Success Measurement

Trusted ministries are not in a race with other ministries to see who can be the greatest.
Conversely, servants keep getting bigger and bigger in God’s eyes.

 

by Dan Busby

 


The movie 42 powerfully depicts Jackie Robinson who wore No. 42, breaking Major League Baseball’s infamous color line in 1947 with the Brooklyn Dodgers. Robinson faced unabashed racism, which was the national social norm of the day, from every side and demonstrated tremendous courage and restraint by not reacting in kind.

Jackie was a fearless runner on the baseball paths, often unsettling opposing pitchers. During his too-brief, nine-year career in the big leagues, he stole home plate 18 times.

One scene from 42 depicts a 1947 Spring Training game with the Dodgers playing in the deep South. An African-American mother and her young son are watching the game from the stands. Jackie is on third base, daring the pitcher to throw over and try to pick him off the base. As he dances back and forth off third base, the pitcher starts into his windup and drops the ball on the mound.

The mother says to her son, “What happened? I don’t understand.” The little boy says, “The pitcher dropped the ball. It’s a balk. Therefore, Jackie scores.”

His mother said, “But he didn’t do anything.” The boy replied “Oh, Mama, yes, he did. He discombobulated the man [referring to the pitcher].”[1] Defining and measuring success can discombobulate ministries.

The two major options for measuring ministry success are the common path and the Kingdom path. These two options are mutually exclusive. Each demands total allegiance.

Measuring success: the common path. In The Choice, authors Gary Hoag, Scott Rodin, and Wes Willmer say the common path reflects what many ministries are doing.[2]

On this path, ministries are driven to do whatever is required to deliver results measured by ministry expansion using all the resources they can muster.

There are three ways we may end up on the common path. The evil one tempts us to

  1. take control,
  2. trust in what we can see, and
  3. revel in the praise people give us when we excel.
While measuring a
ministry's own outcomes
can be meaningful,
only the Lord can
measure how well
we are contributing
to the Great Commission.
God does not provide
a system of points, stars,
or numeric system
to evaluate our results.

These values not only drive our world; but they may also be hindering our fruitfulness for the Kingdom. The three deceptions that face ministry leaders are the same three temptations that preceded the ministry of Jesus.

The common path defines success in terms of more:

  • numerical increases—more people served, more missionaries in the field,
  • growth in terms of physical expansion—more or larger facilities, and
  • finances—larger budgets, more revenue, greater gift income.

Measuring success: the Kingdom path. The Kingdom path defines success in terms of our obedience to the instructions of Jesus Christ for which He promises eternal rewards.[3]

On the Kingdom path, Christ’s followers are less concerned about results and more about obedience.

Our attention shifts from what we are doing for God to what God asks us to do and wants to accomplish in and through us.

The Kingdom path may be generally accepted in principle, but it is not widely practiced.[4]

People who are servants—
humbly, honestly, and
joyfully—keep getting
revealed as the biggest winners.
People who recognize and
embrace their smallness
keep getting bigger and
bigger in God's eyes.
It's the oddest scoring system.
John Ortberg

As believers, we endeavor to advance the Kingdom of God as reflected in these Scriptures:

  • “Go out and train everyone you meet, far and near, in this way of life, marking them by baptism in the threefold name: Father, Son, and Holy Spirit. Then instruct them in the practice of all I have commanded you. I’ll be with you as you do this, day after day after day, right up to the end of the age” (Matt. 28:19–20).
  • “You’re here to be salt-seasoning that brings out the God-flavors of this earth. If you lose your saltiness, how will people taste godliness?

You’ve lost your usefulness and will end up in the garbage.

“Here’s another way to put it: You’re here to be light, bringing out the God-colors in the world. God is not a secret to be kept. We’re going public with this, as public as a city on a hill. If I make you light-bearers, you don’t think I’m going to hide you under a bucket, do you? I’m putting you on a light stand. Now that I’ve put you there on a hilltop, on a light stand—shine! Keep open house; be generous with your lives. By opening up to others, you’ll prompt people to open up with God, this generous Father in heaven” (Matt. 5:13–16).
 

