“What We Measure is What We Treasure” – A Discussion of the application of K.P.I. (Key Performance Indicators) and Mega-church dynamics in Christian Markets
Craig Hall
Introduction
In recent years there has been a move towards the adoption and incorporation of Key Performance Indicators (KPIs) measurement methodologies into Christian organisations, church processes and management methods. Given the dynamic nature of Pentecostal churches and their willingness to embrace and utilise various methods of secular economics, the adoption of KPIs is explicable, particularly with the complexity of emergent mega-churches.
Given that the take-up of KPIs is in its early stages within the Pentecostal movement, with the mega-churches leading the way, it is timely to consider what KPIs mean in a Christian context, and to consider the methodology and philosophy of their use in the light of church mission and ministry.[1] This discussion will view KPIs historically, as well as applied KPIs, and the two stages of transformational morphology which KPIs undergo: Ethereal Morphology, and Reification. This paper seeks to present a conceptual and methodological foundation for a Christian ‘KPI’ paradigm.
Historical Context
In applying KPIs it is important to understand what they are and where they come from, in order to assess the suitability of their underlying elements. At their essence KPIs are simply an outcomes measurement method. However, in context, KPIs originated during the Industrial Revolution of the 18th century from an industrial manufacturing need to measure output, within a de-personalised mechanical worldview.
The Industrial Revolution coincided with and was aided by the development of scientific method, which sought to understand the natural world, primarily through a dissection of that being observed, into its components. Life forms were viewed as biological machines. Naturally, then, as industrialisation spread, scientific method was increasingly used to measure output and analyse the components of manufacturing; one of those factors of production were people, viewed as labour units. Economics emerged, initiated by Adam Smith writing in 1775 about how nations create prosperity.
I do not seek to invoke a Christian/secular “us and them” theological divide - however, it is paramount to recognise there was both an intentional and, later, tacit move to a purely scientific “data only” philosophy within economics. At first there was the earlier recognition, as Backhouse notes, that economics was (became) secular as an intentional move;[2] later, at the end of the 19th century, the mathematisation of economics produced a further tacit sterilising of its philosophy,[3] which sought to turn economics into a secular science.[4] As highlighted by Gray: “modern economic theory has become so scientisitic and mechanistic.”[5]
The emergent Business Colleges in America observed that successful businesses had common features, and this led to the development of the concept of Key Performance Indicators (KPIs). Here, too, it has to be noted these KPIs did not include people. We see this reflected in terminology. Prior to the Second World War, people were seen as employees, literally the recipients of a labour employment contract. After the war they were seen as personnel, a very military worldview. Into the 1980s the modernising of corporate language saw employees renamed as Human Resources. Ironically, it was Karl Marx who spoke up for a humanist view, by declaring that the only thing workers had to bargain with was their labour[6], and thus labour was most often dehumanised and exploited by those who owned the factors of production – with this we recall that human labour was one of those factors of production, over which business claimed ownership. This contrasted with the treatment of workers by Henry Ford who, on the basis of his production targets, his KPIs, simply speeded up the assembly line when he wanted to increase production, with little regard for the impact on his workers - leading to some of the most violent and deadly clashes in industrial history.
There is a need to recognise that KPIs are substantially a secular economic or production measurement tool, essentially operating from a profit maximising worldview. If the standard KPI paradigm is applied or imported into churches, there is a risk of importing a secular measurement framework, and affecting church internal culture. Is it possible and rather necessary to utilise (KPI) measurement methodologies in Christian organisations and Christian business, particularly within the dynamic complexity of Mega-churches?
Mega-church and Christian Markets
The degree to which any economic activity can take place is dependent upon the relevant “limiting factors”. Limiting factors are defined as those things that we first run out of.[7] The limit to the quantity of life that can exist in a desert is the availability of water. Water is thus the limiting factor. The limiting factor of any particular church is the number of people the church can reach and the level of income within that demographic.
