I’m ready to take a break from the supply/demand discussion, at least for a while.  As I’ve been thinking about it I find that other work I’m doing is refracted through the lens of that discussion. 

One such item is an article that Russell Willis Taylor recommended to me and I’m passing it along to all of you.  It’s called No Big Deal, by Thanassis Cambanis, and was published in January in the Boston Globe.  Cambanis writes about the Columbia University economist Scott Barrett whose research looks at the history of success or failure in resolving large-scale global problems — problems that cannot be solved by the efforts of any single nation.

Barrett’s research shows that modest and incremental efforts have resulted in lasting change in instances where global, comprehensive agreement cannot be reached.   Barrett’s analysis of a century of human problem-solving concludes that holding out for the negotiation of  “grand bargains” is tactically less promising than working on a “piecemeal approach” (Cambanis’ language in quotes).

This roughly parallels my own experiences in implementing change — that little steps add up to big steps, and it’s faster, to boot.  Consistent momentum in small steps is nearly always easier than sweeping change in grand gestures.  People and systems are also less stressed by incremental change than by sweeping change, and we can see the evidence of this in politics, business, nonprofits and in our personal lives.  Neuroscience tells us that the brain experiences change as pain.  The leader’s challenge is bring about the necessary change while being mindful of ways to minimize pain and therefore resistance.  (See The Neuroscience of Leadership by David Rock and Jeffrey Schwartz to read more about this.  The site requires free registration.) 

So, while it is interesting to think about a grand re-drafting of the systems in place that inhibit the fullest expression of the arts and culture, research points us in a different direction.  We will get about the work faster and be met with less resistance if we plunge in and begin the work in little but persistent steps.   If applied to the national conversation we are having about the relevance and vibrancy of the nonprofit cultural sector, we can look to the incremental steps that artists and organizations are taking now that will add up to sweeping change in the coming years.  I would argue that changes in interactivity with audiences, in fresh approaches to community engagement, in the re-thinking of organizational structures, in the use of digital tools, and in the processes of artmaking all are proceeding creatively and effectively within our sector, and that these many small steps are adding up to big change.  Do you see this, too?

The subject of whether there is a supply/demand problem in the nonprofit cultural sector is resonating with a lot of people, and for me it’s caused reflection on what’s changed that’s brought us to this discussion.   And one thing that has changed is funders’ expectations for what constitutes an appropriate grantee.

In the 1970’s and 1980’s there existed a number of intermediary cultural organizations that no longer exist (or exist with a changed mission), some national and some local, whose purpose in part was to provide the organizational structure and legal framework for associations of artists and individual artist’s creative projects to qualify for support from the philanthropic sector – government, foundations, and individuals.   In practice these organizations sought out, approved and then sponsored independent projects so that the artists involved could receive contributed support, and they allowed philanthropists to deduct their gifts by providing a bona fide tax exempt organization as the gift recipient.

I ran one such organization, at the time called Alameda County Neighborhood Arts Program (ACNAP) and then re-named Pro Arts, that provided project management and fiscal agent services for a few dozen small arts organizations and individual artist’s projects in the San Francisco Bay Area. We helped donors and artists, allowing each to take advantage of the management systems and processes that a tax exempt organization requires, but allowing the artists to remain unencumbered by the mini-bureaucracy that is required of a tax-exempt enterprise.

Over time, grantmakers decided that giving through “fiscal agents” (sometimes called “sub-granting”) did not provide adequate management, legal, or fiscal oversight of individual projects, and their guidelines became explicit that such applicants were not eligible for grants.  Another policy that undermined these more-flexible structures is that grantmakers developed rules about giving only one grant per recipient.  So, if you were an organization sponsoring dozens of projects, you would allow only one of them to apply to any given grantmaker.

In essence these guidelines against structural flexibility were public policy decisions made by grantmakers, resulting in each applicant becoming a federally approved tax exempt organization.  These policies also resulted in the expansion in the number of organizations because uniqueness, not collaboration, was rewarded.  Without your own board of directors, management structure, and tax exempt status, you could not be eligible for funding from most grantmakers.

It is exciting to see the way artists and new organizations are now evolving new structures that allow the public and private sector to support culture without creating more cultural institutions.  Innovators like USA Artists, Kickstarter, and Fractured Atlas provide flexible mechanisms for individuals, corporations, foundations, and government to provide support for artists’ projects without requiring that each artist or small organization become a 501(c)(3).  

I suspect that the the majority of vibrant tax exempt cultural organizations today have the capacity to create alliances, mergers, or other associations that would result in new creative bonds and less money spent on management and administration.  What’s needed to encourage this is a broad dialogue about the best structures for creativity, and a willingness on the part of the philanthropic sector to consider how to reward new ways to work.

