Fighting the Creeps 1 (of 4)
In ministry and leadership, sometimes problems can “creep” up on you. This week we’ll examine several “creeps” that we should defeat… before they defeat us.
Spending Creep
It’s a rare organization that keeps expenses constant or declining. Generally speaking, expenses tend to creep up month by month.
In your church, expenses can creep up by:
- Adding staff
- Constructing buildings
- Purchasing equipment
- Adding programs and ministries
- Expanding staff benefits, etc.
All of the above can be good things. Adding staff at the right time is wise. Constructing the right building can help move ministries forward. Purchasing the right equipment can empower people to do more. Adding spirit-directed programs can transform lives. Blessing your staff with additional benefits is good for their families, and it can potentially enhance their performance.
But too much creep can be dangerous to the overall health of the organization.
A tool we often use to measure creep is called “cost-per-attender.” We simply take the annual expenses divided by the average number of weekend attenders to see the cost-per-attender.
Although this metric shouldn’t be the only means of decision making, it’s a good tool to make sure we’re being wise stewards over God’s resources.
Have you observed spending creep troubles?
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KUDOS TO SELECTION OF THIS SERIES. I WAS WONDERING IF ANY PASTORS OUT THERE HAVE EXPERIENCED ANY DECLINE IN THE PAST TWO OR THREE WKS IN CHURCH GIVING.WE HAVE AND ALWAYS LIKE TO HEAR FROM OTHERS, SOMETIMES IT IS SOMETHING THAT ALOT OF US SHARE OR SOMETIMES IT IS OUR CHURCH ONLY. ALWAYS LIKE TO TAKE A LITMUS TEST.
As part of the LifeChurch.tv Finance Team, this topic is definitely relevant and worth chatting about! My role is in accounts payable so I see a large amount of our spending. I believe we have a very appropriate view of spending and allocating resources. I’ve also worked at a campus and have seen those purchases put to awesome use!
With our growth, we have to rely of the leadership at every level to be fully in line with our spending culture. Culture is a huge aspect of spending and might even need to be defined to some degree by your church.
Defining your church’s focus could also be valuable. Is this spending in line with the overall focus of your group? What will the impact of this spending be? Would we all agree that is a good use of money?
At LifeChurch.tv, every purchase we make requires some form of approval from a supervisor and supporting documentation. Also, we take a good amount of effort to create and maintain detailed budgets. However the budget never supercedes a ministry’s need.
(If any of you have specific questions, post ‘em!)
Great to hear from you Libby here on swerve. Being a part of the LifeChurch.tv team I am in a great place to be led by others who see our spending as a stewardship and integrity issue. It is challenging to fight spending creep. One of the ways I have found that ’spending creep’ creeps in is by feeding those who consume. I’m speaking of ministries and efforts offered that our churches provide to reach people. In an effort to keep ‘feeding’ our guests we keep adding to the ‘meal’. Before we know it we find ourselves creating a massive machine of consumers: snacks, concerts, ipod giveaways, t-shirts, bounce houses, trips to the moon, etc. I am as guilty as anyone here. I’m a believer in offering things like this…most of the time. There’s a tension between capturing the attention and motivating an unbeliever to check out our church and creating that huge monster that keeps consuming and we keep feeding. I wish I could offer a solution but I really can’t other than here at LC we regularly discuss ‘return on investment’. Are our dollars spent yielding a return of changed lives? I think that’s the measuring stick. But it’s still not always black and white. I’d love to hear your thoughts.
Being a daughter of a small town - small church pastor, I feel extremely fortunate to have seen every last penny (literally) count when it comes to how peoples’ tithes and offerings are spent. I think that definitely influences the way I view a church finances.
I once worked at a church who by the end of fall, was sitting with only hundreds of dollars in the bank after expenses and payroll were paid. Hundreds of dollars isn’t much for a pretty large church…but it’s everything when it’s all you have left.
Talking about financial accountability, understanding limits and processes on staff, and prayerfully considering how to best use the money is so eternally important…Viewing the money that is given as an act of worship calls for nothing less than our utmost care.
Jason, Our people’s giving to the church has been down the last few weeks. We’ve been doing some massive pushes to give to people in need. I’m guessing many people are replacing giving to the church with other giving.
Libby, Thanks for offering your help.
Scott, You raised some good thoughts that should generate interesting discussion.
Anne, Sounds like you were very blessed to see great stewardship growing up. I believe this is one of the most important areas of ministry.
