10 Ways for a Church to Have More Money, Guaranteed (part 1 – saving money)

Posted on June 22, 2011 Written by

There are two different ways for a church (or any organization) to have more money: spend less and receive more. I want to give five ideas in each category that every church should implement so they can have more money to spend on their God-given mission.

5 Ways to Save Money

  • Install Motion Detectors Everywhere!
    • Humans are quite imperfect especially when it comes to turning things off (or on). That’s where motion sensors come in. I use motion sensors for everything: dispensers for paper towels and soap in bathrooms; for urinal flush valves on toilets and urinals; for lights in halls, bathrooms, classrooms, and offices; and soon for thermostats in classrooms and offices.
    • Motion sensors save money by ensuring that lights and thermostats are on only when a human is present; that toilets get flushed; that only a certain amount of paper towel and soap is dispensed; and that lights are on only when people are moving around. Yes, it costs money to install these, but they pay for themselves in both dollars and in public relations.
    • Motion sensors for lights have cut the electric bills in the church I work by 20% per year. Members think it is cool that their church is so progressive – they like to “show off” their church and talk about how “green” we are. It’s a way cool thing!
    • Full disclosure – you’ll need to buy batteries for the sensors but in the long run, you will save money with the sensors.
  • Invest in Energy efficient lighting and less inventory
    • Most of the building I administer has 4 foot fluorescent lamps. In the past two years I’ve been a multi-year process of changing all my T-12 lamps to T-8s (and in a few years, once the price has come down, to T-5s). I’ve removed my 2×2 fluorescent fixtures and replaced them with 2×4 fixtures and put in T-8s.
    • T-8s are 30% brighter and are 30% more energy efficient than T-12s. I’m saving money, I’m helping the environment, I’m reducing the different types of lamps I have around here so I can buy just 4 foot T-8 lamps. I love the KISS principle – keep it simple, stupid. That’s what I’m doing!
    • Here’s how I found the money to make this happen: at the end of one fiscal year, I explained to my electrician what I wanted to do and asked him to come the first couple of weeks of my fiscal year. I gave him a budget of what I could spend on the project. When he had spend the total amount allocated for that year, he stopped installing T-8s. When I got his bill, I paid half of it out of the maintenance budget and the other half out of the utilities budget. My rationale is that the efficient fixtures are going to save money that would have otherwise been spent on electricity. I’m repeating this as many years as I have to and my electrician loves getting the money that would have gone to to the utility company!
  • Pay bills by ACH and online
    • Use technology to pay your bills without paper. I calculate that every paper check costs about $1 between the check stock, ink, envelope, and postage. Every ACH costs less than 30 cents. After writing several hundred checks a year, you’ll save hundreds of dollars.
    • Paying bills online also means you keep the money in your bank account longer. Keeping money in your account means more interest income during the year, too (well, that would be IF the banks were paying more interest than they are now at half a percent per year).
    • Paying bills online also means that you can track your payments and be assured that the money actually reached the vendor and didn’t “get lost in the mail.”
    • Work with your bank to make this happen. They’ll be glad to help.
  • Use Email and Voicemail Heavily
    • Communication with members must evolve from beyond the Ben Franklin post office system. That’s been around for 200 years, move on to something more efficient, effective and a whole lot cheaper!
    • I email statements of contribution to every person who gives money. Emailing statements of contribution saves me about $750 every time. I still snail mail 450 statements of contribution every time at a cost of $450 ($1 each for postage, envelope, paper, and ink). Believe it or not, I’ve not had any resistance to this method of getting statements of contribution – the business world has helped people become accustomed to email in all its forms.
    • Various ministries email or voicemail different groups (small groups, teachers, choir members, etc.) about upcoming meetings or opportunities. The ministers have learned which method is better to use with which group. Some age categories prefer a voicemail and we have PhoneTree to send out messages that way – it is slower than email but effective. Other ages like emails. Oh, I’m not (yet?) to tweeting or mass texting but I’m sure that will come along.
    • My administrative assistant also emails the weekly bulletin every Thursday or Friday to everyone in our database with an email (and give them the opportunity to “opt out”) and she also emails the monthly news-magazine. We use Constant Contact for some of our communications, too.
    • Find ways of using mass communication methods that don’t involve postage or paper. You can save some serious money by getting away from paper. It will save lots of paper and younger mindsets will appreciate the church helping the planet!
  • Bid out contracts regularly
    • Every 3 to 5 years put all of your regular contracts out to bid. This includes EVERYTHING from your food supplier, elevator contract, dumpster, commercial property insurance, copiers, postage meter, financial audit, custodian supplies, etc. I can’t stress this enough.
    • In times like this, some companies are so hungry they’ll really cut their prices just so they can get business to keep their employees (so they don’t have to lay off anyone). They know they won’t make a profit but they will also retain good talent.
    • Some companies gave you price when times were good and with a weak economy, they are willing to do anything just to keep you as a customer, even in the middle of a contract. They want you to stay with them and they’re willing to void a current contract, reduce their fees, and renew you for several years at a cheaper rate.
    • Recently I cut our commercial property insurance by 42% saving the church $18,000 per year. I got a smaller postage meter because we don’t have the same volume of letters as we did five years before. I upgraded to a color copier for less than what I was paying for a black & white copier. We talked with our bank and got a good rate on our fees. AND, I made sure that none of these savings affected the service we are getting.

