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formal letter to the Board of Directors Subject: Management Sources: - Style: Other   Description You are the Executive Director at a midsized nonprofit museum. The museum, while successful, operates

formal letter to the Board of Directors








You are the Executive Director at a midsized nonprofit museum. The museum, while successful, operates very close to the margins meaning your income and expenses are always very close to each other. Your most popular permanent exhibition is a collection of turn of the century surrealist paintings including work by Picasso, Dali, and Ernst. You have just begun a two-month membership campaign using the works in that collection in your marketing materials. The central image in your marketing campaign is a piece by Marc Chagall. Your campaign culminates with a gala held in the surrealist wing. This annual fundraising campaign usually brings in about 30% of your earnings for the year. You have just received a phone call informing you that the Marc Chagall painting at the center of your marketing campaign was stolen from a family by the Nazis during the Holocaust. The family, has asked for the painting back and has made it clear if you do not comply, they will pursue legal action. What do you do? Some things to note. It is 100% true that the painting was looted and sold by the Nazis during World War II. You, however, bought it last year from an anonymous private collector for a very large sum. The American Association of Museums (of which you are accredited) has suggested guidelines for Nazi looted paintings. They are available here: Many museums who have been sued by former owners of Nazi looted paintings have won their court cases. Meaning the museum has been able to keep the paintings, but a court case is expensive and has the chance to ruin your reputation in the eyes of the public and your donors. The family, while firm about wanting the painting returned to their possession is open to negotiating the terms, but is not a family of means and could not afford to pay the full cost. Should you return the painting, the images in your marketing campaign would need to be changed at great cost to you because it would be false advertising. Your insurance company is able to cover only 15% of the value of the painting. No matter what you decide, you will have to make some statement to the press. Even if that statement is “no comment.” Write a formal letter to the Board of Directors explaining your recommended decision. Your letter must contain all of the following: A persuasive argument which clearly states how you believe the board should move forward. Which key stakeholders you spoke with before making your decision and why. The best- and worst-case scenarios which might may arise from your decision. Your proposed statement to the press. (No more than 250 words) You paper must be no less than 1500 words 

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Alex Johnson

Executive Director

Arts and Pieces Museum

December 10, 2019

The Board of Directors

Arts and Pieces Museum

35 Freeways Street

Michigan − 18

Sub: Agreeable Terms concerning Marc Chagall's piece.

Dear Board Members,

I am writing to inform you about the decision made concerning the piece by Marc Chagall

and the family wanting it back. The family has made it clear that should we refuse to comply,

they will pursue legal action. As the Executive Director in this museum, I have taken it upon

myself to seek any means possible to quickly resolve the matter with the family and be as fair

as possible while still appropriately concerning myself with the needs of the museum. It is

also my responsibility to come to mutually agreeable terms, favoring both parties involved.

With competing interests, it is our work as the museum to foster an environment of

cooperation and reconciliation. Because of this, we have decided to resolve the matter in

court as a means to have a common and shared purpose.

I therefore kindly ask for your support in the matter as activities as court proceedings, and

negotiations with the family may take time. Not only support but also I request that we make

an effort at being patient and cooperative as it involves every member of the board, museum,

and our clients as well. The reason I decided that settling the matter in court was the right

thing was that, after a long discussion with a lawyer, it was clear that it will cost us a

considerable amount of money now for a reward soon. As we have been operating close to

the margins, the chances of recovering from that will be high, given that we need the

campaign to get 30% of the annual earnings. Without the piece by Marc Chagall, it will be

close to impossible to hold the yearly fundraising. Notwithstanding, the image in my

marketing campaign is a piece from Marc Chagall.

To move forward as a company, we have to move past the cost and charges the case will cost

and focus at better building the name of the organization to keep our donors and clients

interested while retaining them. The decision to keep the piece was made to compensate the

family for any damages caused, and it was also to keep the campaign running.

Notwithstanding, having gotten it from an anonymous private collector at a very high price, it

was to become one of our permanent exhibitions among the other works and pieces by

Picasso, Ernst, and Dali. It was not our intention to stay with a stolen piece from World War

II. For this reason, having sat down with the company’s lawyer, we saw it best to negotiate

the terms with the family, as they are open for negotiation. It will not hurt to hear what they

demand of us, but it should also not be too extreme to the extent that they require too much,

yet we are trying to keep things together financially as a company. 

