Murder-Suicide Avoided in Cleveland

If you follow the orchestra news closely (as I KNOW you all do), you’ve been tracking the labor dispute of the Cleveland Orchestra.

Cleveland may have many problems, including having its economy based on Lebron James, but it also has an extremely fine orchestra, rated one of the best in America.

As you might expect, though, things are tough in Cleveland right now (yes, tougher than average) and the management of the orchestra is looking to cut costs.  The players, whose average salary is high compared to peers at around $115,000, went on strike to protest the proposed cost cutting measures.

In the end, the strike lasted just a couple days, and the union walked away with no pay cuts for 2 years and then modest increases thereafter.  As far as I can tell, no performances were missed, and so the financial impact of the strike was negligible, if anything.

Which is good, because I’ve always thought that when an organization or industry is in trouble, a labor dispute that takes the “factory” offline is proof that smart people can be stupid.  A few years ago, with the National Hockey League reeling from over-expansion in the 90s, canceled a full season because of a labor dispute.  Technically a lockout, the dispute took a bad situation and made it much, much worse,  The NHL had been struggling, but at the time of the lockout was still considered the fourth of four major sports in America (NBA, NFL, MLB being the others).  Now, in the opinion of many, it teeters of the edge of major sport status.  You used to be able to see NHL games on channels you’ve heard of (and may even have) like ESPN and Fox.  Now you have to find a channel called Versus to be able to watch it.

The fact is, the economics of hockey were wrong and without a plan for improving them, they had to be fixed.  The owners and players both failed to come to grips with this and very nearly killed their sport.  It’s like the crew of a sinking ship having duels to the death right on the top deck.

It’s gratifying to see the situation in Cleveland resolved.  But since, as we know, ticket prices have nothing to do with costs, it behooves the Cleveland orchestra to think about ways to generate new value.  Boy is that easy for me to say, and I really do appreciate the enormity of the marketing challenge they face.  The genre itself is challenged and they are in one of the capitals of our recession and they have one of the highest priced orchestras around.

But all the more reason why it must, must, must be about innovation for the Cleveland Orchestra.  New sources of value creation simply must be found.  New ways to connect with and draw value from the audience must be developed.

And I respect the difficulty of that work enough not to try to suggest anything.  But I also know how to market live entertainment, and the answer to Cleveland’s problems is not (ultimately) cost-cutting.  Can’t be.  It may be needed to get some time on the clock to begin developing those new sources of value, but that’s it.  If it’s the solution, and not just a tool to find the solution, it could be the start of a death spiral: a gradually degrading product, which leads to less revenue and support, which degrades the product further.  You see where that goes.

So with all my heart, I wish them well and hope that they’re embracing the real challenge of their situation, which is not finding ways to shave a few pennies off the P&L.