I recently wrote an article about why it is smart for public media stations to maintain significant cash flows to get them through difficult times. Some of your department heads or staff won’t understand why you don’t approve their budget requests when your balance sheet is positive at the end of your fiscal year.
That article drew several interesting responses.
One manager, who asked to remain anonymous, offered some very insightful observations:
If the station is facing cash flow issues, they go from appearing manageable to bad very quickly. Formerly friendly banking relationships sour when loan covenants are likely to be triggered, or you run up against the limits of lines of credit. A GM must be attuned to these realities, even though I know our cohort of leaders are more human-driven, servant leaders, and that can be at odds with what the classic business advice would be to slash expenses and preserve access to credit and capital.
Licensees will shortly be hit with the impact of state taxation being reduced and direct appropriations being reduced or zeroed out. The CPB money isn’t going to go very far.
What vendors can you ask for forbearance or write off balances as a charitable donation? Is someone in the development and business offices focused on every grant or SBA funding possibility?
What can you ask your major donors to do? Would a donor “unrestrict” a pledge from previous or current endowment/capital campaign or accelerate pledges made for such campaigns (even though their investments have tanked it never hurts to ask).
Make a statement with the highest compensated staff taking meaningful pay reductions temporarily (I don’t think NPR went far enough in this respect). If it’s within your control, freezing 401K matches for a period of time could save a couple of salaries. Go through the budget and be ruthless with everything that can be eliminated for the next few months. Voluntary buyouts are an appealing alternative to layoffs but they cost a bunch up front of course.
Communicate, communicate, communicate with your advisory board and governing board if you have one: no matter how many board packets you’ve sent over the last year with the financial position of the organization, those board members are not as tuned into the financial position as the GM is.
Be prepared to manage a board’s questions about cash reserves and how far they could go, consult your investment advisors so you are ready to answer their questions about the wisdom of pulling money from investments at this time and alternative approaches to raising working capital. Do you as the GM understand the fine print and legal rules around accessing rainy day or endowment funds?
Do not wait to confidently ask the board for their help even though they are dealing with their own business challenges at this time.
Form a task force along with your Chair to deal with this crisis. Both of us have been on board that have had periods of calm for years, this is a time to ask your board for their partnership to bring all the skills they are using in their own businesses. What I found was that they will have an appetite for even bolder, quicker decisions than your comfort level . . . and that can be intimidating or invigorating depending on the day. What I also found is that some of the “type A” personalities relish a crisis to show their stuff and leverage their relationships.
If GM’s don’t have a board, I’m confident that many have professional networks to lean on. Independent HR consultants, financial advisors, PR companies all looking to “do good” in this time of crisis would welcome the opportunity to assist I’m sure and can work with a GM within institutional frameworks.
I know it’s hard enough to keep all the priorities on task in an emergency, but I think GM’s must delegate where needed on the “what and how” of getting the programming and newsrooms into a new configuration – that’s a great opportunity for mid and senior managers to rise to the occasion and work closer with HR and facilities management staff – and allow the GM/CEO has to be focused on keeping the organization above water for the next few months using all the social capital they and the station can muster.
Lots of good advice from a very wise public media professional.
What do you think? What experiences have you had? Share your thoughts below.