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Drucker Exchange

Process Knows Its Limits

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A post on Drucker Exchange, When Process Is a Prison, got me thinking about ticket office operations. I am sure the content of the entry could be applied to a hundred things that happen every day in arts organizations, but that is what bubbled to the top in my mind.

“Procedures can only work where judgment is no longer required, that is, in the repetitive situation for whose handling the judgment has already been supplied and tested,” Drucker wrote in The Practice of Management. “In fact, it is the test of a good procedure that it quickly identifies the situations that, even in the most routine of processes, do not fit the pattern but require special handling and decision based on judgment.”

I pretty much started the trajectory of my arts management career in the box office a couple decades ago. Since then the rules governing exchanges, returns and other transactions have seemed to move from matters of policy and procedure to matters of judgement. These days having a ticket office manager you can trust to make good judgments on behalf of the organization is as, if not more, important than their technical ability to troubleshoot the computer system you are using to sell your tickets.

Granted, box office operations are probably technically more a matter of policy than procedure, but Drucker’s general sentiment applies.

The ticket office has always been viewed as the first place of contact with customers where good manners and efficient processing of orders is prized. But now customer service interactions are almost more important than the product being sold, given customer expectations and their ability to almost instantly report their disappointment to 1000 of their closest friends.

Consistently providing good service doesn’t necessarily mean treating everyone equally because everyone views their situation as special and may expect you to have some degree of awareness of those circumstances. This is why customer relationship management (CRM) software is viewed as so important by businesses at large (though you wouldn’t know it when you call your cable or cell phone provider). Many arts organizations don’t have the resources to support sophisticated CRM software so human judgment and good note keeping becomes all the more important for them.

Perhaps my perception of the change is based on the fact that I have gradually moved into a position of generating the policy rather than enforcing it and I am a big softy. But I suspect there are many others who will confirm that things have changed from the 70s and 80s when it was “No Refunds, No Exchanges, No Exceptions” for non-subscribers. Now it is more akin to “No Refunds, No Exchanges, Except for the Exceptions.”

As Drucker is quoted, the best procedure recognizes those times that are exceptions to the procedure. I think that some times changing environment requires you to recognize that it is no longer useful to maintain set policies and procedures in favor of general guidelines and good judgment.

Quirky Little Trick For Monetizing Creativity

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A post yesterday on the Drucker Exchange blog caught my eye instantly. How could it not when it started (my emphasis),

The story is told that when Peter Drucker was asked how to become a better manager, he replied: “Learn how to play the violin.”

This was, apparently, Drucker’s way of saying that the best managers and knowledge workers are excellent critical thinkers, creative and open to learning new things—just a few of the attributes that, according to a recent article in Time, seem to be in increasingly short supply among recent college graduates.

…The magazine cited several surveys showing that large and growing numbers of job applicants lack “communication and interpersonal skills” or are weak when it comes to “communication, critical thinking, creativity and collaboration.”

The article goes on to cite Peter Drucker saying that lack of social skills shouldn’t be the biggest disqualifier for a position because you are hiring them for their brains, not to act as a social director. It goes on to quote Drucker encouraging companies to hire someone based on the strengths they bring where the company is lacking rather than trying to hire to the job description.

But the entry later quotes a talk Drucker gave where he says the employee needs to be responsible for managing themselves. (this link isn’t the talk, but an article Drucker wrote on the topic.)

“For the first time in human history, we will have to take responsibility for managing ourselves,” Drucker declared during a 1999 talk he gave in Los Angeles. “This is probably a much bigger change than any technology, this change in the human condition. Nobody teaches it—no school, no college—and it will probably be another hundred years before anybody does teach it. In the meantime, the achievers . . . will have to learn to manage themselves, to build on their strengths, to build on their values.”

Drucker may be right that these skills are not taught directly in schools, but some part of them are required in the practical activities of performing arts classes. Teamwork, goal setting, communication, vision, deadlines, it is all there and is ultimately tested when the curtain goes up. All these things can be learned in a classroom or by participating in activities of your local theatre/dance/music ensemble.

(Though certainly recognition of and building your own strengths and values is always going to be something you have to develop on your own.)

There is a question of whether performing arts students are being properly prepared to perform and work in the new modes of expression and communication that will emerge in the future. Because we don’t know what those modes will be, the question is really more about instilling flexibility and creativity of thinking as well as a degree of entrepreneurship.

