There are obviously a lot of pros and cons to mergers within performing arts. I am going to take some time to discuss a few of these, relevant to our readings and discussions in class.
To start, it is not always the best idea for a smaller organization to merge with a larger organization. It is easy to get caught up in the idea that a larger organizational merger will be helpful to a smaller organization. Big audience potential, larger marketing outreach, bigger budgets to work with plus more staff potential may all be waved in front of a smaller organization to entice them to merge with a larger organization.
What we learned from the Size Matters article is how important it is that each organization understands their strengths and stability before going into a merger. It is often presented that a smaller organization will be the one benefiting the most from a merger with a larger organization, but that is not always the case. There are also situations where a larger organization is benefitting from a merger with a sound smaller organization with a devoted audience base. Therefore, understanding an organization’s strong suits will help determine whether or not a merger is desirable or necessary as well as what topics are important to each organization to present during the negotiation of restructuring.
This brings me to the importance of understanding what all needs to be considered when a merger is being negotiated. The types of organizations being merged will greatly detail the conversations being had about the restructuring. Is a merger based on sound fiscal analysis? Is there such a cultural difference between the two proposed merging organizations that increased difficulties are being signified for a successful, smooth merger process?
As we learned from the article about the Utah Symphony and Opera merger – there are often more surprises than planned when merging two different types of organizations. The general director of the Utah Opera, Anne Ewers, claimed that she could manage both organizations under a merger and be as successful of a manager and fundraiser for both as she was when only managing the Opera. Discrepancies in how programming of the symphony would be accounted for within the overall budget lead to a severe deficits within the budget of the entire organization. These severe deficits ($ 1.6 M) caused the symphony musicians to be very unhappy with Ewers. In my opinion, it seemed that Ewers did not do enough work to oversee the symphony as an entity, but rather saw them now as a subsidiary of the opera. The symphonic musicians began asking to be treated as a separate entity in regards to marketing and representation – which seems to symbolize weaknesses in a merger.
I think the real take away from this week’s discussion is that mergers are tough. Sometimes they can really save the day for two organizations, but often times they are not thought out well enough in advance and prove to deliver many complications and challenges.
well.. i just scrolled down and saw the original assignment for the blog this week. I had thought, when signing on, that Brett just wanted us to discuss the readings from the week. So that is what I did. I will also try to write another entry about the articles below. Formatting got the best of me. Let's just roll with it for now.
Moving on to the readings assigned for the blog post, I would like to echo on a discussion that Clara Miller was having with Daniel Kertzner from the Rhode Island Foundation about organizational culture. Ms. Miller points out that, “Organizational culture/vision/persona is a critical business requirement. This frequently makes mergers OK from a distance, but problematic up close and personal.“ Directing this thought back to my previous discussion about the US&O, it seemed that Ewers was so accustomed to the Utah Opera’s company culture that she was trying to put the symphony into that realm without attempting to create much of a new culture for the now merged organizations. So, one question I would like to pose is: Are employees of organizations before a merger is formed going to be willing to adapt and accept a new organizational culture or are outside people better suited to steer the ship of a new merger because they will not be working from a biased previous organizational culture?
Also relevant was the note about Loaves & Fishes’s partnership. Perhaps the leaders of Loaves & Fishes had assumed that the larger group they merged with would respect their organizational culture. However, this was not the case. It is important not to assume that organizational culture will be folded into a new merger. Rather, both merging organizations should work to create a new organizational culture that reflects the programming and environment of the new organization without losing (if possible) the elements of each organization’s culture that were valued highly and proved to be efficient before the merger takes place.
I like your comment about mergers creating a new organizational culture. The more I read about these mergers the more I'm convinced that dissolving each organization to create a new, wholly new organization may be a better strategy. What is lost with this method? The chance to combine the goodwill and audience base of the two organizations. What is gained? The chance to create a new entity devoid of the conflict, baggage and turmoil that seems to inevitably accompany mergers. The balance clearly depends on the specifics of the situation, but I think that the choice is rarely as clear as it seems.