Lead On!
Steve

Next post: 5 Ways to Make Money

Filed Under: budget, church administration, church finances, planning, strategy Tagged: , , , ,

Uncertainty, part 2

Posted on April 4, 2011 Written by

Recently I came across a great example of cutting through uncertainty or how a leader can infuse his or her organization with clarity and commitment. Apple is the darling of corporate America – it is the company that analysts point to, that nice corporate gifts come from, and which is becoming a household name thanks to the iPod, iPhone, and iPad. But Apple used to be a niche company. It’s computers were the mainstays of a few industries such as printing, publishing and other areas that used a lot of graphics.

Apple was created by Steve Jobs and a few friends in the late 1970s when personal computers began coming over the horizon in great numbers. (I remember going to work right out of college in 1983 and my very first personal computer was made by Xerox! It even had two external 5.25 floppy drives – it was amazing.) Apple developed its market but it was not as successful as Bill Gates who teamed up with Intel, IBM and other major manufacturers. Apple very quickly became a niche computer company and the board of Apple fired Jobs in 1985.

A dozen years later, Apple’s board of directors (by now with completely new members) re-hired Jobs. He didn’t like what he found. It was a company in disarray with no focus. Almost immediately Steve began cutting product lines and making changes that lead to great fear of him by the staff. In reality he didn’t cut that much but what was cut was so visible that almost all areas of the company suffered from low morale. That didn’t last long – Jobs began introducing ideas and innovations very quickly (BTW, he co-founded Pixar, the animated movie maker of great fame, during his “exile” from Apple). Soon, Apple became profitable and within ten years, by 2007 had introduced iTunes, iPods, and the iPhone and in 2010 the world was rocked by the iPad which sold 15 million units in less than one year.

Under Jobs, Apple has great clarity of purpose. All extraneous items are tossed overboard. Laser-beam focus is the order of the day. I heard that Apple’s tag line is, “We use technology to make life easier and we just happen to make computers.” Apple is no longer a niche company.

Question for you: does your church have laser-beam focus on its goals. Have you chunked overboard everything that is not helping your church achieve its vision. Or are you saddled with unnecessary programs and activities that really don’t push you forward but you do them “because everyone else is doing them.”

