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Churches Learn from the Economic Crisis

10/18/10

Most agree that the financial crisis has forever altered our economy and culture, and most ministers agree there lessons to be learned for ministries and those who lead them. Few of these lessons have been easy; most of them are painful. In an article in Church Solutions, Mark Holbrook, a provider of banking resources to evangelical ministries across the country, has seen three particularly important lessons emerge.

Early Recognition and Response Matters

Holbrook says ministries need to recognize the scope and severity of economic conditions and make prudent, sometimes difficult, decisions sooner rather than later. “Ministries that did this generally weathered the economic storm better than those that just kept hoping things would get better. In the early stages of the economic crisis, we heard some ministry leaders say things such as, ‘We believe the Lord will see us through,’ or ‘Our people will step up.’ Some of them realized later that the real message from the Lord was probably more like, ‘You need to trim expenses and learn to live on less.’ In addition, before the decline, effective ministry was often defined in terms of programs, projects and paid staff; in fact, effectiveness may be more accurately measured by factors such as depth of relationship, relevance of message, and the presence of a spirit of joyful volunteerism.

Financial Management Matters

Holbrook further explained that prudent financial management is a must. “More effective ministry does not mean spending every dollar that comes in. While many ministries have learned the critical importance of maintaining adequate reserves and managing cash flow, others consider it almost a moral responsibility to spend every donated dime. Proverbs 6 suggests a wiser approach: Setting aside funds now for the coming season is part of good stewardship.”

Relationships Matter

“Now more than ever, leaders are learning the value of relationships and resources that are available beyond the walls of their ministries,” Holbrook added. “No ministry possesses all the expertise needed to pursue their mission well. We all need to recognize the value of outside resources. Interdependence is biblical, as is consulting with people who know things we don’t and have done things we haven’t.” Holbrook suggested networking with ministry peers to find people better versed at handling difficult ministry tasks, such as renegotiating service contracts, project management, budgeting or financial forecasting.

He told the story of one large Southern California church that began its 2009 budgeting process early in the fall of 2008. Church leadership foresaw budgetary issues in the coming year, so, they developed three budget scenarios—one based on the church’s giving history, one based on their best guess given what was happening in the economy, and one based on a worst-case scenario. They ultimately went with a hybrid of the best-guess plan, but they also regularly reviewed and adjusted the budget based on current reality. Along the way, they sought counsel from our ministry development team and others with whom they have relationships. In the end, this church not only weathered the storm, but became stronger in the midst of it.