SMU DataArts, in partnership with The Wallace Foundation, today released a reportThe Alchemy of High-Performing Arts Organizations that identifies common strategies that leaders of 20 high-performing arts organizations reported using to achieve organizational health. Though the study was undertaken prior to the onset of the COVID-19 pandemic, it is shared with the hope that the past experiences of these organizations may inform thinking about strategies for recovery. The paper is co-authored by SMU DataArts Director Zannie Voss, Ph.D. and Research Director Glenn Voss, Ph.D., and is available for direct download on the Wallace Foundation website as well on the SMU DataArts website.
The report examines two cohorts of organizations: 10 with a long track record of high performance and 10 that engineered a turnaround from low to high performance. The 20 organizations were selected for their high performance along seven financial and operating metrics relative to others, using a technique called stochastic frontier analysis that allowed the authors to take into account differing contexts and starting points. The factors that leaders credited for the organizations success were derived from structured, in-depth interviews. These interviews revealed that leaders had a mental map or playbook that linked strategic decisions to outcomes. The report analyzes commonalities across the two groups of 10 over the past five to seven years and offers a model of how they achieved organizational health by linking strategy and financial sustainability.
Our research has shown that success is not accidental or haphazardit is achieved through a strong vision linked to a series of strategic decisions and outcomes, said Zannie Voss. While individual organizations are facing their own set of challenges, we hope this report will inspire new thinking about possible ways forward, while providing guidance to organizations for recovery and long-term sustainability.
According to the interviews, the cornerstone of high performance appears to lie in the alchemy of high standards in the creation of work that is meaningful to the local community. While this deceptively simple statement may reflect universal intentions, executing on it, according to these organizational leaders, takes humility and an intensive investment of resources and time.
According to the leaders who were interviewed, organizational heath was not built all at once but over the following stages:
Strong cornerstones of a strategic vision led to these short-term outcomes: tactical wins that inspire confidence and excitement, a stronger brand, a high-functioning board, and community relationships and buy-in.
Additional key factors were important contributors to success, including mission-driven decision-making throughout the organization, a healthy culture that invites participation, adaptive capabilities, investments in marketing and fundraising, and a multiyear horizon. Environmental factors such as shifting consumer behavior and funder priorities, local population and policy changes, natural disasters, and national crises such as a pandemic also affect an organizations ability to achieve short-term gains.
Short-term outcomes provide a feedback loop that reinforces the cornerstones of strategic vision and leads to intermediate outcomes, including increased organizational capacity and increased engagement among audiences and donors. These resource and relationship wins reinforce an organizations community orientation and advance its ability to achieve high programming standards.
Intermediate outcomes also lead to financial sustainability, provided the organization exercises discipline. Arts and cultural organizations exist for mission fulfillment, not financial sustainability. Yet the long-term outcome of financial sustainability undergirds the ability to maximize mission success.
As arts organizations are struggling with the pandemic, we hope that lessons from healthy organizations from the recent past will be helpful in informing their thinking about the future, said Bahia Ramos, director of arts at The Wallace Foundation. This report is the first in a series of resources that The Wallace Foundation and our partners will release in the coming months. While there is no silver bullet, these resources can help inform arts leaders as they navigate unprecedented levels of uncertainty.
For more information on findings from The Alchemy of High-Performing Arts Organizations, including excerpts from interviews with organizational leaders, background on methodology and the conceptual model or blueprint, please download the full report on Wallace's website