Identify Your Key Assumptions

An inaccurate premise may lead to a colossal flop!

 

by Dan Busby and John Pearson

 

Meetings are a good place to discover whether an organization
might be suffering from groupthink. If everyone in the room
seems convinced of the brilliance of an idea,
it may be a sign that the organization
would benefit from more dissent and debate. [1]

Donald Rumsfeld
 

 

The silence was deafening. Board members gulped. Their red-in-the-face CEO had just delivered the shocking news. The Vision 100 Challenge—unanimously and enthusiastically affirmed by the board—had flopped.

 

Three major donors and a generous foundation had shared the ministry’s enthusiasm for this out-of-the-box initiative. The largest donations in the organization’s history were the sent-from-heaven lead gifts that fueled a robust fundraising campaign. For the first time ever—lack of funds was not the problem.

But there was a problem. The program—an enormously costly venture—had failed miserably.

Remember the story of the dog food company’s annual sales meeting—when the VP of sales castigated her regional sales reps for declining sales? The executive harangued the discouraged sales agents: “What’s going on here? We have the greatest ad campaigns. Our packaging is award-winning. We’ve improved distribution. So why are our dog food sales so dismal?”

An anonymous voice from the back of the room answered, “The dogs don’t like it!”

Good news. There is help for dog food purveyors and ministry board members. At your next board meeting—ask this simple question:

“What are our assumptions about the _______________?”

Just fill in the blanks with your current opportunity, project, or plan (strategic plan, annual plan, ABC Vision Initiative, XYZ Challenge, etc.).

Assumptions are a very big deal—and had the ministry above invested adequate time in identifying and elevating their key assumptions about the Vision 100 Challenge, they likely could have prevented an embarrassing flop and an egregious waste of God’s money.

In the chapter “Thinking Strategically,” in Rumsfeld’s Rules: Leadership Lessons in Business, Politics, War, and Life, Donald Rumsfeld lists four critical strategic planning steps:

  • Step 1: Set the Goals
  • Step 2: Identify Your Key Assumptions
  • Step 3: Determine the Best Course of Action
  • Step 4: Monitor Progress Through Metrics[2]

Rumsfeld writes that the second step “tends to be one of the most neglected. Assumptions are often left unstated, it being taken for granted that everyone around a table knows what they are, when frequently that is not the case. The assumptions that are hidden or held subconsciously are the ones that often get you into trouble.” (Think dog food—will the dogs like it?) He adds:

It is possible to proceed perfectly logically from an inaccurate premise to an inaccurate and unfortunate conclusion.[3]

Rumsfeld, who was U.S. Secretary of Defense twice (and a Fortune 500 CEO twice), describes a planning meeting at the Pentagon: “The objective of the plan was straightforward enough: to defend South Korean sovereignty and defeat the North Korean threat. What I found troubling, however, was that there was no discussion of the key assumptions in which the plan was rooted.”[4]

Rumsfeld dismissed the meeting and they reconvened on the next Saturday. “That Saturday we met for hours and never discussed any of the plans, only the assumptions.”[5]

Are you willing to risk your ministry’s future—with inadequate premises that lead to unfortunate conclusions? We recommend you identify your “Top-10 Assumptions” that you believe are foundational to your programs, products, and services. Here are some well-assessed assumptions:

  • A rescue mission. A social services ministry in a major city noted a trend that many of their homeless guests had previously lived in three nearby suburbs. Assumption: If we create partnerships with key churches in key suburbs—and provide church leaders and volunteers with training and know-how—perhaps those churches could minister to local people in need before they are at a crisis point in their lives.
  • A college. The growing backlash against high tuition costs at private colleges may endanger the very existence of our Christian college (and even the need for a higher education). Assumption: Within X years, student debt for graduating seniors must equate more to car loan levels versus home mortgage levels.
  • A founder-led mission. The aging donor base—hundreds and hundreds of faithful friends of the founder—will soon dry up as they pass on. Assumption: Our future depends on our ability to inspire the children and grandchildren of our current donors to take the giving baton—before our founder retires (or dies).
  • A media ministry. The trends away from traditional TV and radio programming—toward podcasts and streaming—are the hot topics at our industry gatherings. Assumption: We must break out of our traditional ministry model bubble (talking to ourselves, working harder—not smarter, etc.) and probably double our research budget immediately—so we’re not caught flat-footed in a changing technological environment.

Many boards and senior teams have intentional, robust discussions about assumptions—culminating in a one-page document (some call it their Radar Report). Then board members, the CEO, and senior team members look for opportunities to review that one-page report with stakeholders and trend-spotters—asking for informal feedback, like this:

Mary, thanks for meeting with us today. In addition to talking about our capital campaign—would you look over this one-page list of “Our Top-10 Assumptions: The Radar Report” right now? Are these the right assumptions? What’s missing? What would you add or delete?

We urge board members to be receptive to the Lord’s “Tap! Tap! Tap!” on the shoulders of their hearts—not just at board meetings, but 24/7—every day.[6] Listen for the Holy Spirit’s nudge—every day—and look for opportunities to discuss these assumptions with a colleague or even an acquaintance that is not familiar with your ministry. Perhaps God will plant just the right person in your path so your inaccurate assumptions don’t lead to inaccurate conclusions—or a colossal flop!

