The (In)Efficiencies of Scale (Part Two)

Posted by Michael Hickey, Jan 25, 2013 0 comments

Michael Hickey

(Editor's Note: Michael continues his response to our Animating Democracy Blog Salon from December 2012 in this post. It was originally published on his site January 13, 2013.)

The Means of Production

When you “produce” something, that’s a very different process from “creating” something. Production is about assembly, and scaled production means you can bring all the pieces together in an orderly, timely fashion. Again, this works best when both inputs and outputs are standardized.

Automobiles, microfinance, and high school educations all share this in common. In my comments to Ian’s blog post, I noted that the Metropolitan Museum of Art, with it’s $300 million annual budget, “produces” quite a bit of art: that is, it has assembled a stunning diversity of work created by others. But the process it uses to produce this art is highly standardized, as is the way that we consume it.

When it comes right down to it, the Metropolitan Museum of Art actually creates very little art itself. The same is true for the other captains of the NYC cultural sector (Lincoln Center, MoMA, the Guggenheim, Carnegie Hall), and the rule holds true in other sectors as well.

Therefore: Greater scale = Greater standardization.

Now here’s the rub: from the perspective of creating new works, the vast, vast majority of art is being developed by a veritable horde of small cultural organizations, unincorporated artist confederations, solo artists and professional amateurs. They are just churning it out. These are the folks whose work may someday (through a combination of skill, capable self-promotion and sheer luck) wind up being “produced” through a major cultural institution. And these are the exact same folks whose creative efforts are likely to be completely untouched by “scaled” investment in larger cultural partners, and by the funding efforts of grantmakers seeking to place fewer, larger grants.

In other words, there is an inverse relationship between scaled arts production and large-scale arts creation. And this is exactly where “scale” fails us: standardized production cannot handle diversity, granularity, exception, or fragmentation.

As a matter of fact, scaled production is threatened by these phenomena. This is because in order to support the niche, the artisanal, and the quirky, we actually have to move away from “efficiency of delivery.”

Size Matters: The Matter of Size

Size matters. Just ask him.

Oh dear. Doesn’t this mean that art-making is inherently inefficient?

Well, it cannot be standardized and therefore it cannot be scaled—at least when it comes to delivering capital to the system. And as capital providers, as the folks with the money, it’s very easy for us to think about the question of efficiency only from our perspective. Again, it’s easier to give money in big chunks. The problem is that as we do this, we can actually reduce the amount of new art that gets made.

The good news is that if you think about efficiency in terms of creation, then investing through small grants in a diversity of creative producers is far more efficient than making fewer, larger grants to scaled institutions. Why?

Because for a few thousand dollars per grant (plus the sweat equity you invest in your award making process), you will generate far more art per dollar.  As a matter of fact, not only will you generate more art, but more of every dollar will go directly towards art creation (as opposed to administration and overhead).

And there are some handy ways that you can make this process less painful for yourself as a funder:

  • Invest in your staff so that they have the relevant expertise in their area of grant-making to pick strong arts creators
  • Work with an intermediary to provide scaled services to the field, or to have them make smaller awards out of a larger commitment you’ve provided to them
  • Use a panel of artists and creative sector stakeholders to help recommend and evaluate funding decisions to insure quality and diversity

If we want to invest substantially in developing the creative output of New York City (or any city, town or ‘burb), we actually have to move away from scaled investment towards de-centralized, knowledge and process intensive investment. From the perspective of capital placement, a highly inefficient process.

But if our goal is to support the generation of new work, it’s actually more efficient to support many smaller artists. I believe we will get more art made per dollar deployed if we start giving more grants for $1,000—$10,000. In fact, we actually may get more art consumed.

Some answers to these questions lie within the Cultural Data Project, which actually does track audience data; but as far as I know, no one has actually looked to see what the audience/dollar ratio is.

Not yet at least. Hint hint.

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