It is a fool's errand to
overly emphasize the
percentage allocations
for program expense,
fundraising expense, and
administrative expense
to compete with
other ministries
.
  • He has planned great things for us from the beginning (Eph. 2:10). He has showed us the path to walk through trustworthy sayings that deserve full acceptance. Will we follow them?

Drilling down more specifically, the following five methods of measuring success are analyzed:

  1. Measuring success by comparing. What is one of our greatest dangers for injury as leaders of Christ-centered ministries? There is strong potential for a spiritual 911-type injury when we focus too much on comparing one ministry versus another.

John Ortberg tells the story of a conversation with two other pastors. One man said to the other, “So, how is your church going?” The pastor responded, “Excellent, we have about 1,000 at our church. How’s your church going?”

The first pastor said, “Well, the Lord’s blessing us all right. We run around 1,500 or so.”

John says, “Then they looked at me. I knew what was coming next. I was serving a church that had 250 attendees. And then a little voice, so quiet I was hardly even aware of it, began to whisper a management impression strategy to me: Say the church has about 300 people. 250 people is really small.”

Do not worry when
you are not recognized
but strive to be worthy
of recognition.
Abaham Lincoln

“Right at the same time, another inner voice responded: What are you doing? You don’t even know these men. Are you willing to trade your integrity, which, when you come right down to it, is all you really have, for the sake of the status you would gain by 50 people?”

Ortberg continues, “So I said we run about 2,000. Not just transfers from other churches, either. Seriously impressive converts—Hugh Hefner, Jimmy Hoffa, the Dalai Lama.”[5]
 

  1. Measuring success by competing. A related integrity-loss chart topper involves competing. Many of us are guilty.

Professor Jonah Berger, the assistant professor of marketing at the Wharton School of Business, suggests that people who are slightly behind in a competition are more likely to win than those who are slightly ahead. He found that NBA teams that were down by one point at halftime were more likely to win than teams that were ahead by one point at halftime. It’s all about competing.[6] No sports arena sells a giant foam hand holding up two fingers.

The entire life of Jesus
isn't the story of
somebody climbing up
a ladder; it's a picture of
someone coming down—
a series of demotions.
John Ortberg

Ortberg writes, “My hunch is that Jeremiah never checked out Israel Today to see if he had passed up Isaiah on the nonfiction bestseller list. William Shakespeare didn’t look to see how many copies of his plays Christopher Marlowe sold.”[7]

Ministries must always be looking inward and stripping away any pretense of somehow being better than other ministries. It seems counterintuitive, but an important part of servanthood is not assuming you are better than others. The ministries who are really serving are also those who are the most humble about how God is blessing them.

How do ministries get caught up in the comparison race? It often relates to comparing program and overhead expenses between organizations—a faulty metric for measuring Kingdom outcomes.

Our attitude should be the same as that of Christ Jesus: “Think of your­selves the way Christ Jesus thought of himself. He had equal status with God but didn’t think so much of himself that he had to cling to the advantages of that status no matter what. Not at all. When the time came, he set aside the privileges of deity and took on the status of a slave, became human! Having become human, he stayed human. It was an incredibly humbling process. He didn’t claim special privileges. Instead, he lived a selfless, obedient life and then died a selfless, obedient death—and the worst kind of death at that—a crucifixion” (Phil. 2:6–7).

When arrogance
strikes, we
stop listening
to our critics.

“The entire life of Jesus isn’t the story of somebody climbing up a ladder; it’s a picture of someone coming down—a series of demotions. The problem with spending our lives climbing up the ladder is that we will go right past Jesus, for He’s coming down.”[8]

Paul said it best: “Make a careful exploration of who you are and the work you have been given, and then sink yourself into that. Don’t be impressed with yourself. Don’t compare yourself with others. Each of you must take responsibility for doing the creative best you can with your own life” (Gal. 6:4–5).
 

  1. Measuring success by self-adulation. Success is a danger to integrity—sometimes creating unwarranted self-adulation. “Adulation is a close cousin to arrogance and just as dangerous. When arrogance strikes, we stop listening to our critics. When adulation strikes, we no longer have critics. Both will mess you up. Big time.”[9]
Expense allocation
is not a precise process.
In many cases, the
difference between the
overhead ratios of two
very similar ministries
is more a function of
accounting methods
than operational
differences.

