What made the creative industries different then, may not be so potent now.

Management consultants tend to come in two types; generalists and industry specialists. I’m the second type. If I was of the first type, I might tell you (as many have told me) that all businesses are essentially the same – you can consult as effectively to a chair maker as you would to an international arms dealer, because all businesses boil down to the creation of profit via a production process of some kind.

I have always maintained that creative industries businesses are different (well, I would, wouldn’t I? I’m an industry specialist). My point is that a creative work constructs value in a very different way. The profit generated by a chair can be traced through the cumulative addition of each of its components, up to completion when it can be sold for an amount which covers the cost of its production and then some. The profit created by, say, a hit song, is a dependent on a far more complicated formula, with many more unpredictable variables.

Richard E. Caves’ (dauntingly brainy but still pleasingly readable) book Creative Industries: Contracts between Art & Commerce starts with tackling this issue of what makes the creative industries different from all the other industries. He takes an economist’s view of this question, dispassionately considering the sellers and buyers of creative transactions and assuming the perfectly rational decision-making process which underlies economic theory. He lists 7 basic economic properties of creative industries, which, I think, describe the unique combination of complexities which influence the production of creative work.

Caves’ basic economic properties of creative industries

Name of property Summary Detail
Nobody Knows Demand is uncertain. It is almost impossible to tell how a creative product will be valued until it is completed, and by then the costs of producing the good have already been met.
Art for Art’s Sake Creative workers care about their product. Creatives are not indifferent to the traits and features of their work. Instead, they are deeply invested in aspects such as originality, technical prowess, resolution and harmony. In short, artistic achievement.
Motley crew Some creative products require diverse skills. A creative work such as a film requires the cooperation of many different collaborators. But unlike some other collaborative endeavours, a creative work is more than just the sum of the efforts of each part of a production line. It has a “multiplicative production function”, where each input must be present and “do its job – if any commercially valuable output is to result.”
Infinite variety Differentiated products. Creative work can be simultaneously vertically differentiated (a buyer will choose between two similar products on perceived quality) and horizontally differentiated (a buyer will choose between two similar products on personal taste). And the array of choice an artist has in producing a work, and the array of creative products a buyer can choose from, making this variety infinite.
A list/B list Vertically differentiated skills. Creative producers are ranked based on quality, reputation and so on – creating a hierarchy of artists.
Time flies Time is of the essence Maximising profitability of a creative product is dependent on it being finished by a certain date.
Ars longa Durable products and durable rents Creative work can continue to generate revenue after its initial production with no additional inputs, through the exploitation of copyright.

 

I can’t recall seeing these characteristics of the creative economy expressed so clearly. I can add one more:

Name of property Summary Detail
Inspiration knows no timetable How long it will take to come up with a creative concept is unknown. Unlike other industries, where the time taken to produce a good can be accurately predicted, creative concepts can emerge quickly or slowly, and you can’t tell which it will be. This matters because the creative concept is often the component of a creative work which consumers value most and increases profitability – but it’s the part of the process which is the least predictable.

 

Meanwhile, I have been prompted by my tutorial class of Management Consulting students to think about startups and their relationship to entrepreneurship. They have been asking about the threat which start-ups might present to bigger, more established companies, and the predilection of some multi-national corporations to acquiring start-ups. I suspect that this conversation, as with so many on this topic, is actually defining “start-ups” as newly established tech companies. It’s that subset of companies which we, as a society, seem particularly enamoured of.

That particular definition, personified in sneaker wearing, tablet wielding, young tech nerds, successfully raising capital to accelerate their SAAS product’s growth, has become an early 21st century archetype. That archetype is a kind of start-up rock star; the version of an entrepreneur where everything has gone right. I worry that the far more common experience of tech start-ups – the long, lonely slog with no money, no angel investors and time rapidly running out before they need to go get a job – is rarely talked about. If there’s a rerun of the 1990s dot com crash, this time starring exhausted start-ups which never accelerated beyond a brief canter, and with investors looking for their money back – what will this do to our current idolisation of entrepreneurship?

But putting that aside, it struck me that when Caves was writing about his economic properties of creative industries, it was in the immediate shadow of that dot com crash. Caves sought – as I have done – to differentiate the creative industries from the non-creative industries, and in 2000 he could clearly do that.

