This post is a reprint of the most recent ArtsManaged Field Notes, a weekly email I send every Tuesday morning on the process and practice of Arts Management. Subscribe to get future editions!
Beauty – be not caused – It Is –
Emily Dickinson
Chase it, and it ceases –
Chase it not, and it abides
Weekly Features (scroll down to find them)
Function of the Week: Accounting | Framework of the Week: The Iron Triangle
Questions? Ask ArtsManaged
Dear Reader,
One of the main takeaways from the classic in-depth case study of Steppenwolf Theater by Tony Proscio and Clara Miller is that “self-sufficiency, sustainability, and success pull in different directions.” This tension is a constant balance and bother for arts managers who want to play the long game.
Start-up arts initiatives – like early-days Steppenwolf – are often scrappy and small, fueled by passion, purpose, and coffee more than direct financial expense. As one early Steppenwolf board member describes it, “the board consisted of the people who loaned them kitchen chairs.” Such groups are self-sufficent (in the short term) because they are willing to work long hours for little pay and few resources to take big creative risks.
But as these start-ups find their feet, build their audience, grow their budget, and even build or buy their own real estate, scrappiness gives way to sustainability and scalability. This creates internal pressure to staff up and pay more, and external expectations from current or potential donors to do the same.
As the case puts it about Steppenwolf’s growth:
From the borrowed kitchen chairs to the volunteer staff to the actors running the box-office to the smaller theaters’ lower-wage union contracts – all these things were economical, but for Steppenwolf, as for most enterprises, they were not sustainable. The company, as it grew, didn’t merely need a bigger building, it needed a bigger, richer operation. And its artists and supporters needed sustainable lives, which could not involve uncompensated 15-hour work days forever.
Managing an arts organization, especially during growth, is a matter of balancing three interdependent forces at once: vision/ambition, operations/team capacity, and capital structure (real estate, cash, investments, and equipment). In another article, the Nonprofit Finance Fund called this pyramid the Iron Triangle.
Because the three sides are entirely entangled, a rising artistic vision will demand more robust operations and capital capacity. In turn, higher annual expenses and the carrying costs of more stuff (like buildings) will put pressure on artistic vision – toward less risk, more planning, and more predictability. These forces tend to pull against each other. So, arts managers work across the full array of participants to encourage a dance rather than a derailment.
Winston Churchill famously claimed that “We shape our buildings, and afterwards our buildings shape us” – suggesting that the durable systems we construct have a durable impact on what we do. Chasing beauty while bolstering capacity is a dynamic example of how Arts Management shapes, and is shaped by, the creative journey.
Andrew
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Function of the Week: Accounting
Accounting involves recording, summarizing, analyzing, and reporting financial states and actions. And while some believe it to be the opposite of creative effort, it is an essential component of vibrancy and thriving in creative practice.
Just like a potter needs to know the nature of clay, and a choreographer needs to know the nuance of muscles and motion, an arts manager needs to know how to observe, record, organize, and analyze the flow of financial value through their organization.
Framework of the Week: The Iron Triangle
The “iron triangle” describes the dynamic relationship within any complex nonprofit endeavor between its mission and program, its organizational capacity, and its capital structure. Described by Clara Miller in 2001, the iron triangle suggests that growth or change in any one of these areas will necessarily drive (or demand) change in the other two.
Have a Question? Ask ArtsManaged
Do you have a puzzle, problem, or persistant concern about Arts Management? Post your question to this online and anonymous form. I’ll select questions to answer in the Field Guide, or in this newsletter, so that we can all learn together about the real-world messes we face.