In 1998 Ian Jagelman pointed out that “church has become a competitor in the same marketplace.”[8] From this it can be seen that the size of a church is dependent upon two limiting factors: the size of the potential Christian demographic and the speed at which money flows through that demographic. While we may not desire to see church growth so dependent upon money, the realities are that mega-churches require a lot of finance to build and maintain. No church can exist without an income source, at the very least to pay the Pastor’s living expenses, even if the Pastor produces the income via some other work. The reason we do not have a mega-church in every suburb is the same reason there is not a Westfield in every suburb. In fact, the decision to build such mega shopping centres is based upon a rudimentary formula – the amount of retail dollars spent per square metre of retail floor space in a given retail shopping district. Once a particular area reaches a prescribed dollar value per square metre benchmark, a shopping centre or supermarket is established. A similar socio-economic dynamic rests behind mega churches, although we don’t use these sorts of prescriptions when establishing mega-churches. However, it may be said King David and Solomon are the only ones to have planned a ‘mega-church’ from the outset: “Indeed I have taken much trouble to prepare the house of the Lord, 100,000 talents of gold…bronze and iron beyond measure” ... “and the king commanded them to quarry large stones, costly stones and hewn stones to lay the foundation of the temple” – 1Chron 22:14, 1 Kings 5:15-18. Perhaps it can be said that modern mega-churches are not planned as large concerns from the beginning, rather they emerge amid leadership gifting and ongoing blessing, from a small local church plant. Rick Warren does, however, state in his book A Purpose Driven Church that, for a medium to large church to eventuate, it needs to be planted within a growing new residential area.[9] The establishment of Hillsong in the Hills campus north west of Sydney occurred around the time Warren wrote this and therefore has tended to prove his formula. On the other hand, the establishment of Christian Life Centre by Frank Houston in 1977 occurred in the inner city of Sydney, in an established city urban area, and yet quickly grew to a congregation of over 1,000 people.[10] In contrast, also, to the limits of mega-church proximity mentioned previously, is the fact that there are, in Sydney, large churches in close proximity to each other; it is, however, their denominational or spiritual differentiation that permits this. Indeed it is seen reflected in economics, too, that a supermarket and a mega retail centre can exist in close proximity, often with a supermarket actually inside the shopping centre, acting as an attractant – however it is the diversity between the two, technically their point of differentiation, that permits the economic viability of both – likewise for churches. Socio-economic viability is partly the reason for the trend of applying KPIs to Christian organisations.
Application
Witherington quotes N. T. Wright that “all language about the future, as any economist … will tell you, is simply a set of signposts pointing into a fog.”[11] In considering the use of KPI application, there is a need to pose the questions, what are we seeking to measure, and what ought we be measuring? These questions deserve significant reflection as KPIs can and often do alter the focus and culture within an organisation. Conceptually, we will seek to measure those things we focus on, and as we measure those things, by a reciprocal dynamic drift we begin to focus on the things we measure, and what we measure is inevitably that which we treasure. KPI targets naturally become the achievement goals, and can begin as a tool that serves us to help measure outcomes, with the possibility for KPIs to become something we serve. There is a subtle drift on this and requires a cautious awareness. Where KPIs are linked to individual performance, the individual will tend to focus their efforts on the KPI goal – at the expense of other aspects. In a manufacturing process this serves well, however in a church relational and community creation environment, the focus can shift to a KPI being central as opposed to congregational needs. These are some of the behavioural implications of applied performance measures that Parmenter cautions about.[12] It is for this reason that our vision and, more importantly, our mission need to be inculcated into and to subordinate the KPI regime.
The most obvious things measured include congregation size, the attendance at different service times, various costs of running the church or organisation and the levels of revenue. Beyond these there can be numerous sub groups of categories - printing costs, wages, administrative functions - and perhaps different categories of revenue, all of which have biblical substance: “For which of you intending to build a tower, does not sit down first and count the cost, whether he has enough to finish it” – Luke 14:28. These things may seem obvious, however many Christian organisations have not adequately engaged the need to do this very fundamental monitoring of their programs – and it has to be said that without adequate monitoring it is unlikely those programs can be sustained. Significantly, in training pastors for church planting, trainees often receive no instruction in budgeting, cash flow or basic financial management, simply because these financial aspects have not been a church-planting training KPI, despite that financial issues are intrinsic to successful or unsuccessful plantings and parish rationalisations. Yet the essence of measurement regimes contains the biblical good stewardship.