Would it be so easy now? Because if we consider the new breed of tech industry startups, typically pushing an online software product, across multiple platforms but addressing distinct, almost niche, customer needs… don’t all Caves’ properties apply to them? Is it possible that the distinction between creative industries and non-creative industries (the definition of creative industries, as I’ve been describing it) is actually getting harder over time?

If so, the reason why may be that today’s emerging industries look and feel more like creative industries than traditional industries; that the promising, rock star tech industries which we all have such a crush on, actually operate more like creative industries than anything else. In which case, studying what makes creative industries tick may have much wider future use and significance.

Caves, Richard E. Creative Industries: Contracts between Art & Commerce, Cambridge, Mass.: Harvard University Press, 2000.
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Mambo and Halfbrick: two versions of Australian creative entrepreneurship

mambofruitnin

Arts programming on ABC TV has long been characterised by one major factor; its ability to be reliably dull. Though lately there seems to be an effort to liven it up. In recent weeks, two documentaries in particular have shown the ups and downs of creative entrepreneurship in Australia.

The first is Mambo: Art Irritates Life (Dir. Paul Clarke, 2016) which tells the story of the famous fashion brand which seemed to be everywhere in the 1990s. Through interviews with the business’s founder, Dare Jennings, and the artists who contributed the brand’s anarchic designs (plastered on t-shirts, board shorts and assorted paraphernalia), it tells the story of how, almost entirely without planning or strategy, the clothing line grew in popularity and cultural significance.

As the company’s financial success accumulates year after year, a handy graphic shows sales revenue climbing like one side of giddyingly steep mountain. Mambo seems to grow through a series of intuitive leaps, celebrity endorsement and cross category infiltration, but if Jennings had a systematic plan which led to the brand’s success, the documentary doesn’t detail it. Instead there are pleasing tales of how the stable of contributing artists benefited from their designs suddenly bringing in truckloads of cash, and how an inter-group rivalry developed which pushed them to deliver edgier and more striking images.

It’s all very nostalgic, not just for a time when everyone was wearing farting dog t-shirts, but for a time when you could build a world-conquering fashion brand in Australia, something that a combination of high production costs and a cash hungry business model seems to have extinguished for good. The documentary’s main point seems to be that Mambo’s crude and brazen designs had an outspoken, rebellious ethos that was the secret of its appeal. That appeal dissipated when the brand went mainstream, which the film pinpoints to when the Mambo creative team provided giant inflatable kangaroos at the opening ceremony of the 2000 Olympics. From then it descended into ‘dadwear’ and forever lost its cool.

It’s this decline that the film shies away from. There’s no handy chart showing the slide down the other side of that mountain. Instead, the brand’s sale to overseas interests and journey onto the clothing racks at Big W goes undocumented. That’s a shame because it feels like we got half the story. But the half we got tells the story of creative entrepreneurship is familiarly Australian terms – outsiders, larrikins, iconoclasts, schoolboy humour.

Then there’s Play to Win (Dirs. Sue Swinburne and Michael Angus, 2016), the story of Brisbane games studio Halfbrick. Halfbrick was a struggling games development company which struck gold in 2010 with Fruit Ninja, a fun, colourful time eater for various iDevices. The game’s success was almost instant and stratospheric. The money started pouring in at rate which makes Mambo’s climb up that mountain look sedate.

The documentary focuses on CEO Shainiel Deo, a smart, personable and highly driven man who worked hard to engender a laidback and fraternal culture at Halfbrick. As the company’s success grows so does Deo’s ambition, and he looks to access the massive games market in China. But his closeknit band of buds at Halfbrick are fracturing. One of the critical issues is an ideological shift; mobile games are moving to a freemium model – free to buy, but requiring in-app purchases to progress through the game. Some of Deo’s compadres yearn for the days when you just paid for a game once and played it to exhaustion.

This is a story about leadership and the pitfalls of switching business models. It’s a truism that companies which are unable to innovate are destined to fail. Deo can see that the business model underlying games is changing, but is unable – as much to his regret as anyone else’s – to bring his key people along with him. Advocates of business model innovation as a road to growth will probably have some sympathy with Deo, rather than his likeable co-workers who want to hang onto the (admittedly pretty recent) past.

