On July 12, 2012, Scott Provancher, the CEO of the Charlotte Mecklenburg Arts and Science Council (ASC), 'sounded the alarm' about the current model on which the ASC operates. His article appeared on the Charlotte Viewpoint website and in it he promised a second article in which he will propose a solution. I commented on his article and suggested a particular direction for the ASC to take. My article follows Scott's piece:
I recently gave a keynote
speech to a group of community leaders at the Annual Meeting of the Rockford (Ill.)
Area Convention and Visitors Bureau. My good friend John Groh, the CEO of the
Visitors Bureau, asked if I would be willing to talk about the role that social
innovation plays in building vibrant cities.
I have a fond place in my heart
for Rockford
because they took a risk in hiring me to serve as the Executive Director of the
Rockford Symphony when I was just 24 years old—an opportunity that became a
defining leadership experience for me and a spring board for both the Rockford
Symphony and my career. So when John called, I immediately said ‘yes’.
Preparing for this speech also
gave me an opportunity to clarify in my mind what social innovation really
means and the role it must play in ensuring Charlotte’s continued growth and prosperity.
Simply defined, innovation is
an idea that creates value. There is a plethora of ideas in the world, but few
create lasting value. To me, social innovation is the most elusive, yet most
important form of innovation—a novel idea that creates value for the public
good.
Examples of great social
innovations, such as the development of language, irrigation, and the public library
system, immediately come to mind. However, one doesn’t need to look back
thousands of years or even outside of their own community to witness the
importance of social innovation.
In fact, the development of the
Arts & Science
Council (ASC) was a social innovation. The pressing issue of the time was
how a city poised to grow economically in the coming decades could ensure that
it had the arts and culture offerings necessary to attract, retain, and inspire
the needed workforce and their families.
Despite Charlotte’s prospects for future growth, it
had a dilemma. More mature communities had built their arts and cultural
amities through the generosity of a select few—famous philanthropists like Mellon,
Rockefeller, Carnegie and Guggenheim had both significant resources and saw the
importance of a cultural life for a community. Without that kind of wealth,
however, Charlotte
would need to innovate in order to accomplish this feat.
Through the visionary work of
community leaders from both the public and private sectors, a groundbreaking
partnership was formed. The ASC as we know it today was developed as a unique
non-profit umbrella organization that would receive both public support from
the city and county, and leverage that investment to inspire donations from
companies and individuals through corporate and workplace campaigns. The
dollars raised would not only help lead the creation of new venues and
programs, but also provide operating support for a burgeoning group of arts and
culture organizations.
What resulted was nothing short
of a miracle. Over a 35 year period, more than $1 billion (52% private and 48%
public) was leveraged to literally build a city centered on arts and culture.
This innovation helped to make Charlotte
the envy of other cities that by now are seeing stagnating urban cores and
failing arts organizations, but is a significant economic engine for our
community, generating over $200 million in annual economic impact and 6,200 full-time
jobs.
Our funding model is no longer
working
At the risk of being an
alarmist, I am concerned that the entire funding model that fueled our cultural
explosion over four decades is no longer working. Even before the economic
downturn, the underlying system that had fueled the growth of the cultural
sector was quietly and dramatically shifting without a true understanding of
the consequences. The most significant shift came in two forms 1) how companies
partner with ASC to fundraise in the workplace and 2) the City of Charlotte and Mecklenburg
County funding structure
for the arts and cultural sector.
Workplace giving was the single
greatest growth engine for the cultural sector in the past, and it provided
much needed operating resources to keep the doors open for organizations like
Children’s Theatre, Discovery
Place, Charlotte
Symphony and a dozen others.
A Foundation For The Carolina’s
sponsored task force in 2008 affirmed the crucial role of workplace giving for
the future of both the United Way
and ASC affiliates. However, the train had already left the station. Since the
time of the task force report, the dollars raised in ASC’s workplace campaigns
dropped almost 40%.
There is no doubt that the
workplace giving model was seeing signs of its age before the economic
downturn, and the task force agreed that a significant overhaul was needed to
meet the changing needs of employees and employers. But the speed of this
changing landscape left two huge non-profit sectors without the runway to
develop a meaning alternative for the community. This is something that we
still need to resolve.
Another quiet shift remained
virtually unnoticed because of the tremendous growth in the private sector. The
role that the City of Charlotte and Mecklenburg County plan in the partnership to fund
the cultural sector.
An important aspect of the ASC
model is that the City of Charlotte and Mecklenburg County would in essence outsource the
function of a cultural affairs department to ASC, thus enabling a big savings
on overhead and ensuring the greatest percentage of dollars going directly to
the community.
These dollars also play an
important role in the private-sector partnership by encouraging the private
sector to match the public dollars committed to the partnership. However, over
the last decade the public-private leveraging has become a lopsided
arrangement, with the private sector now tackling the lion’s share of the
annual support of the arts and culture sector.
Through a series of decisions
beginning in the early 2000s, Mecklenburg
County gradually reduced
ASC funding until it reached an all-time low in 2010. During this period, total
City and County funding for arts and culture decreased by 36%, while the
overall City and County budgets increased significantly.
