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Arts Management, ownership, and control
There are essentially three ways to structure organizational ownership in most societies. Each has an impact on control, resource, and operations.
I read somewhere
that if pedestrians didn’t break traffic laws to cross
Times Square whenever and by whatever means possible,
the whole city
would stop, it would stop.
Cars would back up to Rhode Island,
an epic gridlock not even a cat
could thread through. It’s not law but the sprawl
of our separate wills that keeps us all flowing.
Mary Karr, from “A Perfect Mess”
There are many ways to organize a durable arts enterprise – nonprofit, for-profit, cooperative, public, collective, collaborative, or combinations thereof. At the center of the choice and the consequence are ownership and control.
The designation of an “owner” determines the nature of control – who gets to choose what the enterprise does and how it moves in the world. Ownership and control also inform the kinds of revenue and resource available; the conventions and compliance requirements that shape operations; and, of course, the legally responsible parties if things go wrong.
There are essentially three ways to structure organizational ownership in most societies:
Ownership by Somebody (private ownership) where one or more individuals or entities own the organization. Here, the owners directly control the choices of the organization or they hire people to make choices on their behalf.
Ownership by Everybody (public ownership) where all eligible citizens of a city, state, or nation own the organization. Here, control is determined by political process, for example by electing representatives who make choices or hire people to make or execute those choices.
Ownership by Nobody (nonprofit ownership) where the organization is held in the public trust. Here, the entity is usually controlled by a governing board that make choices directly or that hires people to make choices with board oversight.
Each of these ownership structures brings different benefits to creative work (dare I say affordances?). Private ownership can draw private investment, along with retained earnings from profits. Public ownership has access to compelled investment (aka taxes and fees). Nonprofit ownership opens access to contributed operating support, capital, and volunteer labor, among other things.
Each ownership structure also brings challenges or negative tendencies. Private ownership is tightly reliant on commercial markets, and therefore can be crass. Public ownership is entangled with public policy and politics, and therefore can be crude. Nonprofit ownership can be reliant on wealth, power, or in-group bias through social forces, and therefore can be closed. For more on this, see the Three Sectors framework.
The trick for Arts Management practitioners is to know the opportunities and challenges their current entity type affords, and to navigate the negative while amplifying the positive. If you’re in the difficult position of choosing an ownership structure for a new venture, it’s essential that you match the motivations, mission, and resource needs of the entity to the ownership structure that serves it best. It can be helpful to look at other ventures like yours to see what sector they’re in. But don’t be driven only by convention. Be aware of your particular context and its consequences.
Ownership and control structures essentially create the “acoustics” for your enterprise – the resonance and relationship spaces that amplify or dampen its efforts. If those acoustics are a poor fit, your performance will be a constant struggle; if they are a good match, your organization has greater opportunity to shine.
From the ArtsManaged Field Guide
Function of the Week: Sales
Sales involves designing, deriving, and capturing inbound revenue from goods, services, or access.
Framework of the Week: What? So What? Now What?
What? So What? Now What? offers a lightly structured process for reflective inquiry or difficult discussions. It encourages participants first to define/describe an idea, issue, or incident (What?), then connect it to relevant context or consequence (So What?), and finally consider options for future action (Now What?).