Mission, Models, Money – Towards a healthier arts and cultural ecology

For the past two years Mission Models Money, a national action research programme and campaign for change, has been addressing the challenges faced by individual arts and cultural organisations (A&COs) and their funders in developing mission-led organisationally and financially sustainable businesses. The accumulated evidence highlights many issues that are already well known and some that have barely begun to be understood. The headlines make for uncomfortable reading yet show an appetite for radical change.

Surviving, not thriving

Technological advances, increasing global interconnectedness and shifting public interest and consumer behaviour mean the sector is facing major, permanent structural change. Hundreds of non-profit A&COs, critical to both the historical and contemporary cultural canon, are over-extended and under-capitalised. Often with high fixed costs they are increasingly dependent on annual public sector grants to survive as patterns in attendance and earned and fundraised income from the private sector change. This scenario, whilst allowing survival, offers very little scope for the fundamental transformation of organisations into responsive, adaptive, sustainable, mission-led businesses delivering cultural excellence to a wider general public. Given the rapidly accelerating change in the external environment, this ability to transform has never been so essential.

Technology laggards

Many A&COs are being too slow at responding effectively to the rapidly changing external environment, especially the shifts in the way the wider public are engaging with cultural experiences and threats and opportunities brought about by new technology.

Often small scale and under-capitalised, they have insufficient resources to develop and implement an effective technology strategy. As a result they are unable to meet the high costs of gaining access to new delivery platforms to innovate and develop new services. They also tend to be poorly informed of changes in technology, which are happening at an increasingly rapid pace, making it difficult for them to respond quickly and effectively to the changes in market conditions and new business opportunities brought by these changes. Given that the strategic understanding and exploitation of technology innovation is an increasingly important factor in their future viability, it is vital now to bridge the communication and research and development divide between A&COs and the technology sectors, and enable them to drive, develop and exploit the potential of new technologies.

Knowledge ability

There are significant knowledge gaps in key areas that could help some organisations achieve greater sustainability. Relatively few are familiar with methods of financing which extend beyond the mainstays of grants, fundraising, ticket sales and other earned income, or alternative legal structures and business models that may offer a better environment for the delivery of mission, or the role that new technology could play both in back office functions and front of house. Some core competencies that relate to the existing modus operandi, such as governance of a traditional charity model, need serious attention across the sector. Outside the relatively well-resourced albeit small number of super tankers who ply the sectors seas and reign our commanding heights, there are major capability issues in key areas such as finance, fundraising and the increasingly diverse and complex world of audience and community engagement. And it is not just in existing frameworks of competence that we need to make a step change. As Graham Leicester(1) points out, we need to develop new competencies to manage the increasing complexity and rapidly accelerating change of our world.

Re-calibrating misalignments

It is by no means only A&COs that face challenges of responding to change faster and driving up performance. The original missions, roles and structures of the dominant public funding agencies and some intermediary organisations may not be best suited to the cultural and political realities of our time and there is still an insufficiently challenging public conversation about the infrastructure and funding environment currently supporting the arts. Recent papers by John Knell, and Margaret Bolton and David Carrington(2) are attempting to raise the temperature around this.

There is a plethora of publicly funded business development support on offer in most regions, largely focusing on sole trader, start-up or commercial creative industries, but not so much on the business development needs of mature non- profit A&COs. Quality issues are being raised and there is confusion about whats on offer. Questions about whether primary public funders should be the ones to deliver capacity building support are being asked, and preferences are being expressed for access to non-partisan sources. Publicly funded agencies charged with capacity building or acting as intermediaries are not responding to the task fast enough, nor are they employing the people with the right skills and competencies to do it.

Structural tensions

New hybrid business models are emerging, demonstrated by a growth in the number of freelancers, facilitators, networkers and producers, but these are not easily corralled into the forms most often required for recognition by the infrastructure agencies and funding communities, who continue to take the view that non-profit institutions should be the major beneficiaries of public support. A broader array of institutional and non-institutional forms could provide wider access and help build universal recognition of the value of arts and culture among diverse publics, but there is currently too much concentration by funders on support for traditional structures. Churchill said, We shape our buildings, and afterwards our buildings shape us. In the same way, our organisational structures and our financial structures influence our behaviour, as do our mind-sets. Cultural policy itself defines structures that discourage or encourage certain behaviours and the ecology of funding has a profound effect on the ecology of the arts.

Jim Collins(3) observes that one of the traits that enables good companies to face adversity and transcend into great companies is the capacity of its management team to stoically face the brutal facts of reality whilst on the other hand maintaining an unwavering faith in the endgame and a commitment to prevail as a great company. Despite the brutal facts our sector faces at this time we have found a real appetite for radical change from within the sector. Route maps are as yet inadequate, but opportunities for positive transformation need to be exploited by all the different players now if we are to design for transition into a healthier arts and cultural ecology.

Clare Cooper and Roanne Dods are Co-Directors of Mission Models Money.
www.missionmodelsmoney.org.uk
E: [email protected]
E: [email protected]

(1) Graham Leicester, Rising to the Occasion: Cultural Leadership in Powerful Times at www.missionmodelsmoney.org.uk
(2) John Knell, The Art of Living; and Margaret Bolton and David Carrington, New and Alternative Financial Instruments, both at www.missionmodelsmoney.org.uk
(3) Jim Collins (2001) Good to Great and the Social Sectors, Random House

True or False? The publicly funded agencies in my region offer the services and expertise I need to develop organisational and financial sustainability. Go to www.artsprofessional.co.uk to answer this and other questions in the MMM consultation.

With the help of around 270 practitioners, the majority of them volunteers, the MMM initiative has delivered a seven-stranded programme involving:

• the support, investigation and evaluation of seven diverse exemplar projects in organisations undergoing radical change in working practices
• seven widely disseminated provocation papers commissioned to catalyse debate on key issues
• twelve nationwide road shows on governance and developing financial capacity
• engagement of existing social lenders and arts and cultural organisations in an investigation into the potential for greater use of new and alternative financial instruments in the sector
• nearly 30 case studies giving examples of how arts and cultural organisations can move towards greater organisational and financial sustainability
• more than 20 advocacy and dissemination events on the topics of new technologies, intelligent funding, corporate social responsibility and the ecology of the arts, and several high profile features in Arts Professional
• a popular and extensive website signposting relevant information, sharing documentation as it emerges from the programme including leading-edge management tools under a creative commons licence.