In a future post I’ll lay out some ideas for how we might reshape our organizational structures and funding relationships based on today’s circumstances.  Please help me by sharing your ideas for how this can be accomplished, or point to successful new models that are already working.

In an interesting turn of events last week, the NEA Chair, Rocco Landesman, echoed the “too much art” refrain that we’ve been hearing lately.   The press quotes varied from this one on the NY Times Arts Beat e-column to this one in the Post.    The Post has him saying, “We’re overbuilt.  We have too many theaters.”   And the Times quote is, “You can either increase demand or decrease supply.  Demand is not going to increase so it’s time to start thinking about decreasing supply.”  

Let’s leave aside for today the thought that the Chair of the NEA apparently said publicly that “demand is not going to increase.”  If I thought that, I could not do my job. But that’s another subject for another day. 

At the moment, the interesting part of Mr. Landesman’s public musings has to do with whether his agency ought to give fewer, larger grants.  Whether or not there is an over-supply of theater, this would be a good idea.  Some of us can remember the days when the NEA awarded 7-figure grants that had a galvanizing impact on local support (remember the Challenge grant program?) and even made local news because NEA grants carried a meaningful (and helpful) imprimatur.  Today, if you’re lucky and you still have a local newspaper with arts coverage, your NEA grant might be listed in a column with a couple dozen other organizations, most of whom receive the same $25,000 – $75,000 (and the SPCO is extremely pleased to be on the list, at an increased funding level, this year).  Meanwhile, the grants process from application to review to reporting is if anything more cumbersome, not less so.  I’m not saying these grants don’t make a difference, they do.  It’s the matter of relative impact I’m considering.  Could the NEA make a greater impact if the agency awarded fewer grants?

Ah, but the difficulty of choosing!  If the NEA decides to give fewer larger grants in the future, they don’t need to look at this process as a sort of death panel — i.e. choosing which organizations will die without them.   What’s needed from the Endowment is to identify which leadership organizations ought to receive (federal) money to do their work – to find those who are thriving in the current chaos and help them succeed even further.  It is not a death sentence for the organizations that don’t receive funding!   Cultural organizations live and die at the local level — we serve a local audience and have local boards and primarily local donors.  Many, many organizations have and will be able to make it without the NEA.

How can the NEA identify leadership organizations?  First, let’s make this an optimistic conversation, one that’s about life (where do we find inspiration?) instead of death (which of us should be euthanized?).  Let’s agree that leadership is about what you are, not about what you aren’t.   And let’s agree that leadership organizations can demonstrate they have an engaged and growing audience, and are dedicated to that being so.  If the NEA is currently funding organizations that are not leaders, then Mr. Landesman’s public soul-searching is understandable.  To change this is within his reach.

Every Sunday’s NY Times Business section includes a special feature on leadership and management in the form of an interview with a business executive.  It’s called  “Corner Office“  and is written by Adam Bryant.  The interviewees are asked about things like what they look for in a person when hiring, how they approach interviewing job candidates, and how they lead their businesses – from a people perspective.   The column is in a Q and A format, and Mr. Bryant does a great job of selecting leaders with different approaches and philosophies.  It’s one of the first things I read in the paper every week. 

This past Sunday the interview was with Robin Domeniconi of the Elle Group.  She called out a quality she said she needs in the teams she leads — and described it as “MRI or Most Respectful Interpretation of what someone’s saying to you.”   It’s a quality of listening and interaction, a state of mind that enables a group to function at a high level because no time is spent distracted by questioning each other’s motives.   MRI is an interesting variation on “assume positive intent” -  an orientation that frees you to focus on listening to one another and getting on with the work . 

Anyone who is part of a team effort knows that teams operate with unique habits, behaviors, ground rules and values, whether spoken or unspoken.   Team leaders can make work more gratifying, efficient, and productive, or more stressful, ineffective, and deflating, depending on the interpersonal environment they strive to create for people who need to work, together.  Thanks, Robin Domeniconi, for giving us a new shorthand – MRI – for thinking about our human interactions in a fresh way.