As we measure these sorts of things as congregation, revenue, and church plantings, there is a familiarity to the type of things we measure, in their similarity to the narrow measurement of industrial production - that is, the most readily adapted church activities to KPIs are outputs, or quantities: revenue, costs and growth - which directly equate to the iron triangle of business KPIs.[13] Australian and Christian Economist Ian Harper, whose book Economics for Life won ‘Christian Book of the Year’, observes that “particular pieces of policy advice may be economically reductionist if the focus is on the more easily measured or narrowly commercial dimensions of an issue”.[14] Indeed, by definition KPIs view an organisation through a small range of “indicators” and are thus, by definition, reductionist – and yet they need to be, in order to provide the requisite snapshot overview. The narrowness of KPIs is contained within the term itself – “key” suggests a limited number of aspects, all of which have been arbitrarily and subjectively selected as a representation of the whole; “indicators” clearly suggests an approximation of performance. We therefore have a measurement method which is a subjective approximation. If we substitute these terms into the phrase Key (subjective) Performance Indicators (approximations), we gain the term “Subjective Performance Approximations”. In addition KPIs use data from last week, last month or last year to formulate forward projections.[15] However, despite only ever being approximations, or indicative, KPIs are often viewed incorrectly as definitive and absolute. As we look to the other main aspects of church, that is, relationship and community, effective measurement using KPIs becomes more difficult, yet ever more necessary, in the modern church. The closer we move towards measuring relational or community aspects, the more difficult or inapplicable traditional KPI paradigms become. If one were to apply KPIs to a marriage, for example, the adversity would quickly be apparent. Yet the health of our church community, the health of our ecclesia, is something we need to be able to monitor, especially in the social complexity of a Post Modern world. This at the very least suggests a need for a philanthropic “humanist” set of KPIs, which do exist under the term Psychosocial metrics.[16] By extension, this inaugurates the need for “Christian appropriate” indicators, and preferably a term which carries distinction from the industry or business connotations that KPIs have. Therefore, rather than KPIs, perhaps CPIs - Christian Performance Indicators, or the more preferable “Christian Potential Indicators”,[17] because as we look into that future fog we are, with respect to our churches, only ever measuring the potential, and our KPIs are only ever historical. We do therefore use historical data to assess the health of and propel our organisations towards a perpetually transforming, presumed, yet unknown future.
KPI Transformational Morphology
Morphology has among its definitions “the study of form or structure” in a general sense, and in Linguistics “the study of word formation…including inflection, derivation and composition”, as well as the transformation of these elements over time.[18] It is this morphological composition of KPIs which undergoes a transformation from an elementary measurement metric on paper, to something which has the potential to usurp the culture of an organisation, which is of interest here. On a most fundamental management basis, KPIs are acknowledged as transforming, as Accounting specialist Garrett Cronin notes: “KPIs evolve over time.”[19]
Despite KPIs being predominantly historical measurement metrics, they are, in addition to being regarded as absolute, granted extraordinary capabilities, such as being able to predict the future. In the lead-up to the GFC (Global Financial Crisis), KPIs were noted as having moved through three waves of transformation. The First Wave comprised KPIs based purely on historical data. Key indicators “existed in name only – they were retrospective, not perspective, and certainly not actionable.”[20] In the Second Wave, databases were utilized which could be integrated into company strategies and initiatives, but these KPIs were still predominantly historical, or current metrics.[21] The Third Wave involved KPIs being seen as capable of predicting the future, as Bauer stated: “KPIs are forecasted using mathematical models to predict future behaviour based upon current and historical data.”[22] These approaches are problematic for two reasons: firstly, the past does not determine the future and secondly, even the “current” KPI data is actually only truly historical, because current data has a very short lifespan before it, too, is historical; as the GFC showed, it may only be a matter of hours before current KPI data is irrelevant.[23] These three waves show the transformational nature of KPIs, yet they are not the types of transformational morphology we need to understand for this section.
In utilising KPIs and before further defining these CPIs, it is necessary to understand the two stages of transformational morphology through which conventional KPIs manifest.