Craig,
How do you balance “the creeps” with a scarcity mentality. In our situation, I believe that to reach people, you must spend money. You need the right equipment, resources and ingenuity that is driven by our passion to reach people with the Gospel. We have swung the pendulum back and forth between overspending and then being so concerned and fearful that we completely shut down all spending. This scarcity mentality is leads to the “Money-Minded” folks to lead/control every other area of the church and project fear to the other ministries. I believe this is the exact opposite of faith. So, my question is, how do you reach out in faith without overspending.
On the other hand, there are certain ministries that seem to keep expanding in their scope and spending, but seem to be faultering in results (a Starting Pointe class that has more volunteers than attendees. How do you balance these things?
The process of spending creep is almost comical. Here’s what I see occur often. One area of ministry gets creative and spends a little more than intended. The event is successful, high-fives are exchanged and everyone is excited. The ministry next door wants to make the same impact so they attempt to duplicate… maybe spending a little more this time. In our efforts to constantly outdo ourselves, we are spending more and more money. The question is… are we being any more effective?
Jonathan asked a great question. I’ll offer some thoughts later in the day. Maybe some of you can give him some wisdom.
“But too much creep can be dangerous to the overall health of the organization.� This is a great comment and really speaks to thought processes of healthy organizations. The bottom line is that spending, evaluating, forecasting…. have to be ongoing and will vary from season to season. Wal-Mart, Starbucks, Dell… leaders have these same conversation and implement effective processes/strategies to ensure a healthy spending culture exists; ministry leaders must do the same. LC Leadership has outstanding processes to evaluate spending.
It really comes down to leadership/stewardship; leaders must consistently evaluate their (ROI) Return On Investment. Sometimes we might not see that return as quickly as we would like and that’s where patience and faith kick in. There are two brothers whom own a local furniture store; many years ago spent a lot of money on TV advertising and did it consistently all the way down to their last dollars. Their leadership, belief in their strategy and patience proved to be effective, as they are now the largest furniture store in Oklahoma and one of the most effective in the country. Their name: “Mathis Bothers� and they still advertise like crazy. I have seen two Mathis Brothers Furniture commercials since I started typing!
What’s the vision and how do you realistically plan to get there?
As a pastor of a 300 church, we are proposing a raise in our 2008 budget by about 25%. Part for a new ministry position and part for technology and others. Two questions -
1. How do you balance the needs for day to day functioning with the need to have ministry take place? Especially in an older church, where the old mindset is based on frugality, sometimes at the expense of ministry.
2. How do you determine the ‘cost per attender?’ That number can change, but is there a target that you shoot for?
Thanks for being a blessing,
Michael
Michael, I’m not sure I understand your first question. On the second, the cost per attender will vary widely depending on numerous factors. I’m guessing that the more established the church, the more the cost tends to rise. That is what we’re fighting against. I’d be careful not to measure this number against other churches. Your church is very different from ours and everyone else commenting.
I asked Lyle Schaller once how many staff members we should have per attender. He said, “As many as you need and no more.” His answer frustrated me but was full of wisdom.
Elevation Church has a very general percentage based budget they offered up on their blog. (i.e.salaries 40%, Facilities, 30%, etc…) Do you have a similar general budget figure(s) you could share per campus?
Jonathan-Money is such a sticky thing and we should be extremely careful with how we spend it. I think, as Craig said earlier, spending it in certain places at certain times can be wise - but it isn’t what’s going to get people in our doors or turn them into disciples.
When it comes to control and fearing not having money, I think that is an indication that our faith is in what’s in our bank and not in the one who gave us what’s in our bank…However, that doesn’t mean we should pour money into black holes either…
I think about the times when Jesus spoke and impacted people in his ministry…one Sunday School example is the feeding of the 5000. Holy miracle, Batman!
As we let the Spirit guide us in our decision making, we remember He is the one who works in peoples’ hearts. It’s not that we shouldn’t be proactive or plan - but we should certainly leave room for miracles…they tend to reflect His glory in ways even the prettiest lights or the most energetic ministry can’t.
As a finance leader at a previous church for several years I can say that this toic is one which can drive you totally insane as a pastor, staffer, or a finance team member. It is SO easy to let the “creep” creep in.
We were in a position of basically covering O&M and that’s all - just barely keeping the doors open. However, the leadership were ferverently seeking God’s will for our church and in the process a few core values were developed. One was stewardship. We believed that God would direct us (read ’save’) us from the church’s human failures if stewardship was highly integrated into our thought and planning processes.
So while the line at the front of the finance door was crying out to cut and run, we stayed strong and paid our bills and fought (read ‘prayed’) that God would keep our ministries alive for the sole purpose of doing His will - long term.
