Volume 2, Number 4
I am pleased to share with you the most recent issue of the Best Practices in Church Management Newsletter of Villanova University’s Center for the Study of Church Management. In this issue, we cover a number of topics, including budgeting, Appreciative Inquiry, and pastor time allocations.
Michael J. Castrilli, senior client decision manager at Decision Lens, delivers the final installation of his three-part series on the budget process. In our previous issues, he wrote about transparency and budget formulation. The series concludes in this issue with Michael’s presentation of budget execution and analysis.
A relatively recent innovation in pastoral planning is Appreciative Inquiry (AI). Rather than focusing on parish problems and how they can be fixed, AI is a more positive approach, emphasizing what is right with the parish. Appreciative Inquiry, with its spiritual underpinnings, helps parishioners to approach problems from an appreciative perspective of parish life, focusing on what is good and life-giving in the parish even as the problems are being managed.
Finally, in the “And The Survey Says” section, we reveal the findings of a national survey of pastors and parish life coordinators that asked them how they spend their time. They were asked about eleven different activities, including some that could be considered pastoral, leadership or managerial in nature. Significant differences were found across various parish staffing arrangements.
I would like to remind you of the educational opportunities available through the Center for the Study of Church Management. In addition to our very successful on-line masters degree in church management awarded through the nationally-ranked Villanova School of Business, we also, in partnership with Our Sunday Visitor and AmericanChurch, offer a series of webinars on church management topics. This series presents the opportunity for an individual to earn a certificate in church management through the Villanova School of Business. The series will begin its second year in September. Individuals interested in particular topics may participate in one or more of the specific webinars without pursuing the certificate. Click here for more details.
We hope that you find the information in this newsletter helpful. We appreciate your previous feedback and are happy to hear your feedback about the topics covered in this issue as well as topics that you would like to see covered in future issues.
Center for the Study of Church Management
Money is tight, donations have been down throughout the year and, as you approach the final months of the fiscal year, cuts have to be made. You have done all of the right things as it relates to developing your budget plan. You have created a collaborative budget process, sought feedback from your management team on spending priorities and generated buy-in from the community through an open and transparent formulation phase. However, expenses have been higher than anticipated, and you are feeling pressure to act. Where do you turn for answers? This article describes a practical budget analysis approach called QUEST (Question, Understand, Evaluate, Solve and Track) that can help you to uncover, focus and respond to changing circumstances surrounding your budget plan.
In the previous article in the Budget Assistant Series, we discussed using variance analysis as a method to help you quickly assess actual receipts or outlays versus planned income or expenses developed through your budget process. (For more information on variance reporting, see: The Budget Assistant: Budget Formulation and Improving Forecast Accuracy). Once the variance report is generated, the next step is to analyze the categories that are either over or under budget. Whenever you undertake any type of budget analysis, the answer to why income or expenses are higher or lower than expected may not be clear or black and white. Therefore, applying the QUEST budget analysis process can help focus your assessment. Let me walk through a simple case in point to apply QUEST. When reviewing your variance report mid-year, you discover that your fuel costs are running 10% over budget and supplies are 20% over budget.
Q = Question. When confronted with the challenge of what to do when income or expenses are higher or lower that planned, often we do not take the adequate time to question and probe further to uncover any underlying factors that are driving results. The metaphor I use to describe budget analysis is like peeling an onion. As a first step, peel the onion one layer at a time and begin by asking questions and gathering information.
The goal is to gather data and information and discuss the situation with your colleagues to arrive at the next level of understanding. This is not an attempt to put blame on people or circumstances for variances but to open communication lines and to share accountability. Using the example related to supply costs, as a first step, you ask the office manager if she has any information to help you understand why supply costs are so much higher than planned. Through this discussion, you discover that although the supply figure is higher than planned, your office manager was able to secure a 10% discount on supplies if she purchased a six-month supply in advance, instead of a quarterly purchase. Although the category appears higher than anticipated during this quarter, in six months, this expense will actually generate savings for this line item. This example highlights the importance of asking questions before concluding what needs to happen next. Of course, this may also help you consider future mechanisms that you may need to put in place for your staff to communicate more proactively on these types of items, but asking questions can help you to understand the scope of the issue and determine next steps.
The increase in the fuel category may be caused by a number of factors, which may include the higher price of oil throughout the region, but it also may be related to additional travel by staff or more use of the organization’s van, which is the least fuel-efficient vehicle in your fleet. It is important to probe further to be able to understand what is driving the results before you develop a premature solution. Therefore, you talk to your staff about their travel and collect prior year budget data on this category of spending.