One of my favorite analogies is of a river with stones in it. First, are you crossing the right river? There are lots of rivers with stones but your vision must point to the river which you will cross and over which your members will follow. Select your vision (river) wisely and with God’s help because once you start over, it is really, really tough to get everyone to back up. You will have some people that absolutely refuse to cross that river – that is fine; let them join another church and cross another river. You’re responsible for your God-given vision and your river. As you cross the river, look for the next rock on which to step – don’t look too far ahead, you won’t be able to see through the mist. Just look one, two or maybe three rocks ahead to know which direction to go – have a sense of direction (of the path) but not necessarily of the ultimate course.

When Jobs re-joined Apple in 1987, much less when he created it in the 1970s, he had no idea of an iPhone or iPad – he just knew his company needed to focus on making computers. Same with you – focus on leading your church in the direction your vision is leading. Don’t get too far in front of your people (don’t let the river’s mist fog their vision of you and the rocks they need to step on to follow you) but don’t slow down waiting for everyone to join you. You may even have to let some staff go and/or terminate some beloved programs – but help your followers understand that while these things are good, they do not add value to your vision. Yes, there will be bottlenecks and rapids and slippery stones – handle them one at a time, but always move forward.

Lead On!
Steve

Filed Under: leadership, strategy, wisdom Tagged: , ,

Offerings

Posted on February 19, 2011 Written by

Offerings are to many worship leaders one of the most awkward times of a service. So, they fill it with special music to distract people from the passing offering plate. I regret that. I’d like to offer a different way of viewing the offering time but one that will require some work and planning.

The offering takes about 90 to 120 seconds in the average church. I suggest that in that time, you tell a story. Tell stories about how the offerings have been used in the past week to tell how a missionary did some really cool work, how a family was fed, how a minister did some counseling, how a teen publicly said he was going to be a Christ-follower, how a mission team to Africa did some awesome things, what the youth trip this summer will be doing, how many kids were at Vacation Bible School and what they studied, etc. Find 52 stories in a year and tell the church how their money is being used.

Younger generations (under 40) want to hear stories about specific people being helped with the money they give to the church. That will motivate them to continue to give and give more money. Older generations like to hear the stories, too.

So, use the offering time to TELL STORIES. After all, that’s what Jesus did!

Lead On!
Steve

Filed Under: budget, church finances, strategy Tagged: , ,

Executive Leadership

Posted on February 8, 2011 Written by

The adult Bible study class I lead is going through Joshua – we study a book of the Bible verse by verse and chapter by chapter. It’s a lot of fun leading a very discussion oriented class. We just began Joshua.

In Joshua 2.1, “Then Joshua secretly sent out two spies from the Israelite camp…” Some points to consider:

  • He sent out two (2) spies – 40 years before, Moses sent out 12 spies and only two came back with a favorable report. The other 10 were so pessimistic that their majority report caused the nation of Israel to wander in the desert for 40 years until every person age 21 and over had died.
  • He sent them out – Joshua had probably selected these guys and trained them for a dozen years or maybe more. That reminds me of the quote of General of the Army, George C Marshall, Chief of Staff during World War II, “I want an officer for a secret and dangerous mission. I want a West Point football player.” Joshua got exactly the person he wanted for this mission.
  • He sent them out secretly – Joshua did not ask for a vote of everyone; he didn’t ask them to huddle for a church-wide prayer meeting; he just did it and knew that if things went wrong, he’d bear the blame. But he was willing to do that. He weighed the consequences of having everyone know what he was doing (and maybe word getting out to the wrong people) versus doing what he knew was right and getting the info he needed for his decision.
Leadership is tricky. In this case, Joshua decided executive leadership was necessary and that’s what he did. In other circumstances, legislative authority (corporate buy-in) is necessary. Frankly, I feel that executive leadership is needed more often than it is used; executive leadership must always be tinged by the advice of clear-headed counselors. The decision can/must be explained to all later, but a leader must lead – that’s why God made leadership and leaders.