The company has trouble replicating the success of Fruit Ninja and its attempts to develop a movie franchise of the title seem to breed only resentment and confusion from those who put the game together in the first place. Deo spends much time overseas and looks enviously while a business colleague lists his company on the NASDAQ. Sadly, his family life suffers as does his surrogate family life at Halfbrick. Senior staff/old friends leave, one after another.

This is a far more personal view of entrepreneurship than the Mambo documentary presented. There, business success was presented as a kind of happy accident, and business decline glossed over. In Deo’s case, business success was his consuming goal and its decline a deeply personal failure. (Even so, this is the polite version of Halfbrick’s troubles. A more scurrilous version is here.)

Mambo’s fall from favour was years ago now (and, it should be said, tempered by a successful exit via trade sale for the founder). Its art is celebrated and exhibited in major public galleries. Its key creative minds look back fondly on wild, heady days. Halfbrick’s journey is not yet over, but its tribulations are raw, the raised voices and angry words still fresh in Deo’s mind. Two distinctly different narratives on creative entrepreneurship; one comfortable and nostalgic, the other raw and painful.

Creative entrepreneurship as a lifestyle choice

Before 10 October this year, I would have been hard pressed to name the federal Education Minister. Turns out it’s Senator Simon Birmingham of the good state of South Australia. In a press release issued on that day, the Senator outlined the tertiary courses “expected to attract funding support under the new … VET Student Loans program.”

As it turned out, a large clutch of creative industries qualifications had been left off that (draft) list. This list itself is heavy with performing and visual arts and digital media courses, but notably also includes a Graduate Certificate in Entrepreneurship for Creatives.

Given the media brouhaha which followed, Sen. Birmingham is probably wishing he’s drawn a red line through these sentences, tapped out by an earnest media officer.

We want to ensure that the courses that Australian taxpayers are subsidising and that we are encouraging students to study, will optimise employment outcomes. Currently there are far too many courses that are being subsidised that are used simply to boost enrolments, or provide ‘lifestyle’ choices, but don’t lead to work.

A number of commentators in the creative industries arced up. Not just in response to suggestion that these courses would not be eligible for student loans (which, after the Government’s unpopular changes to arts funding, they could be forgiven for seeing as another attack on arts and culture). But also to the fact that he described, albeit indirectly, a career in the creative industries as a “lifestyle choice”.

It’s a loaded phrase. In 2015, then Prime Minister Tony Abbot, described people living in remote Indigenous communities in Western Australia as having made a “lifestyle choice”. He said, “what we can’t do is endlessly subsidise lifestyle choices”.  So Sen. Birmingham managed to suggest that the chance of landing a job in photography, fashion, dance or social media marketing, was as remote as a village in the Kimberley. And neither are worth subsidising.

(What is a “lifestyle choice” anyway? At first, it seems to be something of a passive aggressive slight. “You’ve made a choice that benefits your lifestyle, rather than one which builds something worthwhile, like having smashed avocado for breakfast instead of saving for a deposit on a stratospherically overpriced one-bedder in Camperdown”. But it also has an accusatory air suggesting selfishness; “you’ve brattishly chosen a path whereby you can’t contribute to economic good of the nation. You should have made a different choice, a more constructive choice, like getting an MBA and working for a lobby group and a political party, like Sen. Birmingham. We’d have been happy to subsidise that.”)

It’s seems to be the by-product of a policy mindset which sees entrepreneurship in the creative industries as a pipe dream.  Presumably there are other courses which will attract the student loans which encompass entrepreneurship, just not in creative industries.

Is entrepreneurship in some industries a surer bet than others? Surely the innate qualities of a successful entrepreneur mean that they will find a commercial opportunity in whichever field they choose? What this seems to suggest is a hierarchy of entrepreneurship; from those worth subsidising to those which are not.

Subsequently, the Minister went directly to arts industry website ArtHub to pour oil on troubled waters.

Of the 478 courses that will no longer be supported 119 are in management and commerce, 149 are society and culture courses like the Diploma of Life Coaching and 149 are in health-related fields such as veterinary Chinese herbal medicine. In comparison, 57 arts-related courses did not make our proposed list and 29 of those have no students at all… 

Contrary to the impression given by some commentators, VET Student Loans will support studies across a number of different genres and roles related to the arts, including graphic design and visual arts, screen and media, live production, photography and music industry…

The narrative tactics here are clear. You haven’t had it as bad as management and commerce! (Sure in numbers, but what about as a proportion to the total number of courses?) We’re still subsidising lots of creative things! (Just not performing arts, dance, writing or entrepreneurship for creatives) You wouldn’t want us to fund craziness like veterinary Chinese herbal medicine! (But what if my cat just doesn’t respond to Western pharmaceuticals?)

