Performing Arts Management

A Handbook of Professional Practices

Jessica Rae Bathurst, Tobie S. Stein

• Publisher: Allworth
• Year: 2010
• ISBN:
  9781581157536
• Topic: Media & Performing Arts
• Subtopic: Performing Arts & Business

Do you know what it takes to manage a performing arts organization today? In this comprehensive volume, more than 100 managers of top nonprofit and commercial venues share their winning strategies.
* Financial management, building a funding base, labor relations, much more
* Explores the realities of running a performing arts organization todayFrom theater to classical music, from opera to dance, every type of organization is included, with information on how each one is structured, key managerial figures, its best-practices for financial management, how it handles labor relations, and more. Kennedy Center, the Brooklyn Academy of Music, Lincoln Center, the Mark Morris Dance Company, the New Victory Theater, the Roundabout Theater, the Guthrie Theater, Steppenwolf Theater Company, and many other top groups are represented. Learn to manage a performing arts group successfully in today's rapidly changing cultural environment with Performing Arts Management.

CHAPTER ONE

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Organizational Structures and Managerial Positions

Performing arts managers lead and manage theaters, symphony orchestras, performing arts centers, opera companies, dance and ballet companies, festivals, and everything in between. Some managers produce or present performing arts events as nonprofit organizations, while others have selected the for-profit model. A nonprofit organization is defined by its public purpose; if an organization is created to serve the public, that organization is eligible for nonprofit tax-exempt status from the federal government, exempting it from the bulk of taxes.¹ The for-profit, or commercial, model does not need to serve a public purpose (although it may), but focuses on earning profit (income exceeding expenses) as its main goal. The nonprofit organization cannot have a profit-making purpose and must put all money earned over expenses back into the organization to serve its public purpose.

In this chapter, we will explore the nonprofit and commercial performing arts management sectors, focusing on the differences and similarities between the sectors, as well as their organizational types, organizational structures, and managerial positions. Managers from both sectors comment on the ways in which the differences are becoming less evident, and the extent to which the sectors, as well as organizations within the sectors, are working together.²

In the next section, we will discuss the differences and similarities between the nonprofit and commercial performing arts sectors concerning goals, artistic process, legal structures and governance, and budgeting methods.

GOALS

Nonprofit organizational goals are defined by the mission, which is the public purpose of the organization.³ The mission is the guiding principle of the organization. A goal is the desired result that an organization strives to attain. The mission of the organization can encompass a number of goals, including: producing or programming performances or series of performances as an ongoing concern; creating educational activities, ranging from professional training to exploration of the arts; creating programs for local schools, seniors, and patrons; and raising money to support the renovation of existing facilities, construction of a new facility, and ongoing operational support. Each of these goals serves the mission of the nonprofit organization.

As part of their mission, nonprofit theater organizations, such as Ford’s Theatre in Washington, D.C., and the Guthrie Theater in Minneapolis, Minnesota, produce plays to serve the community. Nonprofit dance and ballet companies, such as the Bill T. Jones/Arnie Zane Dance Company and the San Francisco Ballet serve their respective missions through activities such as producing New York premieres for the Lincoln Center Festival (a festival presented by the Lincoln Center for the Performing Arts). All of these organizations are nonprofit organizations.

Additionally, the Guthrie Theater, Ford’s Theatre, the Bill T. Jones/Arnie Zane Dance Company, and the San Francisco Ballet are producing organizations. They create or produce their own productions from scratch; they select the piece to be performed, as well as the performers (dancers, actors, musicians, singers), designers, composers, directors, choreographers, and so forth. They create and rehearse the physical production. A producing organization will then perform the play, dance, or opera in one of its venues or in a venue it rents for that particular show for a specified run.⁴

In contrast, the Lincoln Center for the Performing Arts is a nonprofit presenting organization. “Presenting organizations purchase a series of prepackaged [preproduced] events (both commercial and nonprofit) to appear before their local communities for a specified run. Events are ‘purchased’ directly or indirectly through a booking agent; the booking agent sells an attraction to a presenter and negotiates the terms of the engagement. Presenters pay the costs needed to present the show, including performance fees, transportation, freight, hotel, etc. Presenters typically do not directly pay any costs associated with the creation of the production (e.g., design fees, scenery construction, rehearsal costs).”⁵ The Brooklyn Academy of Music in Brooklyn, New York; Playhouse Square Center in Cleveland, Ohio; and Ruth Eckerd Hall in Clearwater, Florida, are examples of nonprofit presenting organizations. Some nonprofit presenting organizations also produce work, and some nonprofit producing organizations may present performances.