Lead On!
Steve

Filed Under: leadership, strategy Tagged: ,

Resources, Insources, and Outsources

Posted on November 7, 2010 Written by

Several years ago, Dr. Al Sutton of the 6th Avenue Baptist Church in Birmingham, Alabama, spoke to a group of church administrators. D. Sutton used the biblical text of Jesus feeding the 5,000 men (or about 25,000 men, women, and children). It was getting late and the people were hungry. The disciples asked Jesus to send the crowd away. The disciples wanted to outsource the problem but Jesus insisted on “insourcing” the situation. Then the disciples said they didn’t have any money and Jesus replied, “what resources do you have and lets see how we can use that.” Dr. Sutton thanked us administrators for putting up with pastors who want to imitate Jesus by insourcing problems and by telling the finance people to just use whatever you’ve got (without fully knowing what there is to begin with). I’m not doing Dr. Sutton justice with this brief paragraph, but you get the idea.

Every day Christians (and non-Christians) ask God to make personal problems go away. If the issue will only disappear, then there won’t be a problem, right? We even throw Jesus back at God, “If we have faith the size of a mustard seed, God will solve everything.”  God wants us to deal with issues – not run from them. God wants all of God’s disciples to get involved, to get our hands dirty, and to “insource” problems. God doesn’t outsource – God uses you and me. BTW, I’m not talking about medical, ethical, or legal problems – those have tangible consequences and are a matter of much prayer; sometimes God does intervene in human events in miraculous ways to cure diseases and take care of situations far beyond our powers and require divine resources. But what is within our control, God wants us to confront and deal with directly – not push aside.

Next, Jesus asked about the resources available. All too often we tell God that we don’t have enough; that if he’d only provide more we could do more; that the problem is too big for our meager resources. Jesus isn’t about what we have – he’s about what God has. I don’t like it one bit when God tells me to start out on a project when I know that I don’t know the way or have the material goods to finish – I even tell God about the parable of the king who went to war without counting the cost. Invariably God tells me to keep going and trust him. I know it sounds corny and trite, but it is true (about trusting God for daily needs – not daily wants).

So here’s my stewardship lesson for all who read this – all Christians must get involved using every bit we’ve got. Asking God to take the issue away won’t solve anything. Problems are opportunities for God – stop telling God to take some issue away that you don’t want to deal with. Next, use all the resources (time, energy, money) to address the opportunity at hand. As you’re in the middle of the issue, you may be surprised to see God at work and multiplying resources more than you thought possible. Or it may be like the disciples, only after the event is over and some time (hours, days, or months) has passed, will you be able to reflect on that event and see how God was at work. But rest assured of this, God is always at work!

Lead On!
Steve

Filed Under: church administration, church finances, leadership, planning, strategy Tagged: , , , , ,

Personnel as a Percentage of the Entire Budget

Posted on October 14, 2010 Written by

Every year the question comes up, “Is the personnel budget too big?” Some people actually mean, “Are we paying the staff too much?” and that is a question that hurts. In reality, it shows the ignorance of the person asking the question more than anything – they have no idea what their staff does. But more often than not, the intent of the original question is concern over the size of the staff (number of employees) and is that cost appropriate for our church. Here are some figures that I gathered from my local colleagues regarding their church’s 2011 personnel budgets:

  • 40.00%
  • 53.58% – does not include food service or custodial personnel
  • 48.00% – does not include custodians; church also pays $400,000 in debt service
  • 54.00%
  • 47.80%
  • 52.60%
  • 55.76%

From this data, you can tell the personnel team, inquiring church members, and curious onlookers that a range of 40%-60% is within the “normal” range. Feel free to use this info and share it with others – it might help you from those who feel the staff is paid too much or the staff is too big.

BUT, the real question is, “How much staff do we need to do what we want to do?” That is a completely different question and it is too deep to unpack here. However, I do want to wade in ankle-deep.

