Utah Opera merger case study Essay
Utah Opera merger case study
In analyzing the Utah Symphony and Utah Opera merger case study, it was obvious that many factors, finances, personalities, and even the community would be involved. The wide reaching affects of a merger between these two types of organizations was eye opening. At the time of the proposed merger, the Utah Opera had a stronger financial footing and was not in danger of closing. The Utah Symphony however, was sliding down a dangerous financial slope. The organizations were structured differently in their number of employees and financial compensation packages. These differences would prove challenging in a merger and could be the basis Bill Bailey would use to oppose such a merger. Bill Bailey, Chairman of the Board of the Utah Opera Organization, could site Adam’s Equity Theory model in opposition to the merger. This theory basically states that an individual’s behavior is motivated by feelings of inequity or injustice (Kreitner & Kinicki, 2010).
The inequity between the two organizations is vast. The opera is financially sound and has very few full time employees as compared to the symphony. The artists for the opera are hired for the individual performances and not contracted year round like the symphony performers. The symphony also has four times the number of employees and these are unionized contracts. So in Bill Bailey’s eyes, the opera is being used to bail out the larger symphony with it’s more financially sound budget. Also, the symphony performers will still expect this type of compensation after a merger and the opera performers would not receive the same benefits. This would be seen by the opera staff as negative inequity in that the opera is saving the symphony and not reaping the same rewards. The Utah Symphony is also a more widely known organization and this may also be negative in that the opera will essentially be immersed within the symphony.
This could potentially be damaging to the opera leaving it overshadowed by the symphony even though it was a previously thriving organization. These instances of inequality could hamstring both the symphony and the opera by fostering animosity between the two groups of artists. In the long run, this could force performers to leave and find employment elsewhere which would be a detriment to the Utah performing arts community. Scott Parker’s task is to convince Mrs. Abravanel to support the merger. He could use Vroom’s Expectancy theory to make his case. Vroom’s theory is that people will generally do what is necessary to produce desired results (Kreitner & Kinicki, 2010). So when explaining the symphony’s current financial status and the prospective status in the upcoming two years, the goal of remaining an operating entity should be paramount. The symphony could potentially have to be dissolved if the current operational status continues.
The ultimate goal for Mrs. Abravanel would be to keep the symphony operating and allow it to stabilize and grow. This theory could be used to garner her support and the support of the symphony performers as well. If everyone at the symphony supports the ultimate goal of saving the organization, the group will be more supportive of the merger. If the performers want the symphony to succeed we could expect them to be more flexible when it comes to terms of the merger. Anne Ewers is the general director of the Utah Opera. Her positional power as general director is garnered from her formal authority as leader of the opera. She has been the director for 11 years and has been successful in growing the organization and making it financially stable. Her positional power is based on her title and can be taken away if she were to be removed from her position by the board. Her personal or referent power is based on Anne herself. This is the power she has earned through her personality, work ethic, and character.
She is known for being enthusiastic, energetic and capable. She has garnered respect for the work she has done and the improvements she has made in the opera, not by demanding it through her positional power. Anne’s personal power strengthens her positional power by the leadership qualities she displays and the character she shows. Both the board and the members of the opera and symphony can be persuaded to follow her suggestions when her positional power is supported by the personal power she demonstrates in a leadership role. Without personal power, positional power is less effective and can easily be taken away. Anne has been the general director of the Utah Opera for 11 years and has been given the opportunity to be CEO of both the opera and symphony after the merger. She can use her knowledge gained during her tenure as director to help lead the merger efforts. While in her position she eliminated the opera’s debt and increased their budget from one million to five million dollars. She has proven herself to be good at management and fund raising.
She can use this experience and knowledge to guide the merger process to a successful outcome for both the opera and symphony. All these facts establish Anne’s positional power. The board members should be comfortable with her recommendations based on her experience and previous outcomes. The ultimate goal is to have both organizations be financially sound and she has proven through her positional power that she can achieve that goal. Anne’s personal power is based on her character or personality. It’s her natural leadership ability that can be used to gain compliance. She is known for being energetic and enthusiastic. Keith Lockhart is the symphony conductor and is unsure of the idea of reporting to Anne after a merger. She can use her leadership abilities to convince Lockhart that his role will remain unchanged. Anne’s years in managing performing artists have no doubt given her the ability to relate to them and give them the autonomy they require. She can empower him by letting him know that he will still be in charge of the symphony and its creative endeavors.
She can use her enthusiasm for the arts to let him know that she is confidant in his abilities and is honored to be working with him. The symphony performers are all annual contract employees that are unionized. The symphony is required to maintain their annual salaries and an upcoming twelve percent raise is due in the next year. The symphony cannot afford this raise and the budget breakdown is the impetus for this merger. The performers are suspicious that the merger talks are just a way to get out of the current contracts. This level of distrust and suspicion could cause unrest and lack of cooperation. The merger may require contract negotiations and some performers may be unwilling to negotiate. In the long run, some performers may elect to leave the symphony and go elsewhere. Anne should use an integrative negotiation to resolve the performers’ issues. The process has five steps including clarifying interests, identifying options, create alternative deals, pick a deal and perfect the deal.
Both sides usually come to a compromise. The main concern for the performers and the symphony would be salary negotiation. Anne would need to meet with representatives from the group and clarify what their main interests were. Anne could explain the financial status of the symphony and clarify the goal of keeping the organization afloat. Anne could gather figures for other similar organizations and offer contracts on the average scale. The compromise would allow the performers to keep the annual contracts but perhaps not include the planned increase. The performers could decide whether that deal would be acceptable and make minor changes if necessary.
The two most appropriate influence tactics Anne could use to persuade the opera’s staff to accept the merger would be rational persuasion and inspirational appeals. Although the Opera is not having financial difficulty at this time, Anne could rationalize that with the current economy, the opera could soon be affected just like the symphony. Even though the opera has an operating surplus at the moment, things could rapidly change. She could explain that being a part of a merged organization will make the whole stronger in the future. The opera employees are obviously supporters of the performing arts and an inspirational appeal would likely be an easy sell. Convincing performing arts lovers that the loss of the symphony would be devastating would not be difficult. Explaining that the symphony would have to be dissolved in absence of a merger, and the loss that would be to the community, should garner support from the opera staff.
Kreitner, R. & Kinicki, A. (2010). Organizational behavior (9th ed.). New York: McGraw-Hill