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January 2, 2007

The For-Profit Charity

Why should nonprofits and their donors get all the goodies from the IRS? That's the question posed by Eric Posner and Anup Malani of the University of Chicago Law School in a working paper published in September. Posner and Malani suggest that the exclusive tax benefits available to nonprofit corporations are both unfair and inefficient. In response, they recommend that the same benefits should be extended to for-profit charities, and to the charitable activities of for-profit commercial firms.

According to the authors, there are three primary arguments used to support the special status of the not-for-profit sector, none of which they believe justifies the exclusive tax incentives:

  • The public goods theory suggests that charitable tax benefits encourage citizens to support firms that create public goods, displacing the need for government or tax revenues to do the same job less efficiently. (The authors claim that commercial firms can also provide public goods and services, and would do so more effectively and efficiently in some cases.)
  • The agency theory holds that the nonprofit form removes the lure and distortion of profit-seeking from the pursuit of social good -- especially in cases where the donors or consumers cannot evaluate the quality of the goods or services provided. (The authors believe this problem could be resolved through contract and management structure.)
  • Finally, the altruism theory suggests that the nonprofit form encourages altruistic individuals to undertake activities that will benefit others. Assuming that for-profit enterprise will ultimately value profit over quality or quantity of production, the nonprofit creates a space for those who value the latter over the former. (The authors dispute this point entirely, suggesting altruism and commitment to quality can be expressed by entrepreneurs in any organizational form.)

The proposition was provocative enough to make The New York Times Magazine's list of ''big ideas'' for 2006 (available here, if you're a subscriber). And it nudges an already bubbling conversation about the flexibility and future of the nonprofit corporate form.

In the arts, the question of fiscal priviledge for nonprofits is particularly vexing, since creative expression is produced, preserved, presented, and distributed through a full spectrum of organizational types (from independent contractors to commercial firms to informal collectives to cooperatives to hybrids thereof). With nonprofit cultural organizations seeming ever more corporate and risk-averse, and with so much innovation and expressive energy in other forms, it's easy to ask why the nonprofit form in the arts has achieved such favored-nation status.

Since the first focused cultural work of major foundations in the 1950s and the cultural philanthropy and government support that flowed in the following decades, the nonprofit form has been a necessary key to unlock gifts, grants, and discounts. Whether that corporate form was the best choice for the mission or vision of the organization became secondary to the fiscal imperitive.

While I'm not yet convinced that a for-profit charity model is possible or even beneficial in our current economic and social system, I'm thrilled to see the conversation moving forward. As I've mentioned before, organizational form is a tool, not a goal. Great artists (and exceptional managers) are always ready to rethink or reconstruct their tools if their larger vision requires it.

Posted by ataylor at 8:45 AM | Comments (2)

January 3, 2007

Reclaiming 'culture'

Australia's The Age offers an opinion on ''culture,'' hoping to reconnect a word that has become disconnected from the discussion of daily life. The piece claims ''culture'' -- distinct from ''the arts'' or ''being cultured'' -- as universal, an unavoidable stream of experiences, memories, expressions, and conversations, integral to every action in society:

We all carry culture within us; whether we wish to or not, it is as embedded in our minds as DNA is in our cell structure. Culture cannot be reduced to elemental terms, such as a painting on a wall or notes resounding in hall, but is a continuing series of experiences that affect every mind in a different way. In the end, culture is worth celebrating as a word, and as a condition not to be endured but used to educate and enliven.

But while culture is embedded in all of our lives, the article warns that we lose great opportunity if we let it spin unattended:

Back in time, when there was time, acquiring cultural knowledge was considered a rite of passage, not something special or abstruse. People learned of the basic structures of language and history; how civilisations were founded, developed and fell, and how they are remembered through their cultures. It is the chain that binds humans through epochs of change, and we loosen its links at our peril.

Posted by ataylor at 8:47 AM | Comments (1)

January 4, 2007

Rethinking a window to the world

There are so many fascinating things about the One Laptop per Child project, which is working to bring durable, wireless, portable computers to millions of children in the third world. These new machines can only be ordered in quantities of one million or more, usually by governments (like Rwanda or Libya). And the nonprofit project is ready to begin mass production as soon as their orders reach 5 to 10 million.

One Laptop per ChildThe challenge of constructing a cheap and durable computer, designed for harsh conditions and continued use in places that often lack reliable electrical power, is fascinating enough. The implications if the project succeeds could be transformational.