Most church staffs grow organically – that is, stafff members are added progressively every year or two as the church grows. This is the normal and customary route. Oh, we need someone to help the youth minister, hire a part-time middle school coordinator; our seniors are feeling neglected, hire a retired minister (he can use the income) to take care of the seniors; our current custodians aren’t cleaning the building well, hire another one.

Let me suggest a better method – strategic growth. Strategic growth is more painful in the short run but far more productive in the long run. Because of the time needed, cuts in staff that result from this, and the ensuing time needed to educate members and implement the new structure, I suggest that churches only do this at most every five years.

Strategic growth, in a nutshell, is when church leadership (ministry council, elders, etc.) looks at the “five-year plan” that every church should have. Simultaneously, the council gets a conservative estimate of income for each of the next five years. With those two pieces of info, the council decides what is the #1 goal for the next five years (that thing, without which, the church would cease to exist) and then funds that with staffing, programming, and building money. The council then decides what is #2 and funds it appropriately and so forth until the estimated money runs out.

When the council has run out of money to fund its strategic plan, all other items on the priority list are cut. That means that some staff will be cut, some buildings may not be built or may be renovated, and some programs and ministries will no longer be done. That is going to please some members and anger others – this is where the hurt and pain come in. You’re not going to please everyone, but you will please God as the church uses its resources (staffing, building, and members’ time for ministries) in a strategic method.

A lot more can be said about this but I think you get the idea of where to go from here. I do feel that if strategic staffing and programming is implemented, you’ll be able to look back and be amazed at how far how fast the church went.

So, next time someone asks, “How big is our personnel budget?” return the question with one of your own, “Are we spending personnel dollars in the right way?”

Lead On!
Steve

Filed Under: budget, church finances, church staff, leadership, strategy Tagged: , , , ,

Book Review

Posted on May 7, 2010 Written by

Just finished reading “The New Context for Ministry: Competing for the Charitable Dollar” by Lyle Schaller. He wrote this at the end of 2001 and it was published in early 2002. In the book, especially in the last handful of chapters he makes some predications about the future of church economics. It is uncanny how accurate he was and is.

Schaller gives all churches (and non-profits) a warning shot across the bow about the way they’ve always done church finances versus the new economy and how they need to re-shape their church’s finances. It is also hard to acknowledge that the church is not prepared for the future. What is worse, is that no one seems concerned about the future enough to do anything about it.

About once a year someone pulls the fire alarm in my church. It is always a false alarm. Everyone knows it is a false alarm. So, no one moves the exit; no one gets the kids out of the building; no one runs to investigate the source of the alarm. In this book, Schaller is pulling the fire alarm for churches because there is a real fire. Unfortunately, churches believe that “God will provide” the financial resources they need. Well, God will but the church must actively work and search for it.

I recommend the book (even though it is not particularly readable) with an emphasis on his recommendations at the end of the book.

Lead On!
Steve

Filed Under: future, leadership, planning, strategy Tagged: , , ,

Group Decision-making

Posted on February 15, 2010 Written by

I was asked to speak to our church’s “Emerging Leaders” class about decision-making by groups. Specifically, there are three questions to answer:

  1. Why teams or committees in the church make decisions?
  2. How teams make decisions?
  3. How and why decisions are made by teams or committees get passed on for further approval?

First, full-disclosure: I work in a Baptist church. Baptists believe in democracy – my mom said that the truest expression of democracy, warts and all, is in a Baptist church. Members (actually, only those present) get to voice their opinion regardless of how much they’ve contributed to the church financially, how informed they are on the subject, or how much the result of the decision will affect them and their family. Everyone gets a voice – and that is very good and very bad.

Rather than digress into an explanation of the very good and very bad (which pretty much everyone can figure out for themselves), let me speak to these three questions.

