Archive for October, 2016


Pay and Performance: What’s the Connection?

Thursday, October 20th, 2016

money-peoplePayroll expense is the largest line item in the budget of most congregations. When the budget is tight we often turn to payroll expense to balance the budget because we simply don’t have many viable options.

However, we have to ask ourselves if this annual payroll dance around budget time harms our employees. How does the recurring budget dialogue about pay increases (or lack thereof) impact our employment relationships? Does the debate hurt employee motivation or the ability to hold employees accountable for good performance?

Money matters in the relationship that we have with our employees, but perhaps not in the ways you assume.

Does Money Motivate?

Research shows that money does not motivate in employment situations, except when the tasks of the job are purely mechanical.  Contrary to longstanding organizational belief, linking pay increases to performance has negligible impact on motivation, and in some instances actually reduces motivation. (TED Talk: Dan Pink on The Puzzle of Motivation

The absence of adequate salary may keep a person from accepting a job and it may cause enough dissatisfaction for an employee to leave a job, particularly when the employee feels that he is being unfairly treated. However, if an employee finds their level of pay basically satisfactory, money does not lead to higher levels of motivation.

Rather, motivation is produced by managing the more intrinsic side of the employment situation: greater autonomy, the mastery of an important skill, the ability to work in service to a larger good, etc.

Does Money Help to Create Performance Accountability?

Accountability is the obligation that an employee has to account for his or her performance, or lack thereof.  Does pay help to strengthen accountability in our relationships with employees? It does to the extent that pay maintains utility in the employment relationship.  

Employment relationships are basically utilitarian in nature; the exchange between employer and employee must prove useful to both parties. The employee offers something that the congregation values; a set of skills, and the time and energy to apply those skills to tasks and processes that the congregation deems to be important. In return, the congregation offers the employee something that she values: pay, benefits, opportunities for growth and advancement, the opportunity to work for a greater good. This is utility.

As long as both partners in the employment relationship find utility in the relationship, accountability around performance remains strong. An employee is responsive to an accountable conversation in a relationship with utility. If the employer doesn’t provide what the employee needs, or vice versa, the relationship loses its utility. When this happens, accountability is diminished.

When an employee values money in the employment relationship, then decisions about pay impact accountability. If money is not particularly important in the employee’s relationship with the congregation, pay does not foster accountability.

What Matters Most about Money?

So, money doesn’t really enhance motivation, and it may or may not impact performance accountability. In what ways does money really matter in shaping our employment relationships?

Fairness Matters: Pay matters as an indicator of fairness in the employment relationship. Creating pay structures so that co-workers perceive fairness in the workplace is important. When employees feel unfairly treated in matters of pay they will take action to restore fairness. The actions they take may not be helpful to the congregation.

According to behavioral psychologist, J. Stacy Adams, employees seek to maintain equity between the inputs that they bring to a job (time, effort, skill, loyalty, commitment) and the outcomes that they receive from it (recognition, responsibility, sense of achievement, praise, pay).

Employees continually evaluate their perceived inputs and outcomes against the inputs and outcomes of other employees. When an employee feels that the outcomes they receive from the job don’t match their inputs, or when they perceive that others have a better balance of inputs/outcomes, the employee will seek to restore equity.

To restore equity, the employee may seek to renegotiate the terms of employment. If this fails, they may reduce their energy or loyalty. They may also seek to negatively influence the inputs and outcomes of their fellow employees.

Justice Matters: As religious organizations we frequently advocate for those who are marginalized or taken advantage of by society. To maintain integrity, we must be certain that our employment practices are “just” as well.

We are not being just when we fail to pay a livable wage. It is not just to pay employees below what the market says they are worth. We promote injustice when, in an effort to avoid rising health care costs, we break full time positions into part time positions that don’t carry benefits. In these situations, our walk does not match our talk and our behavior demoralizes our employees.

Appreciation Matters: Most employees equate pay increases with appreciation. “If you are providing me with a pay increase, you must value the work that I do. When you fail to give me a pay increase you are devaluing me.”

We must handle our annual conversation about payroll increases in such a way that our employees feel appreciated. When we can’t rely on money to communicate our appreciation, we need to be authentic and creative with other appreciative techniques.

Employees are not likely to feel appreciated if they learn about their pending pay raise in a group setting, or from someone other than their supervisor. They don’t feel valued when everyone receives the same increase regardless of effort. They don’t feel appreciated when the payroll increase is the first thing slashed during the budget dialogues.

The relationship between pay and performance is complicated. This year, as you make decisions about staff payroll increases, don’t forget the conditions that actually impact ongoing performance: accountability, fairness, justice and appreciation.

