- Set aside time to assess the current state of your team, processes, and systems at least annually, if not quarterly.
- Acquiring random responsibilities can take away from your team’s ability to focus on their core function and hamper their ability to improve processes over time.
- For outsourcing to be cost effective, processes must be reviewed and streamlined.
- When conducting software and technology assessments, start with the end in mind, and redesign processes before trying to automate.
Build effective assessments into your finance function.
Church and ministry leaders today are moving at a fast pace, often with little time to reflect on the state of their finance department. The global pandemic has driven more change than anything we’ve experienced in most of our lifetimes, and now a surge in workforce resignations is impacting ministries' ability to recruit and retain competent finance staff. Managing the daily activities of the finance team — while also driving improvement and adoption of better technology and processes — can be a challenge.
To help overcome these challenges, set aside time to assess the current state of your team, processes, and systems at least annually, if not quarterly. You may find you’ve been processing transactions inefficiently, creating outdated or redundant reports, and responding to whatever is “latest and loudest” — being reactive instead of proactive. Taking the time to assess and plan is the secret sauce that can supercharge your team.
Start your assessment by focusing on three core areas — team structure, processes, and systems.
Assessing your team structure
When assessing your team structure, keep the second law of thermodynamics in mind — everything tends toward entropy or disorder over time. Assessments of ministries commonly reveal that team members have picked up work completely unaligned to their job descriptions. Though often begun by altruism —such as the senior accountant ordering the office supplies simply because they think there is no one else to do it — these additional tasks can take away from individuals’ ability to focus on their core function and hamper their capacity to improve processes over time.
Give each team member a copy of their job description and ask them to list the tasks they are doing that are NOT on the job description. Sketch out your team composition in a quick org chart and answer these questions:
- Are job descriptions up to date and do they reflect the current work of the team?
- Is my team size and composition ideal for the size of the ministry? (If not, document new positions along with job descriptions)
- What are areas for improvement in my team members and how can I champion their growth over the next year?
- What team-building events will I initiate in the next year?
Once this assessment is done, discuss possible team changes with the senior ministry leader or operational leader. Your finance department can become supercharged if you have team members who understand their roles and have a growth plan for the next year.
Assessing your processes
During a recent visit with a potential client looking for a quote to outsource her finance department, we learned she had a team of three accountants who were spending most of their time chasing down exceptions on reports submitted by local and regional teams. When we asked what process changes she and the organization would be willing to make to eliminate or greatly reduce this work, she stared blankly. That’s not an uncommon initial reaction. As our conversation continued, we came to agree that for outsourcing to be cost effective, processes must be reviewed and streamlined.
When evaluating your processes:
- Identify three processes in your finance department that are taking too long or otherwise causing frustration (e.g., the corporate credit card cycle is taking until the 10th of the following month to reconcile, and your accounts payable staff are chasing non-submitters each month).
- Schedule time to meet with your team — and at least one person outside your team — to get input on how the process could be improved. During this first session, map the current process (maybe use post-it notes on white board so the current state can be visualized).
- Discuss and envision the ideal process. Get group input on the minimal number of steps and time that process should take. Identify bottlenecks and talk about potential strategies. (If you’d like to read more about process improvement, consider Dan Madison’s book “Process Mapping, Process Improvement, and Process Management”)
- Pick the highest priority process and begin change implementation. Processes touch multiple areas across your ministry, so be sure to advocate the changes with the broader ministry team.
If you commit to improving at least three key processes in your ministry this year, you may be amazed at how the results can supercharge your team.
Assessing your systems
COVID-19 forced many ministries to accelerate adoption of new technologies. Generally, discussion about technology systems has moved from initial adoption of cloud-based software to more robust automation of cloud-based systems and embracing artificial intelligence (AI) as it begins to emerge inside of cloud-based tools. Examples include:
- Bill payment solutions that not only automate the workflow, approvals, and payments, but use AI to make an initial scan of invoices, prepopulate fields on the payable entry form, and automatically route to approvers.
- Smart general ledger tools that can analyze thousands of transactions in seconds and notify you by email that you should review certain transactions that diverge from typical patterns in your data.
- Automation of bank reconciliations as the software automatically matches transactions from a bank feed.
While providing exhaustive guidance on how to conduct a full software assessment is beyond the scope of this article, here are a few key points to remember:
- Redesign processes before trying to automate. We’ve all been involved with software projects where we were promised the software would fix everything — only to find out it didn’t.
- Take time to redesign your chart of accounts so it is built logically with the minimum number of accounts and dimensions needed. For more on this, see “Designing an Effective Chart of Accounts for Churches.”
- Start with the end in mind. Visualizing how you ultimately need to see data can lead to better decision making. Don’t waste hours and dollars trying to rework or fix something that wasn’t built correctly in the beginning.
- Evaluate your general ledger (GL) system first. The GL is the bedrock of your system and reporting infrastructure, so make sure you’re selecting a system that is cloud-built with open architecture, has flexible reporting, and supports easy user access through dashboards and drill-down.
How we can help
It can feel challenging and overwhelming to assess each component of structure, processes, and systems. CLA’s nonprofit professionals can help you lay out a roadmap and provide you with the resources needed so you can continue to focus on your mission and community.