There are three main phases of the church budget process. All budget processes have components of these three phases. Therefore, by understanding them, you’re on the right track to managing your church budget process with ease.

Phase 1: Budget Formulation

The budget formulation stage includes gathering relevant policies, soliciting information from staff and parishioners, documenting assumptions, and projecting revenues and expenses. By developing a resource plan to put priorities into action, collaboration and transparency are critical to this phase of the budget process to ensure openness, buy-in, and accountability by the entire parish community.

Phase 2: Budget Execution

Once the budget is approved, budget execution is the phase when the plan is put into action. The key features of budget execution include establishing and communicating clear policies and procedures for the receipt and disbursement of resources and ensuring financial transparency.

Phase 3: Budget Control

Budget control processes and procedures are established to ensure that the parish meets planned targets for revenue and expenses. If challenges arise or circumstances change for any reason, tools like variance analysis help parish leaders assess the impact of changes and proactively mitigate financial risks.

Now that we have a basic understanding of the budget phases, next week, we will review the different components of what we will call – The Master Budget!

One of my favorite books on the topic of change management is Switch: How to Change Things When Change is Hard by brothers Chip and Dan Heath (New York: Broadway Books, 2010).  The book focuses on the question of why it’s so hard to make lasting changes in our companies, in our communities, and in our lives and how to overcome this challenge. 

Psychologists have discovered that our minds are ruled by two different systems one rational and one emotional.  The rational mind wants to make a change, but the emotional system enjoys the existing routine.  This tension can doom a change effort – but if it is overcome, change can come quickly.

In Switch, the Heaths’ show how we can all confront this challenge of mind and emotion and make meaningful change in our lives at work or home.

Research, Engaging Applications, and Practical Solutions!

The book strikes a good balance between research, engaging applications, and practical solutions.  If you are looking for a better understanding of why change is so difficult and how to overcome common roadblocks, this book is a great read.  Let me give one example that I found very helpful.  In Chapter 1: Three Surprises About Change, the authors explain that self-control is exhaustible.

The narrow sense of the word, as in the willpower needed to fight vice (smokes, cookies, alcohol)…but a broader kind of self-supervision.  Think of the way your mind works when you’re giving negative feedback to an employee, or assembling a new bookshelf, or learning a new dance.  You are careful and deliberate with your words and movements.  It feels like there’s a supervisor on duty.  That’s self-control, too.”

“…when people try to change things, they’re usually tinkering with behaviors that have become automatic, and changing those behaviors takes self-control.  When people exhaust their self-control, what they’re exhausting are the mental muscles needed to think creatively, to focus, to inhibit their impulses, and to persist in the face of frustration or failure.  In other words, they’re exhausting precisely the same muscles needed to make a big change.

Does this point resonate with you? It sure does with me.

Battle Your Rational Mind

As a facilitator, when I am leading a challenging session with participants who are trying to think in new ways about old ways of doing business, by the end of the day I am mentally whipped, and the participants are tired too.  It’s not easy to battle your rational mind that knows you need to make a change, and your emotional self that resists learning a whole new way of doing something; it is exhausting.  I think owning and recognizing this reality can help make any change process more manageable because, at the end of the day, you have a bit more patience with yourself and understanding for why this can be difficult.

Switch is a great read, and I highly recommend it.