Dying with Dignity; or, Euthanasia for the Performing Arts

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We have this terrible time in the nonprofit performing arts sector with the idea (let alone the actual act) of letting groups go out of business. Groups on the verge tend to hit the panic button and mount a “Save Our _______,” which works only some of the time, and generally does not solve the problems that put the organization in peril. For all those involved, going out of business is only seen as a failure, an admission to be avoided.

The thing is that we need more groups to reach that decision point and then make a positive decision — let’s declare victory and move on! Why? Several reasons.

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First of all, we have a supply problem. Remember when Rocco Landesman said that a few years ago as head of the NEA? Poor guy almost got his head taken off. You’d have thought he was suggesting no more sippy cups of alcohol in Broadway theaters. Inevitably, there were references to Theater Death Panels, which managed to stifle any sort of reasonable conversation. Now we have a situation where foundation heads and other arts leaders would all agree privately on the problem. But they won’t say it publicly.

But the fact remains that the recent growth of the sector (here illustrated by the number of cultural 990’s filed by year) is stretching audiences and funders beyond capacity.

The number of 501(c)3's, including those filing 990's, is on the rise again. (Click to enlarge.)
The number of 501(c)3’s, including those filing 990’s,
is on the rise again. / (Click to enlarge.)

The other very important reason to encourage more groups to close up is that we should expect the quality and value of anyone’s creative output to rise and fall over time, and that when it falls below a certain point, there is little reason to maintain the institutional infrastructure that goes around the creation of the work. There are lots of good analogies here. Think of the cultural ecosystem as a forest. Old trees die to make room for new ones. In fact, the forest fires that speed that along are profoundly important to the long-term health of the forest. Simply put, turnover is healthy, as it allows for regeneration.

So what’s the answer? We essentially need to help groups close up shop in a way that treats customers, working artists, staff and contractors fairly, preserves what should be preserved of the work, and honors the organization’s contribution to the sector. Tom Wolf (in his book Managing a Nonprofit Organization in the Twenty-First Century) refers to this as “Organized Abandonment.” But that still sounds like a retreat. Let’s call it “Dying with Dignity.”

The hard part is that what’s really needed to shut things down is not just the will to do it but planning (which costs money), time (which is money), and money. I’ve been talking about this recently with John Macintosh of Seachange, a merchant-banking group in the nonprofit sector that provides transactional support for organizations in transition. They’re already very experienced and proficient in their grant-making in support of organizations merging and collaborating, but now they’re considering the development of a pilot “legacy” fund that could provide support to organizations serious about closing up shop in the best way possible. It’s a great idea. Such a program could provide an incentive for organizations to be proactive about winding down rather than limping along until it’s too late, with negative consequences for directors, artistic and administrative staff, and the nonprofit sector at large.

John recently sent me a great report, written in 1991, by the Fieldstone Alliance. It was their Nonprofit Decline and Dissolution Report, entitled Going Out of Business: Why, When and How to Do It Gracefully. It’s a great report based on comprehensive research and fieldwork that identifies the situations that should lead nonprofit organizations to consider going out of business. It identifies warning signs and causes that signal the need to plan for the end. It provides a framework with which to consider various alternatives to dissolution. It suggests how organizations should deal with stakeholders and outsiders to achieve an honorable death.

This is the work we need to do. But given the sensitivity around the issue, I’ll settle for the idea that, at the very least, this is the conversation we need to start.

  • Guest

    I’m sure I’ve read articles with less thought-out ideas before, but it’s been a long time. There are good reasons for arts groups to end, but those reasons are not here.

    Is such lame thinking all one needs to be a writer these days? And the forest analogy is about the worst comparison to theater I’ve ever read. Trees have no control over the amount of rain or fertilizer around them, but theaters could always build more audiences that would support their growth and the growth of theaters around them. Funders could always provide more for programs that educate and cultivate future audiences in a way that Smokey the Bear can’t do for trees. I’m not saying that Funders do, but it’s just an inkling of how bad this analogy is.

    I would be more interested in a case for Mergers & Acquisitions. This is how for-profit businesses often grow and build interest in their services down the road. It’s also how the theater community could avoid losing a lot of institutional memory and pass along resources (like their 501(c)3) to a newer, growing enterprise.

    Please, go back and rethink this a lil’ deeper.

    • Respectfully, you’re welcome to disagree with the sentiments in Mr. Webb’s post, but you’re also commenting without affixing your name, and one could easily and quite successfully argue that that is, to use your word, lame.

      Indeed, if you really believe theaters can “always build more audiences” to “support their growth and the growth of theaters around them,” is it not at all incumbent upon you to detail explicitly how you would do so, and, further, to disprove Mr. Webb’s contention that audiences are not being stretched too thin? In a society of endless capital and theoretically bottomless philanthropy, funders can “always provide more for programs that educate and cultivate future audiences,” but as you acknowledge that funders are not doing so, what remedy do you propose?

      I will always respect your right to like, loathe or assail whatever writing you want, but surely you can see that your anonymity is suspect. If you would have Mr. Webb “go back and think this a lil’ deeper,” I would respectfully ask you to do the same, starting with putting your name forth as Mr. Webb has, so readers can make their own assessments of competing points of view.