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Tomer Zvulun and the Atlanta Opera: at Crossroads (A)

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Tomer Zvulun and the Atlanta Opera: at Crossroads (A) N9-418-012 JANUARY 13, 2018 MICHAEL L. TUSHMAN KERRY HERMAN Tomer Zvulun and The Atlanta Opera: At Crossroads (A) As Tomer Zvulun, CEO and artistic director of The Atlanta Opera (the Opera), headed down the hall to the rehearsal room, he passed through the wardrobe department, noting the neatly organized floor-to-ceiling stacks of shoes and boots lining the wall and turned on the lights in the rehearsal room; in another 30 minutes the Opera’s orchestra would be warming up for a full rehearsal of Don Pasquale. It was late March, 2017, and opening night was Saturday, just four days away. Despite the gloomy, cold spring weather, the Opera’s offices were abuzz. The week of a new performance always brought a jolt of excitement, but the company had enjoyed a renewed sense of energy and optimism with subscriptions and pledges from donors up, and ambitious new programming scheduled for the upcoming seasons. Much of this was due to the extraordinary efforts of the Opera’s board, and its 2013 decision to hire Zvulun, a young, charismatic artistic and stage director with no managerial experience, as the Opera’s new general and artistic director. In 2012, the former CEO had resigned unexpectedly and the board took over running the company. “The financials were in a mess,” a board member recalled. By 2013, with the search for a new CEO underway, the Opera was in a “death spiral,” as several board members recalled. One added, “We faced some significant deficits, morale was low, and the passion was just not there.” “We were one mistake away from shutting our doors,” recalled Rae Weimer, associate director of development. Most opera companies have two leaders: an executive director for operations, financials and other management aspects, and an artistic director. It was unusual for one person to have both sets of skills; the responsibilities could pit the two roles against one another. “Sometimes you’re forced to give something up in the short term of one production for the longer term health of the organization,” said one insider. Opera Board Member Cathy Adams recalled, “Sure it was risky to hire one person for both roles, but we didn’t have enough money for two people. And we were persuaded by Tomer’s vision, reputation and enthusiasm.” While Zvulun had been New York City’s Metropolitan Opera’s stage director, and had a rising reputation as brilliant stage and artistic director, he had never run a company. He acknowledged, “The idea was exciting but scary. I had no idea how to ask for money from donors; I had never had to sit down and make a balance sheet.” He looked down at his jeans and soft-sole shoes, adding, “And being in an office, behind a desk holding meetings? Who does meetings? I do rehearsals.” Professor Michael L. Tushman and Associate Director Kerry Herman (Case Research & Writing Group) prepared this case. It was reviewed and approved before publication by a company designate. Funding for the development of this case was provided by Harvard Business School and not by the company. The citation review for this case has not yet been completed. HBS cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. DoCopyright © 2018Not President and Fellows of HarvardCopy College. To order copies or request permission or to reproduce materials,Post call 1-800-545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to www.hbsp.harvard.edu. This publication may not be digitized, photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School. This document is authorized for educator review use only by CARIN-ISABEL KNOOP, Harvard Business School until May 2020. Copying or posting is an infringement of copyright. [email protected] or 617.783.7860 418-012 Tomer Zvulun and The Atlanta Opera: At Crossroads (A) Three years later, by 2017, the Opera was back on track. Net assets were up by 27.6% over the previous year. Fundraising had increased by $2.6 million, a 64% jump from FY15-16 (see Exhibit 1). The seasons’ schedules balanced traditional popular main-stage opera with performances of new work, innovative interpretations of traditional operas, and inventive stagings of productions in new, accessible settings. Zvulun had initiated several innovative programs, including The Discoveries Series, and the U.S. debut of an international co-production of Silent Night, which had turned the opera world’s spotlight on Atlanta. A spring performance of The Secret Gardner—in a community garden— had garnered rave reviews in The New York Times, prompting a prominent Atlanta arts supporter and a successful venture capitalist, to proclaim, “The Atlanta Opera is on fire!” The impact was wider