Mastering Inefficiency

I recently read an article by Jared Diamond, author of the thoughtful book Guns, Germs, and Steel, that got my mental wheels spinning. In “How to Become Rich” he presents the question that many in business would love to have an answer to, “Based upon history, what is the best organizational system for a modern business?” (Click on the title of this post to link to the article.) He proceeds to answer the question by arguing for exposure to competition that produces innovation and efficiency. Diamond discusses how the German beer making and the Japanese food processing industries are not as efficient as their American counterparts. He rightfully argues that they are protected from competitive international markets. Germans are protective of their local beers and the Japanese are protective of having extremely fresh foods, and the local laws that govern these industries, reflecting cultural values, drastically reduces their efficiency and prevents future growth, competition, and development.

Here’s the issue that goes nearly untouched that I find fascinating: these inefficient, less competitive forms of production are presently producing far better products than their efficient, highly competitive American counterparts. Furthermore, similar legal protections can provide support to cultural traditions that are of value to society. Even though they face minimal competition, German beer, in my opinion, is superior to mass-produced American counterparts. If nothing else, it is reassuring to go down the hill here in Freiburg and order a beer and know that it comes from the region. People here appreciate that. Likewise, Americans with their efficient and competitive food production systems still don’t have access to foods that are as fresh as those that are provided in Japanese markets. In terms of living in a healthy, soulful society, I posit that we may have a vested interest in not being surrounded by efficiency-oriented systems. Diamond points out that the advance of technologies through history is nearly unstoppable, but I believe that there are questions of value that go unformed in his argument. How do we maintain and protect things we cherish from what amounts to unstoppable progress, efficiency, competition, and development?

What does this have to do with music? For one thing, orchestras, sitting at the pinnacle of classical music, practically define the word ‘inefficient.’ Classical music requires big-time protection and should never be expected to be competitive on the mass market. If we value classical music, which I assume wholeheartedly that we should, and we want it to survive, we shouldn’t try to think of it in modern business terms. For example, the trend of bringing in business CIOs to run arts organizations has had some disastrous effects (a topic for future posts). A quick example would be the classical recording industry that turned to the corporate model of efficiency. The result: they nearly stopped making classical recordings altogether. There is a ratio that orchestras follow that would startle most business people. On average their budgets come from 40% ticket sales and 60% public and private support. Giving concerts often losses money instead of brining in revenue. Try running any other business like that!

Most importantly, our inefficient product is something of real worth. We should cherish it by not trying to frame it as a commodity. If we only extend the metaphors of commerce and business to art and treat it as a commodity, it will be a continual failure by the imposed standards.

Diamond’s article also points out something important that we should note. Namely, where cultural value is affixed, inefficient, traditional systems can flourish. This tells us that the future stability of our art will not rise or decline with our abilities to become more efficient or raise money. Rather, it depends on the way we are valued as an institution. Given the present cultural climate in the US, should we have hope or should we be more concerned?