UE = Understand, Evaluate. After you have compiled information and data, you can now dig deeper into the driving factors and/or assumptions that may be underlying your results. Be careful not to skip over this phase and move quickly to the solve phase of this process without adequately addressing all of the parameters that may be moving behind the scenes. If you think about my metaphor of peeling an onion, the question phase gets you through one layer; understand and evaluate helps you to get to the core.
When preparing a budget, assumptions are used to guide the direction of various components of your budget. A best practice in budget formulation involves writing these assumptions down so you can return to them in the future and review their adequacy or relevancy to what actually occurred. When analyzing budget data, whether the assumptions are written or not, the key is to think through the assumptions you developed so you can either validate or modify those assumptions based on changing circumstances.
Returning to the example of higher than expected fuel costs, you are ready to review your notes and assumptions from the budget formulation phase. Based on these notes, you realize that you built a 3% increase into your budget for fuel spending. Therefore, although the variance report shows a 10% increase, in reality your fuel costs may be even higher than you anticipated because you already increased the budget for this category from previous years. It is also important to evaluate historical data you collected related to this category. Historical budget data that includes planned versus actual outlays can help right size the magnitude of your variance and provide you a roadmap from the past on how money is spent regarding this category. After you review the information, talk with staff and examine assumptions, you conclude that the increase in fuel costs is being driven by two factors. First, the price of oil has increased more than you originally estimated. Second, while discussing this issue with your team, you realize that key members of your staff are traveling more than they did a year ago. Equipped with this information, you are now ready to propose solutions.
S = Solve. Developing a solution to many challenges can seem ominous. However, through the question, understand and evaluate phases, your analysis will likely lead you to understand budget problems in more manageable chunks. Although there is no one-size fits all solutions, key questions can be asked to determine the right course of action. 1. What is the impact that this challenge is causing to the overall budget? 2. Who are the stakeholders that need to be involved in the solution? 3. How quickly do we need to implement a solution (immediately, 0 to 3 months, 6 months to 1 year, long term)? 4. What are the alternative options available to implement? 5. What are the risks to the success of the solution? How can we mitigate these risks?
Through your analysis, you are now comfortable with the reasoning behind the increase in supply costs, but you determine that a solution is necessary related to fuel spending. You propose three solutions with various levels of impact. The highest impact and most immediate solution are to eliminate all unnecessary travel by staff, unless explicit permission is given by individual X. A more moderate solution involves asking staff to use discretion related to travel and asking them to purchase fuel at specific locations that offer lower prices. A low impact, longer-term solution may involve alerting staff to be cognizant of their travel and fuel purchases, and in the next budget year, you may consider more fuel-efficient vehicles. Although you are concerned with the increase in spending for this category, you decide to implement the moderate solution, speak with your staff about the constraints, and decide to review this issue in one month. Developing alternative solutions and collaborating with those individuals involved in executing the solution is important for buy-in and ultimate success. When decisions are made in a collaborative process, team members are more likely to support the initiative and work towards shared goals more effectively.
T = Track. The final step is to track your results. This phase helps you twofold in budget analysis. First, it directs you to periodic check-in points to ensure that you are meeting your expected results and goals. Second, it provides the opportunity to know what success looks like when you have arrived. Tracking can help you stay accountable to your anticipated goals. For example, if you were trying to manage supply costs, you may determine that instead of only reviewing supply costs monthly, for the next quarter you may consider reviewing these expenses every two weeks. By implementing a track system, you establish periodic check-in points and answer the question, “Where are we with this item and has anything changed?” This also reduces stress in your organization because you and the team know when you will return to review this item.
Tracking also forces you to answer the question, “What does success look like for our proposed solution?” Organizations often fail to define what success looks like because it can seem overwhelming. To overcome this hurdle, stop trying so hard to make your goals perfect. Draw a line in the sand, and see how close you come to meeting your target given an established time. It is good practice to get used to defining what success looks for your organization. Keep goals simple, and remember that tracking requires two elements: a goal and a period you will measure this goal. For reducing fuel costs, the goal may be as simple as reduce fuel costs in three months by 3% with monthly check-in points to determine progress. Without a clear understanding of what you hope to achieve, it is very difficult to know when you have arrived. Think of measuring success as planning a road trip. If you are trying to get from point A to point B, you may need see a few road signs along the way to determine how much longer it will take to get to your destination or if you are heading down the wrong road. Tracking is your GPS for the trip.