But is it enough? We keep seeing articles like the one in Time magazine cited on The Drucker Exchange or whenever people reference the IBM study where CEO valued creativity as crucial to ensure the future of their companies.

And yet an ever increasing number of standardized tests are administered every year despite the fact that the only standardized test you are regularly required to pass as an adult is your tax return. And they have software and people that will help you out by soliciting information from you.

The arts aren’t the sole source of creativity in the world, and the CEOs in the IBM study weren’t specifically looking for creativity as it manifests in the arts, but it seems like there is a huge unmet need out there and maybe arts people need to sit down and figure out how package it for Fortune 500 companies if they are so desperate for it.

It probably can’t be done in the same fashion as in college art classes. Drucker is right when he suggests that there is no formal way to teach soft skills. You can’t put together a 40 hour course on being creative and issue certificates confident at having instilled the ability in your pupils.

And yet, people commit acts of creativity every day. Some times with as much effort as it takes the grass to grow, other times with much angst, but with the knowledge and confidence that they are capable of it.

But it seems that finding a method to monetize effectively teaching/instilling creativity is about the only way these days to convince people not to dismiss liberal arts as a pursuit and that there is a Way of learning that does not embrace standardize testing.

Passion vs. Engagement

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The Drucker Exchange quotes an article in Bloomberg Businessweek claiming “truly passionate U.S. employees” make up “a scant 11% of the workforce.”

My first reaction was to wonder if the arts had a higher percentage of passionate employees than most sectors. The Drucker Institute piece mentions the responsibility of the employee to essentially manage their own careers because companies won’t do it for you.

But it also mentions the need for companies to provide an environment which allow passionate people to thrive. This has been a frequent topic recently in respect to the work-life balance employees at arts organizations seek in addition to their desire to make a difference.

“And yet, for all this, Drucker also recognized that it wasn’t simply a matter of employees seizing responsibility. It’s up to their employers to provide the systems and processes and culture for them to be able to do so. Heavy-handed, top-down organizations—those that “rest on command authority,” in Drucker’s words—don’t create the right dynamics for passion.”

When I looked at the Bloomberg article, I was intrigued by the distinction they made between a passion and engagement.

What’s the difference between passion and engagement? Employee engagement is typically used by organizations to figure out if workers buy into the company’s goals, if they like working for their manager, if they find the company sensitive to work/life balance issues, etc. That serves companies well when they want to scale and have workers “engaged” in the task necessary to expand their particular corporate silo.

The passionate worker—the metaphor Deloitte employs is “the passion of the explorer”—are those who view new challenges as opportunities to learn additional skills. That attitude becomes essential, the consulting firm maintains, because the typical work skill will be outdated within five years. “These people are driven to develop new skills at an ever rapid pace and are thrilled by it,” Hagel says. “Passionate people are the most agile.”

Once you think about it, engagement is a different aspect of employment from passion. You can feel engaged by your company and the environment and opportunities you find in your work, but not necessarily be passionate about advancing your skills and knowledge.

An engaged person could advance within the company by performing excellently, but not necessarily advance the company the way a passionate person will.

But a passionate person may not necessarily advance in the company hierarchy. Bloomberg cites the Andon Cord on the Toyota assembly line which any line worker can pull to stop the line and gather the workers when there is a problem.

Like Toyota though, a company needs to create an environment and culture in which passion is valued.

The end of the Bloomberg article notes that those in marketing and management were more passionate than those in accounting and customer service, as were those making more than $150,000.

However, the Toyota example shows that it can be cultivated at all levels of an organization. (And, one hopes, at arts salaries.)

Your Personal Board of Directors

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The Drucker Exchange has an animated interpretation of a speech Jim Collins (Good to Great, Built to Last) delivered in 2009. The speech is titled “Ten To-Dos For Young People” but I am pretty sure it is good advice for people of any age.

The first thing Collins suggests is getting a personal board of directors where the members are chosen not for their accomplishments but for their character. These people don’t necessarily need to know they are on your board of directors.

This struck me as an oft overlooked aspect of personal development. We are often told to find mentors and network to advance our careers, seldom does the character of these mentors and the necessity of moral and value guidance get mentioned.

People in the arts often need this type of guidance because establishing a career is so difficult and subject to so many conflicting pressures. It is not only a matter of whether you appear nude in an “art film” to pay the rent but also the question of whether you are a sell out if you faced with an opportunity for commercial success. Are you a bad person for choosing either of these paths? Professional mentors may not provide the same advice as personal mentors.

