valuing those board members for their acumen rather than their back account.  

Many thanks to my necessarily anonymous reader for this candid and articulate testimony. I hope it will be of use. Feel free, as always, to pass it on.

Mr. X's Dilemma - Stay or Go on a Nonprofit Board?

The other day an old friend and colleague told me a story, one that ends with an interesting question.  Here's the scenario: a gentleman, recently retired as a senior corporate executive is invited to join and accepts a position on a non-profit board of some prominence in his community, where he enjoys a fine reputation. Aside from his professional career, the man we'll call Mr. X, has served on a number of boards of notable nonprofit organizations.

He attends his first board meeting and at one point speaks up, raising a question of governance procedure, namely does the board engage in an annual self-evaluation? A noncommittal answer is given by the executive director who has served in that position for many years, in fact since the organization's founding. That evening Mr. X receives a phone call from the board Chair who in a chiding tone, tells him in future meetings to calm down, to cool his jets and not to be so aggressive.

The mild-mannered Mr. X is taken aback - in fact insulted. He asks a friend: I am 70 years old, with many professional accomplishments and can offer a lot to a board, why should I continue to serve on a board where right out of the gate its leadership seeks to stifle and gag me? A good question...

For an answer, let's engage in some conjecture about the reason the board Chair made that call. It might be he said to himself:  "Oh-oh, Mr. X is on to something and we don't want him to go down that road." This defensive posture suggests the Chair is a control czar, along with the director. Another possibility, and a kinder one, is that the chair wanted to educate, albeit brusquely, Mr, X about the culture of the organization.. If so, he might want to figure out what role the board  plays in governing the institution aside from a select few.

I discussed Mr. X's quandary with the colleague who brought it to my attention. I offered perhaps a)Mr.  X stay on for at least enough time to quietly take the temperature of the board and its leadership at meetings, and plan his participation accordingly or b) take a "Damn the torpedoes full speed ahead"  approach and continue to raise questions that might cause discomfort. That latter option would have to jibe with his personality. It might result in his being pigeon-holed as a troublemaker.

As for the former idea, my colleague suggested an examination of Mr. X's reason for joining the board. If he is deeply committed to the mission of the organization, then he might be able to ignore the style of its leaders, including  their domineering attitude, and press on. But if he is more interested in management issues,  given the controlling nature of the leadership, he could undergo grinding frustration as he finds his ideas routinely brushed aside.

I don't know how much time Mr. X spent with the leadership before agreeing to serve on the board. His quandary might not have arisen if in thorough pre-decision discussions he could have explored issues and scoped out management styles. Perhaps then he might not have signed on.

I have written before about the importance of thoughtful, mutual vetting in advance between a potential board member and the nonprofit. Such a process can determine if there is a good fit. This story only reinforces that need.

What do you think Mr. X should do? Hang in there, or resign and return for more time with the comforts of retirement? Comment below or write me at: info@geoffreyplattconsulting.com

The Corcoran Conundrum - Woes of a Great Art Museum

The Corcoran in the title is the venerable Corcoran Gallery of Art in Washington DC. Conundrum of course means a difficult problem, sometimes set in a riddle. I use it here because a) it's alliterative b) I love the word and c) it  describes precisely the situation the museum presently faces. It may also serve as an object lesson in crisis management by a board and what can happen when the skill of a professional executive is absent.

The Corcoran was founded in 1870 with the purpose of "encouraging American genius" and built on the collection of American art gathered by its namesake William W, Corcoran. In 1897 it moved into a new and beautiful Beaux Arts building near the White House, where it remains today. An addition in 1928 allowed it to display an extensive collection of European art donated by Senator William Clark of Montana (a famous scoundrel, but that's another story). Since 1890 the Corcoran program has included the Corcoran School of Art + Design, an accredited degree-granting college of art. The collections, school and the building are all highly regarded in the museum and cultural world.

The Corcoran is the largest privately supported cultural institution in D.C. That's good and bad news. The level of support is the good news; the bad new is that the Gallery is in competition with the Federally supported, free admission National Gallery of Art and the Smithsonian museums.That, plus the economic downturn, an aging facility crowding its site, and a non Mall location, has created fiscal challenges. The building is said to need $130 million in renovations and the annual operating budget, approximately $20 million, has been running $7 million deficits the past few years.

The Gallery has a history of controversies. In 1989, in the face of Congressional uproar over its content, the Corcoran cancelled a long planned exhibit, partially funded by the NEA, of the photographs of Robert Mapplethorpe, some of which were homoerotic in nature. There was a public outcry against the Gallery for caving in to censorship. The show was taken up by the much smaller Washington Project for the Arts, where it drew large crowds and, parenthetically, elicited one of my favorite public reviews of a controversial art exhibit. When asked by a reporter from The Washington Post what she thought of the exhibit, a well-dressed elderly woman replied: " It gets more disgusting every time I see it."

A number of directors came and went. One of the longer serving, David Levy,  hired in 1991, had grand plans for the Gallery. In 1999 the Corcoran retained the renowned Frank Gehry, fresh off the triumph of his Guggenheim Museum in Bilbao, Spain, to design an addition. The budget was $60 million. Amid much excitement a capital campaign was launched,  gathered steam but sputtered out and died in 2005 after raising what would otherwise be considered an impressive $28 million in cash. Of that, according to Washingtonian Magazine, $17 million went to the Gehry firm and others involved in the planning. As the magazine put it: " not a single stone was ever moved."  Although a recession could be partly blamed, the museum suffered a black eye and donors were very unhappy. David Levy resigned.

