Midsized organizations are at high risk across the performing arts spectrum. They lack the visibility and prestige that attracts big funders and rainmaker board members. They tend to compete in large markets with larger organizations that can provide corporate funders with more visibility for their funding dollars and allow board members to bask in greater prestige for the same amount of board contribution. Moreover, board service to midsized organizations tends to be far more time and labor intensive. From the foundation sector, midsized organizations are "another mouth to feed." Countless are the times that I have heard corporate and foundation funders make reference to how midsized organizations "take away" funds that they believe would be better spent on a large, "major" organization. Furthermore, it is almost an article of faith among such funders that if there is a major, flagship institution surrounded by midsized "niche" organizations, that the midsized organizations (irrespective of their missions) should improve their situations by some form of consolidation so that the funders would have fewer organizations pestering them for a share of the limited pie.

Interesting perspective.

There are small/midsize dance companies that seem to be doing ok: Lines Ballet, ODC, Diablo Ballet, San Jose Ballet (after some trouble) to name a few in the SF area. I'm sure there are many in the NY metro area as well. So what are they doing differently that makes then successful?

I wouldn't say the news is all bad for mid sized companies, we have quite a few flourishing dance companies in the Eastern Region of the US that fall into the small to mid sized range. I am sure there are quite a few more all across the country but I reside and work mostly in the East.

There ARE advantages to being a smaller sized dance organization just as there ARE advantages to being a larger sized dance organization. Equally, there ARE disadvantages to being a small dance organization and there ARE disadvantages to being a larger dance organization. The successful operation(s) of a dance company are not a matter of scale as the size of an organization does not dictate success, however, the management and leadership of an organization do.

I couldn't agree more.

Dance Theater of Harlem was a big well-funded company that couldn't contain it's spending habits during a lean time mostly because of a lack of clear leadership on its administrative end. It's not that the company didn't have support, it just couldn't adjust when it needed to. It's size had nothing to with it either. It even had a school to help it along as well.

How many people can we name in the management of American dance who have been formally trained for the role?

How many have business degrees?

How many have misapplied business experience to non-profit opportunities?

Why are dance companies classified as "educational public charitable corporations?"

I take no pleasure in having predicted, some years ago, the demise of several companies, including Oakland Ballet about five years ago and Washington Ballet more recently. And some of my predictions are still to happen -- several more companies will close.

My point in bringing this up is that any student of organizational and corporate structure can see with piercing clarity which organizations will cut it and which won't. As Osiris points out, it seems to be about management or more importantly leadership. There are several distinct features of a successful organization and there are also clear cut signs when wrong decisions are made. What is confusing sometimes is that the market and circumstances dictate what is needed -- no one policy can be applied successfully to all companies. However, there are some consistent telltale signs that usually spell doom:

- Larger-than-life egos, especially among key leaders and the board (big personalities are great when things are well but tend to handicap companies when it comes to making tough decisions);

- Too few sources of funding;

- A board recruited by a few people (with not enough diversity);

- Donations earmarked for specific projects to favor the donor (not always bad but if happens chronically can detract from other things the company should be doing -- throwing good money after bad);

- Funds regularly exhausted on payroll instead of having a portion saved for development or other more longterm planning;

- Lack of courage and ability to cut back on lavish productions -- while maintaining quality -- when times get tough;

- Few high-quality dancers augmented by a corps of average dancers;

- Unqualified personnel among non-dance staff;

- And more...

Common sense, isn't it? Can you predict which companies will have problems in the next few years?

Great points Azlan!


Very true and the problem I see is that there is a general lack of individuals within the industry that can recognize and or forsee what kind of structure needs to procured and implement in order to survive within certain circumstances and market ups and downs.


