This post is the first in a series of interviews with individuals who have ideas for how museum professionals might leverage this moment to think or work in new ways, or how we might do our work more efficiently and effectively.
This post is from Nik Honeysett, CEO of BPOC, a San Diego-based, non-profit consultancy that provides technology support and development services, and business and digital strategy for the cultural sector. Previously, he was Head of Administration for the Getty Museum. He is a former board member of the American Alliance of Museums and Museum Computer Network, and Guru, a mobile experience startup supporting the cultural, attraction and sports sectors. He is a frequent speaker on issues of organizational and digital strategy.
My “top 5” for digital strategy is a cross between advice about using digital platforms and leveraging a way of thinking that we might call a “digital mindset.” So before I share my Top 5 tips, here are three big ideas about how museums are and should leverage digital platforms and mindsets.
The Real Benefit of Digital is Efficiency and Productivity, not Revenue
There is a misconception about what digital is. People think it involves social media and a website, but it is much more and much more fundamental than that. One knee-jerk reaction to the museum closures was to ask how to generate revenue from digital. But generating revenue takes time, and requires scale. So, if you are doing any kind of online engagement you need to scale up, get in front of more people, this will benefit your online and onsite success. Take generating revenue through online donations as an example. Recently an organization in Balboa Park hosted a Facebook Live event and asked for donations. They got 113,000 views over about four hours and made periodic asks; through this effort they generated around $4,000. A certain percentage of people you are in front of will respond with a donation, so to get $40,000, they need ten times as many views. Scale is a very important aspect of digital.
The real benefit and opportunity of switching to digital is not revenue, it is a way of operating: being nimble, innovative, entrepreneurial, opportunistic, and relevant, because if digital is good at anything, it is good at creating efficiency, productivity, and reach – scale. Digital technology is how you can be more efficient and productive with what you have.
By way of example, the South Bank Center, a performing arts organization in London, moved from a traditional desktop productivity environment to GSuite, that is, shared drives, Google Docs, Sheets and other shared productivity tools. Its a collaborative environment that requires teams work together. They benchmarked productivity before and after the transition, qualitatively and quantitatively. They calculated significant increases in their ability to find things, be more efficient and more productive – the time savings where equivalent of 9 extra people in an organization of around 90.
The challenge here is that by-and-large leadership focuses on real money as opposed to efficiency and capacity building, regarding technology and digital as an expense – “it costs us money”, “can we generate money from it?”, rather than an investment in institutional capability. This expense mindset is reflected in cost-cutting when threatened, rather than looking to accomplish more – if you’re in a hole, don’t keep digging. We need to educate leadership, letting them know that a key economic benefit of digital is the cost savings of efficiency, and the ability to be more productive.
To create better capacity and efficiency in organizations, we use a framework called the Capability Maturity Model. While originally a software development process, it can be applied to organizations as a way of shifting an organization from an ad hoc way of operating to an optimizing environment. Museums often have practices that are inconsistent, with individuals making heroic efforts over long days to achieve results, leading to burn out, underappreciation, and sooner or later they leave. In museums you also have a lack of clarity in roles and responsibilities, as well as unrepeatable processes. The Capability Maturity Model helps organizations address these challenges and become more repeatable, optimizing their environment by looking at four dimensions: people, process, measurement and technology. The capacity-building strategies focus on moving people from untrained to cross-trained, more efficient processes supported by appropriate technology, and collecting data and metrics about performance and using this data to track improvement. Breaking it down into these four dimensions helps to simplify the discussion and the strategy.
Another aspect of digital is innovation, but it requires risk-taking. The capability maturity model mitigates risk because it allows an organization to better understand how its processes work, change them and see the results quickly. Ultimately the goal is to get an organization to a predictive-analytics mode, allowing it to anticipate results before changes are made. This is powerful because museums should take more risks, but risk takers are often filtered out by the hiring process, particularly in large institutions where the HR process avoids risky people. So, when a leader says we need to take more risks, be more innovative, they are usually talking to a group of people filtered for risk taking and innovation.
Museums Need to Rethink their Operating Model
The last few months have created ambiguity and uncertainty. The people who are making it through are the people who are more comfortable with ambiguity and uncertainty. Disruption will be an ongoing challenge, either due to virus flare-ups, or climate change issues that we’ve already seen severely impact museums in susceptible locations. A lot of museums are already planning for a winter closure due to COVID. It’s not just Coronavirus creating uncertainty, there are any number of existential risks coming down the pike, from paying museum staff a living wage, an end to volunteering and changes to, or even elimination of tax exemption. Even several years ago on Museum Advocacy Day, folks on Capitol Hill were talking about reviewing tax exemption because there is so much abuse of it – there was also a view that if you’re an institution for the benefit of a community, the community should fund you. The effect that COVID will have on the national debt will put tax exemption under serious scrutiny, and museums are going to get swept up in this larger analysis. There will be more scrutiny of how you qualify for tax exemption, which will make the qualifying process more difficult. We already have some for-profit museums, and we have new models like Benefit Corporations, which are businesses-with-a-cause, providing a public good while being responsible to shareholders. We may be forced to change our business models.