He also proposed examining yourself as objectively and dispassionately as a scientist would a bug. Just as a scientist doesn’t make judgments about how the bug would be better bug if it only worked harder or learned more, you should just look at yourself as you are at this moment and simply catalog the features you and others observe.

I thought this was especially apt advice for people in the arts since so much self evaluation is derived from qualitative, often emotionally based criteria. Detachment can be difficult to achieve, but the results can be both valuable and comforting.

Although I have often heard the advice to perform objective self-evaluation and had it compared to a scientific approach, I found it helpful to be reminded that a scientist doesn’t generally wish the insects they are observing were as fast as cheetahs and intelligent as dolphins. They hunker down and try to discover what the bug can teach us about the world.

I also liked Collins advice to look at your statement to question ratio and see how you can double it. He says he was once told that he was spending a lot of time trying to be interesting and that perhaps he should shift his effort toward being interested.

Now I will say that while there is that stereotype of the self-impressed artistic type who makes statements about the “true meaning” of something, I think this is part of the learning process. Often these statements are just an attempt to test one’s view of the world.

I think everyone is allowed to be an unsufferable egoist for while to work themselves out. The problem arises if you don’t realize this is a method of learning and not the default mode of social interaction.

Collins advice is apt both personally and professionally as a method of teaching yourself how to learn from everyone you meet. I think this dovetails well with my post last week about the importance of asking audiences and the community about their experience with the arts rather than telling people what their experience will or should be.

Finally, (and if you have been counting, you know I have covered fewer than 10 points–watch the video it is only 4:30 minutes long and a cartoon for goodness sakes), Collins advice is to find something that you have so much passion for you are willing to endure the pain.

If you are involved with the arts, you have probably already made this decision. Even if Collins wasn’t thinking specifically about the arts when he said this, the animation team was and depicted this point with a ballerina dancing and then massaging her feet.

Info You Can Use: Be Careful of Social Couponing

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If you have been considering using social coupons to increase attendance at your events and attract new customers, you may want to read a study covered last month in MIT Sloan Management Review (h/t Drucker Exchange) that noted the repercussions of a badly designed deal could last for months.

The authors, V. Kumar and Bharath Rajan tracked three businesses for a year after they started their social coupon campaigns. The three businesses did attract large numbers of new customers with the campaigns, but experienced significant losses during the month they offered their deal, in some cases two or three times their normal net monthly profits.

“Such losses would not have been so serious if the businesses were able to achieve higher revenues and increased profits in future months. However, this was not the case. Despite their best marketing efforts, the three businesses had difficulty retaining most of the new customers who were attracted to the coupon offers. Based on our analysis, it will take the car wash service and ethnic restaurant 15 and 18 months, respectively, to recover from the profit shortfall following the coupon launch; for the beauty salon and spa, the recovery period for the coupon campaign at current business levels was projected at more than 98 months, or eight years.”

Now granted, given that most non-profit arts organizations lose money on many of their events, these facts may hardly be a deterrent to using social coupons. However, arts organizations do seek new audiences. The authors state that basic design of social coupons aren’t really conducive to new customer acquisition, but steps can be take to mitigate the losses of a campaign.

One approach may be to upselling or cross-selling products and services. Many theatres have tiered pricing on their seating so being able to upgrade to center orchestra may seem like a good deal to some attendees. If theatres are trying to attract a younger audience, they may want to cross sell tickets to their edgier space whose ticket prices are comparable to the discount the person is paying.

In other words, a person comes in with a 50% coupon for a $30 ticket and the theatre asks if they would like a ticket for a later date at the other space where the top price is $20 for the same $15 price. This approach helps to retain the person for another performance for what is probably the average ticket revenue at the other space.

Another approach the article suggests is limiting the size of the discount and the conditions under which it may be redeemed. They mention that the restaurant in their study later offered 30% discount on two days a week and reduced their losses to close to zero.

They also suggest only offering the coupon to new customers, but I am personally ambivalent about that. I think that sours your relationship with existing customers. If you have ever seen those cable commercials that offer tons of great channels at a low price –but only to new customers–like me you may have been a little annoyed wondering what benefit you will ever derive for having paid your bill on time for 5 years. To my mind, even if it isn’t the same benefit, existing customers should feel like they are rewarded for loyalty if the new kids are getting some sort of incentive to participate.

