Creative Leadership

Are You In the Black Because You’re Growing Or Because You’re Cutting Back?

During difficult times it’s important to save on your costs and expenses. One of the quickest ways to go out of business during challenging times is to outspend your income. Keeping a lean, mean machine is one of the smartest things a non-profit or religious organization can do. But don’t ever mistake “cutting back” for “growth.”  Too many organizations think that they’ve solved their long term financial problems by just cutting back to get them in the black. That’s a good start, but it isn’t real growth.

One major religious organization had a very sharp CFO in the past who bought local property when the ministry was doing well.  Years later that CFO departed, and when tough times hit, his successor starting selling the real estate.  That was OK, but he was telling the board they were doing well financially when in truth, they were only selling assets.  They should have also been creating a strong donor development and fundraising strategy – but they didn’t.  So when all the property was gone, it didn’t take long to get them right back in the hole.

Keep the organization lean, but don’t cut back so much that you stop connecting with your congregation, audience, and/or donors.  The truth is, being in the black isn’t just about cutting back, it’s also about having a strategy for growth.

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