artistic vision and financial planning can be friends. really

Artistic Vision and Financial Planning Can Be Friends.

Really.

Getting to know you…

QUESTION: Who’s in the room?

PRIMARY ROLE

TYPE OF CHORUSES

BUDGET SIZE

CONCERT PROGRAMMING

EDUCATION PROGRAMMING

2

Your Planning Process

DEFINITIONS:

PLANNING: Describes what you want to accomplish

BUDGETING: Describes how you allocate resources to achieve what you want to accomplish

3

Who Are the “Stakeholders” with Respect to Artistic Programming

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Artistic Program

Artistic Director & Performers

Marketing

Public Relations

Advancement

Finance

Board (Governance

& Fundraising)

Ticket Buyers

Individual & Institutional

Donors

Major Gifts & Board

Prospects

Financing Your Art With Earned Income

QUESTION: What % of your revenues come from earned sources?

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QUESTION: Are your costs rising more quickly than your earned income? Do you feel pressure to raise ticket prices?

EARNED REVENUE % OF TOTAL REVENUES:

• 0%

• 1% – 25%

• 25 – 50%

• 51 – 75%

• 76% - 100%

$-

$20.00

$40.00

$60.00

$80.00

$100.00

$120.00

10|11

(ACT)

11|12

(ACT)

12|13

(ACT)

13|14

(ACT)

14|15

(ACT)

15|16

(ACT)

16|17

(ACT)

17|18

(ACT)

18|19

(ACT)

Revenues Performance Costs

Avg ticket price fairly flat

STAKEHOLDERS: Marketing, Public Relations, Finance

Performance cost per ticket rising

Financing Your Art With Contributed Income

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CONTRIBUTED REVENUE % OF TOTAL REVENUES:

• 0%

• 1% – 25%

• 25 – 50%

• 51 – 75%

• 76% - 100%

QUESTION: What percentage of your total revenues come from contributed sources?

QUESTION: What are your sources of contributed revenue?

CONTRIBUTED REVENUE SOURCES:

• Individual Donors

• Foundation Grants

• Government Grants

• Corporate Sponsorships

• Multi-Year Pledges

• Events

• Endowment Earnings

STAKEHOLDERS: Advancement (incl. Events), Board, Finance

Financing Your Art With Contributed Income

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• How many of you focus almost exclusively on general operations contributions?

• How many of you focus heavily on generating contributed income for the current season, rather than fundraising now for projects in future years?

• How many of you have moved to programming-related fundraising appeals:

– Guest artist underwriting

– Program underwriting

– Commission underwriting

– Recording sponsorships

– Multi-media projects

Moving to this form of fundraising will force you to plan more than one year’s programming in advance (e.g., a 3-year

planning horizon)

APPROACHING BUSINESS PLANNING

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Artistic Vision vs. Financing Synchronicity

Our vision and financial capacity

are equally aligned!

We compromise some, but are OK with the results

Our vision is limited by our capacity

QUESTION: Where is your chorus on this continuum?

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18 +months

12 - 18 months

6 – 11 months

< 6 months

We wing it!


QUESTION: How far in advance do you start planning your season?

QUESTION: How many of you do multi-year planning?

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• Artistic Director (AD) alone

• AD & Executive Director (ED)

• AD & Board

• AD & Staff

• Other Models

QUESTION: Who ultimately decides or “approves” your season?

QUESTION: How flexible is your planning – are you able to adjust your plans when there are unexpected pitfalls or windfalls?

QUESTION: Who is involved in your season’s artistic planning?