A “long string of successes will cause most people to downplay or forget about our mistakes and failures. It’s human nature.”[10]

“Every mountain climber would rather be approaching the peak than stuck back at base camp. Every leader would rather have success than failure or mediocrity. But only a fool forgets that the higher you go in mountain climbing or leadership, the greater the risk to your future. It’s not a time for cockiness. It’s a time for gratitude and caution. It’s a time to listen to those you might be tempted to write off.”[11]
 

  1. Measuring success through ministry effectiveness or efficiency. You have seen the articles: a nonprofit organization that has 90 percent overhead with only 10 percent being spent on program expenses. Givers are advised to shun the organization because it is inefficient.

The next story in the media is about an organization that has an “exemplary” overhead rate of only five percent of total expenses. Givers are encouraged to support this charity because of how well they steward their resources.

Only God knows
the outcomes for a
particular ministry.
And, He keeps it a
secret because on
the one hand, if we
knew the outcomes
we may be very
disappointed. Or,
on the other hand, it
might go to our head.
Bruce McNichol

There are elements of accounting that are based on hard data and involve precision (for example, cash in the bank and the mortgage balance). But overhead ratios or rates are based on arbitrary allocations of expenses (also called, functional expense allocations). Functional expense allocations are not easily determinable (how much of compensation is allocated to overhead and how much is program expenses?).[12]

Accounting rules only provide general guidelines on the allocation of expenses. The method of allocating the expenses simply must be reasonable and consistently applied. “Reasonableness” is in the eye of the ministry and their CPA firm.

Even if we could quantitatively measure an outcome—a person’s satisfaction after being fed a good meal, a direct correlation between a particular university’s college degree and success in life—there are many ways to interpret those outcomes, and the process is itself subjective and personal.[13]

A review of the ministry’s financial statements is also not conclusive in determining the effectiveness of one ministry versus another. Assume that Ministry #1 and Ministry #2 are both organizations that operate youth programs in Atlanta. Both have annual contribution revenue of $5,000,000. Ministry #1 has an over­head expense ratio of 18 percent, and Ministry #2 has an overhead ratio of 40 percent. Using prevailing logic, charity rating organizations would give Ministry #1 high marks, while Ministry #2 would receive very low marks.

Of vital importance
is whether a ministry
gives some hope that
the problem at the
core of its mission
will be solved.

But what if you knew that Ministry #1 relies almost entirely on paid staff and Ministry #2 relies very heavily on volunteer workers? What if you knew that Ministry #1 serves 1,000 children in a typical year, and Ministry #2 serves 4,000 during the same period? Sadly, few people look past the expense ratios or the ministry’s rating to learn more about the details of each ministry’s operations.

In the last 20 years of my career, I have made on-site visits at over 400 ministries, spending an entire day with more than 300 of them. By observation, I can determine which ministries have the nicest facilities, the least deferred maintenance, the most adequate working spaces, the highest security, and much more. But even spending a day in the offices of a ministry and having access to their top leader, board chair, board minutes, financial records, CPA, and more doesn’t begin to give me a basis to determine which ministries are more effective than others.

I judge all things
only by the price
they shall gain
in eternity.
John Wesley

It is understandable that some grant funders, givers, and others want to grasp onto something that will allow them to compare ministries to each other using mechanical yard­sticks.

Functional expense reporting is not a precise science and is certainly not valid as an accurate measurement across the ministry world.[14] Until someone figures out how to impose a uniform standard measuring changes to the hearts and lives of program recipients, the ratings system and the games that are played with ratings are here to stay. This means that the value of ministries is held hostage primarily to a derivative of the financial information found on the Form 990.[15]

There is a popular conception that watchdog ratings based on stars or points are measures of effectiveness. There is no empirical evidence to support this. It is also a mistake to assume that watchdog ratings are measures of organiza­tional efficiency, including financial efficiency. “The cheaper a particular outcome can be attained, other things being equal, the greater the efficiency.