1) Ethereal Morphology
Defining ethereal is best understood as that which may be suspended in the ether, or within the atmosphere. We may imagine smoke lingering, permeating through the air in a room. This is the first stage that KPIs metamorphose into, and this is a rather simple process. Once a KPI is formulated, it is first written down, placed into documentation, then becomes part of the dynamic day-to-day functions of the organisation. The KPI becomes that which focus is directed towards and by which the organisational and people functions are assessed. A KPI can become an inanimate static manager, which can direct activities even when the actual manager is not present – people refer to the KPI for guidance on task setting and daily activity. KPIs may be, and often are put in place by a particular manager or management team, but over time that team may move on to other positions in the organisation, or may leave the organisation altogether; however, the KPIs remain – but will eventually be modified by new management. The above process is how the KPI morphology manifest; the KPI has changed from an arbitrary measurement or ‘historical outcomes’ figure transposed on paper, to being capable of having some limited influence on the culture of the organisation – yet may still be eventually altered or removed, and is thus still subordinate to management. At this point then, the KPI regime has undergone the first stage of transformation and has, via ethereal morphology, become embedded or suspended in the “ether” of the culture of the organisation, which can just as readily be a Christian organisation or church. The difference between this KPI stage and reification is the degree of power and influence: here the KPI is still in transformation and is still subordinate to management – it is a very different matter when a KPI becomes reified.
2) Reification
Definition: The term ‘Reification’ comes from cultural sciences and is defined as “the apprehension of human phenomena as if they were [real] things…the apprehension of the products of human activity as if they were something other than human products.”[24] Therefore, aspects of culture or organisational processes become embedded so deeply in the psyche of the population that they are believed to be concrete or absolute. Their origins are forgotten, yet they remain and determine individual wellbeing, status, or sense of significance, or indeed a sense of safety. They become, over successive generations, socially normative and their removal threatens the very substance by which the culture exists. Some examples of reification which we may contemplate include the Empire for past generations of Britains, America and Thanksgiving, or the ANZAC legend in Australia. While Thanksgiving is so very ‘American’, its origins and meaning are lost to history, even though it is only some 300 years old. Debate exists as to whether it began with an Indian tradition, or whether it had Christian religious origins. Despite its prominence, its precise origin is unknown.[25] Likewise, it becomes forgotten that KPIs are merely a human-created measurement method, and people look to them as though they are animate, possess wisdom and capable of giving advice. As KPIs are a product human activity, they too can become reified, therefore careful reflection is needed - as Berger and Luckman caution “the reified world is by definition a dehumanised world.”[26]
Organisational DNA: As noted, the KPI regime may stay in place long after the person who devised the regime has left, and more pertinently, long after the purpose of the KPI has been forgotten. Indeed a KPI regime may continue to exist long after the particular circumstances or market conditions for which the KPIs were originally devised, have ceased to exist. In short, the KPIs both create and become intrinsic to the culture of the organisation and significantly influence behaviour. As Paul Stevens, in his book Doing God’s Business, suggests, “values and priorities become embedded in something like the DNA” of the organisation.[27] The most obvious example being if a KPI for growth is introduced, it is most certain growth will become the culture of the organisation at the expense of other thought forms. The focus and presence of KPIs can develop such a degree of authority, that successive generations of employees or managers become reluctant to alter or question them – as to do so one may be viewed as unprogressive, conservative, or not a team player. The presence of a KPI can manifest so strongly that it becomes reified and supersedes the authority of Executive management, as shown by the recent Global Financial Crisis.