Interestingly -- I would say that there is almost no way to maintain a cohesive organization culture with a merger. A take-over yes, but a merger has to honor at least something from both sides. Furthermore, I would say all corporate cultures move and change with each new input, thus a significant change, such as a merger, will bring new people and new values into the system. Ultimately, change will occur and managing that change is the critical step.
I second Kate regarding your thoughts about creating a new organizational culture, and completely agree that dissolving multiple organizations to create a new organization may be a better strategy. I've been trying to find a good example (no luck/internet-less for too long), but it seems like an immense amount of effort can go into combining the goodwill and audience base of two organizations. The communication plan for explaining the reasoning and process and help needed to transition donors and audiences are both major pieces, and not always successful. It seems like the benefits of combining donor bases and audiences can still be captured with well planned branding and language with a new organization. Perhaps I'm missing something/tired.
Great points, Jessie! A merger between two organizations typically doesn't end up resulting in the sum of their parts; compromises, and even sacrifices, must be made across the board.
I also find Kate's point about merging vs. dissolution really valid and fascinating. However, a possible downside of opting to dissolve and starting from scratch is the connotation of the dissolution from a PR/sentiment perspective. The exact organizational reasoning behind any sort of material change like that is hardly reported in media outlets for obvious reasons, and as such, many may view the dissolution as "giving up." It could take a very long time for loyal former audiences of the dissolved organization to trust the new initiative that rises from its ashes, especially if it's under a new brand/moniker. Also, they may not understand the differences between the new organization and the dissolved one, such as in cases where the programming doesn't really change.
This isn't to say that merging is automatically a good or simple solution either, of course. (I'm looking at you, Continental/United...) A tough dilemma indeed.
I think I am for the dissolving if the organization and its mission are unsustainable (perhaps no longer viable for the community or simply not an effective structure or practice to deliver the goods?). Dissolving ANY organization or relationship is difficult, but typically new ideas emerge like a phoenix from the ashes.
I really like everyone's arguments with dissolving and starting from scratch but I also wonder what is lost in this approach. I know it depends on the organization, but when long-term members of an organization leave, will they take some of the information with them? What if this information is integral? One also can't forget the public's attachment to certain workers. I worked for an organization that fired their Director of Sales and it really hurt them. Funders, audiences, and businesses stopped supporting said organization simply because the Director of Sales left. And, based on its size, this really hurt the arts organization. Also, lots of things that the Director of Sales did wasn't known to the rest of the organization and was lost.
I wonder if, in this case, extremes such as dissolving a whole organization or keeping everyone from both organizations are unreasonable. It's finding the middle situation that is so difficult and dependent on the organizations in question.
So Rebecca, I was going to talk about how consultants fit into these sorts of models and your comment also references the idea of a legacy or archive of the institution, as does Michelle's comment.
I always thought the increase in consultants and in this case perhaps the merger (with dissolution) of the previous companies will segment an institution's history. I'm all for doing that, but I feel like it would be at least a little better in the case of dissolution because as Bret said, sometimes you just don't fit in the community any longer or the mission has been fulfilled and you move on to bigger and better things.
I agree with Rebecca--what if a person that is lost in said merger is someone that is unknowingly integral to subscription and donation success within one of the organizations because he/she has, over the past however many years, developed great relationships with a huge number of people? This doesn't only affect fundraising departments, what if that person were working in operations/production? They knew all the good places to get the best deals and had developed relationships with local businesses to the point that even training a new person to go to these same businesses wouldn't get them the same quality of service, let alone price.
This is something that I've been thinking a lot about when an organization looses someone that is integral to the product that the organization is producing. I am thinking particularly of all of the pops programs that had Marvin Hamlisch as their principal pops conductor. How are sales doing? Are the programs and conductors that have been booked to replace those that Marvin was supposed to do met with the same kind of popularity? If they are, is it the same audience? How do we merge the two audiences? The same argument can be made outside of the arts world--take Apple for example. Right after Steve Jobs passed, I remember many asking whether Apple would begin to lose its popularity because Jobs had played an integral role to the "brand" that was showcasing Apple products.
There are obviously a lot of pros and cons to mergers within performing arts. I am going to take some time to discuss a few of these, relevant to our readings and discussions in class.