Give The Gift Of Autonomy For Christmas

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So the big tragedy of non profit arts organizations is that while we are the champions of creativity, we don’t really provide all our employees the most conducive environments for being creative. Sometimes good things happen despite us. Because the workload to personnel ratio is usually slanted in favor of the work load, there often isn’t a lot of opportunity for people to stand back and do some creative problem solving that might result in the alleviation of some of the work load.

A recent post on the Drucker Exchange criticized the industrial age view that long hours and great effort equates to productivity when that simply is not so any more. Andrew Fuqua recently made a related post on the benefit of “slack” in the work place. His post was generally about the computer programming industry, but there were many lessons non-profit arts organizations can take away.

One of the things he says a programming company should do is, “managers must stop assigning tasks.” Instead, it is up to teams to decide how the work will be done. Of course, for non-profit arts organizations, this assumes there are enough people to comprise a team rather than 1 person (or half person departments). But essentially he says, managers shouldn’t be making assignments, handing out work or be an individual contributor.

“Well, gosh, then what should a manager do? Well, I’ll tell ya! You could manage more people. You can still step in when the team needs help (but not too quickly). You are still an agent of the company, handling legal stuff, signing off on expenditures, etc. You can still manage risks, especially if you are a skilled Project Manager.”

Even if that doesn’t sound like something that is viable given the size of your organization, there are other things he suggest that are definitely applicable.

“Keep an eye on the system, looking for improvements
Ensure cross-training is happening (not by making assignments, but making the team handle it)
Understand the dynamics of the organization
Understand how value is created
Protect the team from interference
Make the organization effective; learn to look at it as a system
Support the team
Clear roadblocks
Watch interpersonal interaction — watch when one team member pulls back, withdraws in a brainstorm (for example)
Help the team learn TDD by making room for them to learn (time – remove the schedule pressure while they learn)
Understand the capacity of the team (also a team and scrummaster job)
Think through policies, procedures and reward/review systems and improve them (what messages do they send?)
Understand what motivates knowledge workers (see the previous reference to Pink) and let creating that kind of environment be an imperative”

Arts organizations can definitely benefit from looking at the dynamics of the organization and looking at themselves as a system of interrelated and interdependent parts rather than different segments performing different functions. This approach will help the organization understand where the value they possess lies. It may not only be the stuff you are selling tickets to, but in the expertise that is possessed by the group.

You will see a lot of these factors mentioned as valuable in management texts. The one suggestion Fuqua makes that jumped out at me was in regard to watching when a team member pulls back and withdraws in a brain storm. That can say a lot about the interpersonal dynamics of the organization. It may be viewed as one less person providing opposition to your ideas, but it could be damaging to the organization long term to have someone feel disassociated from the rest of the organization or team.

You might note that Fuqua references Daniel Pink and his talk about what motivates knowledge workers. That motivation is autonomy which repeated studies have shown is more effective than cash rewards.

One of the things Pink talks about is a Australian software company, Atlassian, which periodically gives their employees 24 hours to work on whatever they want. The only proviso being that they share it with the entire company at a party they throw at the end of that period. Apparently the practice has contributed to the solving of a number of problems and the creation of new products.

Imagine what might be produced if you let a bunch of creative arts people loose of their everyday constraints for 24 hours with the promise of beer at the end!

One of the things I know is very important to a lot of people I work with in the arts is professional development opportunities. Again, this is something Fuqua references. Often the biggest thing inhibiting arts people from getting the professional development is the funding. One solution to this problem goes back to my comment a few paragraphs ago about understanding that the value possessed by the organization may not solely reside in the product you are selling to the public.

Your organization may possess expertise that is valuable to other arts organizations and for profit businesses. You might arrange for a cooperative professional development day where all the arts organizations get together and have their staffs provide learning opportunities for each other. You might be able to likewise trade your expertise to area businesses in exchange for training or advice.

Best of all scenarios–your organization (or cooperative of arts organizations) puts together training programs to sell to businesses based on your expertise. Perhaps seminars in team building, creative brain storming, or the selection and lighting of visual art in commercial office spaces.

Domain Knowledge And Arts Management

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I was watching the illustrated lecture seen below on the Drucker Exchange website. William Hopper gives the lecture on domain knowledge which is what a young college graduate would get 50 years ago when he went to work for a large company. Over time, the person would work their way up the ladder of promotion learning the craft of management under the supervision of a more experienced person and you would learn the business of your company.