Global Financial Crisis – A KPI case study: An individual corporate case study is problematic and difficult to obtain due to confidentiality and the reluctance of organisations to provide them externally, as Cronin notes,[28] and also because of what they may reveal about the deep organisational ‘secrets’ and closely guarded methods or market advantage. However the GFC itself provides a collective case study. During the lead-up to the GFC, the pursuit of growth became the sole purpose for which companies existed. As a KPI it was the universal benchmark by which any given corporation was defined and viewed. Growth determined the success of the company as perceived by the “market”, by the shareholders, and how each individual employee’s job was measured. This benchmarking applied to all levels of management, right up to and including the Chief Executive Officer (CEO), the full discussion of which is beyond this paper - however, growth in activity, volume, quantity, output, money, market share or share price was a universal benchmark. To understand how this develops a negative aspect, a simplified yet illustrative scenario of how KPIs distort perception is useful. Consider a financial company, which in year one achieves a before-tax profit of 300 million dollars. Its KPI targets require a growth rate of 10% (which incidentally is conservative compared to the actual targets of many, as noted below). In year two, the 10% is achieved, and the CEO may report to the Board before-tax profits of $330 million. Continuing the example, in year three, growth targets are again 10%, but the company’s before-tax profits are the same as last year, $330 million.[29] The CEO must now report zero growth to the Board and shareholders. The perception now is that the company is in trouble, that the CEO has failed, the market responds with fear, and the share price drops the day after the announcement of zero growth. Yet this is the same profit level that was perceived as a success the previous year. The company is still healthy, maintains its market share, but because of the perception the KPI creates, the company may be viewed as failing.[30] This therefore creates an environment of quite different perceptions, depending on whether the KPI is included or excluded. Despite that such a scenario may seem hard to believe, this is what occurred in Australia, as outlined in the comprehensive report by The Australia Institute Submission to the Financial Services Review, commissioned by the Federal Government after the GFC. Evidence given by Ian McFarlane, former Governor of the Reserve Bank of Australia, noted that banks aimed for before-tax growth rates of 26-29% and further:
“One consequence was that the big banks closed branches that, while still profitable, were not profitable enough … this is a serious problem and is not unique to banks.”[31]
In a financial market, the limits to growth are the number of people who have the capacity to borrow and repay a loan and, more importantly, the number in that group who actually want to borrow. Once banks have lent money to all those who can and want to borrow money, the market is saturated, and growth halts. Within a culture that sees growth as the definitive benchmark, growth cannot stop. The CEO must find a way to produce more growth - the KPI for growth, adopted by the Board and inculcated into all aspects of the business culture, demands it, and the market expectation provides the KPI with the authority to determine the internal culture of the company (by definition, growth wants more). The CEO has no choice, even with the knowledge that the market is saturated. The CEO must produce growth. Under the parameters of a financial market defined earlier, the only way to expand the market is to relax the standards of lending, by downgrading the benchmark for what determines a person’s eligibility to borrow. The income standard drops, so that those on lesser incomes can now borrow. Eventually, the demands for continuous growth see the markets saturated again and growth stops. Again, the only way to expand lending (increase the loan book) is to further lower the lending standards.[32] Collectively, CEOs in the financial sector actually responded in this very way in the lead-up to the GFC, to the point where loans were made available to persons who did not even have income, with what became known as “sub-prime loans.”
To suggest it was just greed over-simplifies and underestimates the dynamic involved. Berger and Luckman pertinently note the reified phenomena “is experienced by [hu]man[s] as an opus alienum over which we have no control.”[33] The pressure for growth, propelled by the embedded KPI for continuous growth, causes the CEO to lose power over the organisation, and leads to irrational behaviour even by experienced executives. The CEO, because of the performance growth KPI inculcated within their employment contract, must also personally answer to the demand of the KPI.[34] Its power is such that the KPI now sits above the management, above the Board, and above the CEO - as all now must collectively answer to the KPI, which continues to draw its authority from the market, public and media expectation, the performance measures attached to each individual’s job, and the internal culture of the organisation - a culture which calls for growth, of which the KPI is the sole determinant. The KPI has become reified.[35]
Furthermore, trust or belief in the ability of KPIs to prevent this sort of thing, or for KPIs to be the vehicle for best practice in organisations, is seen to be a problematic logic.[36] Parmenter notes “KPIs in many organisations are dysfunctional … and may be to the detriment of the organisation.” [37] He adds that the belief that linking performance measures to jobs will increase performance is “one of the greatest myths” of KPIs.[38] The GFC occurred within an environment where companies deemed too big to fail, with assets and revenue in billions, with a veritable army of CPAs, Actuaries and Analysts[39], all with instant access to global financial data – and yet, despite the most comprehensive and complex KPI regimes in the world, the biggest and best collapsed, and did so while their KPIs were all reporting both healthy growth and business outcomes right up to 24 hours before the global financial market collapsed. It was the suddenness and massiveness of the losses which stunned the world, and yet the book of Revelation contains a prophetic word on this matter: “And the merchants of the earth will weep and mourn…for no one buys their merchandise anymore…for in one hour such great riches came to nothing” – Rev 18:11, 17.