ReplyDeleteTo start, it is not always the best idea for a smaller organization to merge with a larger organization. It is easy to get caught up in the idea that a larger organizational merger will be helpful to a smaller organization. Big audience potential, larger marketing outreach, bigger budgets to work with plus more staff potential may all be waved in front of a smaller organization to entice them to merge with a larger organization.
What we learned from the Size Matters article is how important it is that each organization understands their strengths and stability before going into a merger. It is often presented that a smaller organization will be the one benefiting the most from a merger with a larger organization, but that is not always the case. There are also situations where a larger organization is benefitting from a merger with a sound smaller organization with a devoted audience base. Therefore, understanding an organization’s strong suits will help determine whether or not a merger is desirable or necessary as well as what topics are important to each organization to present during the negotiation of restructuring.
This brings me to the importance of understanding what all needs to be considered when a merger is being negotiated. The types of organizations being merged will greatly detail the conversations being had about the restructuring. Is a merger based on sound fiscal analysis? Is there such a cultural difference between the two proposed merging organizations that increased difficulties are being signified for a successful, smooth merger process?
As we learned from the article about the Utah Symphony and Opera merger – there are often more surprises than planned when merging two different types of organizations. The general director of the Utah Opera, Anne Ewers, claimed that she could manage both organizations under a merger and be as successful of a manager and fundraiser for both as she was when only managing the Opera. Discrepancies in how programming of the symphony would be accounted for within the overall budget lead to a severe deficits within the budget of the entire organization. These severe deficits ($ 1.6 M) caused the symphony musicians to be very unhappy with Ewers. In my opinion, it seemed that Ewers did not do enough work to oversee the symphony as an entity, but rather saw them now as a subsidiary of the opera. The symphonic musicians began asking to be treated as a separate entity in regards to marketing and representation – which seems to symbolize weaknesses in a merger.
I think the real take away from this week’s discussion is that mergers are tough. Sometimes they can really save the day for two organizations, but often times they are not thought out well enough in advance and prove to deliver many complications and challenges.
well.. i just scrolled down and saw the original assignment for the blog this week. I had thought, when signing on, that Brett just wanted us to discuss the readings from the week. So that is what I did. I will also try to write another entry about the articles below. Formatting got the best of me. Let's just roll with it for now.
ReplyDeleteMoving on to the readings assigned for the blog post, I would like to echo on a discussion that Clara Miller was having with Daniel Kertzner from the Rhode Island Foundation about organizational culture. Ms. Miller points out that, “Organizational culture/vision/persona is a critical business requirement. This frequently makes mergers OK from a distance, but problematic up close and personal.“ Directing this thought back to my previous discussion about the US&O, it seemed that Ewers was so accustomed to the Utah Opera’s company culture that she was trying to put the symphony into that realm without attempting to create much of a new culture for the now merged organizations. So, one question I would like to pose is: Are employees of organizations before a merger is formed going to be willing to adapt and accept a new organizational culture or are outside people better suited to steer the ship of a new merger because they will not be working from a biased previous organizational culture?
ReplyDeleteAlso relevant was the note about Loaves & Fishes’s partnership. Perhaps the leaders of Loaves & Fishes had assumed that the larger group they merged with would respect their organizational culture. However, this was not the case. It is important not to assume that organizational culture will be folded into a new merger. Rather, both merging organizations should work to create a new organizational culture that reflects the programming and environment of the new organization without losing (if possible) the elements of each organization’s culture that were valued highly and proved to be efficient before the merger takes place.
I like your comment about mergers creating a new organizational culture. The more I read about these mergers the more I'm convinced that dissolving each organization to create a new, wholly new organization may be a better strategy. What is lost with this method? The chance to combine the goodwill and audience base of the two organizations. What is gained? The chance to create a new entity devoid of the conflict, baggage and turmoil that seems to inevitably accompany mergers. The balance clearly depends on the specifics of the situation, but I think that the choice is rarely as clear as it seems.
