Feature Article: Spring 2012

Leaders 2.0

Understanding the cultural differences between businesses and churches

by Jim Smucker

Joe is a highly successful Mennonite entrepreneur. Over the past 15 years, he has initiated four different successful business startups. Joe and his family have remained committed to the local Mennonite church but, given the time and energy he has had to devote to his businesses, he has had little time to participate on church committees or activities beyond worship services. He has, however, been very active and generous in his financial support for the church.

As Joe's businesses stabilized, he began to have interest in taking a more active role in the church. About the same time, several church members were feeling as though the church was in a rut and needed some new vision and wondered if Joe, with his entrepreneurial and business leadership gifts, might be able to help jump-start things. So they nominated Joe to serve on the church council.

Howard stresses the need for more collaboration in leadership styles while Joe favors a more results-oriented, top-down leadership style

Howard is the pastor of the church. He has been at the church for eight years. Seminary trained, he has brought many gifts to the church and has been highly affirmed by many members. Recently, however, Howard has felt the same uneasiness described above by some members in the church. Howard was welcoming to Joe serving on the church council and looked forward to his vision and leadership. At the same time, however, Howard had some experience with business people serving on church committees and was a little reticent about the "take charge" and "business" leadership style that some of these members brought to the table.

Over the past six months, Joe and Howard have butted heads on occasion when it came to decision-making styles and getting things done on the council. Joe complained of the ineffective meetings and the long, process-oriented, deliberate decision-making style. Joe also began to push for more accountability for the pastors and church committees.

All of this was somewhat threatening for Howard and others on the council. In addition, Joe was using phrases like "return on investment" and the "bottom line." Howard shudders when he hears Joe introduce these business terms into the life of the church.

Howard also has been frustrated by Joe's lack of understanding for what he feels are "different expectations for measuring success." The church's "bottom line," or "ministry outcomes" as he would prefer to call them, feel vastly different from those of a business. He sees business as being product—and profit-driven and the church as people—and mission-driven. For Howard, the two seem diametrically opposed. A church is more of a "priesthood of all believers" than a business, and this requires decision-making processes that are more participative. All of which by necessity requires a slower rate of change in a congregation than in a business. Howard stresses the need for more collaboration in leadership styles while Joe favors a more results-oriented, top-down leadership style. At the same time, Howard does recognize the need for the church to increase its capacity to take risks and be more "entrepreneurial," as Joe would say. But he doesn't feel that Joe understands the true nature of a church congregation as compared to a business.

This fictitious story raises several questions that I would like to explore in this article:

To what degree are the key organizational and leadership skills of church and business leaders the same? Different?

In thinking of this question, I surveyed 20 business and nonprofit leaders. This included five pastors, five nonprofit senior executives, five senior leaders from educational institutions, and five business executives, all of Mennonite church background. I asked the question, "What, in your opinion, are the top five or six organizational and/or leadership skills needed to be an efficient and effective leader in your organization?"

Interestingly, across the four organizational types—churches, nonprofits, education, and business—the results were very similar. For these 20 leaders, the leadership skills needed to be successful seemingly transcended organization type. There was high consensus on the following six leadership characteristics:

Developing and communicating the vision and mission of the organization.
Having high expectations and holding people accountable.
Developing trustworthy relationships.
Low ego needs among leaders, coupled with a servant leadership style.
The ability to build a strong team of people.
Strong communication and listening skills.

My own experience researching, working in, and consulting with nonprofit and for-profit organizations resonates with the responses from these leaders. Based on the mission of an organization, it takes in resources and transforms these resources to meet a community need. To be an efficient and effective transformer of resources, these 20 leaders suggest that the key organizational and leadership skills needed are fundamentally the same.

Which begs the question: If good leadership is about performing the same basic functions, what accounts for the differences and frustrations that Joe and Howard experienced above? How do we get beyond the typical stereotypes, the proprietary language, and the divisions that exist between the types of organizations?