Hopper says that business schools undermined this system starting in the 70s when they began to spread the idea that getting an MBA would allow you to manage anything. Instead of starting at the bottom, you could go right to the top and need not worry that you didn’t know much about the business of the company because everything operated more or less the same.

It got me wondering if the arts might be heading in the same direction or not with more people getting management degrees and the general itinerant nature of the profession. A good number of the executive leadership of arts organizations are getting ready to retire. Many of them started as artists before moving on to management and then they stayed at their organizations for many years.

There has been discussion about how emerging leaders are having a hard time getting experience because the existing leaders aren’t ready to move on yet. Many of the younger leaders move around a lot trying to find better opportunities. This may be beneficial in giving leaders a wide variety of experiences to draw upon, but doesn’t provide a depth of knowledge about any one organization. Then there is the dearth of good mentors who have the time to act as such for a younger generation.

I was also wondering if aspiring leaders were bringing extensive knowledge of an arts discipline with them these days. Now that there are expanded opportunities to enter cultural management degree programs, these leaders may not have a lot of experience in the means of production for that art. Before I entered my graduate program, I had some acting experience in school and took classes outside of school as well; I worked as an electrician and carpenter in school and for three different summer theatres (plus one where the box office staff was on the electrics crew during strike).

These experiences have ensured that I talk to my tech staff before signing any contract for a performance or rental event.

I am not sure if these sort of activities are part of an arts manager’s career path any more. Be pleased if anyone wants to relate their story.

I do take consolation in the fact that people have to wear so many hats in the arts there is a pretty good chance that even if someone isn’t really familiar with the other aspects of their discipline before they get their degree, they will be fairly well acquainted with the means of production during their first job. Though the lack of resources that create this situation is not really something to celebrate.

I am not entirely sure how to portray this education vs. experience situation. We are in a place where the first generation of people with arts management degrees will be assuming control soon and I think they can probably do so with more confidence than some of their predecessors because they will possess technical knowledge about laws and regulations their predecessors had to learn about as the subject came up.

What they will lack is the experience of working with boards, government entities, unions, foundations and donors over the course of many years in situations where relationships and institutional memory are important. But this is going to be true for any new leader unless they have been promoted to leadership from within, a situation which is becoming ever rarer.

New Year’s Not To Do List

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So I am back and raring to go. This is the first Christmas holiday season I have been away from my bed in about 10 years. I went back to visit places I used to work and gained some insights and ideas. I bookmarked things to write about when I returned, but it will take a little bit for me to sort and process some of these things in my brain. One bit of wisdom to start off the new year I came across was linked to by Daniel Pink. It was an entry on the Drucker Exchange, a blog maintained by the late management guru Peter Drucker’s Drucker Institute.

The entry titled, Your Not-To-Do-List, essentially advises organizations and individuals to examine themselves and decide what efforts they are no longer going to pursue. It sort of follows the idea that if you bring something new into your house, you get rid of something old. In this case, you are encouraged to get rid of something old to leave room for the arrival of future innovations. The Drucker Exchange cites a 2004 interview in Forbes where Drucker says:

“A critical question for leaders is, “When do you stop pouring resources into things that have achieved their purpose?” The most dangerous traps for a leader are those near-successes where everybody says that if you just give it another big push it will go over the top. One tries it once. One tries it twice. One tries it a third time. But, by then it should be obvious this will be very hard to do. So, I always advise my friend Rick Warren, “Don’t tell me what you’re doing, Rick. Tell me what you stopped doing.”

The only hitch I think arts organizations might have with this is that waning audiences can make many programs look like they should be put on the not-to-do-list when some just need the attention being spent elsewhere to succeed. I think it is telling that Drucker focuses on the almost successes and achieved goals for elimination rather than targeting poor performers. While the latter should certainly be examined for elimination, Drucker reminds us not to become too invested in the moderate successes just because they provide a degree of satisfaction.

I just read the article this morning and spent most of the day catching up with a backlog of emails so I haven’t really had time to ponder what I might want to eliminate both personally and organizationally. However, over the holidays I had been thinking of discussing with the staff a new approach to one of our events with an eye to more closely connect with the local arts community. The old approach to the event might be the perfect thing to put on the top of our not-to-do-list.

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Butts In The Seats by Joe Patti is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Unported License.
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