Suppose they agree to our terms, we will have to pay them a compensation fee and for their

lawyer and all the case will require. As we will win the case, we saw it best to take it upon

ourselves and pay what they will expect as long as it is reasonable and within our means. It

will do us right in that though we will pay for these costs, we will eventually end up keeping

the piece, and this could better our organization in the future, especially after the campaign

party. The court will rule in our favor, and this cost will be nothing compared to what the

company will make with its collection in permanent pieces. Also, should they agree to our

terms, the face of the marketing campaign remains to be the piece by Marc Chagall, and this

will increase our success rate twofold. While we will have to pay for the painting and the

family’s costs, we will not have to pay to look for another image for the marketing campaign.

It is both expensive and time-consuming, and looking for another face for the marketing

campaign is tedious work. We could instead use the time, money, and resources to bettering

our society or in improving the museum. It is, however, in the negotiation that I hope to come

to agreeable terms that will suit the family and museum.

I also want to believe that the more we grow our permanent exhibition, the better we stand a

chance at being successful. Though we have just begun with among the most envied pieces,

giving away the one by Marc Chagall will be counteractive to our primary goal. Though we

are working close to the margins, with incomes and expenses almost being the same, we

cannot continue to rely on the annual fundraising campaigns to get earnings. As a business,

the artefacts in the museum should bring in the revenues. While on the phone with an

important stakeholder, both a donor and client, he thought that having been invested in the

business's success, it was clear to him that we were starting to break even. Though it may

seem like a long time since we started getting proper earnings in the museum, it is also clear

that we have a lot more years to wait until we can be comfortable with the profits from the

museum alone. The stakeholder, however, put his faith in the exhibition, claiming that the

more permanent, the better they are for business. Not only is he a regular visitor, but he is

also the Professor of Anthropology and Art History and has worked as a museum educator

for close to two decades. His opinion mattered from a visitor’s perspective, given that he is

not a member of the board.

However, should the family not agree to our terms, then we will have to dig deeper and look

for a way to equitably compensating them and coming cooperatively to a common ground.

As the goal of the American Association of Museums is to have these pieces taken back to

their rightful owners, restitution in our case is not an option. For this, however, we will pay

dearly. It will also mean that the image at the center of the marketing campaign will have to

change, and the work and costs involved in changing perceptions are expensive. Also, we

might lose out on essential donors and visitors when we decide to give the painting back. It

is, however, not good for business. We will either be decapitated, unable to carry out the

normal functioning of the company, and we will go bankrupt as there is no money to run the


Now that we are all here, I had a request to make concerning increasing earnings. Though it

is not necessary to have all exhibitions being permanent, I was for the idea we get some

excellent pieces on loan and use them to grow the business’s name and market. While we do

not have to buy them as expensively as we did some pieces, we will be paying the private

collector a certain amount annually to carter for the piece being in our custody. During annual

reviews, we will come together and analyze what worked and what did not and what painting

we should return to the collector and what we can keep. While this will take time and effort

in assessing and discerning what pieces will do good and the ones that will not, it will require

patience as one piece could be a reason for our success as a company. Although the insurance

company is willing to pay only 15% of the value of the piece, should we return the painting,

it will cost us more having to pay compensation and still keep the company afloat. Though it

is a hard call to make, I believe that having to pay the total lump sum at once will be of more

advantage than having to pay the amount and still look for means to make earnings. I am

confident that keeping the piece by Marc Chagall is the best move to make, and while we

have the opportunity to learn from this and many more experiences, I know that it is the right

choice I am making and the right choice for the company.

As for a proposed statement to the Press, we are still working on coming up with a reasonable

and equal ground for all parties involved, and we will do whatever it takes to make sure the

family is well compensated. It is our responsibility to make sure the company is running

smoothly and making its earnings without having to operate too close to its margins. I believe

that in keeping the piece by Marc Chagall, we will better our relationships with our clients,

who are our number one stakeholders and some who also are our donors. The family will be

well compensated, and the Museum will handle all costs and charges regarding the case.

Though we have come so far, it is in the best interest of the company to keep the painting, as

it will be more value here. Notwithstanding, it has made a mark and is among the most

permanent and popular exhibitions. It means that though results cannot be seen now, with

time, it will bear fruits given that we are new to the industry. It is, however, with sincere

regret that I apologize for any inconvenience caused to the family.

Yours Sincerely,

Alex Johnson,

Executive Director.

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