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National Leadership Roundtable on Church Management

Managerial Excellence: Engaging the Faith Community in Leadership in the Church Today National Leadership Roundtable on Church Management Annual Conference at The Wharton School

Annual Conference

1350 Connecticut Avenue, NW, Suite 825 Washington, D.C. 20036 Tel: Fax: E-mail:

(202) 223-8962 (202) 296-9295 info@nlrcm.org

www.nlrcm.org

June 25–27, 2008

National Leadership Roundtable on Church Management

June 25–27, 2008 Philadelphia, Pennsylvania


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Leadership and Management: Distinction and Relevance Keynote Address

Mr. Fred Gluck, Former Managing Director, McKinsey & Co.

THINKING ABOUT PROFESSIONAL MANAGEMENT IN THE CONTEXT OF THE CHURCH A number of Church leaders (bishops and pastors) have raised questions about the perspective of the Leadership Roundtable on how they should think about their roles and responsibilities in managing their parishes and dioceses. They are particularly concerned with how their temporal responsibilities can be balanced with their pastoral duties and spiritual life, and with the priestly vocations they have chosen. Fred Gluck

The following sections attempt to shed light on the issues raised by these questions by considering the role of the bishop (and, by analogy, the role of the pastor) in terms of leadership and management. Leadership and Management Both good leadership and good management are essential to the long-term success of any enterprise. Effective leadership is necessary to sustain focus on the mission of the organization in the face of environmental changes and to inspire and motivate people and maintain their trust, confidence, and commitment. Effective management is necessary to ensure that the necessary resources to achieve the mission are effectively utilized and to sustain the trust and commitment of the people who supply them. This is as true of the Church as it is of any commercial enterprise. These terms are imprecise in some ways, but Figure 1 illustrates certain important features of each.

Leadership and Management: Distinction and Relevance

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Leadership and Management: Distinction and Relevance

8 Figure 1: Leadership and Management Compared and Contrasted RESPONSIBILITY

LEADERSHIP

MANAGEMENT

Key concerns

Big picture (environment) Change and adaptability Strategy

+

Operations Effectiveness and efficiency

Overall direction

Mission Values Culture

=

Specific objectives

Priorities

For the enterprise

=

People/teamwork

Inspiration Motivation Trust Confidence

Resource management People Money Facilities

Match to priorities

+

+

For the operating units

Hiring and firing Quality Skill Deployment Performance measurement

Manage day by day

As indicated in the figure, the key concerns of leaders tend to be about the “big picture”: thinking about how the environment is changing, about how to change and adapt to it, and about shaping an appropriate strategy. Leaders also define the mission and values of the organization and shape the culture.1 Managers are primarily concerned with operations’ effectiveness and efficiency, and with setting specific objectives for the units that report to them. Leaders shape the overall priorities for the enterprise and work with managers to translate them into principles for action (and eventually into specific objectives for operating units). Both man-

1 Mission and values in the religious sense are timeless for Catholic leaders, but cultures adapt to changes in the human condition and are not necessarily identical in all geographic regions at all times.


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9 agers and leaders work through people, but leaders tend to be more concerned with inspiration, motivation, trust, and confidence, while managers need to continually deal with more workaday problems, such as hiring and firing, quality control, skill levels, deployment, and performance measurement. However, there is always a management component to a leader’s job and a leadership component to a manager’s job. Leaders need to decide how to deploy their resources in accordance with their priorities. Managers manage those resources on a day-to-day basis. Leadership and management are completely complementary functions and need to be closely integrated and carried out in a holistic way. This happens naturally when a single person carries out the roles of leadership and management. In most organizations of any size, however, the chief executive officer (CEO) provides the overall leadership and delegates most of the managerial tasks and their concomitant leadership roles. The key challenge for the CEO then becomes obtaining the necessary information and understanding to provide the necessary leadership and maintain effective control of (manage) the organization. The bishop’s ability to acquire the necessary information and understanding depends importantly on developing a cohesive team that is energized by mutual trust, respect, and confidence. His key lever for exercising control is to agree on appropriate objectives with his subordinates, assess their performance against those objectives, and take appropriate action if they are not achieved. The principles and techniques of good management are independent of the values or ethics of the organization that uses them. They are the same for religious organizations as they are for commercial operations or even households. Their missions and their underlying ethics and values define the nature of these organizations and not their management approaches. Dioceses, like all complex enterprises, must be well managed to discharge their responsibilities and execute their mission effectively. The Questions Returning to the questions of how bishops can think about their leadership and managerial roles and responsibilities in relation to their spiritual lives, pastoral duties, and priestly vocations, one might make the following observations: 1. Bishops have to play both leadership and managerial roles as well as carry out their other duties. These other duties tend to be pastoral and spiritual in nature, but they also include such worldly things as representation and fundraising. However, the amount of time spent on leadership and management and other more worldly activities compared with the amount spent on pastoral duties will shift with increasing organizational responsibility and/or personal preference and individual skill levels. Appropriate and effective delegation of certain leadership and managerial tasks and responsibilities can free the bishop to concentrate on the things that only he can do and the things that give him the most personal fulfillment and satisfaction and are at the heart of his pastoral vocation.