• Artistic Director

• Executive Director

• AD & ED

• Board

• Other Models

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Master Chorale Planning Process, 18|19 Season:

Sub #1: (2)Mozart: Requiem & Kirchener: Songs of Ascent

Sub #2: (1) Bach: Magnificat & Esmail: Love Between Us

Sub #3: (1)English Cathedral Christmas

Sub #4: (2)Whitacre: Sacred Veil (commission)

Sub #5: (1)Durufle: Requiem & Trumbore: How to Go On

Sub #6: (2) Great Opera vs. Great Movie Choruses

SEP NOV DEC FEB MAR MAY

18|19 Season – As Announced

NS #1: (2)Festival of Carols

NS #2: (1)Handel: Messiah

NS #3: (1)Messiah Sing-Along

Artistic Planning Process: the Destination

Many stakeholders’ perspectives led to this outcome (as you will soon see)

Lagrime Tour (2 presenters)




OCTSEP JAN MAY

• Artistic:

– Want interesting repertoire to rehearse and perform

– Want to continue to add to the canon through commissions, especially LA-based composers

– Want to add immersive elements to performances where appropriate

– Want our programming to reflect our values of inclusion and representation

• Marketing:

– Want enough “familiar” programming to attract subscribers, preferably strong opening and closing anchors

– Want enough variety to build subscription series that will sell

– Want each program to have stand-alone attractiveness (e.g., avoid a program of all gnarly music)

• Advancement:

– Want enough adventure to attract donors to join our “innovation fund”

– Want some familiar large-scale chestnuts to encourage program underwriting

– Want commissioned works, which are fundraising magnets

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Artistic Planning Process: How Stakeholders Influence the Discussion

• Pro’s:

– Alignment across functions with the final product

– Collaboration often provides valuable perspectives regarding artistic choices

– Recognizing impediments to artistic choices early in the process allows time for acceptable substitutions• Practical considerations: calendar conflicts; inability to sign desired guest artists, programming duplications with

other regional arts organizations, more lead time needed to fundraise for commissions or recordings, etc.

• Financial considerations: other initiatives have cost mandates that cap the total season spend at levels below the proposed programming

• Con’s:

– Any perception that the artistic leader is ceding his/her authority to formulate the artistic product

– In the earliest stages of the planning process, the artistic viewpoint should not be inhibited by stakeholders’ concerns (that gets folded in later)

– Fear of risk-taking by stakeholders can regress artistic planning to the tried and true15

Pro’s and Con’s of Involving Stakeholders in the Artistic Planning Process

THINGS TO CONSIDER DURING YOUR SEASON PLANNING:✓ Can programs can be moved or scaled to maximize resources and goals?

✓ What programs are “locked in” or immovable? (i.e. holiday programming)

✓ Can a program/project be postponed?(What are the ramifications [+/-] of delaying the action?)

✓ What additional info do you need to make the best decision?

✓ Who ultimately makes that decision?

✓ Are you cataloging all of the “assets” that will make the program successful? (i.e., sponsorships, guest artists, marketing/PR opportunities)

Other Planning Parameters

2018|19 Season Budget/Artistic Planning Cycle (18 months)

Summer 2016

SEASON OUTLINE

• Artistic Director drafts 8 - 10 programs; presents season outline to Senior Staff

• Goal: Choose 6 Programs for Full Subscription Series

Jul – Aug 2017

SEASON CONSTRUCTION

• STAFF builds concert-level programmatic budgetsDirect Concert artistic & production expenses and earned revenue (ticket sales) and contributed revenue models

October 2017

SCENARIO ANALYSIS

• CFO & CPO prepare season scenarios and Incremental Analysis, a report comparing direct season program expenses to revenue

Planning Timeline

Britten: War Requiem (100th

anniversary of WW1)

Vaughan Williams: Dona Nobis Pacem & Trumbore: How to Go On

**Subscription program undecided**

Whitacre: Sacred Veil (commission)

Mozart: Requiem

SEP NOV DEC JAN JUN

Festival of Carols (2 perfs)

Handel Messiah (1 or 2 perf)

Messiah Sing-Along

Artistic Planning Process: Journey to the Destination

Version 1

Newton: St. Matthew Passion

APR

Other PossibilitiesHandel: Saulor Theodora

Beal Sunset (silent film)

Kirchner: Songs of Ascent

Britten War Requiem (100th

anniversary of WW1)