The need to forge a new path
All that is to say, the
once-innovative model that was developed to support the arts and culture sector
will need to be reinvented to meet the growing needs of our community.
The great Peter F.
Drucker made a profound observation when he said, “Business has only two
functions –marketing and innovation. All the rest are costs." In other
words, the function of business is to develop products and sell them to
customers.
The ASC and
Charlotte-Mecklenburg is no different. We must design solutions that provide
community value and ensure their success. Going back to the old model for
support of arts and culture is simply not possible. The change that our
community has seen is significant and, like our community did decades ago, it
will need to forge a new path forward to ensure our cultural assets continue to
flourish.
When I stood on stage in Rockford, behind me were two juxtaposed pictures: the Charlotte skyline in 1976
and one in 2012. I looked at the audience and said, “Do you want to see what
innovation can do for a city? Look no further than the transformation of Charlotte.”
The arts and culture sector was
one of the most significant catalysts in this transformation. With the help of
the community, our key civic and corporate partners, I am confident we will
find a way to accelerate our arts and culture sector and continue to make Charlotte one of the best
places in the world to live. Innovation is how we can do it.
________________________
John Clark Response:
I commend Scott Provancher
for suggesting the current ASC model supporting cultural arts fundraising in
Charlotte-Mecklenburg is no longer working.
Five years ago (January 2007), just before the Great Recession began, I
offered a critique of the approach in a Charlotte Observer op-ed piece. It garnered support from professional
musicians, dancers, painters, poets, singers, actresses/actors and other
individuals from our arts community and was generally panned by the ASC and
other arts organization directors. No
surprise there.
Naturally, I am interested in
Scott’s upcoming solution to the problem and in the meantime would like to offer
some thoughts about the model as it has worked in our community. My purpose is not to revisit the past per se
but rather to note certain inherent weaknesses of the model with the intent to
steer clear of them in the design of a new approach to supporting the arts.
The united fund approach for
the arts, borrowed from the United
Way by many cities, was primarily begun to
minimize the number of financial requests to the business community from arts
and cultural groups. Another reason, as Scott
cited, was the business need to achieve an arts environment “...necessary to
attract, retain and inspire the needed workforce.” As you see, doing it
directly for the benefit of the arts was not high on the list.
The major strength of a
united fund model is its efficiency. Organized by the ASC, hundreds of
individuals volunteer through their places of work cover various sectors of the
community (professionals, education, retail, etc.) to solicit employees to give
to the annual fund. Scott notes during
the past 35 years, 52% of the $500 million raised came from the private
sector. That’s $260 million. Break down that figure as an average for each
of those 35 years and it is only $742,857.
Not all that impressive.
Here’s why. While this model is efficient as a workplace
campaign, it denigrates the true nature of giving. The experience of true philanthropy is
exciting, inspiring and very rewarding.
An individual makes a gift directly to an arts organization such as the
Charlotte Symphony. She does so because
she enjoys the concerts and is moved to give money beyond simply buying tickets
to the performances. It’s the emotional
connection with the Symphony that is most meaningful in her gift-giving. This connection increases over the years and
is reflected by her greater involvement and in larger gifts to the Symphony.
That experience is largely
missing in the ASC united fund approach.
Sure, there are key volunteers who get involved in the campaign and are
highly motivated. It’s short-term,
however, not only because it occurs once a year, but also because it’s a
fundraising project, not an arts-making endeavor.
If you’ve been living here
for a while, you’ve heard the horror stories of employees, especially at the
larger companies, being pressured not only to give to the ASC campaign but to
give based on the level of their salaries.
I know of a friend who worked at one of our big banks whose work team
had to go on a retreat to deal with sore feelings from such pressure. This is akin to turning donors into mercenaries
with the ‘pay’ being the fact you won’t lose your job or be overlooked for
promotion.
Even in its more benign form,
that is not true philanthropy and hardly the way to build over the decades a
true philanthropic environment for the arts.
And it does take time for that to happen. Yet, because Charlotte opted for the united fund approach
35 years ago, we’ve lost a lot of time.
Clearly, it’s difficult to
say what would have happened if we had not gone the united fund route. The symphony in Nashville nurtured a major donor. She was instrumental in their impressive
campaign of raising $123 million within five years. Recall our ASC raised in private funds only
$260 million in 35 years. In choosing
the road of developing a philanthropic environment for the arts during the past
four decades, Charlotte
may have produced a number of wealthy arts philanthropists (it did and
does have very wealthy individuals).
More importantly, it would certainly have produced many more authentic
donors who would have a direct giving relationship with an organization that
actually made art—music, drama, dance, singing, painting, sculpting, etc.
I hope the new direction the
ASC takes is to foster that philanthropic environment to nurture individuals
now in the 30s and 40s to experience the joy of giving directly to a group that
is making art for our community. The ASC
can increase its role as an incubator for arts groups to learn how to raise
funds and promote their art forms. The
ASC could work to get people excited, not about a fundraising campaign, but
about a campaign that puts us in the center of our local arts world. One that truly moves our hearts.
