Mga week 509 mhver


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Mga week 509 mhver

  1. 1. MUSM7032 Museum and Gallery Administration Week 5 [email_address]
  2. 3. Funding and Finances <ul><li>Where does the money come from? </li></ul><ul><li>How can you tell what an organisation is worth? </li></ul><ul><li>How do you plan an annual budget? </li></ul><ul><li>How do you manage the income and expenditure? </li></ul>
  3. 4. <ul><li>Where does the money come from? </li></ul><ul><li>Sources of funding: </li></ul><ul><li>Public funds - Government </li></ul><ul><li>Sales - goods and services </li></ul><ul><li>Grants and contributions </li></ul><ul><li>Investments/Endowment </li></ul>
  4. 5. Funding & Income (from DASR)
  5. 6. Trends in funding sources <ul><li>Public funds falling as proportion of income </li></ul><ul><li>Increased emphasis on sales and diversification </li></ul><ul><li>Increased emphasis on grants and contributions, with specialist staff and Development units </li></ul>
  6. 7. “Sales of goods and services” <ul><li>Can include: </li></ul><ul><li>General admission fees </li></ul><ul><li>Special exhibition admission fees </li></ul><ul><li>Shop </li></ul><ul><li>Venue hire </li></ul><ul><li>Cafe and catering </li></ul><ul><li>Special programs fees </li></ul><ul><li>Consultancy/service fees </li></ul><ul><li>Loan fees - objects, exhibitions </li></ul>
  7. 8. “Grants and contributions” <ul><li>Can include: </li></ul><ul><li>Grants from public funds </li></ul><ul><li>Membership fees </li></ul><ul><li>One-off gifts from individuals </li></ul><ul><li>Grants or donations from Trusts and Foundations </li></ul><ul><li>Sponsorship </li></ul><ul><li>In-kind sponsorship </li></ul><ul><li>Regular giving </li></ul><ul><li>Legacies </li></ul>
  8. 9. <ul><li>Two examples: </li></ul><ul><li>General admission fees -sales </li></ul><ul><li>Lottery funding - grants </li></ul>
  9. 10. General admission fees vs free entry <ul><li>USS Constitution: </li></ul><ul><li>Small organisation </li></ul><ul><li>Large pool of potential visitors </li></ul><ul><li>15% of income from admission fees </li></ul><ul><li>Substantially increased income from other areas - shop, donations </li></ul><ul><li>No mention of increased costs of extra visitors </li></ul>
  10. 11. General admission fees vs free entry <ul><li>UK National Museums: </li></ul><ul><li>Large organisations </li></ul><ul><li>Potential visitors? </li></ul><ul><li>Around 10% of income </li></ul><ul><li>Government increased funding by GBP 27M </li></ul><ul><li>Museums complained of large increased costs in wear and tear, programs, consumables </li></ul>
  11. 12. <ul><li>Selwood (2005) p 445 </li></ul><ul><li>“ Competition for people’s time - and people’s desire for novelty- is so great that, in general, museums that fail to improve what they offer to visitors can be seen to have experienced falling attendance. </li></ul>
  12. 13. <ul><li>Selwood cont </li></ul><ul><li>Our research suggests that if museums want to sustain - let alone increase - attendance they must constantly refresh themselves through new developments or attractive programs such as temporary exhibitions.” </li></ul>
  13. 14. 2. How can you tell what an organisation is worth? <ul><li>Balance sheet and/or statement of financial position </li></ul><ul><li>Shows Assets and Liabilities </li></ul><ul><li>Usually find them in annual reports </li></ul><ul><li>Show overall health of the museum or gallery </li></ul>
  14. 16. 3. How do you plan an annual budget? <ul><li>Byrnes (2003), p 207 </li></ul><ul><li>“ A budget is a financial expression of the plans of the organisation” </li></ul>
  15. 17. Expenditure <ul><li>Three types of costs: </li></ul><ul><li>Fixed costs eg Electricity bill </li></ul><ul><li>Semi-fixed costs eg salaries </li></ul><ul><li>Variable costs eg travel </li></ul>
  16. 18. <ul><li>Two types of budgeting: </li></ul><ul><li>Incremental budgeting - look at what you spent last year, and allow the same again, or more, or less. Top down. </li></ul><ul><li>Zero-based budgeting - build up complete budget for each planned activity or operation, include everything. Bottom up. </li></ul>
  17. 19. After Heller (2001) Top down vs Bottom up discussed not stated Priorities reviewed none Alternatives periodically annual Frequency more less Time and effort wide range budget holder People involved whole of business individual function Needs awareness of best/worst one sum Amount activity last year +/- Basis zero spend last year Starting point