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Leadership and Management: Distinction and Relevance

10 2. A bishop can delegate much of the work of the Church, but he must retain the ultimate responsibility for ensuring that the mission of the diocese is being effectively carried out. This in turn depends on the ability of the bishop (or pastor) to obtain the necessary information and understanding to provide leadership and to maintain operational control of (manage) the organization. The operational effectiveness of the enterprise is largely dependent on the performance of the people and organizations to whom various tasks have been delegated. Accordingly, assessing this performance in a systematic way and on a regular basis and taking appropriate action effectively exercise operational control—even this responsibility can largely be delegated by appointing a chief operating officer (COO), in which case the bishop’s key assessment responsibility is of the COO. In some cases (e.g., pastors, chief financial officers), the bishop (or COO) may possess the necessary skills to make this assessment. In other cases, he may require the advice and counsel of external advisors or advisory groups (e.g., pastoral or financial councils, auditors). Bishops can choose different balances between responsibilities they retain and those they delegate, and different ways to assess how well the delegated responsibilities are being carried out depending on the characteristics of their dioceses and their personal preference, experiences, and skills. Once size doesn’t fit all.

Accomplishing the pastoral and spiritual missions of the Church is completely consistent with achieving operational efficiency and maximum economic effectiveness as long as the leadership and managerial roles and responsibilities are properly defined and carried out.

3. Accomplishing the pastoral and spiritual missions of the Church is completely consistent with achieving operational efficiency and maximum economic effectiveness as long as the leadership and managerial roles and responsibilities are properly defined and carried out. The ultimate responsibility for the overall leadership and the success of the diocese lies with the bishop. On the other hand, responsibility for carrying out the great majority of the duties and functions of operating the parish or diocese can be delegated as described above. The key to successful delegation, however, is the implementation of effective systems for managing it. Bishops and pastors can be effective leaders without necessarily being good managers or devoting themselves primarily to management tasks. They do, however, need to understand the essentials of good management and appreciate its importance to carrying out their missions. They also need to assess (or have assessed) their strengths and weaknesses as managers and take appropriate steps to capitalize on their strengths and compensate for their weaknesses. This usually means designing and implementing governance structures and management systems and processes appropriate to the scope of their activities, the size of their organizations, and their own personal capabilities and preferences. Accomplishing these things requires openness and teamwork and building mutual trust, confidence, and respect with subordinates and advisors. In smaller dioceses


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11 (or parishes), these structures and processes can be simpler and less formal. In larger ones, they will generally be more complex and formal and require more professional managers (either clerical or lay) to design and operate them. In either case, delegation without assessment of its effectiveness transforms delegation into abdication.

The ideas about leadership and management . . . reflect the leadership and management practices of the world’s most successful competitors. They are highly applicable to the task of leading and managing a diocese and in no way conflict with the mission of the Church or the diocese.

Summary In summary, the twin tasks of leading and of managing have always been part of the priestly duties of the bishop. And many dioceses have been well managed. But the extraordinary increases in the range and accessibility of information and transportation that have driven the globalization of the world economy have changed forever the environment in which dioceses (and parishes and the Church as a whole) operate. Increased governmental and public scrutiny has added another dimension of complexity and challenge. Moreover, these changes have substantially raised the hurdle for what constitutes effective leadership and good management. It has become much more difficult to recruit people, and especially the most talented people, into the clergy; much more difficult to attract people to the ranks of the Church and keep them there; and much more difficult to attract and deploy effectively the financial resources required to carry out its sublime mission. In other words, the Church is operating in a much more competitive world. The ideas about leadership and management outlined above reflect the leadership and management practices of the world’s most successful competitors. They are highly applicable to the task of leading and managing a diocese and in no way conflict with the mission of the Church or the diocese. In fact, they are quite complementary and facilitate its effective pursuit. They are already utilized with great effectiveness in some dioceses and parishes. More complete and widespread adoption in the Church would lead to a Church much more capable of fulfilling its mission in today’s highly competitive race to win the minds and hearts and souls of the people.

Leadership and Management: Distinction and Relevance

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Leadership and Management: Distinction and Relevance  

Leadership and Management: Distinction and Relevance Keynote Address by Mr. Fred Gluck, Former Managing Director, McKinsey & Co.

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