Should Your Church Have A Bad Hire Budget?
The most expensive hire you will ever make is hiring the wrong person. What exactly does making a bad hire look like for your church financially?
Don Charlton defines a Bad Hire Budget as, ”The calculation of the additional ‘overhead’ your business pays every month because your company has underperforming, underdeveloped, or even missing team members.”
It’s more difficult for churches to think about the consequences of a bad hire than for-profit organizations. However, many of the same principles apply.
Here are a few of the components you should consider in your church’s bad hire budget.
Decrease in giving because of lack of key leaders.
One of the pain points our clients experience when their Senior Pastor leaves is a decrease in giving. This is always true when the Senior Pastor leaves under negative and difficult circumstances. However, even if the Senior Pastor has a positive and healthy transition, church attendees often visit other churches or decrease their attendance during an empty pulpit season.
A decrease in giving can also be experienced when other key staff members are missing. If your Volunteer Director, Pastoral Care Team Member, or Small Groups Pastor team member is missing, it is likely that church members are feeling less connected and might not be tithing as much as when they felt connected through a staff member that cared for them each week.
Smart churches expect and plan for this reduction in tithing in their church budget during a pastoral transition. They also put systems in place to help their church staff and congregation understand the budgetary restraints in a season of transition so that the church can minimize the financial risk as much as possible during the transition time.
Loss of productivity because of underperforming employees.
When an employee is underperforming, the cost is much more than emotional frustration. One of the key mistakes we see churches make is to wait too long to address an underperforming employee.
If you suspect you have an underperforming employee on your team, revisit their job description and put monetary amounts by the tasks and projects for which they are responsible. For the projects they have completed successfully, put a dollar amount of the value they have added to the team beside the task. For the projects they have not completed, put a $0 amount by the projects or tasks they have yet to complete. For the projects and tasks in which they underperformed, place a -$X next to it to account for the amount of money that cost the church. Does the total dollar amount equal the person’s salary?
This is a bit more difficult to do for a role that has many intangible responsibilities, but if you are paying a staff member a salary, you need to be able to account for the value the person is bringing to your church, your team, and the Kingdom.
Loss of productivity because of untrained or inexperienced employees.
Similar to the point above, how much productivity is your team losing because of untrained or inexperienced employees? Before you make a hire, ask yourself, is this someone who can immediately jump in and add value, or is this someone I’m going to need to train and invest in before they add value to the team?
Either hire can be the right hire, depending on the role and your team’s needs, but you must understand the cost of each. Many senior leaders say that they like to hire young and less experienced team members because they can pay them less in the beginning and develop them as a leader. However, it is rare that a senior leader truly understands the time (and thus the budget) commitment that properly training and onboarding a less experienced employee demands.
Because of this misconception, we often see frustrated senior leaders fire less experienced team members all because they didn’t realize the time and expense they needed to commit to properly training the employee. Thus, the senior leader must spend more money in time and resources in the long-term training the less experienced employee instead of bringing in a more tenured employee who can hit the ground running at a higher salary.
Employee overtime and burnout due to a staff vacancy.
A misconception in hiring is that a senior leader thinks, “We can’t afford to hire a new team member right now, so we’ll just pay our current team members overtime in the interim.” However, the opposite may in fact be true. Count up the amount of overtime you will need to pay your current staff to make up for the vacancy. Does this add up to equal a salary? If not, it might be wise for you to pay your current staff overtime. If it does, I highly encourage you to make the new hire for more than just budgetary reasons.
Even the most dedicated and hardworking employees will face exhaustion and burnout if they are pushed to the limit for too long. Keep a close eye on your current staff during transition times. Care for them and make it a priority to show them they are appreciated.
Increase of time commitment from senior leaders.
One of the most significant costs that senior leaders often miss when they make a bad hire is their own time commitment. All of the above situations require extra time from the senior leadership team whether it is discussing corrective steps for an underperforming employee, extra training of an inexperienced employee, or taking on additional workload due to a staff vacancy.
Beyond the extra time commitment involved, it also takes the senior leader away from what their day-to-day role and leading the team forward toward their vision.
If you are experiencing any of the above pain points on your current staff, seek help before the situation gets worse. Our team here at Vanderbloemen Search Group would be glad to help you build and grow your team effectively.
If you liked this, then you'll also like Free Download: 7 Ways To Make A Bad Hire (And How To Avoid It).