I would say this is one of the LARGEST problems facing most dance organizations to date, especially within the artistic leadership. I can't tell you how many times I have been involved with or heard about artistic leaders that when faced with worst-case-scenario situations i.e. closure/bankruptcy and have maybe one more opportunity to present a program/production to try and stimulate a community's interest, what do they put on the stage? Something nobody wants to see, or something that appeals to a very select audience. You ask them why and most of the time you will hear, "well that is the kind of company that we are, a creative and artistic one." Yeah , but now unfortunately a non-existent one too? Artistic ego can be the best and the worst assett to a dance company. It all depends on the individual and the board's ability to control that individual when foolish decisions are proposed.



One would think

Are US companies managed more badly than European ones? My guess is - no. I believe the difference in the number of closures is due to the the shakiness of the underlying financial position, as compared with their European counterparts and, yes, the ones that are not managed to the highest standards are the ones that will fail.

My initial question was "Is US performance dance still a viable economic sector?" And, of course, it is not a yes/no answer, but it certainly looks as though it has become a lot tougher and when the next downturn in the economy comes and there is a general pulling in of belts in the corporate, public and private sectors, it will sure as heck get even tougher and we could see a LOT of closures.

The extrapolation of this is a US dance scene that has major companies with solid funding from endowment income and the sale of social cache and new, cheaply run small companies flying on a wing and a prayer for a few years, and not much in the middle of the dance sector.

When comparing the European public subsidy model with the US one, I have always been alive to the advantages of the US one in certain areas, but I do wonder whether the wheels are coming off.

We have discussed the different models before:

http://www.ballet-dance.com/forum/viewt ... ht=ireland

To summarise, state spending on the Arts in the UK (with often generous municipality spending on top) is 30 times higher per capita then the US and in one of the most generous European countries, Eire (Ireland), the ratio climbs to 50:1.

Stuart, what exactly do you mean by "Performance Dance"? "Performance Dance" as opposed to what, non-performance dance?? When you say "Ecenomic Sector" are you meaning the entertainment industry? If not, what ecenomic sector would dance fall into? Please pardon the questions but I don't think I am understanding what you mean 100%.

This is simply not true, not all smaller dance organizations are "flying on a wing and a prayer" as you say. Additionally, not all "major" companies enjoy the luxury of solid funding from endowment income, take for instance the present situation with Dance Theatre of Harlem, or, the former Cleveland Ballet, or, Joffrey Ballet when it was in New York City, or the former financial woes of American Ballet Theatre. It doesn't take much to throw the delicate balance of finances for any size dance company into turmoil, large or small.

What exactly are you considering the middle of the dance sector?


This is comparing apples to Oranges here. The individual tax structure, which is where the bulk of the funding for state run arts organizations in the EU comes from is completely different then that of the USA. Citzens of these countries in the EU pay significantly higher taxes to support these types of programs then that of citzens in the US, some would say this is a good thing and some would say not a good thing. How can we compare and contrast the two when the government models are so completely different.

Thanks for all your points, osiris. Taking them one by one:



as opposed to social dance. We used to define CriticalDance using the term.




I intended a focus solely on the financial viability of performance dance.



That's great to hear. My impression is that the small companies in the US have a much tougher time than their counterparts in Europe - acccessibility of grants, free healthcare, heavily subsidised rehearsal space etc etc. I salute those US examples that are on a stable financial basis despite all these disadvantages.



To be fair, I didn't say that all major companies would survive, but it remains my view that the larger companies have more options because of their social cache and the resultant fund raising advantages.

Re "medium", in ballet, it would include the regional companies and in modern/contemporary those companies with 7 to 12 dancers under contract. But if you define it another way, that's fine.



I'm keen to do this, as it is always interesting to learn from other models. European companies can certainly learn from their US counterparts when it comes to raising funds from corporates and private donors. Even William Forsythe in Germany is going down this route now.

However, it is perfectly reasonable in my view to compare the good points and bad points of the various systems - the proof of the pudding is in the eating. For instance, the UK's Northern Ballet Theatre, a medium-sized ballet company of around 35 dancers has around 40-50% state funding and that is defined for the next 3 years, regardless of what happens in the UK economy. That gives a stability that most US companies and their dancers would be very pleased to have, I suspect.