  18. 20. Annual Budget cycle <ul><li>Establish plan for year ahead </li></ul><ul><li>Estimates for new and ongoing activities compiled by managers </li></ul><ul><li>Collated into draft budget </li></ul><ul><li>Compared with funds forecast to be available/risk/cashflow by budget cttee </li></ul><ul><li>Amended and agreed </li></ul><ul><li>Implemented and issued to budget holders </li></ul><ul><li>Usually separate process for recurrent and capital </li></ul>
  19. 21. 4. How do you manage income and expenditure? <ul><li>Two main systems: </li></ul><ul><li>Cash accounting </li></ul><ul><li>Accrual accounting </li></ul>
  20. 22. Regular reports <ul><li>Overall - income and expenditure </li></ul><ul><li>By Department or budget </li></ul><ul><li>Cashflow and cash position </li></ul>
  21. 25. Financial controls <ul><li>Agree standards - eg everyone will stay within budget </li></ul><ul><li>Monitor - by regular reports </li></ul><ul><li>Analyse - often manage by exception. Look for variances or differences from last year </li></ul><ul><li>Action - sort out issues as arise </li></ul>
  22. 26. <ul><li>Internal controls </li></ul><ul><li>Include - approval levels, separation of duties, multiple checks, limits on expenditure, reviews of risk areas </li></ul><ul><li>External controls </li></ul><ul><li>Include - regular audit of accounts each year, agreed risk areas </li></ul>
  23. 27. Branding
  24. 28. Museum branding <ul><li>Wallace (2006): </li></ul><ul><li>“Branding a museum starts with identifying its mission, a promise that every member of the museum family can agree with and adhere to... </li></ul>
  25. 29. Branding <ul><li>...Branding continues when the museum develops a personality, a way of collecting and interpreting and talking that has a distinctive style. Branding becomes truly effective when all the Museum’s constituents hold the same indelible image of the institution.” </li></ul>
  26. 30. Confusing language <ul><li>Corporate identity - what the organisation decides is its mission/essence </li></ul><ul><li>Corporate image - what stakeholders see as the organisation </li></ul><ul><li>Branding - what joins it all together </li></ul>
  27. 31. <ul><li>Maclean (1995): </li></ul><ul><li>Communication is a museum-wide activity </li></ul>
  28. 32. Wallace (2006): Museum Branding <ul><li>Exhibitions </li></ul><ul><li>Education programs </li></ul><ul><li>Staff </li></ul><ul><li>Volunteers </li></ul><ul><li>Uniforms </li></ul><ul><li>Membership </li></ul><ul><li>Fund-raising </li></ul><ul><li>Shop and Merchandise </li></ul><ul><li>Website </li></ul><ul><li>Publications </li></ul><ul><li>Entrance </li></ul><ul><li>Signage </li></ul><ul><li>Cafe </li></ul>
  29. 33. Branding - issues <ul><li>Differing understandings of identity, brand and branding </li></ul><ul><li>Lack of coherent strategic plan makes consistent branding difficult </li></ul><ul><li>Silos or different activities can lead to proliferating and competing brands </li></ul><ul><li>Branding exercises done by outsiders can seem superficial </li></ul><ul><li>Cont... </li></ul>
  30. 34. Branding - issues cont <ul><li>Participation of staff important to understand relationship of mission to different activities </li></ul><ul><li>Tension between reality and image that Museum or Gallery wants to portray </li></ul><ul><li>Needs a watchdog to ensure consistency - usually Marketing and/or Design departments </li></ul>
  31. 35. Case studies <ul><li>Natural History Museum </li></ul><ul><li>British Airways </li></ul>
  32. 36. NHM - Rebrand
  33. 38. British Airways 1
  34. 39. British Airways 2
  35. 40. British Airways 3
  36. 41. Marketing <ul><li>P Kotler and Scheff (1997): </li></ul><ul><li>Marketing is, “a means for achieving the organisations’ goals, and using marketing and being customer-centred should never be thought of as the goal in itself.” </li></ul>
  37. 42. Approaches to Marketing <ul><li>Product-oriented </li></ul><ul><li>Sales-oriented </li></ul><ul><li>Customer-oriented </li></ul>
  38. 43. Marketing plan <ul><li>Aageson (1999) A marketing plan is built in five steps: </li></ul><ul><li>Situation analysis </li></ul><ul><li>Determining market opportunity </li></ul><ul><li>Setting market objectives </li></ul><ul><li>Strategy and program development </li></ul><ul><li>Implementation, monitoring, evaluation </li></ul>
  39. 44. Case study <ul><li>Te papa resource </li></ul>
  40. 45. Exercise
  41. 46. <ul><li>Legislation/Constitution </li></ul><ul><li>Vision/Mission/Purpose </li></ul><ul><li>Strategic Plan </li></ul><ul><li>Operations Projects </li></ul>
  42. 47. Study Evaluation