Where Does the Money Come From?

Ted Engstrom 
This article provided by the Engstrom Institute

One of the most worried about and least discussed problem in every Christian organization is, "Where does the money come from?" Money does peculiar things to our thinking. If our church or other Christian organization has a significant balance, someone might say, "My, the Lord is really blessing!" On the other hand, if it is in short supply, we may hear, "Too bad; they are really suffering for the Lord!"

Money is a very personal thing. If you don't believe it, the next time you are in a social group, ask someone how much money they earn each year and listen for the deathly silence in the rest of the room!

But we need to talk (and write) about money. For money is one of the great "tools" that God has given us to carry out his business.

Input—Process—Output

Let's try to fit money into proper perspective. Every organization can be thought of as going through a three-step, repetitive process of 1) inputting resources into the organization, 2) processing those resources in order to 3) produce some form of result or output. A manufacturing organization will take money, manpower, and raw materials as input and process all of this to produce some product (output). A service organization will gather funds (input) and spend (process) these funds in such a way that it will produce a desired service (output). A local church will gather together the lives, prayers, time, skills, and money of its congregation (input) in an attempt to combine (process) these in such a way that men and women are brought into the kingdom of God and that members of the Church are built up (output).

This we see that it is possible to functionally divide any organization into three major functions: 1) input function, 2) process function, and 3) the output function. At World Vision, we think of these things as being fundraising, operations, and ministry.

Start With the Output

"Output" can be thought of as objectives, goals, or outcomes that you want to produce. Regardless of how you describe it, this is a place to begin. Too many organizations worry about money first and outcome last. We need to set high objectives, clear goals—goals and objectives that will make us stretch. After we have decided what it is that God wants done through us, we should move next to the question of the means (process). Only after we have looked at outcomes and looked at the means should we turn our attention to resources (input) that will be needed.

Set Fundraising Goals

Just because money is the last thing we should consider in the planning process, it does not mean that it should not have considerable attention. If our simple model of input — process — output is descriptive of what we are all about, then we need to pay attention to the input. We need to set some goals for funding, lay plans for funding, and evaluate our fundraising performance. Fundraising goals should be based on ministry goals and not vice versa. Nevertheless, fundraising goals need to be specific and challenging.

It is true that there are some fundraising strategies that are dependent only upon the amount of money that is raised. A good example is the local church that raises funds for missions against the goal of "50%" of the total church budget. But, in general, goals of this type have little ability to stir people's imagination. They easily lead us to supporting the organization rather than supporting the purpose of the organization. Few people are interested in giving to support an organization, no matter how well oiled it may become. Men and women are interested in change. They are interested in what's going to be different. They are interested in the output, the results of their investment. Can good stewardship demand otherwise?

One of the reasons so many fundraising programs fall short is that the projects and programs for which they are intended are not clearly defined. The reason that people are usually willing to give to a building program is that in their mind's eye, they can imagine a new building. They can even fantasize that they personally paid for one window or part of a wall. But it is rather difficult to fantasize what part of the average pastor's day one pays for.

Anything that can be done to redesign the organizational budget so that it focuses on what is to be accomplished (output) will be a great help in setting and achieving fundraising goals.

Don't Forget the Plan

A good fundraising program is not the product of three Tuesday night meetings over the course of a month. Usually fundraising programs continue to improve because of the evidence of past performance. If the last time people gave to your program they were really thrilled with the results, chances are they will be ready to give a second time.

If you are a local church working on a yearly fundraising program, then working a year ahead is none too soon. In the same way, you should continually project a three-to-five-year program of fundraising.

Who's in Charge?

The highest goals, the most beautiful plans will never be realized unless someone individually believes in those goals and plans. We need goal owners. Who besides the CEO is going to take that responsibility? This is a decision that needs to be made. It cannot be a fly-by-night decision. Good Christian fundraising requires a high level of dedication, considerable experience, and no small amount of skill.

Resources for Resources

It takes resources to gather resources. It takes money to raise money. This is nothing to be ashamed of. Quite the contrary. So we need to make sure that we have allocated enough resources.

If we hired someone to do a five-hour job and they took 10 hours to do it, we would be displeased. We would think that that was inefficient. The same is true of fundraising. If we plan to spend $10 to raise $100 and we end up spending $20, we should be unhappy with our performance.

Is There Enough Money?

We've already said that as we plan, we should start with goals or outcomes, then move to means, and only lastly deal with resources. Some will immediately reply, "Well, we can't spend money we don't have!" They remember what a tough time we had last year, and they can't imagine that things are going to be better. "You can't get blood out of a turnip."

O ye of little faith! The Bible has as much to say about money as almost any other subject. Do we really believe that God is limited in His resources or that God's people are so overextended that there is no possibility of them giving more to His work?

Perhaps no group has exercised as little faith in fundraising as some "faith" missions. An enterprise that began many years ago to send missionaries has since developed into an extremely complex business of supporting overseas programs. Although missionary support levels have been rising, it is still a fact that in most cases the program cost is one to two times the cost of salaries and individual support.

Too often mission agencies have initially presented to the local church only the individual missionary support costs and then had to return time and time again for additional items such as vehicles, buildings, or the network of a national evangelist. It is my opinion that the average thinking church member will welcome an overview of the total cost package and will respond enthusiastically to support those programs with clear, accomplishable goals.

What about Ethics?

There have been a lot of "exposés" about the improper handling of funds in nonprofit organizations, including local churches. Rightfully so. An organization's integrity is more at stake in fundraising than in any other activity. It is all too easy to spiritualize our goals into such high-flown purposes that we justify sloppy fundraising and even sloppier accounting. All the more reason to get fundraising costs out into the open. This is one of the reasons I applaud the efforts of an association of CPA's to standardize accounting procedures so that fundraising costs are separated from administrative costs and what is lumped together under euphemism of "overhead" is seen for what it is, namely, the cost of input and process which produce the ministry (output).

What about Professional Fund-raisers?

An organization must take responsibility for its fundraising. This is not something which can be delegated away. The use of outside consultants or professional fundraising organizations certainly has its place, particularly if new ideas are needed. However, choose them with care. Personally talk to other organizations who have had experience using their services. Make certain that your ministry goals are clearly enunciated both to yourself and to those who are going to ask to help you. Remember, you are raising money for a ministry, not yourself.

Money Is a Tool

In reality, money is just a convenient way of transferring resources. Unfortunately, it is often used as a measure of things which it tells us nothing about. Don't be ashamed of your need for money. If there is going to be a ministry (output), then there need to be resources (input).

Editor's Note: We reached back and pulled a vintage article from Dr. Ted Engstrom, who wrote on the topic of fund raising and many other aspects of leadership and organizational development. Ted served as president and president emeritus of World Vision International and was former president of Youth for Christ International.This article with timeless wisdom is adapted from an issue of Christian Leadership Letter that Ted Engstrom along with Ed Dayton wrote during their time in leadership at World Vision.