The parish that works: Business practices for the church

In the Pews
Synergy, efficiency, and compliance aren’t just for business. They’re also important for a stronger church.

Imagine the moment (with a choir in the background for good measure): Under a banner proclaiming “Welcome Home!” a lapsed Catholic opens the beautifully crafted doors to the parish where she hopes by God’s grace to renew her faith life in Christ and the holy church. The friendly pastor, a smile on his face, shakes the newcomer’s hand, saying, “Thanks for giving us your business! We promise that you’ll discover we operate with best practices, accountability, transparency, and financial protocols that will ensure your donation is used effectively.”

Choir sputters out, banner blows away in a sudden storm, and the returning Catholic bolts.

And rightfully so. After all, thinking of the church—the body of Christ—and parish life in business terms is not what anyone wants. That’s just flat-out secularizing the sacred.

Isn’t it?

Charles Zech, director of the Center for the Study of Church Management at Villanova University, has heard the criticism and agrees with it—to a point. “The church is not a business,” Zech says, “but we do have a stewardship responsibility to use our resources wisely.”


The goal is to adopt, to the extent possible, best practices from the business and nonprofit sector so as to more effectively utilize parish resources in service to the mission of the church, according to Peter Denio, coordinator of the Standards for Excellence project at the National Leadership Roundtable for Church Management (NLRCM, see “Business schooled” on page 14).

Best practices include transparency and accountability in planning, financial reporting, and decision-making; collaboration with lay experts; good communication practices; thoughtful protocols (including child protection procedures) instead of “the way we’ve always done it”; and evaluating performance so as to improve.

Good management in parishes and dioceses has always been a concern but has become more complicated as the world evolved. “I think back to the simple parish I grew up in in Ireland,” says Thomas Groome, chair of Boston College’s Institute for Religious Education and Pastoral Ministry. “Father Pat Harris, bless his heart, did not need a parish manager.”

A priest didn’t even need a secretary. At least Pittsburgh Bishop Hugh Boyle, who wrote in 1948, didn’t think so: “I observe that some pastors have arbitrarily and boldly presumed to charge the parish treasury large amounts of money paid to a lay parish secretary. This is definitely unlawful and cannot be tolerated. All secretarial work must be done by the pastors and their assistants.”

Bishops came around to see the need for parish secretaries, and they come around to seeing the need for better management practices. Msgr. Arturo Bañuelas, pastor of St. Pius X in El Paso, Texas, believes that bishops have themselves encouraged some of the new collegiality through their example of including more lay experts on diocesan boards and turning to lay experts for advice more often.


“Yes, the church is not a business,” Groome said in response to one skeptical bishop, “but there’s the credibility of it that has been terribly damaged by poor management.”

It’s not, in fact, for-profit business models that Groome and Zech are teaching. That would be easy.

Both nonprofit and for-profit models are about planning, stewardship, enhancement of leadership, evaluation, and accounting. But while efficiency dominates the for-profit model, nonprofits must balance efficiency with relationships and mission.

“The mission has to trump the management,” Groome says. “Yet the mission is constantly enhanced by good management and diminished by poor management.”

Performance review

A confluence of events has brought wide support for bringing the church into the modern world of striving for best management and financial practices. Foremost is the church’s culture of secrecy and clericalism that facilitated crimes against children. At almost the same time, the 2001 Enron debacle underlined the need for accountability and transparency, as well as good financial and personnel management, in every organization.

Meanwhile the shortage of priests has made even vehement critics of the Second Vatican Council’s empowerment of the laity acknowledge at least a temporary need for laity to fill non-sacramental roles. “Half the priests already serve more than one parish,” says Father Steve Brice in Wausau, Wisconsin, regarding the Diocese of La Crosse. “We’ll have to go to one priest per four or five parishes.”

Costs from lawsuits have already brought about nine diocesan bankruptcies. Those losses plus a lack of priests, practicing Catholics, and revenues have led to the closure of hundreds of parishes and schools nationwide. The Archdiocese of Newark, New Jersey alone has announced 100 parish closures in the past six years. The Diocese of Cleveland’s recent reconfiguration resulted in 50 fewer parishes.

