The Cycle: A Practical Approach to Managing Arts Organizations

A spate of negative developments, including the decision of a bankrupt New York City Opera to shut its doors, the ongoing lockout of musicians at the Minnesota Orchestra, and surveys showing a decline in theatre attendance, would seem to spell trouble for nonprofit performing arts organizations.

Don't cue the fat lady just yet, suggests Michael M. Kaiser, president of the John F. Kennedy Center for the Performing Arts, in his new book, The Cycle: A Practical Approach to Managing Arts Organizations (Waltham, MA: Brandeis University Press, 2013). Yes, nonprofit arts organizations face significant challenges - including the aging of their traditional audiences, the impact of disruptive technologies, and the lingering effects of the Great Recession — but by following the principles laid out in his book, any arts organization, regardless of size, target audience, or location, can set in motion "an internal engine that powers consistent success."

Known in some circles as the "turnaround king" for his successful efforts to save or revive financially troubled organizations such as the Kansas City Ballet, Alvin Ailey American Dance Theater, American Ballet Theatre, and the Royal Opera House in London, Kaiser draws on his extensive experience to illustrate in The Cycle how "good art, well marketed" attracts loyal audiences, volunteers, board members, and donors whose support can be reinvested in developing even bolder, more exciting programming, eventually creating a positive feedback loop with a circular momentum of its own.

Written with Brett E. Egan, director of the DeVos Institute of Arts Management at the Kennedy Center, and developed during Kaiser's 2009-10 "Arts in Crisis" national speaking tour, The Cycle is the third in a series of books by Kaiser (following The Art of the Turnaround: Creating and Maintaining Healthy Arts Organizations and Leading Roles: 50 Questions Every Arts Board Should Ask) devoted to the practice of arts management. In it, he presents accessible, step-by-step advice with respect to clarifying an organization's mission and creating programming that embodies that mission, developing and mounting an aggressive marketing campaign, leveraging your board to grow your "family" of supporters, controlling expenses, and maximizing donated income through tailored fundraising efforts.

For each of these interlinked elements, the book outlines what many arts organizations do, but should not; what successful organizations actually do do; and how each element of the cycle affects other elements. For example, the chapter on programming points out that established arts organizations tend to be risk-averse, which often leads them them to offer the same kind of programming season after season — or programming that is similar to what other groups are presenting — instead of offering new and dynamic projects. Less ambitious, unsurprising programming, in turn, inevitably "sets in motion a vicious cycle" in which audience enthusiasm and engagement cools, leading to reduced revenues, which leads to even less risky programming, and so on until the organization finds itself in trouble.

To break that deadly cycle, arts organizations need to figure out how best to balance their mission with the size and generosity of their "family" and, with that information in hand, plan projects up to five years in advance. "Five years?!" you're probably thinking. Yes, writes Kaiser. Having worked with dozens of arts managers from all over the world, he's well versed in the arguments of those who say that's impossible or impractical — and explains that planning five years out gives organizations the time they need to secure resources and talent and/or form joint ventures; to market each performance, exhibition, and outreach activity effectively; and to educate, engage, and expand their "family" of supporters. It also gives them the flexibility to adapt to unforeseen circumstances and changes. While planning that far in advance may be especially challenging for smaller organizations, it's especially important for such organizations to be proactive, he adds, given that they have fewer resources and leaner fundraising operations.

Kaiser is big on proactivity. He thinks of institutional marketing "as a proactive tool for healthy organizations as much as...a remedial approach for troubled ones." Moreover, no organization, no matter how successful, can afford to become complacent at any stage of the cycle. The cycle is not self-perpetuating; each element fuels the element that follows, for better or worse. If an organization neglects to maintain the engine, the engine will stall.

It's an approach that's evident not only in the book's emphasis on long-term planning, but also in its focus on the critical role of the board and donor stewardship. Raising an organization's profile through effective institutional marketing is critical to recruiting effective board members, Kaiser writes, but at the same time board members must be actively managed and engaged — for example, by being asked to "adopt" specific projects. Arts managers also should audit the board periodically to evaluate board members' productivity and replace those who no longer meet the organizations' evolving needs. Although it may surprise some readers, Kaiser tells us that, when working to save Alvin Ailey, he asked eighteen of the dance company's thirty-six board members to relinquish their seats — and that "seventeen did so happily and remained actively engaged with the organization."

Similarly, the cultivation of individual donors — which is where, according to Kaiser, the best possibilities to boost income lie — requires a "disciplined, proactive, aggressive" plan that aligns a donor's interests and social objectives to support for a specific project(s). Moreover, while many arts executives and board members view donor cultivation as distasteful and prefer alternatives such as cost-cutting, pursuing unrelated business income, or chasing after endowment gifts, such measures, in Kaiser's view, are overrated as sources of financial stability and hardly obviate the need for persistent donor cultivation and annual fundraising efforts.

At the same time, Kaiser cautions his readers not to confuse fundraising with begging; fundraising, he writes, is about matching the needs of donors to the needs of the organization. And the most important element in that process is donor stewardship — i.e., developing solid, dependable relationships with donors by providing superb customer service, celebrating their achievements and milestones, sharing good news, and delivering more than you promise. Much of this is common sense, of course — and at times The Cycle insists on spelling out even the most basic information — and yet, writes Kaiser, too many arts managers passively assume that members of the organization's "family" will seek out opportunities to renew their support on their own, when in fact the onus is on the organization to be proactive in presenting donors with new reasons and occasions to do so.

Despite Kaiser's insistently optimistic tone, the book makes clear that even with organization-wide buy-in and careful planning, it can take years for a positive cycle to take hold — and even then it can be derailed by a misguided programming choice, a poorly executed marketing campaign, neglect of "family" members, poor cash management, or mission drift. Indeed, Chapter 9 is devoted to the steps an organization should take when that happens — from extending the planning timeframe and announcing new projects, to rebuilding the board, to cutting non-strategic (i.e., non-programming/marketing) costs — as well as what not to do (cut the program/marketing budget; merge with another troubled organization; stop planning). In other words, Kaiser writes, don't sacrifice one element of the cycle in an attempt to shore up the others. Instead, do whatever you can to ramp up each of the four elements, which in turn will bolster the next element, and so on. After all, it is a cyclical process.

Kaiser insists throughout the book that the four-step approach he lays out can be applied to any type of arts group, not just performing arts organizations. And while that's more than likely true, it also means the framework he presents is by definition rather broad and therefore will require extensive customization on a case-by-case basis. Otherwise, The Cycle is a well-organized, easy-to-read primer for arts managers looking to ensure that their organizations survive and thrive in an increasingly tough environment for the nonprofit arts. Based on his extensive knowledge of arts managers' passions and fears, Kaiser provides a clear-eyed and persuasive guide that, with some patience and dedicated practice, will lead arts managers and their organizations to a bolder and better-funded future.