Editors’s Note: This is the story of a turnaround. And as with any turnaround situation, the organization was near death, with many in favor of a do-not-resuscitate order. What struck us as important in this story, among other things, was the primary strategy employed—to engage as many stakeholders as possible in the development of a cohesive plan for the future. This plan had to be produced quickly and had to pass muster with the court-appointed receiver, because the organization had already filed for bankruptcy protection.
The enormous energy and wisdom that this strategy drew to the situation should tell us something about the resources available to us that may not typically be used in our own organizations. The high-engagement strategy is transferable, but it requires a deep shared passion and a willingness to work together to co-create a solution for the thing that is to be saved and given new life.
When the Calgary Philharmonic Orchestra (CPO), Canada ’s fifth largest orchestra, sought bankruptcy protection on October 15, 2002, the predominant view of both funders and the public was that the orchestra should not be saved.
Giuseppe Mazzini once wrote, “ Music is the harmonious voice of creation; an echo of the invisible world.” In other words, music is there to be made and it has a will to be realized. In this case, that will exerted itself through those involved with this orchestra.
The 2002/03 season was already under way when the CPO called for bankruptcy protection. Contracts with guest artists were signed or verbally committed to, and subscribers were paid up and expecting to attend scheduled concerts. Calling for bankruptcy protection gave the CPO only seven weeks to come up with a viable business plan that would have to be approved by receivers. So what had prompted such a move?
In fact, behind a thin patina of business as usual, the picture was quite dire. The CPO had never wholly recovered from reductions in government funding two decades before and had already and repeatedly been rescued from financial ruin. And now it had painted itself into another corner with a plan to fund a large portion of its current year’s operations with its next season’s subscription funds. After all, most of the subscription funds for the 2002/03 season had already been spent. On top of this, unsecured creditors were owed approximately $400,000, and liabilities to the musicians and other employees were estimated at over $1 million.
Immediately before and after the CPO filed for bankruptcy protection, the president and CEO and the entire fund development staff of six resigned or were terminated, leaving only a third-year university student fulfilling his four-month practicum. The temporary artistic operations manager fulfilled her short-term contract, and the music director completed his tenure with the orchestra with no immediate replacement identified.
Numerous financial crises over the years had led to staff lay-offs or staff leaving to find more stable employment elsewhere. Salaries were cut, and staff quality declined. High staff turnover and temporary or transient staff adversely affected customer service, fund raising, and administrative infrastructure. Records and files were inadequate and office decorum became sloppy. Redundant approval points were required to double check the work of inexperienced staff, resulting in duplication of effort and unnecessary time delays. Crises management was well entrenched. Pride in the organization plummeted.
Finally, unable to cover payroll, the CPO was forced to lay off all 65 musicians and reduce its staff to ten.
The administration offices were piled high with close to 300 boxes of old files. Ten half-ton truckloads of garbage and dilapidated furniture were disposed of, and hundreds of boxes of files were archived.
Even before things came to a head, the relationship between the musicians, board, and staff had been strained, having deteriorated to such an extent that the various parties could not abide sitting together in the same room. Communication at the CPO was a “top down” affair and, despite the fact that the musicians have a high level of education and creativity, they had mostly served in token roles in operational and fund development activities. Thus the symphony’s core asset, its musicians, had been substantially disengaged from its course setting, despite having five voting seats on the board. While this was an outcome of the history and traditions of the symphony, where musicians follow the directions of the conductor and section principals without asking questions, it was a disaster when it came to planning or acting in concert as a whole organization.
Luckily, there was a flash point issue symbolizing the differences between the musicians and other parts of the organization: the size of the orchestra. A contentious debate had been raging between musicians, board, and funders on this issue for several years. Positions were sharply divided. Musicians wanted to maintain the orchestra size at 65, while the funders felt the only sensible course was to reduce the orchestra size to 55 or fewer and possibly to combine it with the Edmonton Symphony Orchestra, 300 kilometers to the north. The board’s decision on this issue turned out to be the leverage point for change.
The musicians were angry, frustrated, and demoralized, but they were also totally committed to retaining the ensemble at 65 in order to preserve artistic integrity. When the board made the decision, over funder objections, to maintain the size of the orchestra if a sustainable business model could be put in place, it constituted a watershed moment in the organization’s turnaround. The decision drew in and galvanized the musicians. In exchange for the board’s conditional act of faith, they agreed to support the ongoing leadership of the board chair, despite their initial belief that he was responsible for the current state of affairs. Finally, a real collaborative effort rose out of the ashes of past conflicts and mistakes.
Suddenly, there was a will to pull together as a whole. Teams that cut across stakeholder groups were quickly assembled to address the following strategic issues:
- customer demographics, including current and potential new markets
- immediate and long-term revenue opportunities
- artistic visioning and programming alternatives
- the competitive landscape
- organizational structure and governance
- examination of fundraising practices and opportunities
- communications and branding
- alternative facilities and venues
The teams were required to collect information, compare and contrast alternatives, identify trends and opportunities, identify and address issues, and co-create solutions, within a predefined time period.
Despite this now-united will to create a viable future for the CPO together, the road ahead would be very long and laborious. Specifically, the time commitment for the work of the teams was daunting. They generally met daily for the seven weeks allotted for development of the plan. During this time, the teams donated an estimated 8,000 hours, with team meetings often beginning at 7:00 am and running until midnight, seven days a week, for seven weeks. Most were comprised of volunteers since almost no one was on staff, so there was a real possibility of burnout. To keep the groups focused and flexible, the teams started or completed their tasks at different times. This so-called staged approach enabled each group to hand off concepts to others in a logical progression.
An overall strategy integration team, which consisted of the chairs of each task team along with the local union representative, worked to synthesize all the information and recommendations forwarded by the other teams to form a comprehensive renewal plan. This team met for two to three hours every other day for seven weeks.
Given the time commitment, it was important to ensure that each team member was fully vested in decision-making. A fact-based approach leveled the playing field and allowed the group to achieve consensus. The task teams researched, analyzed, and shared a wide variety of information, including:
- research studies
- benchmarks from at least 45 orchestras of various sizes worldwide
- iinterviews and discussions with key stakeholders
- significant community input, including 1,000 telephone interviews and a survey of more than 1,250 patrons
- current and historical market research
- collective knowledge and experience of musicians, staff, board, and external facilitators
In order to reestablish the first connection back to the community, the CPO crafted a deliberate media strategy to announce