In the 2009-2010 academic year, 174 Catholic schools closed or consolidated. Finally, it’s almost cliché to say that if the 30 million lapsed U.S. Catholics were counted as a denomination, they’d be second only to the 68 million Americans who count themselves as Catholic.


None of this reflects upon the eternal truths of the Catholic Church. They are rather the result of management problems, with terrible consequences for the faithful. There is no way that fewer priests, parishes, and schools make for a stronger church.

But after a group of powerful and concerned Catholics created the reform-minded NLRCM in 2005, Bishop J. Kevin Boland of Savannah, Georgia told USA Today that the church is ordered by faith, not stockholders. “I fully support collaboration, but the challenge is how to apply [good business practices] theologically. We are not Walmart.”

Still, when you combine the budgets and workforce of U.S. dioceses and other Catholic institutions, with a million employees and an annual budget of $100 billion, the church “is comparable in size to Walmart,” Frederick Gluck, former managing partner of McKinsey & Company, wrote in the Jesuit journal America in 2004. “But it still follows a feudal model of governance and management,” added the now-board member of NLRCM.

Neither Groome at Boston College nor Zech at Villanova hear criticism anymore regarding the need to run parishes and dioceses with best business practices—which means greater lay involvement. There may at one time have been unease surrounding handing over business management of parishes to lay staff, they say, but that’s now in the past. “Bishops see the need,” says Zech. “We’re killing our priests.”

Human resources

There have always been parishes that have provided models of good management—and pastors in favor of running their parish on a business model. “I want to believe that we are running the parish on a gospel model with good business practices,” says Father Dave Gutmann, pastor of Holy Trinity in Beaverton, Oregon.

A hardworking staff surrounds Gutmann, and the office door opens regularly to parishioners, coming in and out of the Oregon drizzle. Two thousand parishioners attend Sunday Mass here, and Holy Trinity boasts a dozen active ministries. “The finances and personnel management alone would take all my time if we didn’t run the parish like—well—a business,” he says.

Gutmann credits his business manager, Kenya Palmer, as key to Holy Trinity’s smooth operations. Palmer, a 25-year veteran of upper management at nearby Nike, is a picture of welcoming efficiency—as is Gutmann.

So does Palmer’s presence mean that Gutmann doesn’t need to keep track of the parish spreadsheets? Not at all. “Knowing business practices and administration is just part of the job,” he says. “A priest can’t just wash his hands of it; he can’t be a good administrator without knowing the stuff.”

Easy for Gutmann to say. The priest is clearly a type-A personality, an on-the-go, well-organized extrovert who says he’s very familiar with how to read a balance sheet. He’s taken courses in business and regularly reads business books—for enjoyment. “I’m interested in it,” says Father Gutmann. “I knew it would be important.”

Few seminarians, though, hear their vocation in terms of parish finances, budgets, and human resources management. When even a priest like Gutmann insists on a business manager, consider the plight of most priests.

At St. Anne’s in Wausau, Brice says he’s been asked how the 1,700-family parish can afford a business manager. “How can we afford not to?” he counters. “Clergy have no training for human resources, for finances, for legal concerns. We’re walking into a buzz saw unless we bring in laypeople to help.”

In the course of renewing the parish—and avoiding that buzz saw—Brice hired Jesuit Father Tom Sweetser and his partners at the Parish Evaluation Project to assist with self-assessment, planning, decision-making structures, and other business practices, all within the paradigm of empowering lay leaders.

Sweetser says the naysayers on adopting business practices are still there. “You have to be very careful,” he says. “When we come in, we drop all language that has business connotations. It’s not business methods, it’s church methods.”

A key element of Sweetser’s solution to bettering parish management practices is boldly elegant: He helps pastors find a lay partner, a co-worker who has knowledge in business and human resources. “Amazing things happen when the pastor has a partner who knows best business practices,” he says. “This person can sit down with the pastor and say, ‘This is what you need to know.’ ”

At St. Anne’s, the former business administrator has become the pastoral administrator. “We share a vision,” Brice says of Jennifer Baumann. As an example of how such a partnership works, Brice tells how St. Anne’s recently hired a firm to manage its endowment fund. Both Brice and Baumann were present at the first round of interviews. When it came time for the second round, the pastor turned it over to Baumann. “I respect her business sense,” he says.