Of particular interest to the cultural world, however, is the machine's operating system (trust me on this one). Instead of using Windows or Macintosh software, the developers of the laptop are designing an entirely new user interface, with their audience in mind -- third world children and their teachers. Where most of us shuffle around our 'desktop' and through our 'folders' and 'files', the XO system (as it is now called) is designed around the user and his or her 'friends' and 'neighborhood,' facilitating collaboration and shared experience at every step (there's an article on the new system in the Washington Post, and an interesting video demo on YouTube).

Why is an operating system for third-world children interesting to arts and cultural managers? Consider this: The computer operating system is becoming the predominant way many of us interact with the world -- through e-mail, through the web, through our spreadsheets, word processor files, and graphics. In essence, operating systems define the metaphors we use to access and organize our thoughts, our expressions, our relationships, and our connections to the thoughts and expressions of others.

While the 'desktop' has been the default metaphor for the past 20 years (since Apple swiped an original idea from Xerox for the first Macintosh computer), it's an increasingly odd and anachronistic one. How many of our kids use file folders anymore..especially nested folders? And, in the age of instant messaging and live chat, what proportion of their computer time is related to documents or files, or to work they do alone ''at their desk''?

In essence, the current computer operating systems reflect a past generation's way of being in the world, and a traditional view of what computers are intended to do. The fact that at least one company is radically rethinking this interface is massively important to anyone involved in arts and culture. The thought that the new system could be in millions of young hands around the world should only underscore the point.

Posted by ataylor at 8:50 AM | Comments (1)

January 5, 2007

A shot across the bow

Artist/director/maven Peter Sellars got right to the point in his conference keynote for the American Symphony Orchestra League, suggesting that the contemporary standard for the American orchestra doesn't serve the art, doesn't serve humanity, and disconnects the two in the process:

If you want to respect your grandparents, take care of your kids. You can't keep your grandparents alive forever, but they're still with you in your own children. In America, we fell in love with an artificial life-support system that wouldn't let certain things die. Telling ourselves it was out of love that we were doing this, we starved the kids.

Any business that still has things on the shelf from 50 years ago as its primary's a little odd. Everybody's saying everything but the obvious -- it's dead.

Well worth a read or a listen. You can find links to the audio of the keynote (mp3 format) and a printed excerpt (pdf format) on Henry Fogel's weblog.

Posted by ataylor at 6:56 AM | Comments (5)

January 8, 2007

Measuring cultural vitality

Lots of communities and consultants talk about ''cultural vitality,'' and the benefits of achieving that status for their local economy, education system, creative workforce, and quality of life. But few have actually detailed what they mean by the term, or by what measures they would know that they had achieved their goal.

Cultural Vitality in CommunitiesA clear definition of ''cultural vitality'' and specific measures for assessing that vitality are two of the goals of the Arts and Culture Indicators Project, a decade-long effort of the Urban Institute. The latest monograph emerging from that project, Cultural Vitality in Communities: Interpretation and Indicators, was released last month, and is available for download in PDF format.

The report defines ''cultural vitality'' in a wide and inclusive way, encompassing professional arts venues, producers, and presenters, but also amateur, informal, educational, individual, and community elements:

Cultural vitality is the evidence of creating, disseminating, validating, and supporting arts and culture as a dimension of everyday life in communities.

Building on this definition, the report details the available data at national, regional, state, and local levels, recommending the most consistent and accessible to the task. The resulting indicators still favor the more formal nonprofit and commercial creative activities in any community, simply because they are tracked more reliably by government and related research projects (IRS data, charitable statistics, labor statistics, and so on). But the report points the way to building more rich and inclusive assessments of vitality on all levels.

Of particular interest are the case studies of cities already at work defining cultural vitality for themselves, and creating on-going efforts to measure their success. These include the Boston Indicators Project, the Metropolitan Chicago Information Center, and the Metropolitan Philadelphia Indicators Project, among others.

If you or your community are struggling to connect arts activity in your community in a more dynamic, integral, and accountable way, this report is worth a read.

Posted by ataylor at 8:54 AM | Comments (2)

January 10, 2007

The key to happiness? Low expectations.

The New York Times has a short summary of a rather tongue-in-cheek medical journal article on happiness and life satisfaction in the European Union. It turns out that citizens of Denmark consistently rank as more satisfied with their lives than their counterparts in other EU countries.