Aim at heaven
and you will get
earth thrown in.
Aim at earth and
you will get neither.
C. S. Lewis

This is very different from what watchdogs measure, which involves metrics such as the ratio of program spending to total spending. Under the watchdogs’ system, the more expensive a ministry’s programs, other things being equal, the more efficient the ministry. In fact, an organization could generally improve its ratings by switching to more expensive suppliers or simply by wasting money on unnecessary expenditures that increase program costs without affecting non-program costs. This way of understanding efficiency is not just problematic for measurement purposes; it may also introduce perverse incentives for nonprofits to misallocate resources.”[16]

Dan Pallotta said, “We’ve all been taught that charities should spend as little as possible on overhead things like fundraising under the theory that, well, the less money you spend on fundraising, the more money there is available for the cause. . . . We should be investing more money, not less, in fundraising, because fundraising is the one thing that has the potential to multiply the amount of money available for the cause that we care about so deeply.”[17]
 

  1. Measuring success through mission focus. Rather than attempting to rate or evaluate ministries against one another, givers should look at whether each ministry is effectively carrying out its own mission. Givers should also look at other attributes, including the ministry’s commitment to effective board governance, financial integrity, and verifiable accountability. These are the issues that warrant attention.

Givers should be swayed by the values that a ministry holds. What really matters is whether a ministry gives some hope that the problem at the core of its mission will be solved. Overhead is just as vital to mission success as program funds.

Defining success from a biblical perspective may be the most important decision we make as God’s people. Measuring it comes a close second because what we measure communicates what we value. How leaders define and measure success gives form and direction to all aspects of ministry. It shapes the culture that follows and ultimately determines our outcomes.

When we combine the trust factor with the Kingdom path, we significantly elevate the opportunity for God to work with us as His servants.

 

  Questions   for reflection
 
  1. How do you personally maintain servant alignment with Jesus?
  2. How is success defined for the ministry you serve?
  3. Is the ministry caught in the trap of delivering results by secular measurements?
  4. Is ministry success defined in terms of obedience to the instructions of Jesus Christ?
  5. Is the ministry you serve unduly comparing itself to and/or competing with other ministries?
  6. Does the ministry you serve place too much emphasis on measuring success through overhead ratios (i.e., percentage of program expenses to total expenses)?
 

[1] 42, directed by Brian Helgeland (Burbank, CA: Warner Bros., 2013), DVD.

[2] Gary G. Hoag, R. Scott Rodin, and Wesley K. Willmer, The Choice: The Christ-Centered Pursuit of Kingdom Outcomes (Winchester, Va.: ECFAPress, 2014), 2-6.

[3] Ibid., 7–11.

[4] Ibid., 1.

[5] John Ortberg, When the Game Is Over, It All Goes Back in the Box (Grand Rapids, Mich.: Zondervan, 2007), 40–41.

[6] Jonah Berger, “If You Want to Win, Tell Your Team It’s Losing (A Little),” Harvard Business Review (October 2011).

[7] John Ortberg, When the Game Is Over It All Goes Back in the Box, 40-41.

[8] Ibid., 45.

[9] Larry Osborne, Innovation’s Dirty Little Secret: Why Serial Innovators Succeed Where Others Fail (Grand Rapids, Mich.: Zondervan, 2013), 115.

[10] Ibid.

[11] Ibid., 116.

[12]> Michael E. Batts, “Let’s Admit It – The Emperor is Naked: Functional Expense Reporting for Nonprofit Organizations is Voodoo,” Nonprofit Watchman (Spring 2013), 1–2.

[13] Doug White, The Nonprofit Challenge: Integrating Ethics into the Purpose and Promise of Our Nation’s Charities (New York: Palgrave Macmillan, 2010), 49.

[14] Ibid.

[15] Ibid., 50.

[16] George E. Mitchell, “Reframing the Discussion about Nonprofit Effectiveness,” (Washington, DC: DMA Nonprofit Federation, 2010), 12.

[17] Dan Pallotta, “The way we think about charity is dead wrong.” Lecture presented in Long Beach, Calif., March 1, 2013. TED: http://www.ted.com/talks/dan_pallotta_the_way_we_think_ about_charity_is_dead_wrong/transcript.

 

From TRUST: The Firm Foundation for Kingdom Fruitfulness, ECFAPress, 2015, 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.

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