Church Business Management: How & Why To Run Your Church Like A Business
Church business management is about mission: Managing well ensures your church’s people, purpose, and resources are directed towards the vision God's given you.
Church business plans are a good idea: A clear structure for where, how, and when your resources will be used keep your church focused on mission and long-term goals.
Keep your business meetings efficient and impactful: Respect time, use agendas, and keep your team focused on purpose.
Church business management is about stewardship: Remember: rou’re accountable to something much higher than shareholders or KPIs... you're accountable to God.
In a very practical way, it's easy to assume that your church's business management practices represent a ceiling for your growth and progress. And, in some respects, that's true.
However, it's critical to remind yourself of this: while your church’s management process can limit effectiveness - God values faithfulness above fruitfulness
For the pastor who wants to improve or supplement their skills with top-ranked church management systems, there are a dizzying number of possibilities. (And, if your budget is a lot smaller (or zero), there are an equal number of free church management software tools.)
That being said, as a ministry leader, I rarely considered the work I did as 'management.'
Today, though, I have a much clearer understanding. As I spend time reflecting on the meetings, generating church financial reports, managing church volunteers, setting up and organizing church conferences, the standard operating procedures, etc. I see had a ton of business administration skills I didn’t even know I had!
The issue, though, was this: I didn’t think of myself or my church leaders as business management material.
Let’s start by defining all of our terms and then start getting you to think about church management from a different point of view so you can lead your local church effectively.
I’ll cover:
- What Is Church Business Management?
- Is A Church A Business Or An Organization?
- What Are The Advantages Of A Church Being A Business?
- Conducting Church Business
What Is Church Business Management?
Church business management is overseeing the organizational needs, financial management, and administrative side of the local church as a legal nonprofit organization. (NOTE: church record keeping is a critical part of long-term success. Don't neglect this!)
'Church business management' could be swapped out for 'organizational leadership' or 'church stewardship' - it's about managing the resource infrastructure of the church well
If you are in full-time church leadership, then this will affect you differently than those who are bi-vocational or part-time because you will have higher expectations to run the church organization than those who split their time. However, it is a critical skill set for all lead pastors to develop.
What Is Church Management?
Church management, at the level we are talking about, deals with the whole of the church as a religious organization. From pastoral care to preaching to budgeting and human resource management skills, all of this is part of church management.
While there is some overlap between church administration duties and church management, these two typically fall into these categories: religious and business. A local church organization is expected to perform both well, but it is the role of the lead pastor to focus on a whole church business management approach that encompasses both.
One of the single best tools you can add to your church management toolbox is (wait for it...) church management software. My team and I ranked and evaluated the very best church management software tools.
Ready to explore church management software? These articles will help:
- Global market for church management software
- Must-have features of church management software
- Benefits of church management software
- Pricing overview for church management software
What Is Church Administration?
Now, church administration focuses more on mobilizing the church as a religious organization from the standpoint of financial management and human resource management. The goal is the same as with church management, but the administrative side of things applies more to managing the business efforts and real-time needs of the church as a nonprofit business.
This is where many pastors begin to feel ill-equipped. Managing a business or an organization isn’t what you signed up for, right? Well, let’s discuss this.
Read more about how to set up church administration here.
Is A Church A Business Or An Organization?
The answer to this question lies within an unusual space: tax code! If we peer into the definitions of a 501(c)(3) tax code for a nonprofit organization under “religious” reasons, then we see the language of “organization” a lot.
However, there is also language that refers to “business income” for money that comes in outside of donations (often in the form of tithes and offerings). You can also see that, in reference to employees, they must be given pay based on fair market value. This means they must be paid appropriately based on an equivalent role outside of the nonprofit status.
This all means that we can see church as both a business and an organization! Yet, many lead pastors don’t shift their thinking to that of church business management. If a lead pastor can make that mental shift, though, there are many advantages that come into play.
What Are The Advantages Of A Church Being A Business?
