The "Business" of Show

I realized, after I wrote that last post on The Standard Model, I only told half of the story. There’s more to The Standard Model, and it’s a large factor in the way theatre is made: how the money is raised and allocated. Again, this is something that I have strong feelings about, but I will try to present it objectively.

The federal rules on non-profit organizations (501(c)3 status) requires that the organization have a board of directors and corporate officers. Early in almost any theatre company’s history, these people are the artistic members of the community, along with friends, family members, mentors, the people providing the initial funding. All decisions, both artistic and financial, are made by the artistic members. Usually, there are only nominal titles, but the work is done by all capable of doing work.

The early days of a theatre company is catch-as-catch-can. If you can write a decent sentence, you’re writing grants. You can count, you’re the money person. Very rarely does anyone have any training in what they’re doing. Often, they just walked into the office at the right (or wrong) time.

If the company is successful, the grind of artistic administrative work usually takes its toll. Also, with more money coming in from artistic endeavors and better fundraising, means there’s money to hire a staff. This is the first step in institutionalization and, in general, the artistic members are all involved in this discussion and in the creation and staffing of the new positions.

As the company grows, new board members are brought on, board members who have more money, access to more money for the theatre. As more money comes in, the staff grows, the positions become more departmentalized and “professional”. Also the board begins to grow in power and influence. This is generally regarded as a good thing. A board that provides more money exerts more influence on the growth and direction of the company.

Eventually, the standard business model emerges: the organization is effectively cut in half. On one side, you have the artistic staff: Artistic Director, Literary Manager, Associate Artistic Director, etc. On the other, the administrative or business staff: Executive Director, Managing Director, Development Director. In very large organizations, there’s little meaningful contact between the two. The artistic staff reports to the Artistic Director, the administrative staff reports to the Executive Director, the Artistic Director and the Executive Director report to the board. The board, in stark legal terms, are responsible for the financial health of the theatre. If there are improprieties, it’s the board that’s ultimately responsible. If there are financial setbacks, it’s the board that deals with it. In real world terms, this means that the board is directing the actions of the organization. In general, they have the power to hire, and fire, both the Artistic Director and the Executive Director. They approve the theatre’s seasonal budget, at the very least, have nominal veto power of the selection of plays. At the end of the day, the buck stops with the board.

This is true for most any middle-sized or larger theatre from New York City to Des Moines to San Francisco.

It’s a big part of the problem.

Keep reading for the problem…