Stuart, thanks for clearing some of that up, I understand what you mean now by Performance Dance.


Indeed, how right you are.

Probably not but some companies are better managed than others. A company -- any company really, for-profit or not-for-profit -- is badly constructed if it relies entirely on the market economy. The well-structured ones are built to weather the storm by having the right collection of people who can take advantage of opportunities when the going is good and make difficult decisions when the going is tough.

A simple example: Bank of America struggled in the wake of banking de-regulation and was finally bought by NationsBank. Yet Wells Fargo, in the same exact banking market, beat the stock market average by leaps and bounds and continues to sustain their performance. Wells Fargo was simply built better.

At this time, I don't see a strong direct correlation between size and survivability of ballet companies. Some of the healthiest companies are the smaller ones while some of the more problematic companies are the bigger ones. In the big companies category, DTH and Cleveland Ballet enjoyed widespread support yet closed while Ballet West remains functional by making tough decisions about their season. In the smaller companies category, Oakland Ballet struggled with city support yet other smaller companies thrived on much smaller budgets.

Companies like SFB, ABT and NYCB weren't always successful financially. They have struggled in the past (at least once, SFB dancers took to the streets to solicit donations) but they reshaped and regrouped. SFB hired the brilliant Arthur Jacobus from PNB as their Executive Director. He built an executive machine at SFB that is among the most effective in the world. Their fundraising dossiers are impressive (however, there are signs that ineffectiveness may be creeping in with new hires after Jacobus' tenure). Kevin McKenzie insisted ABT hire a good executive director as a condition for him taking the position of AD (there have been several EDs since then but that's a different story). In other words, these companies aren't successful because of how big they are. Rather they are big because of how successful they are. They had for the most part the right people helping make the right decisions, i.e. some sort of effective management even if flawed in some areas, and built success upon success through good times and bad.

...And the really well-structured ones take advantage of such opportunities that may be unique to bad times. For example:



After the 1906 San Francisco earthquake, Bank of America (then known as the Bank of Italy) made low-interest loans so people could rebuild -- at a time when others were pulling out of the market altogether and certainly not investing in buildings that could be knocked down by earthquakes. This was once of the reasons San Francisco survived as a major city (4 years later, when a hurricane wiped out Galveston, Texas, there was no equivalent incentive to rebuild and Galveston was soon eclipsed -- almost entirely -- by Houston) and the bank became a colossus.

Yes, exactly.

There also has to be a certain commitment to the employees as well: dancers and admin. When employees feel they are valued and acknowledged, when they feel that they matter, they are much more likely to make sacrifices for the company in lean times.

For instance, when SFB had a very lean year a few years back, the employees were not extended their usual cost-of-living raise, because the Board felt it could not be financially supported. In lieu of the raise, the Board voted (at the suggestion of the administrative executives, I believe) to add 2 holidays and 2 personal days. This did not cost SFB a dime, but the employees felt compensated for their financial sacrifice. They felt valued. As far as I know, ABT has never made this kind of concession to its admin employees which is why their turnover is so high (and expensive).

I've previously mentioned Up the Organization. In it, Townsend talks about two different types of companies (as described by Douglas McGregor): Theory "X" exists for the management and operates under the assumption that people hate to work and must be cajoled, threatened, and coerced into working, and "Theory "Y", which exists for the employees and, through them, the stockholders and management.

Townsend writes:

"You want proof? I can't give it to you. But let me tell you a story. When I became head of Avis I was assured that no one at headquarters was any good, and that my first job was to start recruiting a whole new team. Three years later, Hal Geneen, the President of ITT (which had just acquired Avis), after meeting everybody and listening to them in action for a day, said, 'I've never seen such depth of management; why I've already spotted three chief executive officers!' You guessed it. Same people. I'd brought in only two new people, a lawyer and an accountant."