As church leaders, we’re accountable not just to legal standards, but to God himself, who entrusts us with people, purpose, and resources.
So when it comes to leading your church, everything you do needs to flow from that calling:
- Preaching Jesus.
- Helping people.
- Training others to do the same.
That’s the mission. And the minute we start drifting from that? We’re off track.
Holding Staff and Volunteers Accountable
Say you’ve got a staff member who’s not doing what they’re paid to do. They’re loved by the congregation. Great attitude. Always around. But their job description? Totally ignored.
- Do you confront them?
- Let it slide?
- Fire them?
This is where management and ministry seem to clash. Grace matters. But so does accountability. You’re not just managing people—you’re also safe-guarding your church's mission. You're responsible for stewarding the financial resources of the church. And sometimes that requires making hard calls, even if it ticks people off.
I've had to let staff members go before - and it's never easy. BUT - I'm responsible for ensuring the church's money is spent in the best way to achieve its mission.
If there's a staffer who's not doing what they're paid to do? I'm shirking my duty if I don't address that.
Church isn’t a business - but it is an organization. And when the the core mission gets muddied, the whole thing falls apart.
So here’s the question every pastor has to wrestle with:
How do we run the church faithfully—with clarity, courage, and love—without compromising the mission Jesus gave us?
Living into your role as someone overseeing church business management puts you in the place of defender of the congregation and the mission of your local church! This, combined with the responsibility to also share the love of Jesus, allows you to take stances you might otherwise be too nervous to take.
Conducting Church Business Faithfully
Activities like church project management, fundraising, outreach, and pastoral care are all important parts of operating a church well, but they aren’t managing the church as a business.
These church business activities tend to look like the parts that don’t seem like as much fun:
- Creating business plans
- Organizing church business meetings
- Casting a mission and vision in alignment with the original purpose of the nonprofit organization
- Human resource management
- Financial management (aided by excellent church accounting software)
- Creating a church management program
These are the tasks that tend to suck the life and energy out of many pastoral leaders, yet they are equally important to make sure the church organization continues on for years to come! Of course, there are times when leaders must consider more drastic measures, including how to close a church gracefully when necessary.
Directly relating your work within the church business management portion of your role to the life-giving gospel of Jesus Christ will go a long way to helping turn away this negative mindset. Budgeting so that your church can be the hands and feet of Jesus in your community is just as important as going and serving the orphans and widows directly.
Your Church Business Plan
A clearly defined, actionable church business plan will help you and your congregation consistently work towards goals and tasks that will further the mission of your church.
Whether it is investing more time into church property management, fundraising for a specific opportunity, or assessing what it takes to create an online program for a specific ministry, a well-crafted business plan will keep you on track.
I've broken out the process/steps for writing a church business plan, and made THIS sweet template for you and your team to adapt and use:
Don’t think of the church business plan as some rigid outline for what you have to do, but as a document to keep the church leadership accountable to what God is leading you and your church into.
Conducting Streamlined Business Meetings (FREE TEMPLATE)
Even the best run churches need business meetings... but I've been to my share of meetings that were TOO long or felt ineffective.
Done well, though, business meetings can keep your mission and vision in sight and on track at all times. Having a simple, efficient church business meeting agenda can help streamline these meetings. This will help them not feel as daunting and keep everyone focused and feeling they have been heard and listened to.
Recognize that many of your church leadership are likely volunteers taking plenty of time out of their life for these meetings. So treat them with the respect they deserve and treat each church business meeting as critical to the mission and vision of the church.
This free agenda will be super helpful for you:
Church Management Is Missional
Thinking of church business management as missional work for the body of Christ and your local congregation can go a long way to alleviating any fears and doubts you might have about running the church like a business.
At the end of the day, embracing the business side of church management is about shepherding and stewarding your church’s finances, human resources, physical resources, and enthusiasm to share the love of Jesus Christ with the world!
(Along the way, any of these excellent church software tools can save you a ton of headaches and frustration!)
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