ranging. Younger audiences were attending. While donors supported about 70% of the Opera’s income, and subscriptions were ramping back up; ticket sales were on a steady increase. Zvulun had built out a professional management team and expanded the Opera’s arts production team, but the growing popularity, increased performances, and expanded higher-profile productions were stressing Zvulun’s and the organization’s capabilities. Was it time to hire a seasoned chief operating officer? Previously, operations, finance, human resources (HR) and information technology (IT) had all sat under the Opera’s CFO’s purview. But his plate was full, and further, Zvulun felt the time had come to bring in a more senior leadership partner. Zvulun and his senior team debated who should fill this role: an insider who had experience with the Opera and had helped steady its recuperation and recent growth? Or an experienced outsider who would continue to raise the senior team’s capabilities to help take the Opera to the next level? Zvulun’s ambitions were broad reaching. He envisioned raising the Opera to the level of a tier one company—on par with top U.S. operas such as those in Los Angeles, Houston, San Francisco, Seattle, Washington D.C., and Sante Fe. “What distinguishes top companies such as the Met or Seattle?” Arthur Fagen, the Opera’s music director, and chair of Orchestral Conducting at the University of Indiana, said. “They can mount a performance of Richard Wagner’s Ring Cycle, the holy grail of the opera world.” Bringing on board a seasoned, experienced COO could provide the anchor to Zvulun’s senior leadership team, act as an alter-ego for Zvulun, and relieve some of the day-to-day pressures on Zvulun, leaving him more time and freedom to focus on the Opera’s longer range vision and growth and fundraising to support those aims. But could he relinquish control to such a partner; could he share the stage? As they considered Zvulun’s ultimate ambition—launching a Ring Cycle—his senior leadership team weighed the implications of such a goal. Was this the right vision for Atlanta? Was it too much of a reach? Could they depend on Zvulun? Some worried, would Atlanta be enough for Zvulun? For Zvulun, the birth of his daughter Maya, in June 2016, had prompted him to acknowledge he was planting roots in Atlanta; could he reconcile his growing international reputation as an innovative stage director with a more settled life in one U.S. city? And if he could find a middle ground for these ambitions, what would he need to adjust in his management approach? These personal, organizational, and professional considerations weighed heavily on Zvulun and the board. A Brief History: Opera and the United States Meaning “work” in Italian, opera used words (the libretto) sung to music to convey a story to audiences.1 Operas tended to tell stories with drama and grand themes, and drew from a range of literary or artistic sources, from mythology, Greek and Roman tragedies, to Shakespeare and even Docontemporary Not events.2 Copy or Post 2 This document is authorized for educator review use only by CARIN-ISABEL KNOOP, Harvard Business School until May 2020. Copying or posting is an infringement of copyright. [email protected] or 617.783.7860 Tomer Zvulun and The Atlanta Opera: At Crossroads (A) 418-012 Drawing upon the foundations laid by ancient Greek dramas, opera emerged in 16th-century Renaissance Italy.3 From its founding, opera continually evolved, from the splendor of the Baroque Era to the grandeur of the Romantic Era and realism of the 20th century.4 Large orchestras typically accompanied singers, which combined with elaborate sets and costumes to achieve the opera’s dramatic effect.5 Wrote one observer, “While opera combines music, plot and the spectacle provided by the sets, costumes and staging, the result is much more than the sum of the parts. It is truly an audio-visual art form.”6 Operas were performed by principals, who played the lead characters, and the chorus, which either advanced the plot or provided observations. Singers’ voice ranges spanned from soprano (the highest female range) to bass (the lowest male range).7 Behind the scenes, the stage director managed the staging of the production while the conductor led the orchestra, singers and chorus, though an additional chorus master might work with the chorus as well.8 Designers and choreographers also contributed to the staging of a production. The general director managed the entire opera company. He or she was responsible for tasks such as setting a company’s strategy, managing budgets, fundraising, and reaching contract agreements, among other duties.9 Throughout its history, opera crossed national borders and oceans, as composers, singers, and conductors moved between opera houses.
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