With the New Year came dozens of media stories about resolutions and how to stick with them.  Two of my favorite were the Oliver Sacks’ Op-Ed in the NY Times (This Year, Change Your Mind) about things you can do (at any age) to strengthen your brain function, and a Wall Street Journal article on the neuroscience of developing new habits by Sue Shellenbarger (How to Keep a Resolution: Forget Willpower, Reaching a Goal Means Retraining Brain to Form New Habits).  Both of these reminded me of the inspiring section in Benjamin Franklin’s autobiography in which he maps the virtues he admires and then shows how he tracks his own virtuous achievements in chart form.  Shellenbarger’s approach is akin to Ben’s – she explains how to reinforce your good efforts and create a reward system for yourself for reaching benchmarks, literally re-training your brain along the way.  Perhaps today Ben would be tracking his progress on his iPhone through some sort of virtue-tracker app, which might rival “Map My Run” or other fitness apps in popularity.

Sacks’ op-ed explains that neuroplasticity  (“the ability to create new pathways”) can be strengthened when we “practice an old skill or learn a new one” and he goes on to report that ordinary people can successfully learn new things (languages, musical instruments) even well into middle age, or older. He says, “Music is an especially powerful shaping force, for listening to and especially playing it engages many different areas of the brain, all of which must work in tandem: from reading musical notation and coordinating fine muscle movements in the hands, to evaluating and expressing rhythm and pitch, to associating music with memories and emotion.”   Sacks asks us to consider whether we are shaped by our brains’ capacities or whether we shape them ourselves through the tasks we give our brains to do. Pair this with Shellenbarger’s piece on how to go about re-training the brain through simple exercises, and it seems that we are more in control than we think of what we can learn and do.

Arts advocates are latching on to the sort of brain research that Sacks writes about — evidence that shows, for example, that playing and listening to music are powerful brain exercises (check out the Dana Foundation’s 2008 report on Arts, Learning and the Brain).  If we are compelled to assign an instrumental value to music I find the neuroscience argument preferable to the economic development argument.  That is, personally I find I’m more comfortable arguing that music helps you develop a brain closer to what’s possible for the species — it broadens your cognitive capacity and your ability to be captivated — than argue that music is good for the economy (though the economic multiplier of arts activity is undeniable).  And because our culture is obsessed with assigning instrumental value to everything from food to taking a walk to singing a song, we may find success in the public sector by pursuing this brain-science argument.

That said, I also resist notions that everything we do must be “good for us” in order to be valued.  Does every New Year’s resolution have to be linked to self-improvement?  Or would it be possible to resolve to learn a musical instrument or listen to more music just because it seems interesting, not because we are trying to reform or improve ourselves?  Are music and the arts truly served if arts education becomes the vegetable on our plate?  Our version of spinach, for the brain?

I’m grateful that neuroscientists are documenting the ways the arts are “good for you” and for your brain, and I hope that more people include something arts-related in their New Year’s resolutions.  I expect that if we all read more books, play more music, join more community theaters, and write more poetry, 2011 will be a more interesting and memorable year for each of us.  Turns out our brains will be better off, too.

Lately I’ve been thinking about how to encourage charitable giving without evoking the tax deductibility of gifts as a benefit.  Why? As government looks for ways to balance its books, both revenue and tax code simplification proposals are being widely debated among policymakers and the press.  Among these are proposals to terminate both the mortgage interest deduction and the charitable gift deduction.  For example, an article in last week’s New York Times by University of Chicago economist Richard Thaler (“It’s Time to Rethink the Charity Deduction”) outlined the benefits of ending the charitable deduction as part of series of policy changes that he believes would make our tax system more equitable.  An earlier Times’ story (“Nonprofits Fear Losing Tax Benefit”) cited an estimate of the “tax cost” of the charitable deduction as between $237 billion between 2009 and 2013 and reported on ways the tax code might change based on recommendations of three different “blue ribbon” policy panels.

Would ending the deductibility of charitable gifts have an immediate chilling effect on individual philanthropy?  Perhaps not, although this will be hotly argued, and I admit I don’t relish the opportunity to find out first-hand, particularly in an already turbulent fund-raising environment!   But I believe donors’ primary motivation for support is belief in an organization’s mission, respect for its results, and trust in its stewardship of resources.  The deductibility of a gift is an ancillary benefit, not a primary one. 

Still, our own behavior can affect how donors’ perceptions are shaped, based on how we seek, value, use, and report on their gifts. For example, I cringe when I see cultural nonprofits over-emphasize “perks” when a particular gift level is reached (i.e. for a gift of a particular size, we will provide you with a variety of personal benefits).  This approach risks turning a gift into a transaction; the quid pro quo is not the good work the organization will do with the donor’s gift, but rather the individual benefit to the contributor. 

Tax deduction or none, I think the best way to encourage donors to contribute is to consistently describe the community benefit of our work, to ask donors to join in helping us make our communities more interesting, more inspiring, and more energizing places to live because of the arts.   We can help donors understand that without individual support most cultural organizations would fail in short order, as earned income coupled with government, foundation, and corporate support is insufficient to sustain a robust cultural sector.