There are many reasons why you should ask volunteers, donors, and others for feedback. R. Mark Dillon notes that “big ideas attract big gifts.” He urges CEOs, pastors, and fundraisers to engage givers at the front end of a project.

“Big ideas are mission-centered.” He quotes one gifted giver, “Please don’t come to me with an ‘order list’ already thought out, where my only decision is how much to give!”[7]

Dillon notes, “When the organization has done all the thinking and only wants capital from the giver, they have forfeited not only wise counsel but also a deeper relationship and, most probably the big gift as well.”[8]

Rumsfeld would agree with Dillon. Here’s a Rumsfeld rule that is worth memorizing:

If you expect people to be in on the landing,
include them for the takeoff.[9]

In addition to insights on assumptions—a neglected key component for stewarding your resources and preventing flops—you’ll enjoy reading and repeating many of Rumsfeld’s 400 rules, including:

  • “The first consideration for meetings is whether to call one at all.”
  • “If you can find something everyone agrees on, it’s wrong.” (Rep. Mo Udall)
  • “The default tendency in any bureaucracy, especially in government, is to substitute discussion for decision-making. The act of calling a meeting about a problem can in some cases be confused with actually doing something.”
  • “Stubborn opposition to proposals often has no basis other than the complaining question, ‘Why wasn’t I consulted?’” (Pat Moynihan)
  • “If you don’t know what your top three priorities are, you don’t have priorities.”
  • “What you measure improves.”[10]

We end with this caution about fake news! Peter Drucker, often called “the world’s greatest management thinker,” famously said, “What everyone knows is usually wrong.”[11] William Cohen’s book, The Practical Drucker, notes:

What Drucker wanted to emphasize was that we must always question our assumptions, no matter from where they originate. This is especially so regarding anything that a majority of people “know” or assume without questioning. This “knowledge” should always be suspect and needs to be examined closer because, in a surprisingly high percentage of cases, the information “known to be true” will turn out to be inaccurate or completely false. This can lead to extremely poor, even disastrous management decisions.[12]

 

BOARDROOM LESSON
_______________________________

Identify your key assumptions
so your inaccurate premises don’t lead to
inaccurate conclusions and colossal flops!
Invest time in assessing the validity of your assumptions—
and asking for advice and counsel from others.
Expect God to lead you to colleagues, acquaintances,
and even experts who will give you feedback
on your ministry’s important plans
and your assumptions about those plans.
 

  Board Action Steps:

  1. Allocate: Begin your process by allocating 30 minutes at your next board meeting to discuss assumptions. Ask board members and senior team members to read this lesson in advance—and then, in groups of two or three, ask each group to identify their key assumptions (up to 10).

  2. Assess: Ask the CEO and senior team to combine and narrow down the lists of assumptions—and give the board the first draft of the one-page document, “Our Top-10 Assumptions: The Radar Report.”

  3. Advise: After the board affirms or edits the first draft, then it’s time to review the Radar Report with others. Be intentional about seeking the advice and counsel of colleagues, friends, acquaintances, experts, givers, volunteers, former board and staff members, and others. The feedback will sharpen your plan.
     

 

Prayer

Lord, protect us from colossal flops!
Give us humility as we seek the counsel and advice of others
so that we follow Your plans.
Guide us to the correct premises
that will lead us to Kingdom impact for Your glory. Amen.
 

 

 

 

[1] Donald Rumsfeld, Rumsfeld’s Rules: Leadership Lessons in Business, Politics, War, and Life (New York: HarperCollins Publishers, 2013), 39.

[2] Ibid., 68-88.

[3] Ibid., 76.

[4] Ibid., 77-78.

[5] Ibid., 78.

[6] > Read Steve Macchia’s convicting insights in Lesson 11, “Tap! Tap! Tap!” in Dan Busby and John Pearson, Lessons From the Nonprofit Boardroom: 40 Insights for Better Board Meetings, 2nd Ed. (Winchester, VA: ECFAPress, 2018).

[7] R. Mark Dillon, Giving & Getting in the Kingdom: A Field Guide (Chicago: Moody Publishers, 2012), 65.

[8] Ibid.

[9] Rumsfeld, Rumsfeld’s Rules, 299–331. (Note: Appendix B includes the master list of 400 Rumsfeld’s Rules. The book includes color commentaries on dozens of Rumsfeld’s favorite rules.)

[10] Ibid.

[11] William A. Cohen, The Practical Drucker: Applying the Wisdom of the World’s Greatest Management Thinker (New York: AMACOM, 2014), 55–56. (Read Chapter 9, “What Everyone Knows Is Usually Wrong.”)

[12] Ibid.

 

From More Lessons From the Nonprofit Boardroom: Effectiveness, Excellence, Elephants!, 2019, www.ECFA.org/KnowledgeCenter.


This text is provided with the understanding that ECFA is not rendering legal, accounting, or other professional advice or service. Professional advice on specific issues should be sought from an accountant, lawyer, or other professional.

Navigation