But later on in the same article we get a sense of what the real problem is.

We know there are job opportunities in the arts for current and future students – but the demand for graduates is not significant enough to justify funding every single arts course, just as it isn’t in many other industries.

It’s the demand for graduates which designates whether something’s a lifestyle choice or not. And in a way, the decision to redirect funding makes perfect sense; why oversupply an industry with graduates it cannot support?

But there’s another implication here; that a career in the creative industries means finding a job, not creating that job for yourself. It’s another tacit indication of that mindset which sees creative entrepreneurship as a fanciful dream.

The clash of two professions

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Works of art, more centrally and nakedly than ever before, are becoming commodities, consumer goods… Now it’s every man for himself, every tub on its own bottom. Now it’s not an audience you think of addressing; it’s a customer base. Now you’re only as good as your last sales quarter. It’s hard to believe that the new arrangement will not favor work that’s safer: more familiar, formulaic, user-friendly, eager to please—more like entertainment, less like art. Artists will inevitably spend a lot more time looking over their shoulder, trying to figure out what the customer wants rather than what they themselves are seeking to say.

I love this article from the Atlantic about the changing role of the artist in society and how it has morphed into the role of the creative entrepreneur. It expresses elegantly the tensions between the two and tries to come to some sort of reconciliation between the two. And it gets there in the end, but never quite shakes off that nagging sense that something isn’t right about this. These two things are fundamentally incompatible.

How does this belief linger so, that making a piece of art and making a buck are inherently different? It may be partly that we are not just talking about the clash of two professions, but the clash of two romanticised professions; the creative and the entrepreneur. And romanticised in ways which are the polar opposite of each other. You’re an artist and you’re poor? Well that makes sense. You’re an entrepreneur and you like profits? Of course! We can’t mix different types of genius.

There’s also something that makes it easier to be a creative entrepreneur the further you away you move from high art. Sculptors are poor, but no one expects the furniture maker to live off an arts grant. Poets are artists, Stephen King is a brand. Somewhere in between is the sweet spot, where explorer and exploiter coexist side by side.

I also like this article’s shrewd observation about the reclaiming of the word ‘artisan’. Sometimes it’s hard to find a photo to accompany these posts, but I knew the stock image search engine would have no trouble with ‘artisan’. (If it had, I could always have tried ‘bespoke’). Artisans make things, rather than create things. They’re allowed to make money from handmaking products which we’ve grown used to having mass produced. Whether it’s baskets or buckets, coffins or cronuts, the word artisan itself has become a stamp of quality. A brand of its own. They’ve found the sweet spot.

 

 

 

Bridging the creative/financial divide.

I’m preparing to deliver a training workshop at the Artlands conference in Dubbo later this month. It’s a workshop I’ve now delivered many times called ‘Making Money Business’ and it covers business skills for Indigenous artists running creative enterprises. It’s a workshop I’ve gained a lot from and have blogged about it before, on what these Indigenous artists can teach other businesses about sales.

I’m in the middle of redesigning the workshop for its next iteration, so was intrigued to come across this journal article which details the results of “a survey of small creative firms … in the south west UK”. The survey indicated:

…the majority of firms are interested in a lifestyle based on fulfilling creative aspirations. Very few respondents exhibit any interest in participating in training schemes aimed at enhancing business performance.

So that was little discouraging.

This is a space I’ve inhabited for many years. I’ve both organised and delivered training activities for creatives covering a variety of topics. Generally, the feedback from those sessions has been very positive. And usually, these activities are well attended, which would indicate some level of interest in participating.

But as I read through the article, I realised the assertion that creatives aren’t so keen on undertaking business skills training is not the guts of the article. It’s a conclusion drawn from the piece’s central analysis about the motivation driving the owners of creative firms. (Interestingly, he uses an established quantitative model for measuring entrepreneurship.)