Denmark folks are very satisfied with their livesThere's even a chart. So it must be true.

The causal factor, according to the authors? Low expectations:

The key factor that explains this and that differentiates Danes from Swedes and Finns seems to be that Danes have consistently low (and indubitably realistic) expectations for the year to come. Year after year they are pleasantly surprised to find that not everything is getting more rotten in the state of Denmark.

So, in 2007, set your sights low. Tell your boards to dial back the expectations. And encourage staff to anticipate the worst. You may not make a positive difference for your community, but at least you'll all be measurably more satisfied with your lives.

NOTE: If you're itching to learn more about happiness, satisfaction, and other subjective measures of the enjoyment of life, be sure to visit the World Database of Happiness (to be honest, I feel measurably happier just knowing such a thing exists).

Posted by ataylor at 8:26 AM | Comments (1)

January 11, 2007

Sophomore slump

Madison's $205-million Overture Center for the Arts is bracing itself for a budget pothole in its coming season -- a $735,000 gap between projected revenues and expenses, against an $11 million total budget. At the heart of the problem is a projected 29 percent drop in ticket sales -- to $4.1 million, about $1.6 million less than 2006 -- along with increased operating and staffing expenses.

It's not uncommon for a major new cultural facility to face budget woes in the years following its gala opening (remember the Kimmel?). Just as the ''newness'' wears of, and audience and donor attention drifts elsewhere, the facility staff and leadership are just beginning to realize the true cost of running the space. Costs are invariably higher than expected (especially when external forces drive unavoidable costs like heating and health insurance). And the rosy glow of early revenue and contribution projections smack up against reality. The lack of a major, extended blockbuster show like Lion King or Phantom of the Opera only makes the numbers crunchier.

And, after all, so many new facilities are ''aspirational,'' envisioned and designed to be bigger, better, and busier than anything the community has experienced before.

To fill the gap, Overture is drawing down the assets of its support foundation, reducing the scope and scale of its artist contract budget, and hitting the pavement for new and continuing sources of contributed support (around $500,000 a year, according to one board member). The Center opened with only a small endowment, and without obvious plans to raise one.

It should be an interesting first week, month, and year for the Center's new president, who officially begins on Monday.

Posted by ataylor at 8:34 AM | Comments (2)

January 12, 2007

The prognosis on classical music

Fellow blogger Greg Sandow has emerged from his reading and research on classical music confident enough to make the following prediction:

...the era of classical music is going to end. Not this year, not next year, maybe not in 10 years.... But sometime reasonably soon, the era of classical music will be over.

What does it mean to ''be over''? Greg says this:

To be as precise as I can, I might say that the apparatus of classical music, as we know it now, will very likely fade away. We won't see many concerts (or at least not nearly as many as we see now) featuring only music from the past. We won't explain classical music primarily in historical or structural terms. We won't tell classical musicians that their main job is to serve the great composers. We might not ask our audience to sit in silence, clapping only when it's told to.

And while it may seem a wrenching prediction, Sandow suggests that a new ecology might well emerge in its place that's more personal, more connected, and more sustainable for the coming century. Loss is an essential part of renewal. And he suggests this particular art system is ripe for something new.

Posted by ataylor at 8:43 AM | Comments (5)

January 16, 2007

Getting ready for the road

My weblog entries will be slim this week as I prepare for and travel to the Association of Performing Arts Presenters conference in New York. It's the 50th annual conference for the association, which began here in Madison those many years ago.

If you're attending the conference, come by the ''burning issues'' session on Sunday morning, January 21, at 9:30 am (description below). I'll be introducing a presentation/discussion prepared by four of my MBA students on a topic that seems to be bubbling up everywhere these days. Most of the rest of my students will be participating in the conference, as well.

Sunday, January 21, 2007, 9:30 - 11:30 am
Burning Issues Forum:
"Professional Presenters and the Amateur Arts"

New York Hilton & Towers, Concourse E
With new technologies and renewed passion, Americans are making art and expressive works in a thousand different ways -- knitting circles, community ensembles, web-based songwriter networks, ''weekend warrior'' musicians, webloggers, photographers, ethnic dance and handicraft groups, filmmakers, podcasters, poetry slammers, hip-hop and scratch artists, and on and on. Some aspire to and surpass professional standards. Others engage for the rush and joy of creating something new. Join a team of graduate students and special guests as we explore the role and relevance of professional arts presenters in this emerging world of participatory practice. Are these amateur art-makers competitors to the arts presenter or powerful new partners in advancing a community's expressive life? This second-annual effort of the Bill Dawson Research Internship Fund will honor Bill's life and work by connecting emerging trends to professional practice and by stretching what you think you know about your work.

