Tuesday, March 31, 2015

No Margin. No Mission.

Board members and CEOs often tell me they get pushback on cost-cutting initiatives with pious-sounding rebukes from staff members: “Is this a ministry or a business?”

My opinion: that’s a big-waste-of-time question.

Jesus never asked that question.

Let me explain. Here in North America, we enjoy the luxury of tax-deductible giving. That’s good news and bad news—because the associated nonprofit machinery has muddled the biblical principles of doing God’s work.

One of my favorite seminary profs reminded our class, “We’re nonprofit, but we didn’t plan it that way.”

Another colleague weighed in, “Nonprofit is a tax category, not a management plan.”

Last week I heard a board member succinctly describe the issue in four words:
“No margin. No mission.”

When staff members, or volunteers, or even board members push back on the importance of profit, margin or cash reserves—it often means we’ve missed opportunities along the way to discuss biblical money principles. Questions like “Is this a ministry or a business?” trumpet bad theology and ill-informed core values about money management.

So is it time for a “no margin, no mission” discussion?

• Discuss what the Bible says about money, including Proverbs 21:20 (TLB), “The wise man saves for the future, but the foolish man spends whatever he gets.” According to Greg Laurie, “The Bible offers 500 verses on prayer, fewer than 500 verses on faith, and more than 2,000 verses on money.”

• Discuss sustainability from a biblical viewpoint (Luke 14:28-30) and from a nonprofit viewpoint. (Example: Talk about the four quadrants of mission impact and sustainability as described in Nonprofit Sustainability.)

• Discuss cash reserves. According to the ECFA 3rd Annual Nonprofit Governance Survey, about one-third of ECFA-accredited organizations have operating reserves of six months or more. Almost 84% of board chairs would like to have at least three months of reserves within the next 18-24 months.

• Discuss the future.  Read Ron Mattock’s 2008 book, Zone of Insolvency: How Nonprofits Avoid Hidden Liabilities and Build Financial Strength. Every chapter includes “Five Great Questions for Your Next Board Meeting.”

QUESTIONS: Are you getting pushback on the way your ministry manages finances? Is the push-back based on bad theology or ill-informed money management approaches? Is it time for a time-out and a transparent discussion? Who should lead that?

Wednesday, March 25, 2015

Do You Need a Consultant or a Pastor?

This revelation may shock my colleagues and clients—but not every governance issue can be solved by a consultant or a new book.

Those of us with platitudes, PowerPoints, and preachy epistles on best practices, need to take a breath occasionally and take a boardroom backseat—and just listen. (Yes, I’m looking in the mirror.)

Listen for heart issues, not just health issues. Listen for pain, not just problems. Listen for God’s voice, not just the loudest voice. 

Let me explain. 

Independent Sector has just declared there are 33 principles for good governance and ethical practice. The short version is available free as a two-page PDF.  The 86-page reference edition, Principles for Good Governance and Ethical Practice: A Guide for Charities and Foundations, is sold online.

Don’t misunderstand. It’s good stuff!  The 33 principles are organized into four major categories: Legal Compliance and Public Disclosure, Effective Governance, Strong Financial Oversight, and Responsible Fundraising. Here’s a taste:

  • "8. A charitable organization must have a governing body that is responsible for reviewing and approving the organization’s mission and strategic direction, annual budget and key financial transactions, compensation practices and policies, and fiscal and governance policies."
  • "24. A charitable organization should spend a significant amount of its annual budget on programs that pursue its mission while ensuring that the organization has sufficient administrative and fundraising capacity to deliver those programs responsibly and effectively."

But wait! Before you lead your board down one more governance resource path (“the management by bestseller syndrome”), take a deep breath and ask yourself, “Is our most fundamental problem organizational or spiritual?” 

Do You Need a Consultant—Or a Pastor?” describes my memorable experience leading a governance workshop.  When a CEO whined about his board and asked me a very, very long question—the Lord nudged me to share a very short answer. (The board needed a pastor.)

I’m just saying. Of course—keep reading the literature, but slow down. Listen to the underlying issues in your boardroom conversations. 

QUESTION: Do you need a consultant—or a pastor? 