Brice instead spent the day anointing four dying parishioners and visiting a fifth. “That’s the beauty of this model,” he says. “The business gets handled with expertise, and the priest is able to be about pastoral ministry.”

Who’s the boss?

Most pastors can achieve this kind of partnership, Sweetser says, but not without growing pains.

“I’d always thought of myself as a collegial guy,” says Brice. “But I had profound feelings of displacement as we were implementing this.”

He remembers, for instance, how he once led all the staff meetings, and how satisfying it was to see all those heads turn in his direction for answers. Now there’s a rotating leadership for staff meetings and the staff often looks to Baumann. In compensation Brice says the various leaders bring unexpected and important agenda items and insights to the meetings, and he isn’t burdened with preparing them every time.

The parish is flourishing. “It’s a supply-side model,” Brice jokes. “If you supply the ministries, people will come.”

A part of St. Anne’s vision statement reads, “At St. Anne’s, every baptized person is given the opportunity to share in Christ’s priestly, prophetic, and kingly ministries. . . . As parish members, we bring our wisdom and experience to all aspects of parish life from leadership decisions to ongoing operational projects. The pastor recognizes and promotes the dignity, giftedness, and responsibility of the laity and leads them by example.”

A pastor must honestly have faith in the Holy Spirit in order to do that, Brice says. “But I believe we are incarnating the spirit of Vatican II.”

Sweetser acknowledges that a new priest coming into a smoothly running parish can undo all the good work. Younger priests, in particular, may not have the self-confidence to believe that there won’t be chaos if they delegate power. “It’s a troubling scene,” he says, referring to a parish where an unsuccessful transition has occurred. “People are going somewhere else. There are financial problems. Without accountability a pastor can do anything he pleases.”

A transition committee, Sweetser says, can create an image in the diocese of what kind of parish they are (branding, in business-speak), and go to the chancery to present the parish’s needs.

If the new pastor is prickly about his power and makes decisions without telling people—or staff make decisions without telling him—relationships can sour.

The practice of “consult, decide, inform” is one solution to that communication pitfall. First, Sweetser says, people clarify the issue they’re deciding. Then they discern who should decide. That person or group then consults with the necessary parties, makes the decision, and then considers who must be informed of the decision.

Processes like this are time consuming, but it makes for a smoother operation—and in the end even idealistic young priests realize that they don’t have the time to make every decision if they hope to run a parish that offers all the ministries of today’s parishes.

Multicultural and multilingual parishes make for even more challenges. It’s difficult to find management theories that apply to multilingual, multicultural communities, says Bañuelas. For instance, a priest or parish manager must begin with building relationships when working with Hispanic parishioners, since their culture prioritizes family and community. With some non-Hispanic parishioners, though, that priest or lay manager may need to demonstrate a get-to-the-point, time-is-money sensibility, he says.

“It’s not just to affirm their worldview, it’s in order to enter into it and see the world from their point of view, so that you can collaborate with them at a deeper level—both for management and for pastoral care,” says Bañuelas. “Otherwise you might miss out on the gifts they bring.”

Bañuelas suggests that the servant-leader management model works across cultures. “The church has a great theology for servant leadership and collaboration with the laity,” he says.

Well-oiled machine

Zech sees today’s ideal parish as having a number of vital ministries, all well supported by the parish staff. “Get rid of the word volunteer,” he says. “These people are doing ministry; we should call them ministers. Serving on the finance council is just as much ministry as being a eucharistic minister.”

Volunteers don’t necessarily expect to be supported or trained. They certainly don’t expect to be held accountable. “But ministers should expect all three of those things,” Zech says. “We wouldn’t throw someone in as a lector without training. And ministers should understand that if they’re not a good fit for their ministry, then we’ll find something else for them to do. It’s not OK, for instance, to be unprepared if you’re a teacher.”

Another benefit to parish volunteers seeing themselves as ministers? Sweetser has found that they substantially increase their contributions to their parish.