Do stop by to say hello, give a listen, offer an insight, and advance the conversation.

Posted by ataylor at 10:48 AM | Comments (0)

January 17, 2007

Preserving the ethnosphere

There are lots of compelling thoughts in Wade Davis' short speech to the TED conference from 2003, exploring the complexity and fragility of the world's cultural ecosystem. With fabulous photos, and tales of his global travels, he spins out the idea of an ''ethnosphere'':

...the sum total of all thoughts and dreams, myths, ideas, inspirations, intuitions brought into being by the human imagination since the dawn of consciousness. The ethnosphere is humanity's great legacy. It's a symbol of all we are and all we can be as an astonishingly inquisitive species.

Davis suggests that the ethnosphere is just as important to the earth's health and well-being as the global natural ecosystem we call the ''biosphere,'' but he claims the former is degrading far more quickly than the latter. No biologist would suggest, for example, that half of all species on earth were on the edge of extinction. And yet the number of world languages has dropped at least by half in our lifetime. Every two weeks, he claims, ''some elder dies and carries with him into the grave the last syllables of an ancient tongue.''

While some might say such attrition in the world's cultural diversity is the inevitable result of globalization and a shrinking world, Davis makes a compelling argument that we should be concerned. The loss of language is just an indicator of the larger loss of stories, insights, metaphors, world views, and entire civilizations that threatens the richness and sustainability of our ethnosphere.

Posted by ataylor at 7:59 AM | Comments (3)

January 19, 2007

Audio on Arts Presenters

I'm in New York City now, preparing for the opening of the Arts Presenters conference. For those who want to hear a bit about what it is, and why it matters, give a listen to my short interview on WNYC's ''Soundcheck'' program (it's the first segment).

Let the conferencing begin...

Posted by ataylor at 12:05 AM | Comments (0)

January 22, 2007

The smartest nonprofits online

Squidoo, GetActive, and Netsquared give us a list of 59 of the ''smartest ORGs online,'' nonprofit web sites selected and praised for their innovative use of social networking and rich media in advancing their causes. Only a few arts/cultural entries on the list, but still worth a visit to see who's pushing the system.

Posted by ataylor at 12:49 AM | Comments (1)

January 23, 2007

Glazed and confused

I'm finally back from four days in New York at the Association of Performing Arts Presenters conference, and still a bit hazy from the experience. With over 4000 registrants wandering around a single hotel, so many old friends and colleagues to chat with, and so many ''virtual'' connections finally made ''actual'' (I met many readers of my weblog, as well as blogger Doug Fox and AudienceBuzz co-founder Rolf Olsen, among others), it was everything I've come to expect from the mega-convening of performing arts professionals...that is, exhalirating and exhausting.

One of the highpoints of the event (admitting my bias) was the fabulous conference session researched, prepared, and presented by four of my MBA students in Arts Administration. They did an exceptional job exploring an emerging issue and challenge for professional performing arts presenting organizations, and teasing out the essential context and insights for those who want to take positive action.

The subject, as I've mentioned before, was the promise and challenge of building more meaningful connections between professional performing arts presenters and the amateur or non-professional creative artists that surround them in their communities.

A briefing paper summarizing the project will be coming in a month or so. But in the meanwhile, we've posted updates to the project home page with links to key literature on the subject, to organizations discussed during the session, and eventually to the session slides and the briefing paper itself.

Kudos to Leigh Henderson, Joanne Jacobson, Jara Kern, and Maggie Marquardt for their hard work and successful presentation. And thanks also to my other students who were attending the conference -- Angie Han, Derek Kwan, Jennifer Post Tyler, Andrea Albrecht, Eric Harris, and Isaac Walters -- who provided evaluation and documentation support to the event, and professional connections for the arts institutions they work for here in Wisconsin.

Now it's nap time.

NOTE: Blogger Doug Fox offers an overview of the student's conference session on his website.

Posted by ataylor at 8:47 AM | Comments (1)

January 24, 2007

Should PR come in one voice, or a thousand?

