Widespread Mergers: Could It Work in the US?
At the 2012 American Association of Museums conference in Minneapolis, along with Ole Winther and Marieke Van Damme, I presented a session on the concept of widespread, proactive mergers across the museum field in the US. This session was inspired by a presentation Ole gave at the European Museum Advisors Conference in 2010 about widespread mergers in Denmark and was further fueled by the growing concern Marieke and I share about the long-term sustainability of US museums, many of which are finding capacity building and improving public value to be Sisyphean tasks.
We are using this page to document the session. Below you will find background information, notes from our audience discussion, and a resource list. You can download the session PowerPoint presentation here. If you have questions or comments, or are considering facilitating a proactive merger discussion at your next museum conference, you can post a comment on this page or email us:
Rainey Tisdale: raineytisdale at gmail.com
Ole Winther: ole at kulturstyrelsen.dk
Marieke Van Damme: marieke at bostonhistory.org
For the past ten years, museums in Denmark and Norway have been undergoing sweeping reform, including widespread mergers supported by the national government. These mergers have reduced the number of state-subsidized museums in Denmark from 170 to 111. Norway’s numbers are even more dramatic: 350 museums have merged to 75. Although there have been plenty of bumps along the way, both countries report that collections are better cared for, administration is consolidated, risk is minimized, and the public is better served.
Meanwhile, here in the US, there are a handful of isolated museum mergers each year. Usually we see these mergers as a last-ditch effort when ailing museums face closure; therefore we associate mergers with failure. But what would happen if we instead started to see mergers as a proactive option all healthy museums consider during strategic planning, as natural to us as drafting a collections policy?
Reports from the field are troubling. In the AAM Annual Condition of Museums in the Economy 2011 survey 71% of American museums reported economic stress ranging from moderate (39%) to severe (14%) to very severe (18%). The 2005 Heritage Health Index warns millions of objects held by US museums and historical societies are at risk from poor storage conditions as well as inadequate staffing and disaster planning. The 2009 TDC white paper “Building a Sustainable Future for History Museums” reports that significantly increased performance expectations, coupled with particularly high capital costs for maintaining collections and buildings, have set up many institutions for failure. At a time when everyone in the field is talking about sustainability, the future of museums, collaborations, and creative solutions, shouldn’t we own the discussion of this controversial topic and have it on our terms, before more museums face closing their doors and have to make tough decisions under duress?
During our AAM session Ole Winther, head of the Museums Department at the Danish National Heritage Agency, described the widespread merger process there. Then Marieke and I facilitated an audience discussion. Audience members reported that they were intrigued by this idea. We all agreed that mergers are not a panacea, and that the US has a radically different governance and funding model. But nonetheless, the possibility of somehow changing the entire system, so that individual museums no longer have to pull themselves up by their bootstraps against a host of odds, warrants further discussion across the field.
Main Points from Ole Winther’s Presentation
- The museum mergers in Denmark did not take place in a vacuum; they happened because of larger national reform that consolidated local government districts. In most cases the new local governments initially recommended a merger and then the Danish Heritage Agency provided support to make it happen.
- The mergers have been accompanied by national initiatives to improve research, access, and collections care.
- Museums are still merging, but at some point they will stop—there is such a thing as too few museums.
- Total annual museum visitation in Denmark has not decreased despite fewer institutions. On the contrary, total visitation has risen.
- Many museums fought the mergers at first, but now that a number of them have been successful, some institutions are even volunteering to consolidate.
- In general the museum friends groups were the source of the most community opposition—and in a few cases the friends groups made management of the museums very difficult.
- The merger process was stressful for many museum directors because it directly affected their jobs. But in the end a number of them were relieved to go back to research and programmatic positions without the administrative headaches.
- A new national museum law is currently in process. If passed, it will further improve and strengthen the national museum system.
- In Denmark if a state-subsidized museum is not performing to standards, the Heritage Agency is authorized to take the keys to the museum. This rarely happens, but there are two museums currently under consideration.
- So often we see mergers as having a winning institution and a losing institution—maybe we need to find a way for it not to seem so polarized.
- In the US the research suggests that nonprofit mergers rarely save institutions money; instead they build capacity and allow institutions to use their money more effectively.
- It so often feels like there’s a hidden agenda behind a merger, that it’s driven by politics. This is one of the reasons they have a negative connotation.
- If we merge, can we pay our staff higher salaries?
