I’ve done enough consultations long enough and studied organizations carefully enough to recognize a pattern in some organizations. I refer here to those whose organizations, some young, some old, that ended their institutional lifespan. Though many were surprised by the organization’s demise, a closer look, a little perspective, a bit less bias and naïveté would have been enough to offer a more realistic assessment of the organization’s predicable march toward closure.
Here are characteristics that help ensure well-intentioned people will eventually kill an organization, whether a business, school system, congregation, or non-profit organization:
1.They hire non-experts as institutional leaders. Some organizations are attracted to personality leaders and tend to become bedazzled by charisma, assuming charm is sufficient for leadership. Some boards get snookered during hiring interviews and get taken in by spin, promises, and unfounded narratives of past successes. Many believe that success in one field will automatically translate to success in another. However, leaders need to know the business they are in so as to make diligent, wise, informed, and responsible decisions (I’ve consulted with two organizations whose leaders thought they were in one business when they were actually in a different kind of business!).
2. They tolerate too long a series of underfunctioning, unqualified people in key offices. These can become entrenched in these key offices for a variety of reasons. Some keep their position because they were hired by virtue of a relationship with a supervisor rather than for their competence. This tends to be especially true during its formative early years, which sets up the organization for a weak beginning whose effects linger long into more critical stages and transitions. Some underfunctioners are able to stay due to a corporate culture that over accommodates mediocrity and fails to consistently hold people accountable.
3. Some organizations that are born out of reactivity and cut-off from a parent organization never outgrow that reactivity. They carry on attitudes of blame and suspicion that give rise to unhealthy patterns of reactive behaviors. Many never get past defining their identity over and against the “other” organization, so they never find their own core values and identity.
4. They tend to have a series of squandered opportunities. Whether due to lack of vision, talent, imagination or willingness to risk, these organizations fail to recognize and exploit opportunities (grants, strategic windows of opportunities, shifts in the industry, etc.) that would have put them on a trajectory toward growth and influence .
5. They make poor programmatic and financial decisions. For example, a school will create the wrong degree program, or fail to adapt the innovations in its field (e.g., online education). A non-profit organization will purchase properties with little strategic benefit. A business will expand too soon, too large, or into a business it does not understand. Many jump too soon on a new fad sinking financial resources into what eventually is a black hole, then delay too long in cutting its losses.
6. They under resource key offices that provide critical functions. In a school, it can be the recruitment office, in a non-profit organization it can be marketing or fundraising, in a business it can be the sales force. They fail to understand that it’s important to put your money (1) where it shows, and (2) where you get a strong return on investment.
7. They have an inability to innovate. Whether because their leaders are risk averse or they have not learned to overcome resistance and sabotage from within (employees, supervisors, managers, faculty, etc.) their inability to innovate leads to a failure to adapt to the ever-changing conditions that impact their industry.
8. They run out of money. Pragmatically speaking, every failed organization shares in this failure. Every failed organization I know runs out of two things: time and money. Both are a failure of foresight, sound strategic decisions, and wise stewardship. Ignore the cautions of numbers 1, 5 and 6 and you’ll eventually wind up here.
Aside from those eight characteristics there are things which a leader and the organization cannot control. Many are external forces and conditions they cannot anticipate and for which they cannot correct. That said, more often than not, it is the internal failures, those which they can control but fail to, which does an organization in.
Israel Galindo is Associate Dean for Lifelong Learning at the Columbia Theological Seminary. He directs the Pastoral Excellence Program at Columbia seminary. He is the author of the bestseller, The Hidden Lives of Congregations (Alban), Perspectives on Congregational Leadership (Educational Consultants), and A Family Genogram Workbook (Educational Consultants), with Elaine Boomer & Don Reagan, and Leadership in Ministry: Bowen Theory in the Congregational Context.
His books on education include Mastering the Art of Instruction,The Craft of Christian Teaching (Judson), How to be the Best Christian Study Group Leader (Judson), and Planning for Christian Education Formation (Chalice Press).