Chris Anderson's Long Tail weblog wonders if the new dynamics of communications and consumer conversation require a new focus for traditional public relations strategies. As standard press releases and generic corporate pronouncements get less and less attention, he suggests that the best response might be to stop speaking in a single voice...instead enabling the many voices within your organization to speak for themselves. Says he:

I wonder whether the solution to this is to evolve the role of PR from external relations to internal relations, from communications to coaching employees on how to effectively do the outreach themselves.

As an example, he mentions Microsoft's 3,000 bloggers who speak with specific expertise about emerging products and challenges. For consumers with a high level of expertise and a true passion for the field (software and gaming, in this case), these 3000 individual bloggers offer a palette of opportunities for leading-edge updates, inside scoops, and an on-going narrative in a personal voice.

I'm sure there are cultural organizations that have enabled their staff to speak directly to their community about their area of expertise -- programmers at presenting organizations, curators at museums, artistic directors, community engagement professionals, education staff, and so on. If you know of a few, post the link as a comment to this entry. They needn't be ''official'' weblogs of the organization, but they should be encouraged and supported by the mother ship.

Posted by ataylor at 9:05 AM | Comments (1)

January 25, 2007

None of us is as dumb as all of us

Ken Thompson reminds us that teamwork is an exercise in understanding the players, goals, constraints, and the task at hand -- and making sure they all are aligned in the same direction. He offers a quick team profile checklist to see where the team and the task may be out of whack, focusing on eight areas:

  1. Nature of Team Objective
  2. Team Leadership/Management Style
  3. Team Member Profile
  4. Team Shape
  5. Team Environment
  6. Team Working Approach
  7. Team Social Dynamic
  8. Team Technology Factor

He also quotes Jon Katzenbach and Douglas Smith, writing in the Harvard Business Review, who identified three types of teams, each requiring a different communications and control strategy to move them forward:

  1. Recommender Teams: those that recommend things -- task forces or project groups (often part-time; great for reviewing work but can lack a "team engine" for getting detailed work done).
  2. Doer Teams: those that make or do things -- manufacturing, operations, or marketing groups (great for doing things, but their networks may be limited to their own functional areas which can blind them to some innovation and cross-functional opportunities).
  3. Managing Teams: those that run things -- groups that oversee some significant functional activity (often staffed with senior executives who have serious time management challenges and are unlikely to engage with traditional team communication and meeting approaches).

NOTE: The title of this weblog entry comes from a favorite ''demotivation'' poster from Or, try this one on group behavior, or this one on teamwork, or maybe this one on the benefits of ignorance.

Posted by ataylor at 8:41 AM | Comments (0)

January 26, 2007

Don't tell the marketing department

The Milwaukee Symphony is trying to make a case to the Wisconsin Department of Revenue that its performances are not entertaining. That is, they're asking for a refund of the sales tax they have paid against ticket sales for the past four years, on the grounds that their performances are education not entertainment, and therefore exempt.

It's an interesting end-run around Wisconsin's lack of a sales tax exemption on nonprofit performing arts tickets, offered by other states including neighbor Minnesota. But the request and now the appeal led to some rather odd interchanges between the symphony's attorneys and tax officials.

Tim Schally, the orchestra's attorney on the case, suggested attending the symphony is more like going to a museum than a basketball game, even comparing the musicians to a utility expense:

"Classical pieces themselves are complex pieces of art," he said. "Playing the music is like turning the lights on at the art museum."

On the other side, the Tax Appeals Commission stressed the entertainment and enjoyment of a symphony event in their 79-page ruling:

"While only a small portion of the general population attends classical symphony concerts, for those who do, it is not unreasonable to assume that the concert is an enjoyable, pleasant and relaxing night of entertainment, often combined with other social activities with friends, such as dinners, social gatherings and drinks," the Appeals Commission ruled. "If concerts were not entertaining, it seems unlikely that so many people would be willing to spend a weekend night or Sunday afternoon to attend."

To make the case a bit more shakey, some tax officials claim that even if the symphony won it's request for around $720,000 plus interest, any refund of past taxes would go to the consumers who purchased the tickets, not the symphony.

Either way, a tax authority and a symphony arguing about whether performances are enjoyable or not: priceless.

Posted by ataylor at 8:21 AM | Comments (6)

January 30, 2007

Wandering elsewhere

I'm crazed with other projects this week, so I won't be blogging. Go off to read another fine ArtsJournal weblog in the meanwhile.

Posted by ataylor at 9:06 AM | Comments (0)

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