How Realistic Are Your Budget Projections?

It’s not exactly earth shattering to say that budget projections are a squishy dark art (at best). But some of what I hear from colleagues on the earned income side of budget projections has been fascinating when it comes to the 22/23 season.

While some are still embracing what I would consider a prudent approach of not having anywhere near enough data to accurately predict sales, I hear from others about pressure from the executive leadership level to include projections that go far beyond reasonable expectations.

While data on ticket buyer habits coming out of the pandemic is still thin, one thing seems clear: we aren’t even close to pre-pandemic levels of earned income predictability. agendas notwithstanding, that’s why downward pressure seems so odd.

I’ve been chatting with colleagues that attended the League conference and based on those voices, it doesn’t seem like this topic garnered much airtime outside of a few instances that occurred during closed constituent meetings. Even then, those discussions apparently focused more on “let’s get real” conversations rather than acknowledge the potential harm that comes from unrealistic projections.

If I had to give advice on this topic to large donors, funders, musicians, and patron groups it would focus on making sure there’s transparency about those projections and what sorts of contingency plans are in place if actual revenue falls short (spoiler: panic driven cuts are not a plan).

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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