Fast forward to the present day. After another director came and went, leaving in 2010 because of illness, the current leadership emerged. The board chairman is a successful venture capitalist/art collector, the director a retired bank president who first served as a consultant (one of many over the years) to the museum and the chief operating officer is a former board member from the economic development field. It has been pointed out that none have professional museum management backgrounds. But they have plenty of business experience.

Perhaps that background led to the astonishing announcement in June 2012 that the board, to cope with the financial crisis,  was "exploring" selling its present building, its iconic Beaux Arts home for over 105 years, and relocating the collections and school.  To where was unstated, although later it was revealed there had been discussions with officials in neighboring Alexandria, Virginia. Was this a form of business divestment? For sure, it was a public relations misstep, Predictably a public uproar ensued, a "Save the Corcoran" organization formed, letters and petitions circulated.

Furthermore, in the midst of what The Washington Post termed the Corcoran's "methodical - critics say plodding- process to re imagine its identity" (for which $1.5 million was reportedly spent on consultants) steps Wayne Reynolds, a prominent Washington philanthropist, who announces in March 2013 he has a plan to save the Gallery. By that time the idea of selling the museum building had been shelved by the board. Few would have paid attention to Reynolds' announcement, including the media, if he had not just finished leading a capital campaign that raised $54 million in support of historic Ford's Theatre.

Reynolds' plan included selling "hundreds of millions of dollars worth of art" not normally seen in public. That move, plus other radical ideas, would require his becoming board chairman. His scheme generated much publicity, a cool response from the Corcoran leadership and a lot of clucking in the art world about such a public spat.

Finally (perhaps not in this saga) in April the Corcoran announced the results of its lengthy deliberations. First is that it is entering into two partnerships, one with the University of Maryland directed at sharing higher education resources, the other with the National Gallery of Art, whose East Building is closing for renovation in 2014, to exhibit works displaced by the project. Lastly, and importantly, Peggy Loar, a respected and experienced museum director has been retained to oversee these significant initiatives as "consulting director."

Will it be enough? One could say such a plan would be plenty ambitious even for an institution in a stable financial situation which, with its deficits and infrastructure needs, the Corcoran is not. Somewhere along the line the leaks in this ship have to be fixed. With a professional at the helm, the previously mentioned new strategic partnerships and a rally of public support, let's hope that will happen.

The most successful museums, and this goes for nonprofits in general, are guided by responsible boards and professional executives knowledgeable in their fields. The lack of the latter at the Corcoran these past number of years may be one reason why this ship lost its bearings. Admittedly it is tough to bail and steer at the same time. But it is helpful to have a professional pilot.

Join the Meeting Revolution

Last February in The New York Times, Carson Tate, a management consultant from North Carolina, wrote an article entitled: "When You've Had One Meeting Too Many" in which she decries the "meeting-intensive" culture in our corporate life. She gives an example of a senior manager who, because of a schedule crammed with meetings and little time at her desk, found her team  - those female members at least - following her into the restroom for consultations.

I bet just about everyone reading this would agree with her premise that we suffer from meeting glut.. "Where is X?" "He's in a meeting...."  The core question to ask is: how productive is any meeting? You can bet one without an agenda would lead the pack, followed closely by one with no time limit. Ms. Tate asks us to evaluate the  return on investment of  time - a  most  precious commodity - derived from any meeting. Then, if the answer is negative - and here is where the revolution idea comes into play - perhaps deciding not to attend.

That is easier said than done, especially if your boss has called the meeting, though perhaps it would be a service to senior management if questioning the necessity of meeting was posed more often. Sometimes meetings occur at requests of, say, project managers who want the "face time" with top management and to assert their authority over team members. No doubt there are legitimate reasons to gather. But Carson Tate reasonably suggests that if that is the case ground rules be established and promulgated in advance.

Setting agenda and time is the first rule. What will be discussed and for how long?  Without these guideposts any meeting is almost guaranteed to be a waste of time. With their establishment however is the requirement that whoever chairs the meeting - usually the convener- serve as a stern referee. The evil elf -whose name is Digression - is always a meeting attendee and should he make a vocal appearance, needs to be quickly dispatched back to his lair.

I have experienced Chairs who are masters at keeping meeting participants on task and some who have not. One in particular, who led a board, was part of the problem. Participating in one of his meetings was a little like being on a river voyage with a boat captain who, coming upon a tributary, impulsively decides to explore it, even though it means there will be a delay in arriving at the ultimate destination. The result was often frustration, meetings going over time and agenda items being given short shrift.

Others with whom I have worked have skilfully  kept the craft on course, sometimes having to tactfully shut down babblers and grumblers - all in the cause of keeping to the agenda, and the allotted time.

Trickier to manage can be the more informal meetings - "let's get together to discuss X - see you at 3."  If the person who wants the meeting cannot be persuaded to use another medium - email or conference call for example - then Tate suggests convening what I first heard called a "Navy Meeting" (presumably developed on the high seas) -  where all attendees meet standing up. Leg fatigue is sure to limit the length of discussion. I know from experience.

There are other techniques that can lead to shorter and more focused meetings- clarity on what outcomes are desired for instance, which can lead to an ongoing check of a meeting's progress by those in attendance. For formal board meetings use of a "consent agenda" can be handy. Borrowed from legislative procedure, this agenda bunches non-controversial issues into one package for a one vote approval. It assumes board members have read in advance whatever reports or matters are included. That in itself can be a challenge.

These ideas can streamline meetings, but if there is to be a  true "meeting revolution" then the need for and purpose of any meeting needs to be questioned in the first place. For everyone, time carries a high value and should not be squandered needlessly.

On a personal note, thanks to those of you who wished me well on knee replacement surgery mentioned in the February post. It has been postponed. Look for another call for sympathy sometime in the future.