Personnel and percentages

As we enter the holiday season and draw closer to the end of the calendar year, many people are getting into the giving spirit. Knowing that, watchdog groups will begin circulating information about how charities use donation dollars. The typical thought is that the higher the percentage that goes toward direct services (e.g., hot meals, cancer research funding, disaster relief supplies), the better an organization uses your money. It is, then, more deserving of your donation.

In his TED talk, fundraiser Dan Pallotta challenges this way of thinking. Rather than criticizing organizations for spending money on personnel, advertising, and building the necessary infrastructure to live toward their visions, Pallotta says that we should be measuring the impact an organization has on its area of focus. Here’s an example. An organization to feed hungry people spends 1% of its donations on overhead and serves 1,000 unique individuals each year. Another hunger-relief organization spends 35% on overhead and serves 1,000,000 unique individuals each year. Which organization is having the greater impact? The numbers are straightforward.

But what does this perspective shift have to do with your pastor search? As you put together a compensation package at the outset and negotiate the details at the end, people in your congregation might ask why a minister needs that salary or those benefits. They might be concerned about the percentage of personnel costs relative to the total church budget. Anticipated impact is the reason why a church is willing (eager!) to pay a good wage and why the personnel budget doesn’t need to keep members up at night. Your congregation has discerned the vision toward which God is calling it and named the pastoral gifts and passions that will help your church inhabit it. Now it’s time to invest in those gifts and passions that can lead to equipping more leaders, creating more connections, and affecting more lives.

Your church can have a big impact on the surrounding community and beyond. Don’t be afraid to pay for the leadership that can help you make that change you want to see in the world.