Commercial producers organize the project (known as the “property”), find investors who put up the money for it, and either manage the project or, most frequently, hire a general manager to manage it. Commercial productions have very different goals from nonprofit organizations. “A commercial production’s primary intent is to return a profit to its investors [individuals who invest money into a production, who expect to have their investment returned],” states Harold Wolpert, managing director of the Roundabout Theatre Company, a nonprofit producing theater. “It’s not just to put a show on that people will like. It’s to put a show on that actually will make money back for the people who put money in.”⁶ Tom Proehl, executive director of the Minnesota State Arts Board and former managing director of the Guthrie Theater, elaborates, “The commercial theater’s main purpose is to make money through the exploitation of a single property (play or musical). The production is supported and funded by investors, and investors are generally looking for a return on their investment. For instance, if a play gets awful reviews on Broadway, and tickets are not selling, the investors will generally close the show to cut their losses. However, if it is a hit, the show will run for as long as possible in order to return the highest profit to the investors.” Proehl notes that investors in the long-running commercial productions of Cats, Wicked, and The Phantom of the Opera have received a huge return on their original investment.⁷ Sean Patrick Flahaven, managing director of the Melting Pot Theatre, a small Off-Broadway nonprofit producing theater, adds: “The goals of the commercial venture are to first pay back its investors, then make a profit, and then make something with artistic integrity.”⁸

Commercial producer Tom Viertel (Hairspray, The Producers) illustrates the difference between nonprofit and commercial theater: “Commercial theater requires productions to make a profit, to actually have the shows work out economically so that the show standing by itself is a successful, profitable entity, rather than the theater as a whole being a profitable entity. I work on both sides of the fence, because I’m the chairman of the board at the Eugene O’Neill Theater, which is a nonprofit theater in Connecticut. At the O’Neill, the theater’s budget encompasses a lot of different activities, including production workshops and the school that we run. Every budget for a nonprofit theater has a lot of elements to it; income from ticket sales is one element of the budget, but it’s only one part of how a nonprofit theater stays alive. It’s also funded to a significant extent by contributions from individuals, foundations, and the government. In commercial theater, ticket income for a show has to stand on its own. As a commercial producer, each of the shows that I do represents a significant set of potential income streams for me, and so as an economic matter, I need to make sure that each of those shows is successful in terms of ticket sales. From a nonprofit theater’s point of view, it expects to put on a season, and it knows that the shows in that season will come to an end. (The shows have to come to an end, or the theater won’t have a place to put the next show in.) The purpose of a nonprofit theater is to produce a range of shows in order to satisfy a subscription audience that is expecting anywhere from five to eleven or twelve productions in the course of a year. In those circumstances, you approach each production with a great deal less desperation about the individual production. You’re more concerned with making sure that it moves along through the production process, so that it can have its time in the theater, and then the next show can take its place. That’s a completely different mindset from a commercial producer, who tends to approach individual shows as if they were life-and-death matters, because if these projects don’t work, the shows are quickly out of business. If the production isn’t successful, it represents no opportunity for a continuing sustained income at all, and the commercial producer has to start over with a new show.”⁹

So when Richard Frankel Productions, a commercial producer, produces a successful show and makes money from one of its properties—such as The Producers or Hairspray—it will distribute this money to its investors, first as repayment of their investment, and then as profit. The producers will receive part of the profit once the investors are paid back. In contrast, while nonprofit organizations can earn a profit (called a “surplus”), they must reinvest the surplus into the organization to support their nonprofit activities, such as producing opera or presenting performances. No individual in a nonprofit organization may benefit directly from the profits of the organization.

Another way for a producer to earn a profit is to tour a production. (A tour is a production that moves from one location to another.) If a producer chooses to tour a commercial attraction, he will engage a for-profit booking and touring company, such as On the Road, to create a profitable tour for the play or event. The booking and touring organization will book the event in theaters throughout the country by working with presenting organizations to present the tour. As both the commercial producer and for-profit booking and touring company are organized to make a profit, their participating principals (e.g., producers and investors) are allowed to benefit. Also, some presenters operate as for-profit entities; these commercial presenters program or book a series of events or a season to make a profit. If a commercial presenter, such as the Fox Theatre in St. Louis, Missouri, makes a profit, the presenter will keep that profit. However, as noted previously, if a nonprofit presenter makes money on the touring event, the profits must be redistributed within the organization to fund presenting activities.

CLASSROOM DISCUSSION

How are nonprofit goals defined? What are some examples of nonprofit goals?

What is a nonprofit presenting organization? Give some examples.

What is a nonprofit producing organization? Give some examples.

If a nonprofit organization earns a profit, what must it do?

What is the goal of a for-profit performing arts organization?

What are investors?

What is the role of a commercial producer?

What is the role of a commercial booking and touring organization?

How does a commercial presenter differ from a nonprofit presenter?

THE ARTI...