Recognizing that there are a number of techniques to assist you in budget analysis, I encourage you to consider QUEST as one method to keep in your leadership toolkit to help you analyze your budget, maintain focus on your priorities, and reach your organization’s goals and outcomes. For questions, comments, or more information on this topic or any budget related matters, feel free to email Michael Castrilli at firstname.lastname@example.org.
One of the key roles that parish pastoral councils play is to engage in pastoral planning. Frequently the approach used is some variation of the SWOT method – identifying the parish’s Strengths, Weaknesses, Opportunities, and Threats. Too often, this approach leads the council to focus on parish problems – what is wrong with the parish, and how it can be fixed. In recent years a more positive approach to parish planning has emerged: Appreciative Inquiry (AI). Rather than focusing on what is wrong with the parish, AI emphasizes what is right with the parish.
Two of the leading experts on Appreciative Inquiry are David DeLambo and Richard Krivanka, both of the Pastoral Planning Office of the Diocese of Cleveland. They present an excellent summary of the methodology of AI in their chapter, “Appreciative Inquiry: A Powerful Process for Parish Listening and Planning,” found in Four Ways to Build More Effective Parish Councils: A Pastoral Approach, edited by Mark F. Fischer and Mary Margaret Raley.
DeLambo and Krivanka define AI as “the process of asking questions and exploring things that give life, health, vitality, excellence and success.” Life and what enhances it is the heart of the analysis, rather than problems. According to DeLambo and Krivanks five basic principles underlie AI:
1. The Constructionist Principle. All of us tend to see things as we are, not as they are. Reality is decidedly subjective. Change relies on altering the way we see, the way we construct reality. With regards to parish planning, the lens we use to construct our reality of the parish is critical. A problem-solving lens leads to negativity; an appreciative lens leads to optimism.
2. The Poetic Principle. All parishes are similar to poems, full of boundless interpretive possibilities. But too often in our haste to get to the problems we overlook the life-giving facets of parish life. Rather than looking for flaws and weaknesses, AI spotlights these life-giving features. Understanding factors that work enhances our ability to replicate them.
3. The Principle of Simultaneity. The process of inquiry and the process of change are not separate, but rather they occur simultaneously. AI captures this principle through its maxim “inquiry is intervention.” As DeLambo and Krivanka phrased it, “There are no neutral questions. The seeds of change are implicit in the first questions we ask. What we seek, we find. What we find, we talk about. What we talk about leads to images that guide us into the future—the material from which the future is conceived and change is made.”
4. The Anticipatory Principle. Our vision of the future guides our current behavior and, ultimately, the future of the parish. If we believe our parish’s best years are yet to come, it will be reflected in the planning process.
5. The Positive Principle. Simply speaking, the more positive the parish planning process, the more effective any change will be. Again quoting DeLambo and Krivanka, “positive questions lead to positive images, which increase positive energy, resulting in positive change.”
Appreciative Inquiry in Parish Planning
The planning cycle for AI is frequently referred to as the “4-D” cycle, reflecting the names given to its different phases: Discovery, Dream, Design, and Destiny.
1. Discovery Phase. This phase calls for the parish to “discover” the sources of parish life, the best things about the parish. Parishioners are invited to share their stories about what attracted them to the parish in the first place, what keeps them there, what they value, and their hope for the future. The Discovery Phase revolves around six questions:
a. Beginnings: why were they attracted to the parish, what were their first impressions, what excited them about the parish, etc?
b. Life-giving experiences: when did parishioners feel most enthused about being a parishioner, and what made it such a vital experience for them?
c. Values: what do parishioners value about themselves and the parish that explains their attachment to the parish?
d. Impact: within the last year, what is the single most important contribution that the parish has made to their lives?
e. Essential spirit: what is the essence of the parish? What force could the parish not survive without?
f. Images of the future: If a parishioner had the opportunity to modify the parish, what three things would be done to increase its vitality?
Based on the responses to these questions the major sources of life in the parish can be identified. They in turn become the focus for a thorough exploration of what animates life in the parish. The Discovery Phase can either be conducted through a series of personal interviews with individual parishioners or through a town hall approach.
2. Dream Phase. The Dream Phase uses the data and images gathered in the Discovery Phase to imagine an even more vital future for the parish. It leads to the question, “What is being called for?” This is the time to create a mission statement if one isn’t already in place, or to revisit it if the parish has one.
3. Design Phase. In this phase, input from the previous phases is utilized to identify tangible ways of enriching parish life. For example, each component of the parish mission statement can be examined for practical ways of implementation. For each item in the mission statement, parishioners are asked, “What do we do best?” with regards to that item, and then to envision ways of enhancing that activity. The parish planning committee can then take these recommendations and develop an action plan with goals and strategies for implementing them. The critical element here is that discussion began with a positive, not negative, tone towards parish life.