Martin Mass for Double Choir & Weir a blue true dream

Whitacre Sacred Veil (commission)

Durufle Requiem & Trumbore How To Go On

Great Opera vs. Great Movie Choruses

SEP NOV DEC JAN MAR JUN



Messiah Sing-Along


Version 1

Esmail This Love Between Us & Kirchner Songs of Ascent

APR

Version 2

Beal Sunset (silent film)

Handel Saul or Theodora

Mozart Requiem

Other Possibilities

Ravinia Festival: Chicago

University of Michigan

SEP OCT JAN

Folding in the Lagrime Touring Company Schedule

Version 1

MAY

Version 2

Univ of IL Krannert Center

Melbourne Festival :Australia

CervantinoFestival: Guanajato, Mexico

Annenberg Center: Los Angeles

University ofNorth Carolina

Cal PerformancesUniv of CA (Berkeley)

Barbican Center: London

Lensic center: Santa Fe, NM

Sage Gateshead: Newcastle

Cite de la Musique: Paris

Palacio BellasArtes: Mexico City

Between 2 & 3

Britten: War Requiem (100th

anniversary of WW1)

Esmail: This Love Between Us & Kirchner: Songs of Ascent

English Cathedral Christmas


Durufle: Requiem & Trumbore: How To Go On

SEP NOV DEC JAN MAR



Messiah Sing-Along


Version 1


MAY

Version 2

Beal: Sunset (silent film)

Handel: Saulor Theodora

Mozart: Requiem

Other Possibilities

Version 3


Mozart: Requiem& Kirchner: Songs of Ascent

Bach: Magnificat& Esmail:T his Love Between Us

English Cathedral Christmas


Durufle: Requiem & Trumbore: How To Go On

SEP NOV DEC JAN MAR



Messiah Sing-Along


Version 1


MAY

Version 2

Baal Sunset (silent film)

Handel: Saulor Theodora

Britten: War Requiem

Deferred to Future Seasons

Version 3


FINAL

Sub #1: (2)Mozart: Requiem & Kirchner: Songs of Ascent

Sub #2: (1) Bach: Magnificat & Esmail: Love Between Us

Sub #3: (1)English Cathedral Christmas

Sub #4: (2)Whitacre: Sacred Veil (commission)

Sub #5: (1)Durufle: Requiem & Trumbore: How to Go On

Sub #6: (2) Great Opera vs. Great Movie Choruses

SEP NOV DEC FEB MAR MAY

NS #1: (2)Festival of Carols

NS #2: (1)Handel: Messiah

NS #3: (1)Messiah Sing-Along

Artistic Planning Process: Cost Feasibility

Ticket Sales Revenue $1,653,721

Programmatic Expenses 2,063,441

Net Incremental Cost $(409,720)

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$(302,717)

$(379,369)

$(502,171)

$(610,400)

$(409,700)

FY 14|15 FY 15|16 FY 16|17 FY 17|18 FY 18|19

Artistic Planning Process: Proposed Season vs. Prior Seasons

Budget Target

January 2018

APPROVE SEASON

• Artistic Director & SENIOR STAFF present the proposed season and programmatic budget(Direct concert expenses and revenue) for Board Review and Approval

Feb – May 2018

REFINE BUDGET

• SENIOR STAFF Finalizes Organizational Budget;

• Refine organizational departmental budgets

• Announce Season & Renew Subscribers, New Acquisition Campaign Begins

June 2018

FINAL REVIEW & BOARD APPROVAL

• AD, CEO, CPO, & CFO present full FY17 organizational budget with any revisions to the Board for final approval at Annual Meeting

2018-19 Season Budget/Artistic Planning Cycle (18 months)

Budget Process

Concert Assets Discussion: Artistic & Admin staff discuss the core assets and

opportunities for each concert in the next season (2-3 hours); Line walls with post-it pads all around room to capture ideas (See handout for example)

