Category: Administration
Boyd's blogs about administration
Are you overpaid? Based on the responses of hundreds of ministry leaders we have served over the years, my guess is “no.” In fact probability you are underpaid. Our board did a smart thing. Several years ago we formed the Compensation Committee as part of our Finance Committee.
- Every May they begin researching salary surveys across the ministry and nonprofit landscape. The Compensation Committee takes the top two or three of the highest paid positions in our organization and contrasts those salaries with comparable roles in same-size ministries. This is a ministry Best Practice and the information is required on the ministry’s IRS Form 990 annual tax return.
- Other resources used by the Compensation Committee to harvest current data for salary surveys are ECFA and Guidestar.
- Happy surveying!
I am learning that financial freedom comes in the form of regular accountability. One of the wisest practices our board has implemented was adopted in early 2008. We resolved to have a monthly Finance Committee call to review the year to-date, compare the projected budget with the actual, and project cash flow for the next three months.
- In the beginning, this meeting cramped my entrepreneurial style because I like “running and gunning” for God! However, I learned that I better make sure there are bullets (cash) in the gun or I will fire blanks…not good.
- Fortunately, our Finance Manager has the gift of populating and interpreting spreadsheets. There is not a detail she has ever met that she does not like. This is why she is affectionately called our Detailed Diva. So, each month we have from her a very accurate report on where we are and where we are going.
- Consider asking two to three board members to serve on your finance committee. Maybe you invite a CPA or financial planner to be the committee chair and then try out this monthly call format. With experts asking direct and practical questions before the board meeting, you will be much better prepared. Accountability provides financial freedom, and it facilitates a sustainable financial model!
- Check out these financial reports: P&L Budget to Actual, and Current Cash Position spreadsheet, and use them as templates to put your ministry in a position to have financial freedom.
As a leader, do you have people around you who understand, value, and champion process? Process is what frees you to shift the organization from a personality-centric culture to one that is more inclusive. It defines goals, helps in making team assignments, and clarifies decision-making to ensure excellent execution. Process that makes progress is your best friend and is to be valued.