How can business and church leaders learn to adapt their skills to the realities of disparate organizational cultures so that they can be more effective in bringing about positive change?

Realizing that leaders from all types of organizations spend their days doing similar work is a start. But savvy leaders go further and understand that, to be an effective leader, they need to understand the cultural differences inherent in individual organizations. Even leaders that move between organizations in the same category, from one church or business to another, can experience extreme cultural differences. Not accounting for these differences is one of the main reasons so many corporate mergers fail. It is also the reason there is at times high frustration between church and business leaders. There are several common cultural mistakes that leaders make when they move between organizations.

Leaders often fail to take into consideration the differences in the independent variables that exist in any organization at the individual, group, or system-wide level; variables like values, attitudes, group norms, and the degree of change or stress currently being experienced in the organization. Effective organizational leaders understand that their first response should be to listen and understand. Too often the temptation is to overlay on the new organization what worked in a previous organization. In the example above, Joe's tendency is to confuse the what and the how. For example, the what, accountability, is critical in every organization; how accountability is accomplished needs to factor in the independent variables mentioned above.

Effective organizational leaders understand that their first response should be to listen and understand. Too often the temptation is to overlay on the new organization what worked in a previous organization.

Effective leaders also understand that, generally speaking, churches and business tend to work with different sets of values and assumptions about how to accomplish work. There is a difference in their fundamental nature that is driven in part by their respective missions, life conditions, and roles in society. For example, churches in our tradition tend to place more value on dialogue, consensus-driven decision making, and harmonious relationships. Businesses, on the other hand, tend to be more rational, objective, and achievement-oriented.

Finally, leaders in all organizations tend to undervalue the power and importance of building trustworthy relationships. In times of systemic change, one of the keys to organizational effectiveness is high levels of trust among its stakeholders. It takes time to listen deeply and establish trust. Leaders are often impatient and don't allow enough time to develop these relationships. But once trust is established, implementation can be much more effective and more efficient. Joe would have been well served by taking time to develop high levels of trust with those around the council table prior to working at a change agenda.

Finally, how can leaders in local congregations leverage the gifts of a diverse group of people to think about new ways of being missional?

Joe and Howard could mutually benefit by staying focused on the mission of the church and developing an appreciation for the diverse gifts and perspectives that each one brings to the table.

There is a system concept called the Law of Requisite Variety which suggests that the internal diversity of any system must match the variety and complexity of its environment if it is to deal with the challenges posed by that environment. In other words, to effectively engage our communities, we need a diverse yet complementary team with a sense of united differences. Strength comes from different people with unique capabilities working together.

This unity in diversity is critical for the challenges facing our churches today. In the example above, Howard intuitively understood that Joe's gifts could be helpful for the church in this time of "uneasiness" and change. Many churches and church organizations today need to become more entrepreneurial to respond to changes taking place in our communities. Business people grapple with a competitive environment on a daily basis. It seems only natural, then, that our local congregations can benefit from the entrepreneurial gifts of business leaders.

Finally, Joe was frustrated by the slow pace of change and implementation in the church. Churches can too easily get bogged down in a cumbersome permission-giving process that stifles creativity and missional imagination. Someone once said, "Good management is democracy in decision making and benevolent dictatorship in implementation." Certainly both churches and business need to be participative in decision making. The key is learning when to be participative and then, once a decision is made, to learn how to implement in an effective and efficient way. This might be another way business leaders can be helpful in assisting pastors in understanding when and how to utilize appropriate goal setting and healthy accountability processes.

In the end, effective church and business leaders employ similar organizational skills. Based on the organization's mission, each takes in and transforms resources to meet a community need. Our mandate to further the kingdom of God necessitates that we develop the capacity to bring together the strengths of church and business and unleash this power in ways that transform our local communities so that God's healing and hope flow through us all to the world.

Jim Smucker is president of and partner with his brother in the Bird-in-Hand Corporation, a company that employs 450 people in the hospitality industry. He attends Akron Mennonite Church in Akron, Pennsylvania.