ReplyDeleteInterestingly -- I would say that there is almost no way to maintain a cohesive organization culture with a merger. A take-over yes, but a merger has to honor at least something from both sides. Furthermore, I would say all corporate cultures move and change with each new input, thus a significant change, such as a merger, will bring new people and new values into the system. Ultimately, change will occur and managing that change is the critical step.
DeleteI second Kate regarding your thoughts about creating a new organizational culture, and completely agree that dissolving multiple organizations to create a new organization may be a better strategy. I've been trying to find a good example (no luck/internet-less for too long), but it seems like an immense amount of effort can go into combining the goodwill and audience base of two organizations. The communication plan for explaining the reasoning and process and help needed to transition donors and audiences are both major pieces, and not always successful. It seems like the benefits of combining donor bases and audiences can still be captured with well planned branding and language with a new organization. Perhaps I'm missing something/tired.
ReplyDeleteGreat points, Jessie! A merger between two organizations typically doesn't end up resulting in the sum of their parts; compromises, and even sacrifices, must be made across the board.
ReplyDeleteI also find Kate's point about merging vs. dissolution really valid and fascinating. However, a possible downside of opting to dissolve and starting from scratch is the connotation of the dissolution from a PR/sentiment perspective. The exact organizational reasoning behind any sort of material change like that is hardly reported in media outlets for obvious reasons, and as such, many may view the dissolution as "giving up." It could take a very long time for loyal former audiences of the dissolved organization to trust the new initiative that rises from its ashes, especially if it's under a new brand/moniker. Also, they may not understand the differences between the new organization and the dissolved one, such as in cases where the programming doesn't really change.
This isn't to say that merging is automatically a good or simple solution either, of course. (I'm looking at you, Continental/United...) A tough dilemma indeed.
I think I am for the dissolving if the organization and its mission are unsustainable (perhaps no longer viable for the community or simply not an effective structure or practice to deliver the goods?). Dissolving ANY organization or relationship is difficult, but typically new ideas emerge like a phoenix from the ashes.
DeleteI really like everyone's arguments with dissolving and starting from scratch but I also wonder what is lost in this approach. I know it depends on the organization, but when long-term members of an organization leave, will they take some of the information with them? What if this information is integral? One also can't forget the public's attachment to certain workers. I worked for an organization that fired their Director of Sales and it really hurt them. Funders, audiences, and businesses stopped supporting said organization simply because the Director of Sales left. And, based on its size, this really hurt the arts organization. Also, lots of things that the Director of Sales did wasn't known to the rest of the organization and was lost.
ReplyDeleteI wonder if, in this case, extremes such as dissolving a whole organization or keeping everyone from both organizations are unreasonable. It's finding the middle situation that is so difficult and dependent on the organizations in question.
So Rebecca, I was going to talk about how consultants fit into these sorts of models and your comment also references the idea of a legacy or archive of the institution, as does Michelle's comment.
DeleteI always thought the increase in consultants and in this case perhaps the merger (with dissolution) of the previous companies will segment an institution's history. I'm all for doing that, but I feel like it would be at least a little better in the case of dissolution because as Bret said, sometimes you just don't fit in the community any longer or the mission has been fulfilled and you move on to bigger and better things.
I agree with Rebecca--what if a person that is lost in said merger is someone that is unknowingly integral to subscription and donation success within one of the organizations because he/she has, over the past however many years, developed great relationships with a huge number of people? This doesn't only affect fundraising departments, what if that person were working in operations/production? They knew all the good places to get the best deals and had developed relationships with local businesses to the point that even training a new person to go to these same businesses wouldn't get them the same quality of service, let alone price.
ReplyDeleteThis is something that I've been thinking a lot about when an organization looses someone that is integral to the product that the organization is producing. I am thinking particularly of all of the pops programs that had Marvin Hamlisch as their principal pops conductor. How are sales doing? Are the programs and conductors that have been booked to replace those that Marvin was supposed to do met with the same kind of popularity? If they are, is it the same audience? How do we merge the two audiences? The same argument can be made outside of the arts world--take Apple for example. Right after Steve Jobs passed, I remember many asking whether Apple would begin to lose its popularity because Jobs had played an integral role to the "brand" that was showcasing Apple products.