The author’s survey tested the how strongly the participants leant towards creative satisfaction or financial gain from their work. The results were mapped on the matrix above. He finds that the participants value the creative benefits more highly than monetary ones and so…

… it seems rather unlikely that one could persuade them to dramatically alter their artistic
philosophy to the point where they now wish to participate in business growth support
programmes…

For the creatives I’ve worked with, and for the participants in the Making Money Business workshops, I’d argue that this is not a binary choice. Most creatives I engage with want to be creatively fulfilled and financially successful. Sometimes the dream of making a living out a creative passion is unfeasible – an insurmountable mismatch between an artist’s labour of love and the market demand for that work.

But where there is a market demand to be met (and Indigenous art is a good example here) and an artist can tread the line between making fulfilling art and art that fulfils a customer’s order, then there’s a mutually beneficial transaction to be made. Which can be useful if you want to both make art and pay the rent. For me, it’s not so much about dramatically altering an artistic philosophy, but about seeking to improve the chances of being able to do both those things.

 

 

 

 

 

Hey, this could be a play AND a conference paper.

This is an odd piece. Two academics sit down to write a short play for a conference, to demonstrate their theories on entrepreneurship. Through the course of that conversation, they have a business idea of their own. This exchange then becomes their short play. Which they then present and comment upon in this journal article. There’s something going on here about unfulfilled theatrical ambitions.

What they’re seeking to demonstrate through their play is that entrepreneurialism is often seen as set of personal traits within people lucky enough to be gifted with the ability to spot and convert opportunity. The reality, they say, is that the emergence of business ideas is far more complex, and more iterative. One idea builds on another. Elements of the idea are explored, discard and developed depending on who you’re talking to and where and when.

This rings true to me and chimes with my experience of helping people develop and realise their business ideas. There’s also something weirdly meta about these academics creating narrative versions of themselves which express their own foibles; teaching but not living entrepreneurship, growing tired of their jobs, gently niggling at each other throughout.

But it is also familiar territory for me as a playwright. The central concepts for my own plays are often a combination of ideas. Often one is not sufficient to sustain an entire plot, but the juxtaposition of two or three key ideas can present something novel and intriguing.

So if the process of being entrepreneurial is similar to the process of narrative construction (unpredictable, piecemeal, gradual, collaborative), then perhaps all we’re talking about is the iterative process of developing any idea? The single sole lightning flash of perfect inspiration is probably rare. The slow development of an idea bit by bit over time, with input from a range of people and stimuli, might be the standard.

In any case, I think the dialogue could do with a little tightening up. But my favourite line is this one, which might betray a prejudice about the prospects of a career in the creative industries:

I’ve never settled into what you call ‘a proper job’ but, as you keep observing, I do have talents with photography, video and music.

Yeah, don’t call us. 😉

 

 

 

Don’t call me creative.

Not everyone’s happy about creativity. Lucy Kellaway of the Finanical Times is one of them. In fact, she’s cranky about it.

In this blistering piece, she calls creativity a “plague” which has infected management and recruitment processes to an extraordinary and unnecessary degree. Confronted by scores of job ads which include the word “creative”, she says “being polite and co-operative are vital traits for every job I’ve heard of, whereas most companies have no use for real creativity at all.”

Kellaway notes a current trend for “creative worship” which leads to patronising and misleading labels (such as Subway calling its workers sandwich artists) or time wasting team building exercises (such as Lego play sessions for staff). As she goes on, she gets around to talking about creativity’s role in “making things new”. Here she expresses a familiar blurring of the lines between innovation and creativity, the first of which is often seen as essential to business success but without the Lego constructing nonsense associated with creativity. (See also James Dyson’s umbrage with the term “creative industries”, again drawing a defensive line around innovation.)

Kellaway concludes:

To survive, companies need to change from time to time. They need to do things slightly differently from how they were done before – but for that they don’t need creativity. They need people with intelligence and judgment to work out the right variations on existing ideas. More than that they need people with the determination to test those ideas, tweak accordingly and turn them into sales.

Not much to argue with there. But does this mean creativity should be treated with disdain and hostility? There’s also something going on here about identity; Kellaway starts her article with the declaration, “I’m not a creative”. Who is allowed and not allowed to be a creative? Why is it good or bad to be one? And does distinguishing innovation from creativity help  – either with management or with identity?