4. Destiny Phase. This is the implementation phase of AI, where the plan comes to life in the form of specific actions. A critical component is the generation of an “appreciative culture” within the parish that values continuous assessment and improvement. Just as the planning process itself was positive, so too the evaluation must be positive and appreciative, celebrating the life of the parish.
Summary and Conclusion
No one is suggesting that parishes don’t have problems that need to be addressed. Appreciative Inquiry, with its spiritual underpinnings, helps parishioners to approach problems from an appreciative perspective of parish life, focusing on what is good and life-giving in the parish even as the problems are being managed. As Delambo and Krivanka summed it up,
“We must always remember that central to the Church’s mission is being the herald of the Good News. Appreciative Inquiry creates a culture of ‘good news’ by making the parish a place where people tell stories about God in their lives, and where people implement life-giving actions. Are people in your parish excited because they are talking about the things they most deeply value? Are they discussing and implementing those things that give life? Do they see the good that the parish does, and do they make increasing that good the focus of discussion? If not, a change of culture is needed. That change can begin by engaging the power of Appreciative Inquiry.”
Nearly everyone would agree that US Catholic pastors are overworked. Surveys typically reveal that many pastors spend 60-70 hours per week serving their parish. Due to the decline in the number of priests and other factors, parish organizational structures are being reconfigured (merged, clustered, etc.), which leaves many pastors leading either larger parishes or multiple parishes. Canon law makes it clear that the pastor carries the threefold office of sacramental leader, teacher and administrator.
So, how do Catholic pastors spend their time? In addition to their pastoral duties, do they get bogged down in management, or are they able free themselves from much of the minutia of parish administration and focus their time and energies on leading the parish community? Likewise, does the time that pastors spend in managing rather than leading differ by the staffing structure of the parish?
A recent survey conducted by the Cooperative Congregations Studies Partnership (CCSP), a multi-faith group of religious researchers and faith leaders representing over 25 faith groups, had some interesting findings in that regard. The survey included data from a national sample of 390 Catholic parishes. These included parishes that represented three different staffing situations: a single priest serving as pastor; parishes staffed by a pastor assisted by one or more parochial vicars; and parishes staffed by parish life coordinators (PLCs) under canon 517.2 of canon law. Unfortunately, the survey did not include information on whether or not the pastors led multiple parishes.
The survey asked about eleven activities, six of them pastoral in nature, two representing leadership, and three that can be characterized as managerial. These are listed in Table 1. Respondents were asked if they spent very little, some, quite a bit, or a great deal of time in each activity. The average amount of time spent by each area of responsibility for all of the pastors in the sample, as well as broken down by parish staffing situation, is found in Table 2.
The amount of respondents indicating “a great deal” of time spent in each area of responsibility did not differ substantially from one area of responsibility to another for all pastors/PLCs in the sample. However, these figures mask some broad differences that appear when we look at the activities broken out by parish staffing situation. Pastors in parishes where they were assisted by parochial vicars on the average spent the largest portion of their time at management tasks and the least amount of time leading their parish. Alternatively, PLCs spent most of their time, on average, serving in a leadership role and the least amount of time (although about as much as pastors with parochial vicars) in pastoral activities. Pastors without parochial vicars spent the least amount of time, on average, in two of the areas of responsibility listed and in the middle for a third, although they spent more time at pastoral activities than in any other area of responsibility.
So, what conclusions can we make from these findings? Some of them are counter-intuitive. One would think that a pastor supported by one or more parochial vicars (and in most cases, larger staffs) would be spending most of their time in a leadership role while delegating routine management tasks. But just the reverse is true, as they spent the most time in management and the least time in leadership. Conversely, PLCs, with the least amount of support, nevertheless were able to devote more time, on average, to leadership functions. As might have been expected, pastors who lack a parochial vicar tended to be in the middle range for the areas studied.
|Table 1: Activities Studied
|Table 2: Time Spent on Activities by Pastoral Staffing|
|Pastor with Parochial Vicar(s)||19.7|
|Pastor with no Parochial Vicar(s)||15.5|
|Parish Life Coordinator||19.6|
|Pastor with Parochial Vicar(s)||9.3|
|Pastor with no Parochial Vicar(s)||13.9|
|Parish Life Coordinator||31.6|
|Pastor with Parochial Vicar(s)||22.8|
|Pastor with no Parochial Vicar(s)||14.4|
|Parish Life Coordinator||21.2|