- Many US nonprofit boards are under-functioning and asleep at the wheel. This is both one of the reasons more mergers aren’t happening and also one of the barriers to moving forward with this idea.
- It may be the mid-sized institutions we really have to worry about—the big ones already have economy of scale, and the little ones can continue operating on shoe-string budgets (see Paul Light article below).
- It’s important to see mergers not as black-and-white but on a continuum of options museums have, from collaborating on individual programs, to sharing back-end resources, to merging outright.
Stakeholders with a vested interest in proactive mergers:
- Executive directors
- Museum staff
- Members and friends groups
- Community at large
- Federal government
- State government
- Local government
- Tribal government
- Cultural tourism
- Granting/regulating agencies
- Organizations that have contractual relationships with the museum
- Any and all collaborators
Arguments against mergers and how they might be neutralized:
- Museums will lose their identities (Does identity matter if you aren’t healthy enough to fulfill your mission?).
- Board members are territorial (No responsible board member in 2012 should be satisfied with the status quo).
- Executive directors don’t want to lose their jobs (Institutional stability is an amazing legacy).
- Communities will fight mergers (Maybe they need to see what museums can do when we’re thriving).
- You can’t merge museums that have very different collections/missions (That shouldn’t stop us from merging the ones that do make sense).
- The government can’t step in here the way it did in Denmark (Maybe foundations or some other 3rd-party broker can instead).
- Museum volunteers will fight this—they don’t want to lose their sweat equity (If the museum is only reaching a small number of volunteers and core members, it’s not actually a museum that serves the community, it’s more like a club).
- Everyone fears change, loss of status (Look at a case study like Peabody Essex Museum—now, so many years later, we can see that the merged institution is much stronger and healthier. If you don’t embrace change you close yourself off from better possibilities).
Things that need to happen for the field to embrace proactive mergers:
- A system of support for institutions undertaking mergers (funding, hand-holding)
- Neutral leaders to set the ball rolling
- Studies/analysis of data
- Buy-in from national/regional/state professional associations (maybe they could play 3rd-party broker role, do some hand-holding, and take some risks)
- Buy-in from stakeholders
- A communication strategy
- More vision overall (what does a successful museum look like?)
- Skilled facilitation of lots of conversations
- More case studies so we can figure out what works and what doesn’t work; then individual museums can decide for themselves based on a larger body of information
Concrete Steps for Moving Forward:
- Further consciousness-raising to create a more positive perception of mergers
- Teach proactive merging in museum studies programs
- Approach major museum funders about possibly supporting a merger initiative
- Create a clearinghouse for resources/information
- Identify a neutral party to broker mergers
- Study the corporate world to find models of success
- Publicize the Nordic case studies of widespread mergers more widely here in the US
- Investigate incentives for mergers—something like tax credits?
AAM Information Center on mergers
“Building a Sustainable Future for History Institutions: A Systemic Approach,” Elizabeth Cabral Curtis and Susan Nelson, 2009, Technical Development Corporation, Inc.
“Museums and the American Economy in 2011: A Report from the American Association of Museums,” April 2012
“A New Day for Local History: No Longer an Island,” Lisa A. Anderson, Jody A. Crago, and Peter H. Webb, History News, Autumn 2011 (vol 66, no 4)
Nonprofits in General
(A note on terminology: if you’re researching nonprofit mergers online, it’s helpful to know that they often fall under the more general heading of “strategic restructuring” or simply “collaborations.”)
SeaChange-Lodestar Fund for Nonprofit Collaboration, a national funder of nonprofit strategic restructuring (a number of local or regional community foundations are also creating funds for nonprofit collaborations, alliances, and mergers. Check to see if such a fund is available in your area).
La Piana Consulting, one of the leaders in guiding nonprofits through strategic restructuring, provides numerous articles and resources
The Foundation Center’s Nonprofit Collaborations Database (case studies):
Resources from Fieldstone Alliance
“Merging Wisely,” David LaPiana, Stanford Social Innovation Review, Spring 2010
“Nonprofit Mergers and Acquisitions: More Than a Tool for Tough Times,” Alex Cortez, William Foster, Katie Smith Milway, The Bridgespan Group, 2009
“Merger Myths: 6 reasons the package really is on the truck,” Thomas A. McLaughlin, The NonProfit Times, April 1, 2009
“Four Futures,” Paul Light, NonProfit Quarterly, 21 December 2008