✓ CONCERT STATS: # of musicians, guest artists, repertoire, significance…

✓ MARKETING: Keywords, visual design, PR opportunities, Target Audiences…

✓ DEVELOPMENT/FUNDRAISING: Sponsorships and underwriting, donor cultivation and events (salons, meet the artists)…

✓ AUDIENCE DEVELOPMENT: Subscriber events, community events, invited dress rehearsal audiences, etc. …

Concert Assets Discussion: Bringing Everyone Together

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Concert Assets Worksheet

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Concert 1 Concert 2 Concert 3TitleDateThemeGuest ArtistsCommissioned WorksPlays to which reputation strength(s)

Plays to which aspect(s) of mission

Marketing Themes

Public Relations

Community Alliances/New Audience Targets

Donor Cultivation Targets

Donor Event

Concert Assets Worksheet

• Stakeholders Appreciate the Heads-Up:

– Development staff can cultivate donor support more effectively with a longer planning horizon

– Production staff can lock in guest artists with greater success with more lead time

– Finance staff can build strategies to deal with varying cost mandates among seasons

• Programmatic Initiatives Are Sequenced More Thoughtfully:

– Community engagement events can become predictable, but scaled to the size permitted by each year’s budget

– An internal commitment to supporting new composers can be an annual programmatic component

– Large-scale presentations with a big price tag (e.g., multi-media compositions) can be folded into development fundraising plans

Making the Case for Multi-Year Planning

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Making the Case for Multi-Year Planning (Example 1)

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• Project: collaborate with a visual artist to create a new work performed outside a traditional concert hall setting.

• Year 1: identify the artist and negotiate commission agreement

• Year 2:

– Begin intensive fundraising efforts:

• Approach major donors who want to underwrite innovative initiatives

• Perform an excerpt from the work-in-progress at annual Gala

– Identify the production challenges and hurdles

– Determine which audience segment would find this appealing

• Year 3: rehearse and perform the work

Making the Case for Multi-Year Planning (Example 2)

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• Project: commission a new work from a well-known composer, with potential to record and tour.

• Year 1: negotiate commission agreement and obtain donor support for commission

• Year 2:

– Perform the new work/Organize meet-the-composer donor events

– Determine whether to record/Secure donor support for recording.

– Determine whether to tour/Market project to prospective presenters.

• Year 3: Record work and begin tour (possibly year 4).

QUESTION: How do you decide if your chorus is ready to tackle a new initiative?

NEW INITIATIVE POLICY – A FRAMEWORK TO CREATE A PLAN (See handout)

• Support for Mission – How does this further our mission & goals?

• Describe the project – what are the goals and expected outcomes?

• Stakeholders – who is served by project, who implements?

• External Analysis – Why now, what is the need, and are there similar models?

• Resources Needed – What human, time, & space requirements are needed?

• Budget and Financials – what are the expenses and revenues?

• Timeline/Alternatives – When can this be implemented?

• Decision and Evaluation – Who gives the “go/no go” for the project?

New Initiative Policy: “So I have this GREAT idea!”

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Plan Accuracy

and

Interim Information Adequacy

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QUESTION: Which of these describes your organization’s results relative to plan?

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How Good is Your Roadmap?

We have frequent surprises

We sometimes have surprises, usually due to unanticipated

events

We stick to our plan, have few

surprises and hit our numbers!

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How Good is Your Roadmap?

Can you say…

✓ I can distinguish between my “permanent” variances and timing items in my interim reports.

✓ I am comfortable that I know where our year is headed based on interim information I receive.

✓ I know what my cash position is, and whether it should be robust or thin depending upon our cash-flow cycle.

QUESTION: Does your interim reporting provide actionable insights?

Have a Question? Ask Us!

Steve Neiffer, Chief Financial Officer(213) 972-3116 / [email protected]

Kevin Koelbl, Chief Production Officer(213) 972-3117 / [email protected]

LAMASTERCHORALE.ORG

artistic vision and financial planning can be friends. really

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