One of the themes I’ve heard incessantly over the course of labor disputes involving the Atlanta Symphony Orchestra, the Minnesota Orchestra, the Metropolitan Opera, the Saint Paul Chamber Orchestra and other ensembles has been that musicians are just too dang expensive, and they have to take huge pay cuts for their respective organizations to survive.
Essentially, leaders from these various organizations have adopted a perspective straight out of the for-profit business world. Swept up in this line of reasoning, managements have repeatedly described their organizations’ financial problems as personnel problems: payroll was just too high.
For example, the management of the Atlanta Symphony Orchestra (ASO) has bemoaned the fact that 24% of their operating costs go towards paying the musicians. Here in Minneapolis, board members decried that musicians’ salaries accounted for 40% of the Minnesota Orchestra’s expenses.
And because they were seeing their problem from a for-profit angle, the managements from each of these organizations tried to lower costs by using a well-established mechanism from the for-profit world—they decided to cut payroll. The workers were going to have to make concessions… or get cut themselves.
This has been a standard operating procedure in manufacturing and other economic sectors; and if this is your frame of reference, it would seem perfectly logical to reduce the musicians’ pay as a way of reducing overall organizational costs.
But this framework is completely wrong here. As I have said many times before, the arts groups in question aren’t for-profit businesses… they are non-profit organizations. The entire reason these organizations exist is to make music. As a result, the musicians are not simply personnel, they are also the product.
From this perspective, the fact that musicians only account for 24% for the ASO’s budget is astonishing. Where on earth is the rest of the money going… administrative overhead? What would we we think of the Red Cross if only 24% of its budget was going to disaster relief?
When I come to a concert, I am coming to hear a crack ensemble perform music in ways that excite, surprise, and astonish me. I’m there for the end result, which is glorious music. Anything that interferes with that will lessen the likelihood that I’ll buy a ticket or contribute to the organization. Reducing the number of performances, or replacing veteran players with younger, cheaper models will have a direct, and measurable effect on the product and, from my perspective, set off a chain reaction that will greatly harm the organization.
To explain what I mean, let’s look at this from a different perspective that may be more understandable—the notion of a restaurant.
Chicago is home to many distinguished eateries, but one of the most spectacular is Rick Bayless’s Topolobampo. Bayless has created a culinary empire by serving glorious, authentic Mexican food with astonishing care and attention to detail. Topolobampo is the crown jewel in this empire, a restaurant that raises Mexican cuisine to a rare art form… I doubt the president of Mexico’s personal chef could do any better. Guests eating at Topolobampo expect the best, and expect the prices to match. While you don’t have to break the bank to eat there, you certainly can—when you factor appetizers, entrée and dessert, along with an astonishing bottle of amarone that magically brings all the assorted flavors together, a party of two can easily rack up a very large bill. (Let’s just say I know this from personal experience.)
But all restaurants live on painfully thin profit margins. Those highly trained chefs, the crack team of servers, and those rare ingredients come at a cost. What if Bayless decided to improve his bottom line by adopting a business model closer to that of, say, Chipotle?
He could, for example, choose to move away from fresh, seasonal ingredients and buy bulk products that are canned or frozen. He could create an assembly line that would cook all the food in large batches ahead of time, and simply assemble and warm each plate when orders came in. He could get rid of the sommelier and the hand-selected wines that pair with the specific ingredients and go instead with a corporate partner that would supply bulk wines cheaply. Bayless could further reduce staff by eliminating servers altogether and adopt a “facilitated buffet” service. He could also have patrons bus their own dishes to eliminate busboys, too. Add in a corporate sponsorship with Coke, and his new, cost-effective restaurant is ready to open, and he and his business manager could dream of all the wonderful profits they would make.
But he would have also eliminated any reason to actually eat there.
The changes he made would have fundamentally changed the product, and while the old expensive elements would have gone away, so would all the things that brought in a profit. In this new restaurant, I would never, ever, pay $200 for my food. That price is predicated on me having a culinary experience, not just grabbing a bite to eat. I won’t care what kind of discount the restaurant got on its beef if my dish has the consistency of rawhide. I won’t care that the glass of “I-Can’t-Believe-it’s-Cabernet” on the menu is more profitable for the new restaurant to serve… if it makes my food taste like metal, I won’t want to drink it.
At the end of the day, why would I go to a restaurant that’s chasing Chipotle? If I wanted to go to Chipotle, I’d just go there, instead of a knock-off.
Let me be perfectly clear that I like Chipotle just fine as a restaurant and I don’t want to disparage it or accuse it of unsavory business practices; I won’t, however, go there for a special occasion, buy a Chipotle cook book, sign up for their e-newsletter, or spend more than $10 for my food. I would, however, do all those things for Topolobampo.
The same holds true with an orchestra. Cheaper musicians and pops concerts might look more profitable on paper, but I certainly won’t spend $80 a ticket to hear them. I won’t buy this orchestra’s recordings since I can most likely find better ones performed by better ensembles. If I’m not inspired, I probably won’t contribute more than a small, token amount, and I certainly won’t give to a capital campaign. And since there are so many artistic and musical ensembles to support, this new “profitable” orchestra will most likely drop off my radar altogether.
Let me be clear. I’m not going to a concert to help your bottom line… I’m going so I can have an experience. If I can’t get this experience with the you, I’ll go somewhere else where I can. And if I do walk away, how much time and effort will you have spend to break through my indifference to get me to support you again? To trust you again? Your orchestra or opera house might have a profitable year in the short-term… but it will do so at the expense of long-term prospects and support.
Why go down that road?
So as the ASO is contemplating another lockout of its musicians, I say this: No business thrives by diluting and diminishing their core product. And since the musicians are your core product, I would advise changing your frame of reference to reflect that.