Would you sell Michelangelo or cut 150 people?

By Category :

Do you remember the Royal Academy of Arts having a similar difficult situation? Management was faced with the task of reducing annual costs by £8 million: Michelangelo's bas-relief "Madonna Taddei" could save the situation for many years to come (its starting price would have been £100 million). What kind of crisis management regime would you choose: lay off 40% of the staff or sell the only Michelangelo marble in the UK? Or maybe something else?

3 Answers

  1. A little-known fact from the world of museum finance is that all museums in the world are unprofitable — including the Louvre, the Hermitage, London's National Gallery, &c. The problem is the basic costs of operations: space, light, microclimate, security, and so on. The only sections of museums that generate any income are cafes and souvenir shops, while visitors cost museums twice as much as the cost of tickets.

    In addition, London's museums, including the Royal Academy, are free of charge. That is, apart from private patronage, they have no sources of income at all. And by the way, they can't freely trade items from the collection — museum sales are strictly regulated, and as a rule, sales revenue can only be spent on replenishing the collection.

    It is also worth mentioning that RA is a purely private charitable organization. Burlington House, which they occupy, is formally owned by the state, and is leased to them for a thousand years (sic), but they have never received any other state aid.

    So they need to sell Michelangelo. Not at auction, of course (although it will be a much larger sum at auction) — the state should buy it out and transfer it to the British Museum. Based on the following considerations.

    1. The main problem with Michelangelo is that it is a job that is expensive to store and maintain. Anyone who's ever been to RA and imagined Burlington House knows that it's a walk-through yard, which is fine to be a walk-through yard — but it has this damn marble at the back that requires a completely different infrastructure. The British Museum already has this infrastructure, and the cost of storing Michelangelo will be proportionally much easier for the British Museum than RA.
    2. The work is now estimated at about a hundred million, and for the state this is not a very large investment-less than half the cost of one Type 31 frigate, the construction of which can be postponed for a year and launched in 2028 instead of 2027-I am sure the sun will not set over the British Empire for an extra year. I understand that RA doesn't want government interference, but it's better than handing over a job at Sotheby's to go to Abu Dhabi at best, or to anonymous private hands at worst.
    3. To be honest, this work RA simply does not need. It's a treasure, yes. But RA is not a treasure house — it is a large educational office, famous for temporary exhibitions and educational programs. Not a collection. Jeopardizing what RA does well for the sake of just keeping one very expensive artifact is a bad strategy, and everyone in RA basically understands this. The problem is not solved not because the differences are so great, but only because it is not yet possible to solve it properly.

    Such cases.

  2. The question is not mine, but I found it in my “Authors” section, and I'll answer it as soon as I can. Please do not judge strictly.

    In the specific situation described, I would not sell a masterpiece for two reasons.

    1. Any “academies” and” headquarters “are bureaucratic structures that develop according to Parkinson's laws, one of which is:” officials create work for each other.” And if so, then such shakes-abbreviations are very useful for business. Natural selection, so to speak. And England is not a country where it is difficult to find a job. In any case, the dismissed employees will not go around the world and starve to death.
    2. Trite ,but “ars longa vita brevis”. “Art is eternal, life is fleeting,” I apologize.

  3. To answer this question,you need to understand how long the crisis situation will continue, what are the priorities of the business, and its sustainability in a crisis. What is the real business value of an item that can be sold at a high price? If the business promises to develop precisely in times of crisis, according to an analytical assessment, and the thing that can be sold has only a symbolic value, I would sell it. If the crisis does not promise anything positive for my company, then I am inclined to reduce. It's like cutting the tail off piece by piece-sell, invest, and lose. What for? But the question itself has neither a correct answer nor a positive solution. Imagine that you are a lifeguard-two people are drowning-young and old, you can only save one – who will you save? So it is with business support – there are always nuances.

Leave a Reply

Categories