Sweetser reminds parish staffs that they can’t be the only doers. They’re there to find partners themselves. “The laity have a lot of resources already, but they’re not empowered.”

At St. Pius X in El Paso, finance committee members don’t just advise, they vote on long-term and short-term plans for the 3,000-family parish. The parish’s ministry council decides on major projects.

“But this isn’t just about finances, it’s about training people to take their roles in the church,” says Bañuelas. “This is an inspiration of Vatican II. Because of our baptism, we all have a part to play in the mission of the church. One of the greatest gifts of a leader is to bring out the gifts of everyone else and put them to work for the good of the community.”

Thomas Harvey, a former head of Catholic Charities and now director of Nonprofit Business Development at the University of Notre Dame’s Mendoza Business College, has a key maxim he practiced at Catholic Charities: Never rely on behavior if you can solve a problem systemically. “The collection isn’t counted by one person,” he says. “You may have to borrow tools from a nonprofit library. Use an assessment tool for volunteers. Hold people accountable. As people are coming on, they need to sign a conflict of interest statement.”

For child safety, he recommends the protocols set forth by the Council on Accreditation, which offers an evolving blueprint of policies and procedures. If, for instance, a child has to go to the dentist, there must be more than one chaperone in the car. Harvey says Catholic Charities and accredited child welfare agencies have almost no pedophilia because accountability is built into the system. “There’s a protocol, not just a handshake.”

Father William J. Byron, S.J. has suggested parishes consider themselves as family businesses. Family businesses train their members in a more personal, more caring way than would a big corporation. Additionally, everyone in the family has a right to know how the business is doing and has a say in decisions.

Craig Franco, president of the Catholic Business Network in Salt Lake City, sees this happening. “The church is coming out of this horrible period of abuse of power,” he says. “It’s reaching out and becoming more of a true community. So businesspeople will be able to do even more for their congregations. There’s so much talent within a parish—a lot of good is left untapped.”

Growth chart

Many parishes across the country already embody best practices. At Holy Trinity in Oregon, for instance, the books are always open, available to anyone. But even Gutmann had to learn some of his current competence the hard way. He winces at the memory of having discovered embezzlement at a previous parish only after several thousands of dollars had disappeared.

The NLRCM’s programs and those offered by Boston College, Mendoza, Villanova, and several other institutions, aim to give lay administrators and pastors the tools they need to avoid having to live through cautionary tales of their own.

“There are so many requests from young priests,” Harvey says. “They’ve been assigned parishes and don’t know what they need.”

“No one goes to seminary in order to run a small business,” Zech says. “But they should know enough about finances to be able to talk with the folks running [them].”

It’s not only priests who have limited business experience. Parish staffers are more likely to have a degree in theology than in management. At the most they may have a background in nonprofits.

Pastors’ most frequent requests are for courses in accounting and human resource management. “Personnel concerns are what keeps a pastor up at night,” says Father Bob Heidenreich, pastor of Sacred Heart parish in Winnetka, Illinois. “Ministry is relationship. Cardinal [Francis] George [of Chicago] said ministry is to bring people into relationship with Christ and to bring people into relationship with one another as the body of Christ.”

Harvey notes that in the past, there were high levels of trust, allowing for better functioning with parishioners accepting the pastor’s authority. Geoffrey Boisi, a former Wall Street banker and a board member of NLRCM, has said the Roundtable is intended to help re-establish the relationship of trust between the hierarchy and parishioners.

What goal could be more worthy? In fact, good management within parishes, Catholic nonprofits, and the church as a whole isn’t important just for Catholics. Catholic schools educate more than 2 million American children every year, and Catholic Charities is second only to the U.S. government in helping those in need.

At a less tangible but more profound level, Groome says that the Catholic Church has been one of the primary social structures forming opinion and values. “It has been a major force within the public realm of this great American experiment,” he says. “The Catholic Church and Catholic community have been a major force for good, truth, and justice.”

Tragically its forcefulness, or as Groome puts it, “its leavening power,” has been greatly diminished in recent years. Can good management turn that around? As Brice might say, how can we afford not to try?

This article appeared in the July 2011 issue of U.S. Catholic (Vol. 76, No. 7, pages 12-17).

Image: Erin Drewitz