We may get a chance to see what it’s like to raise money in a dramatically changed tax policy environment.  Thinking about how we should position ourselves for this change – now – can strengthen our case for support and help prepare for uncertainty regarding the future deductibility of charitable gifts.

For the past few months, the SPCO has been experimenting with on-line coupons to reach new audiences.   This is part of our multi-year plan to expand our audience using non-traditional and grassroots methods.  We give more than 100 classical music concerts each year in ten locations around the Twin Cities.  Just about half our concerts are performed at the Ordway Center in downtown St Paul; the remainder are in surrounding communities, including Minneapolis.  One hundred concerts translates to a lot of tickets, and our goal is full houses for every single concert.  We are especially eager to fill unsold seats with new audiences, and so we have been trying many different ideas to learn what works for us.

Last week we had some interesting results with a (not Groupon) online coupon offer, which seems especially timely because of the news stories last week about Google and Groupon (click here for the NY Times’ Freakonomics blog entry, “Why Groupon works.” )  Here’s some history.  In May 2010 we had our first on-line coupon venture through Groupon, and sold about 80 coupons for a specific concert last season (of which 60 were actually redeemed for tickets).  Our next test was through Travelzoo.  In October, we offered an inexpensive two-concert “flex pack” for the current season, and sold  more than 500 of them — a very good result (we won’t know the redemption for a while since the passes are good for a few more months).    But then last week we had an even more fun experience.  We offered a season pass for Thursday and Friday night concerts for the rest of this season through Living Social, and sold more than 1400 passes — an amazing number for a one-day sale!

It will take some time to see how many coupon purchasers redeem their coupons for tickets, how many purchasers turn out to be new to our audience database, and how many attend again without the benefit of a coupon.   We know now that short-term, we are seeing a significant gain in new audiences through these and other non-traditional and grassroots methods.

Media reports about the public’s waning interest in classical music concerts would do well to more carefully examine what’s being done to lower or remove barriers to attendance.  Our work is showing us that when concerts are accessible and affordable, more people will attend, and more frequently.  Of course it starts with giving memorable, riveting concerts, otherwise new audiences will not return!  We have our SPCO musicians to thank for their exciting performances that give new audiences plenty of reason to look forward to their next SPCO concert.

If you are having good results from online coupons it would be interesting to hear about it.

When you go to the Grantmakers in the Arts website you can read two documents there that provide deep background on a conversation GIA members are having about trends in their work and how their grants shape the financial and artistic vitality of the nonprofit cultural sector.  The reports posted there are the result of a literature review and then meetings to discuss capitalization in the nonprofit arts sector (and lack thereof).

The funders’ group asserts that a) arts and cultural organizations are undercapitalized which “leads us to be concerned about their sustainability and the financial health of the sector as a whole, and that persistent uncapitalization has the strong potential to erode artistic vision and quality” and b) that “there is an oversupply of product in some marketplaces, and that current funding practices do not address this issue”  (emphasis mine).

I have been thinking about this premise ever since I read the report earlier in the fall,  trying to understand what funders really mean when they say there is an oversupply of product.  Surely there is no such thing as too much art? I think what funders mean is that there are too many applicants, so they need to re-think their funding criteria.   They’re telling us that there are a lot of organizations, some are losing audience, are financially weak, or are no longer artistically vibrant, and they can’t fund all of us or even as many of us as they used to fund.

I think it is good for funders to make bigger bets on their grantees and I hope this is an outcome of the report.  Grant size is static.  For example, the median size of an arts grant is $25,000 according to the Foundation Center, and has not changed since 1993.  Meanwhile the cost of living has gone up about 50 percent from 1993 – 2010, meaning that an organization spends around $37,000 now to get the results that $25,000 bought in 1993 (I used the American Institute for Economic Research calculator for this.)  Many foundations had a funding cap of $1 million back going as far back as the 1980’s, and in many cases their maximum has not changed.

Beyond this, if an organization is artistically stagnant, losing significant audience, financially undisciplined or unsound, or irrelevant in its community, funders could do something else — they could just say no.  That in and of itself would be a service to the field.

In an email message last Wednesday, The Bush Foundation announced the end of its existing Fellowship programs, including the Bush Artist Fellowships,  and the beginning of a new, single program which will be called the Bush Fellowship Program.  The new program’s aim is to “help people increase their capacity to work with others to improve their communities.”  Guidelines will be released December 1st.