Friday, March 20, 2015

5 Years From Now, What Advice Would You Give Yourself Today?

Last month I asked colleagues, and readers of this blog, to submit their ideas for “The Top 20 Frequently Asked Questions About Board Service.”

Bob Andringa weighed in with seven meaty questions including, “What evidence should we collect to know we are achieving our mission?”  Fantastic question!

Well…Steve Brown wins the award for the most questions!  He’s the author of the 28-page booklet, Great Questions for Leading Well. He wasn’t content with 20—he has over 200 questions!  (Read my review of the booklet.) Provocative questions like:

   • “What role is fear playing in your thinking and actions right now?”
   • “What are the costs of not delegating more?”
   • “What’s the highest and best use of your time?”
   • And from John 5:6, “Do you want to get well?”

The questions are not specifically designed for board members—but they are amazingly applicable when wearing your governance hat and/or seeking to support, encourage and bless your CEO. For example, have you ever asked your CEO these questions?

   • “If you had a dashboard gauge for your spiritual life, character, relationships and service—what would each gauge read? (Green for health, yellow for concern, or red for trouble?)

   • “If it were 5, 10, or 25 years from now, what advice would you give yourself today?”

   • “Does your budget/time demonstrate your values?”

Brown quotes Peter Drucker: “The leader of the past was a person who told, the leader of the future will be a person who asks.”

Think back over the best board meetings you’ve ever attended.  My hunch: powerful and poignant questions helped create an atmosphere of seeking God’s direction, caring for one another, and like Andringa’s question, discerning what evidence should be collected to affirm mission achievement.

QUESTION: What will you do at your next board meeting to invite questions that could be the fulcrum for effectiveness?

Wednesday, March 11, 2015

How Would Your Board Invest One Extra Hour?

Unless you live in Arizona or Hawaii, you lost an hour last Sunday when your iPhone automatically stole 60 minutes for Daylight Savings Time. 

So for these last four blurry mornings, I’ve been wondering—what could I have done with that lost hour? Leverage it? Invest it? Squander it? 

So…here’s my governance question today:

If you had one extra hour
at your next board meeting,
how would you use it?

One size (one answer) doesn’t fit all. Taking cues from the four social styles, here’s how your board members might respond:

[  ] Analyticals might leverage the hour by slowing down and asking for more information—before rushing into any action items. “No decision is better than the wrong decision.”

[  ] Drivers, if they don’t already have the gavel, would ask for the floor and—in less than 60 minutes—would clean up any low-hanging action items. “Any decision is better than no decision.”

[  ] Amiables (and don’t we love the Amiables on our boards?) might suggest that this gift of an extra hour be used to enrich our relationships—get to know each other better! “Oh! So you approach decision-making this way because you were the youngest of five children—and you never saw your parents disagree? Interesting!”

[  ] Expressives (those are the two board members in the hallway on their cell phones) might ask about the annual awards program. Are current board members eligible for awards? How about a “Board Member of the Decade” dinner? And she’s available if you need an emcee.

Time lost is time lost. Heed Ephesians 5:15-16 (NASB), “Therefore be careful how you walk, not as unwise men but as wise, making the most of your time, because the days are evil.”

Coach John Wooden was a master at mentoring his teams during his 40-year coaching career.  From 1948 to 1975, his UCLA basketball teams won 10 NCAA national championships, including seven in a row! ESPN named him the greatest coach of the 20th Century.  Here’s Coach Wooden on time:

“Time lost is time lost.  It’s gone forever. Some people tell themselves that they will work twice as hard tomorrow to make up for what they did not do today. People should always do their best.  If they can work twice as hard tomorrow, then they should have also worked twice as hard today. That would have been their best. Catching up leaves no room for them to do their best tomorrow. People with the philosophy of putting off and then working twice as hard cheat themselves.” (Coach Wooden One-on-One: Inspiring Conversations on Purpose, Passion and the Pursuit of Success, by John Wooden and Jay Carty)

QUESTIONS: Time is a precious commodity and board meeting time, perhaps, is even more precious. How would your board redeem the time and use an extra hour at your next meeting? Should you add an extra hour?