Memphis Closes Annual Deficit Shortfall But Still Cagy About 2014/15

A handful of traditional media outlets are reporting that the Memphis Symphony Orchestra (MSO) has apparently raised enough bridge funding to make it to the end of the current season but there is no word on what is planned for 2014/15. Likewise, there is no word on what sorts of adjustments may be made to the remaining season’s programs.

ADAPTISTRATION-GUY-037Although the MSO has yet to publish a public statement detailing the recent fundraising results, the 3/17/2014 edition of the Memphis Business Journal published an article that reports the bridge funding consists of a pair of $100,000 donations and an undisclosed amount of revenue from fundraising concert events.

An Associated Press report quotes MSO CEO and President Roland Valliere saying that the organization won’t release any information about next season until after they’ve developed a new financial model.

“…we won’t make a formal announcement about next season until we align our expenses with revenue to come up with a financial model that is sustainable.”

Between now and then, the organization has a collective bargaining agreement to negotiate and a season’s worth of programming to plan.

If this seems like a chicken or the egg conundrum, you’re on the right track.

For more than half a century, professional orchestras have crafted annual budgets based in large part on a series of variables; one of those being the labor expense for contracted musicians as defined by a collective bargaining agreement that defines wages and any benefits over a period of one or more years.

Consequently, unless the musicians agree to a radical reversal in this relationship and agree to work under a business model that determines any given season’s pay based almost exclusively on previous season’s revenues, the organization may find itself amidst what might be best defined as a strategic planning paradox.

Nonetheless, given the organization’s penchant for caginess, don’t expect strategic details anytime soon. Likewise, the MSO’s recent decade of labor relations suggests that whatever may paradox emerge, it won’t likely rise to the level of a public stakeholder struggle.

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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6 thoughts on “Memphis Closes Annual Deficit Shortfall But Still Cagy About 2014/15”

  1. It’s quite a paradigm shift you’ve referred to, Drew. Tying next year’s pay to this year’s bottom line on an annual basis is quite common for start-up companies, but musicians who move to a city to be part of its orchestra generally want a little more certainty about their prospective paychecks. I can’t see wanting to move somewhere with the potential of telling my kid, “sorry, we can’t let you do sports or have music lessons this year. Marketing and Development have had a rough go.”

    • No arguments there not to mention such an arrangement would have a profound impact on maximizing potential. But the language used by Valliere is indicative of what I believe you’re referencing when you mentioned a start-up perspective (but correct me if I’m wrong). If we think back to Honolulu, this was the model being proposed that the musicians ultimately rejected and in return, the old institution liquidated and a new institution is now in the process of emerging from that shut down.

      As such, I’m very interested in seeing what transpires at Memphis; it won’t likely have the sorts of labor dispute fireworks that are commonplace nowadays but it shouldn’t be surprising to anyone if this sort of proposal makes its way into the mix (regardless the eventual outcome).

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