It’s interesting to look back on the Foundation’s Artist Fellowship guidelines and wonder who in our current professional philanthropic sector would launch such an artist support program today.  The program was designed “to enable selected artists to devote concentrated time to their work and to increase the quality and pace of their artistic and career development, ”  and was part of the Foundation’s overall aim “to establish and sustain an environment in which the arts can flourish.”  An artist could use the Fellowship in many ways, “To engage in solitary work or reflection, for collaborative or community projects, or for travel or research.”  Through a detailed application process, panels composed principally of working artists reviewed first preliminary and then final applications from several hundred artists per year.  Final evaluation always included review of original work (actual paintings, for example, rather than slides of paintings).   Artists selected (15 each year) received stipends of $50,000 (the amount of the fellowships increased over time).   Panelists — all from outside the grantmaking region — also were well compensated for reviewing work samples and coming to St Paul to discuss applicants and select Fellows.   Artists in Minnesota, North Dakota, South Dakota, and certain counties in western Wisconsin, were eligible to apply.

I worked at the Foundation from 1990-1999 and so my observations are biased.  Here are some noteworthy things about the program that I remember.

– The Foundation’s internal evaluation process was sufficiently rigorous that regular evaluation studies were completed every few years to document and assess the impact of the Fellowships on both the individual recipients and on the broader community.  These evaluation reports were widely disseminated and were influential in convincing other private foundations and public arts entities to establish artist support programs throughout the 1980’s and 1990’s.   In these studies, artists repeatedly cited the life-changing impact the Fellowship had on their work; the reports detail rich, personal stories of how the fellowship time period was associated with generative changes in artists’ work, and they presented data about Fellows’ increased ability to support themselves through art making.   As our field struggles with ways to document the impact of philanthropic dollars spent, these studies are well worth revisiting.

– The panel process was comprehensive.  Panels met for multiple days and had ample time to read aloud, view films, and otherwise deeply consider the work at hand.  Within these panel meetings, vocabularies and perceptions were expanded as we worked to find words to talk about what we were seeing, reading, and  hearing.  Lifelong friendships were formed, cross-pollination occurred, and careers were advanced, just through the selection process.

– The program had a documented effect on artists staying in the region and calling this place home.  It helped establish the Twin Cities’ area, in particular, as a creative hotbed and a place where artists’ contributions were valued.

– Over many years the list of artists who’ve received Fellowships includes many who’ve gone on to be recognized through all manner of other awards and prizes.  In no particular order, Fellows included August Wilson, Patricia Hampl,  Jim Moore, Joann Verburg, Tom McGrath, Louis Jenkins, Lee Blessing, Kevin Kling, William Kent Krueger, Libby Larsen, Bart Schneider, Kathleen Norris, Wing Young Huie, Alec Soth, and so many, many artists who are nationally recognized and identified with this particular place.

The Bush Foundation has taken an instrumentalist turn with respect to its grantmaking in the cultural sector, focusing its efforts and dollars on large regional problems it is trying to solve, or at least make a dent in, over a ten-year period.  In the context of its new strategic plan the Foundation is looking for Fellows whose work aligns with its own.  If Bush sticks with this program for 35 years, as they have with the Artist Fellowship Program, I hope they have something with as significant and lasting a value as what the Artist Fellowships Program have had over time.  In the meantime, it’s good to pause and reflect on what a terrific and long-term commitment the Foundation’s Board once made to the cultural sector and to individual artists, and the difference their grants made to so many of us whose lives are enriched by the work of Bush Artist Fellows.

Every week or so I get a push email from Mark Hurst at Good Experience with some of his ruminations and observations. Mark’s interest is in “what enables or detracts from meaningful experiences of creativity, technology, community, and life.”   If you look at the Good Experience job board you’ll see that most of the postings are related to e-commerce and other software applications where “user experience” has a specific meaning.  But it turns out once you start thinking about user experience it carries over into all manner of experiences that call out for consideration and critique, from product design to in-store experiences to artistic experiences, and so the website covers all of these things.

If you want to get a sense of the scope of the work, check out the videos from past GEL conferences (GEL= Good Experience Live), an annual event in New York.  You’ll see a mix of talks by designers, artists, writers, and entrepreneurs.  The conference schedule includes experiences that are exemplary and memorable and make the participants get up and do stuff, like learning to juggle with the Flying Karamazov Brothers, taking a “Sound Walk” in Central Park with Doug Quin, or  going on culture and tasting walks through New York City neighborhoods.   To get a sense of how some people outside the cultural sector think about experiences, try physician Brigid Duffy on the experience of being a patient; or Sal Khan on creating engaging educational videos that students want to use;  or Natasha Schull on how the gambling industry creates experiences for its customers.