Have We Failed?

Tuesday, October 4th, 2016

635944741686261514734284120_success_failure_directBarb shared her decision to end the day trip ministry. “I simply can’t organize these trips anymore. We began this ministry to address the loneliness and isolation of older adults. It’s been wildly successful in terms of participation. People love going on these day outings and enrollment fills up immediately. But our funding source is drying up. I can’t find anyone to succeed me in leadership, or even to help with the organization of the outings. I’m tired of carrying the load alone. I guess the ministry is going to end when I step down. If I had been a better leader, I would have found more money and a successor.”

Barb’s comments reflect an unstated assumption at work in many faith-based institutions. A successful ministry is a sustainable ministry, one that goes on indefinitely. To sustain something is to keep it in existence, to supply the necessities that ensure continuity, to uphold or defend an ongoing practice. There is inherent value and worth in sustainability. If we value something we must do everything within our power to see that it is sustained. When something is not sustainable, it has failed or is failing. Right?

Wrong. This assumption invites us to tell a troubled story about any ministry that ends. We talk about the parts of the ministry that don’t work in order to justify the ending. The ending is announced and the ministry slips quietly off into the sunset. The leader of the final chapter bears a silent shame. “I wasn’t good enough to keep it afloat.”

We are living in an era where many things we have done in the name of Church are no longer sustainable. Does this mean we have failed? In an era of institutional decline, linking sustainability with success and unsustainability with failure is problematic in three ways:

  • We avoid sunsetting programs. To pull the plug is to label the thing a failure—or even worthless—when it is still important to some. So, we don’t evaluate or ask hard questions of the ministries that we do sustain. Is this the best use of our resources right now? Does this ministry still align with our mission, core purpose, and values?
  • We don’t learn from our experience. Failure feels painful. In order to avoid the pain, we dismiss the experience as quickly as possible. We miss a tremendous opportunity when we don’t carefully consider why a program is ending, or what we have to learn about the changing conditions around the program.
  • We stop innovating. Innovation happens best in environments where experimentation and failure are normalized. It has to be okay to fail. When sustainability becomes a core criterion for success, we avoid starting new things.

What Makes a Ministry Sustainable?

On some level, every organization must be sustainable. If we cannot afford to cover our overhead expenses over time, we will cease to exist and won’t be able to support any ministry.

However, under the umbrella of a sustainable organization we should be free to experiment with programs that may or may not be individually sustainable. We need to be able to innovate, reflect, learn and adapt. We can’t do these things without some better language about sustainability. There are at least four types of sustainability that we ought to regularly consider:

  • Economic sustainability: This approach to sustainability seems to get the most attention, maybe the only attention, when we are talking about the viability of a program or ministry. Will the program eventually pay for itself? If not, will we have the funds to sustain it on an ongoing basis? These are important questions, but not the only questions related to sustainability.
  • Leadership sustainability: What kind of leadership presence will this program require? How many staff and volunteer hours will be devoted to its sustenance? What kind of leadership succession plan do we have for this program? Is more than one generation of leadership likely to support this ministry with time and talent?
  • Social sustainability: What difference will this ministry make in the world? What environmental condition does this ministry seek to resolve or improve? How will it improve lives and which lives will it improve?
  • Mission sustainability: How does this ministry promote the unique mission of our organization? Does it draw upon our unique strengths and passions? Does it meet the needs of a constituency that we are meant to serve? Is this what God is calling us to do or become in this season?

When a program satisfies all four types of sustainability we should certainly include it in our portfolio of ministries. When a program fails to satisfy any of the four types it should clearly be discontinued. The tricky landscape to negotiate is when a program satisfies several categories but fails to satisfy others. Then we need to have thoughtful conversations about whether the program should end.

Learning from our Endings

When the decision is made to end a program or project, we need to learn all we can from the ending. Rather than letting the program quietly disappear in the hope that no one will be upset, we need to stop, reflect, learn and adapt. This is how healthy organizations grow and thrive.

Ask yourself these questions: When the program was first begun, what condition in the world was it was meant to address? How has the original condition changed? What impact has the program had on this condition over time? How have resource requirements shifted over time? What outcomes did we experience then and now? Which forms of sustainability are no longer viable for this program? How can we celebrate the success we had? How can we honor the leaders who have served? How might we talk about the legacy created? How does the end of this program ensure other new beginnings for this organization?

It’s time to examine the assumptions that you and your organization carry about sustainability, success, and failure. A program is not a failure because it ends. It is only a failure when we ignore the powerful invitation to reflect, learn, adapt, and innovate.