  1. Why do churches have committees to make decisions?
    1. The Baptist church is a democracy: as explained above, decision-making is shared by the church. Now, the entire church cannot decide everything so it delegates some decisions to committees. Some decisions are made by the committees and some are passed on (see question #3). Sharing the burden (or blame) helps unify the church.
    2. “The Wisdom of the Crowds:” providing a venue for people with different life experiences to share their wisdom can help make decisions more informed and thus have better results. I frequently remind my committees that “right now we’re operating from a basis of ignorance and getting more information will help us make a better decision.” Decision-making from a base of ignorance is never good – get as much knowledge and wisdom as possible.
    3. Corporate buy-in: having as many people as reasonably possible in the decision-making process will mean that later on, those decision-makers can be “emissaries” to others who question the decision. It also means those decision-makers will support the decision verbally and financially when the time comes for them to speak out (or else they’ll be viewed as hypocrites and not trusted by other members).
    4. CYA (cover your ass): this is not a polite term in church but it is exceedingly true. Smart leaders will use officially sanctioned committees to make decisions that might cause heartburn in a handful of individuals. Those individuals who have their own agendas will find it harder to fight the group. An individual decsion-maker can be hounded (sometimes mercilessly) by a person with an agenda. Individuals who question the group decision in a public arena can be asked why they did not go to the committee rather than air their grievance to the world.
  2. How do teams make decisions?
    1. The best decisions made by groups are by consensus. Sometimes a vote necessary for an official record. However, shy away from official votes when possible. Ask the members of the group if everyone is in agreement. Then, when you do need to take a vote, those official votes will have that much more power because members are willing to put their opinions in the record.
    2. Decision that are made by split or almost split decisions are not valid. Decisions should have a clear majority (at least 66-33) in order for them to have full support of the committee. Then, the committee must share and explain their decision with others so that there is further and continued buy-in.
    3. Point of clarification: some decisions should be made by a person for one of several reasons
      1. Expediency: there is not enough time to have an official meeting. In those cases, if the decision is minor then the leader can make the decision. Sometimes a leader may want or need to consult one or two others for their input but ultimately the decision will be made by that person.
      2. Leadership: “follow we” is not what Jesus said. Leadership is given to us by God. Sometimes leaders just need to make a decision and get out there and lead. Leadership is not “finding a parade and jumping out in front of it.” Leadership is realizing that sometimes people are following you and sometimes people are chasing you – sometimes at the same time! Leadership is a topic for another blog.
  3. How and why decisions that are made by teams get passed on for further approval?
    1. Authorization: some committees are not authorized to have the final say in an issue. A team will pass on their decision with a recommendation to the next group in line when they are required to do so. The next group may or may not follow the prior group’s decision and/or recommendation.
    2. Publicity: having a decision made by the entire congregation or a very large group provides the opportunity to “sell” or “market” the decision. That way, more people will be aware of the decision, can tell others about it, and when the time comes, can support it financially.
    3. Tricky issues: matters which could affect a member or group of members might need to be dealt with in an official capacity (depending on the matter and the people it affects). Some people accept negative news better than others; those who do not accept bad news are well-known and when a decision involves them, a group decision can help (see CYA above).

All that being said, let me tell a story that happened in a church. A certain member had a major contract with the church which annually cost the church over $40,000. I wanted to put that contract out to bid and I was authorized to do so but I knew how news would be received. I asked the church’s Finance Committee to “order me” to put this out to bid (see CYA). Four companies bid on it and that member’s bid came down 35% even though it was the same contract and two other bids were almost identical. I was authorized to make the final decision but I asked some elders in the church to help with the decision. They realized this was a tricky issue and they asked the Finance Committee to make the decision. The Finance Committee wrestled with this for over an hour before giving it to the member. The result is that about a dozen church leaders felt that this member was taking advantage of his church and his influence waned. The right decision was made, the member was put on notice that his prior actions were unacceptable, and the church got a $14,000 discount on an annual contract.

I need to go now, the contractor for a small renovation project needs me to make a decision. I’ll handle that one myself – no committee need get involved!

Lead On!
Steve

Filed Under: church administration, leadership, strategy Tagged: , ,
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