Even if this doesn’t happen, the pandemic has shown us that we need to urgently diversify our earned revenue streams, and adopt new ways of working, there will be long term consequences and emergent trends we are seeing now, will accelerate. For example, our heightened awareness of hygiene will have an impact on cash transactions. I’ve made one cash transaction in the last 3 months and it was a strange experience, its all going mobile and contactless. The SARS epidemic in 2003, accelerated China’s path to digital payments, COVID-19 is doing the same thing here. To reopen, museums are requiring transactions online before a visit, and there will be no going back. There is a significant benefit to this which is visitor data. On the negative side, a move to contactless and mobile will impact economically challenged communities.
Museums are Businesses
Thinking about museums as a business is really difficult for museum leaders. Museums are mission-driven, but ask a museum employee to recite their mission and they often struggle. Additionally, missions are derived internally and consequently tend to be very internally-focused – “this is what we’re going to do for you”. But missions can be problematic, you can deliver on your mission and be financially in trouble, but you need healthy finances to deliver on your mission.
Mission should be in two parts and much more externally derived – an obligation. A social obligation – what are you doing in return for the privilege of tax exemption? If you are tax exempt, your community is losing tax revenue, so what are you giving back to the community? You also have a financial obligation – you are obligated to run a successful business that allows you to both deliver on your social obligation and support a workforce. “Not-for-profit” is a tax status not a mindset. It doesn’t mean you can’t make money, it means you need to reinvest the money in your organization, at the very least build reserves to smooth out the bad times, something that it appears museums have struggled to do.
We need to figure out how to diversify revenue, particularly earned revenue. Who knows what will happen to the grant-giving world, particularly federal grants. Local and community foundations have focused on emergency services, and there was immediate support for COVID-impacted museums, but this cannot be sustainable. So we need to evolve to produce more diverse earned revenue, not just admissions, it requires we think like a business and make decisions that are more financially sound. A part of this thinking is to regard the cost-savings of technology-enabled efficiency as revenue, either allowing fewer people to do more, or the same people to scale their productivity and reach.
With this in mind, here are five concrete ideas related to digital strategy. Remember: Digital strategy is just good strategy.
1. Digital thinking is a pattern in a stream of decisions.
A digital transformation is most often a cultural transformation, following the 80/20 rule: 80% culture, and 20% technology. Digital is an investment, not an expense, an investment in future-proofing your organization. A digital mindset is innovative, nimble, opportunistic, entrepreneurial, and a questioning mindset, constantly thinking about how to improve, become more relevant, productive and efficient. Transforming an organization is baking these approaches into an organization’s culture.
2. Be thoughtful and impactful in your planning
Measure what you do against its impact and its financial sustainability and stop doing anything that is low on impact and low on financial sustainability, or figure out how to move one of those dimensions to high. Its fine to have something that is high impact but not financially sustainable, as long as it is balanced by something that it high on financial sustainability. In an ideal world, everything you do would be high on both dimensions, but that is often not the case. Everything you do in the digital world should be literally remarkable – so that people remark on it and share with their networks – this is how you create scale. For many, the response to the closures has been to just push any content out to the world, we whould be much more thoughtful and impactful with the content we put out there – its a question of quality and branding.
3. Measure success and act on the data
Evolve from anecdotal conclusions, and use data to understand what works and make the change. If you are not engaging audiences, analyze what is more engaging or stop doing it. If your twitter posts only get a few likes and no shares, why are you doing it?
Traditionally we talk about Key Performance Indicators (KPI) – a quantifiable measure used to demonstrate success. KPIs look back, and not forward. We need to switch to a new model and use Objectives and Key Results (OKR), which require you to look forward by settings attainable goals and working towards achieving them. OKRs require you to plan and act in a way that simply reporting your KPIs don’t. OKRs inform your work instead of reporting retrospectively on it.
4. Assume the lowest common denominator of digital literacy
Digital is new to everybody, it is a constant learning process because the tools morph and change, digitally savvy people are just those who are not afraid to just try and experiment with the tools. Often your staff and your audience don’t want to admit what they don’t know. How do you use Zoom on your phone? How do you tag a museum on Facebook? How do create a Google Doc? How do you assign a task to a team member in Slack? To enable digital literacy is to make basic instructions and training always available, establish both formal and informal learning in your institution, and create user groups for complex technology with your peer communities.
5. Be clear about roles and responsibilities and eliminate silos.
A key digital strategy tenet is common understanding. Common understanding of where data and assets reside, how the organization’s processes work, and common understanding of roles and responsibilities. This should be explicit and implicit. Collaborative environments create an implicit expectation for where things are and how processes work, they demand that staff work collaboratively. Staff roles and responsibilities should be explicitly communicated, otherwise people will morph their job into what they want it to be and do the work they want to do. Collaborative environments, project management tools and a common understanding of processes can significantly reduce the need for meetings and email which are two of the biggest productivity drains in an organization.