Process Still Matters

The 4/6/2009 edition of the Star Tribune published an article by Graydon Royce that examines a recent round of budget and pay cuts at the St. Paul Chamber Orchestra (SPCO). The article reports that the organization’s president indicated that pay cuts for management and staff took place before approaching musicians. This is the same procedure most organizations instituting pay cuts this season have demonstrated and on the surface it sounds fine, but in reality it contains a fundamental procedural flaw…

Intentions notwithstanding, proper process produces better results.
Intentions notwithstanding, proper process produces better results.

The move by SPCO’s president, Sarah Lutman, is on track with recommend concessionary practices (Point # 2, “Stakeholder Parity“) but according to the Star Tribune article, Lutman made a point to indicate that executive and staff cuts were decided and implemented before approaching musicians.

[Lutman] said it was key that management and staff took pay cuts before approaching musicians to do likewise. After that, Lutman said, “There never was any inkling that the musicians would do anything but step forward to help keep us vital and exciting.”

As well intended as this might sound, implementing administrative salary cuts before approaching musicians only serves to reinforce the negative old-school “us against them” mentality. Ultimately, it is just as unfair to middle managers and entry level staffers as it is to the musicians.

The only real exception to this is if immediate management and staff cuts are the only options available to prevent financial impasse, it is better to examine the current state of the institution with all stakeholders and use that collective input to expand the possibilities of uncovering a comprehensive set of options before coming to a mutually agreeable solution.

Fortunately (unless I missed something), the SPCO didn’t follow the dark path that some other organizations have been seduced toward of implementing administrative cuts, announcing those publicly, and then approaching remaining stakeholders. Nonetheless, at best this process is simply good intentions run amok but in the worst of cases, it is a deliberate attempt to limit stakeholder input and institute reactionary strategic visioning.

About Drew McManus

"I hear that every time you show up to work with an orchestra, people get fired." Those were the first words out of an executive's mouth after her board chair introduced us. That executive is now a dear colleague and friend but the day that consulting contract began with her orchestra, she was convinced I was a hatchet-man brought in by the board to clean house.

I understand where the trepidation comes from as a great deal of my consulting and technology provider work for arts organizations involves due diligence, separating fact from fiction, interpreting spin, as well as performance review and oversight. So yes, sometimes that work results in one or two individuals "aggressively embracing career change" but far more often than not, it reinforces and clarifies exactly what works and why.

In short, it doesn't matter if you know where all the bodies are buried if you can't keep your own clients out of the ground, and I'm fortunate enough to say that for more than 15 years, I've done exactly that for groups of all budget size from Qatar to Kathmandu.

For fun, I write a daily blog about the orchestra business, provide a platform for arts insiders to speak their mind, keep track of what people in this business get paid, help write a satirical cartoon about orchestra life, hack the arts, and love a good coffee drink.

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5 thoughts on “Process Still Matters

  1. Hi Drew – thanks for this post, but I have to disagree. It seems to me that the management of the SPCO showed great diplomacy and respect by cutting what they could at the management level before they approached the musicians. This is one of the only recession-induced agreements we’ve seen lately that wasn’t divisive and schismatic. I can’t help but feel that we should be looking at what management did right in this situation and not what they did wrong.

  2. Thanks for the feedback Dave, I don’t about this being the only non divisive or schismatic concessionary agreement. Similar agreements in Cincinnati, Atlanta, and Utah were no different (am I missing anyone?) and in fact, they all followed a similar procedure as the SPCO. But in each of those cases I would say they made the same errors.

    Fortunately, those errors aren’t as harmful to the organization as what we’re seeing at other groups. But I do know that middle managers and staffers in some of the above groups that feel a great deal of resentment over being forced to take cuts before players. Resentment like that can end up manifesting in a number of ways, none of which are particularly healthy.

    If an executive wants to offer a measure of good faith, I would recommend that they – individually – take a voluntary pay cut but leave the remaining non-artistic cuts to take shape during the process I espoused in the piece. Again, unless there is dire economic need to institute other administrative cuts, that’s a better way to go.

    But you’re right, it is good to point out the positive, which is why the piece mentions the beneficial aspect of not using public announcements of administrative cuts as a leverage tool in negotiations with remaining stakeholders (and don’t forget; for some groups, that includes groups like AGMA & IATSE in addition to the orchestra musicians).

  3. I see what you mean, and the top executive(s) taking the first pay cut is good idea. But considering the difference in salary between many executive directors and their orchestra’s base salaries, I would imagine that kind of good faith measure would seem a little superficial to most players.

    I do feel, and perhaps this is just a musician talking, that the actual orchestra is the product of the organization, and altering the product should be the last resort – which is what it seems like the SPCO did in this situation.

  4. I agree, an individual executive taking a pay cut may be perceived by some players as a hollow gesture (certainly not to the exec) but overall, I think most player committees will understand. After all, it certainly beats the exec taking a pay raise while asking for concessions (remember Philly in 2003?).

    I certainly agree that altering the artistic produce should be the option of last resort but the reality is that due to the presence of a CBA, an orchestra can’t simply cut musician compensation at will anyway so it’s mostly a moot point. If cuts are needed to avoid financial impasse, approaching players for concessions with complete institutional transparency and coming up with a plan for the entire organization is more likely to produce a cohesive environment.

    Nonetheless, I have some thoughts about how much – if not all – of the panic and turmoil going on at many organizations can be mitigated and even prevented in future cases. It’s a big plan and something I’m working on in earnest with a few other professionals but more on that later in the month.

  5. Great back and forth here and an important discussion. I agree with Drew, the organization has to unify and move together as a unit with transparency, and movement in any direction done separately is divisive by nature. For instance what if it was the opposite scenario i.e “The management of the XYZ Symphony has given itself a raise, and would consider a raise for the musicians too if wasn’t for their agreement”…that wouldn’t go over well either! The orchestra will want to help in troubled times and should always be called upon to help any situation that will ultimately affect them.

    There is something else here also, it is potentially detrimental to even announce something like this. Nothing scares off sponsors more (both new and those considering renewing) than an orchestra in trouble and with no unified plan to solve a problem. I happen to know of two orchestras who’s senior management have taken pay cuts, but they have neither advertised it, or have even told the musicians specifically because they don’t want to appear to be calling the musicians out. That is how it should be done, otherwise an advertised pay reduction might come across as grandstanding.

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