So did we abide in faith? Yes indeed. Pasotrs paychecks were delayed or divided ased on the $’s we had in the bank. We refiancned (a God story that would take another 2 pages to describe), changed insurance carriers, and did everything we could to survive - because God told us not to shut the doors and walk away.
Be a good steward - but that entails listening to God for each penny spent, not to man.
Becsaue God’s people were faithful, we are now part of LC and God blessed our new brothers/sisters with some goodies, too. The cut and run scenario would have landed us squarely with nothing - but worse, it would have creted a nightmare of financial webs,
Marty, You asked about percentages. With a large church, percentages can be very deceiving. When talking about staff, it depends on who you count. Some churches don’t count weekday childcare people, band members, architects etc.
I would suggest percentage for staff being as low as 30% and hopefully not higher than 55%. These percentages will likely vary widely depending on: age of church, size of church, staffing up for growth seasons, outsourcing verses hiring, etc.
Jonathan asked about scarcity mindsets verses spending to reach people.
You are right. We have to walk a fine line. I tend to lean more toward the scarcity mindset. My team has been helpful leading me through my fears.
I think it is important to remember that we don’t “buy” church growth. Some people believe we can “market” our way to a stronger church.
Most of the time, we’ll never fully agree where all the resources should go. The leaders must keep the vision hot.
When I’m talking about spending creeps, I’m thinking about things that we don’t really need that we start to think we need.
For example, when Amy and I first got married, cable TV and eating out weren’t options. It costs more to live today because we’ve adopted these things as necessities when they really aren’t.
Spending creep, I also call it nickel and diming. Please forgive me because I am using a comparison to my old retail world to the ministry I am currently serving. In the retail world I would get upset about employees and overtime. They would say I am sorry I am 15 minutes over my time, that doesn’t sound like a lot of time and I agree. It is when you have numerous employees spending the extra 15 minutes, 30 minutes or even a hour that adds up. When you total it all up it could be 50-100 hours of overtime and that can be signigicant in dollars to your budget.
In Ministry it is if we are trying to justify our spending when we say it is only 15 dollars, 30 dollars more than I have to spend and when you have a lot of our staff spending a little over what they should it is adding up.
you mentioned the idea of cost per attender, and I was curious what you would see as a good cost per attender, where is the line that might be crossed. This is a formula I have not considered before and now I am intrigued by it.
Wow, a lot of great thoughts on this. I think something we have to watch that can contribute to the spending creep is ministry materialism. Materialism is everywhere in our society, and we are called to live in the world but not be of the world. Everything we do should bring glory to Jesus Christ, but that doesn’t mean that He demands everything that’s done in a ministry to be the most expensive option. Jesus Christ is the same yesterday, today and forever, and the Holy Spirit is the same Holy Spirit in the Bible and He is able to reach people for Christ just as He did 2,000 years ago. Gina mentioned this above — about one ministry doing something and everyone else wanting to do it but not thinking about whether or not it’s effective or a good use of God’s money. Then, depending on church size, you have to consider not only how those decisions impact you, but also the rest of the church and how it would look if everyone at the church did what you did, as Rodney said above. In other words, we don’t have to do everything that everyone else is doing! Leave room for the Holy Spirit to do His work in the ministry He’s given us!
You all have such excellent questions and insights into this topic of spending creep, and spending per capita (attender). There has to be a God-honoring balance between spending on ministry and spending on marketing, and we must also know their purpose. If we were just calculating “bang for our buck” leading people to Christ and providing basic needs, we would spend as much as possible on international mission work. After all, $25 will touch a lot more people if spent outside America’s borders. But, we want to benefit ourselves and our own community, too. Just decide how much.
I agree with Craig that comparing statistics with another church can be dangerous to our long-term vision. One way to evaluate the difference we are making in the lives of our attenders might be to compare the trends in per-capita giving as well as turnover. If we are feeding people spiritually and providing the resources for them to grow, will they remain part of our church and gradually increase their giving? If we are spending a great deal on marketing, will we end up with higher turnover?
It’s one thing for a church to say it had 1,000 new people attend this year, but not if 600 mature Christians left the church because they weren’t being fed spiritually. If a church is overweighted in marketing, it may draw new bodies in the door, but can it keep them there? Enthusiastic newcomers might be great when a horde of people are needed to jump in and get involved in a project. What you won’t get may be the long-term attenders who provide the foundation of a mature Christian community, their faithful leadership, better resourcing, and more consistent tithing.
Entering a recessionary period in our economy is where a church will really notice where they’ve been more successful — building a solid foundation or building a revolving door.
Thanks for your place in the foundation!
Karen