Organizational Management Task 2 Wgu

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A. 1. A financial strength of the Utah Symphony is the government grants received by the symphony, which represent 25% of their total revenue. This is well above the norm of 6% for U.S. arts organizations. Another financial strength is their low management and general expenses which are only 5.5% of their total expenses and 5.4% of their total revenue. This is much lower than those of the opera which are 14% of total expenses and 12% of total revenue. Yet another financial strength is their endowment fund, which was $10 million in January of 2002. Additionally, the symphony only draws 5% from its endowment fund to cover expenses. A financial weakness of the Utah Symphony is its performance and contribution revenues. These revenues total 66.9% of their total revenues, while the norm is 82% for U.S. arts organizations. Program expenses are another financial weakness for the symphony, which include the orchestra salaries, related benefits, and payroll taxes. These expenses represent 85% of their total expenses and are 84% of their total income. This is mainly due to the exorbitant contract agreements with the musicians that must be paid regardless of the number of performances. Fund-raising expenses are another weakness. These represent 15% of the money raised by the symphony, while the opera’s fund-raising expenses total only 6.6% of the money the opera raises. These fund-raising expenses also include $100,000 in bad debt expense, resulting from unpaid pledges. All of these contribute to the biggest financial weakness of the Utah Symphony, which is its profitability. The symphony’s bottom line profit for 2000-2001 was only $116,308, which is less that 1% of its total revenues and the forecast for 2001-2002 paints an even bleaker picture with bottom line profit projected to be only $2,042. A leadership strength of Keith Lockhart is his in-depth

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