It provides a salient example that we tend to measure those things which we want to, but not measure those we don’t. The very KPI which was not being measured in the lead-up to the GFC was that of increasing risk, because if it was measured, the irrational methods for producing growth would have been self-evident and could not have been undertaken. The tendency is to measure and set KPIs over those things which justify our goals or beliefs, and our goals are most often those things which are easiest to measure, easiest to increase, and which make us look good, or which represent how we would like things to be. As J. Stiglitz, Chair of the UN Committee report on the GFC, cautions, “flawed theories distorted decisions in both the private and public sector.”[40] As seen with an unfettered application of growth that a Global Financial Collapse resulted, and it is important to reflect that by following precisely the conventional use of KPIs in this same way can have the possibility of a Global Church Collapse, particularly with the debt-financed expansion and global financial integration churches engage in. Again, this does not suggest that debt financing or financial integration should be avoided, on the contrary it has provided unprecedented expansion and discipling of the nations by the church.[41]
What shall we say then, are KPIs bad? Is growth bad? Certainly not! Yet as I borrow from St Paul’s rhetoric of Romans 9:14,[42] there is need, as Christian organisations, for significant reflection on the reification of KPIs, for if and as they begin to be used in Christian organisations, there is a further need to assess what is an appropriate regime. What should a Christian Performance Indicator be?
Towards a Christian Performance Indicator
The need for a Christian specific measurement regime gains support from Cronin, that “the industry angle should be considered when choosing KPIs.”[43] Christian Performance Indicators (CPIs) are a set of measurement indicators specifically designed for a Christian organisational context, rather than the narrow corporate/industrial business measurement tool of conventional KPIs. Previously I introduced the term Christian Potential Indicator as an alternate extension of the Christian Performance Indicator (CPI). As discussed, indicators or data figures are only ever historical, and can only inform of what happened in the past. Such past outcomes can be an approximation of the organisation’s near future, but not any actual future outcome. Thus, whether KPIs or CPIs, they can only ever indicate potential performance, not actual performance (except historical). When including psychosocial metrics, the anthropological or humanist nature of those indicators suggest not the performance of our congregation or church community, but only its potential, and thus the term Christian Potential Indicators may be more appropriate – ‘potential’ is less offensive than ‘performance’ when considering the dynamics of a community.[44]
A KPI regime can create a focus on those things that produce the most, progressively narrowing attention upon creative micro-transactions, especially in what eventuates as an emphasis of increasing KPI targets over time – today’s record achievements become tomorrow’s minimum expectation.[45] It is a salient reminder that many firms collapsed during the GFC despite the most comprehensive KPI regimes existing in the largest firms. Implicitly there are limits on what KPIs can measure, and this carries the risk that what cannot be measured may be overlooked, creating injustice or disenfranchising the ecclesia. As complexity increases with size it is no surprise that use of KPIs appears in mega-churches. This is a positive thing which answers to biblical good stewardship. It is said that injustice is caused by poverty, that solving poverty will solve injustice. However it can be argued that if injustice exists, it is because justice is not a KPI within society, and defining such psychosocial KPIs is complex and subjective.
Psychosocial KPIs
The complexity of psychosocial metrics (KPIs) is due to their focus on the people aspects of organisational activity, and the inherent “dichotomy between the perceived importance attached to [these] KPIs and the practicalities of data measurement linked to that KPI.”[46] As one program manager commented:
“Yes we would like to do it, and we talk about it a lot, but in terms of getting a specific metric to measure [it], I can’t think of one. Though it is crucial to what we do.” [47]
It is likely that church leaders can sympathise with this sentiment. Yet it is more important to develop this KPI approach, as the psychosocial aspect - the psychological and social aspects of community - is the larger part of core church purpose. It is so much easier to measure profit (revenue), output (congregational growth), and cost; these three, profit, output and cost - being the iron triangle of business KPIs, which is why “the iron triangle takes precedence,”[48] with the psychosocial perceived less important (what we treasure is what we measure). More challenging is the reality that some psychosocial KPIs such as career opportunity or personal growth may not be possible to meet for many in the organisation.[49] This can especially be so in a mega-church where there is often an oversupply of gifting and experience due to the large congregations.[50]
The psychosocial involves the health of the church community, as represented by intangibles such as ways of speaking, facial expressions, being friendly, showing signs of warmth, blushing, anger, sadness, or waving [hello or] goodbye.[51] Craig Schiff adds “if you don’t already measure client satisfaction, for example, it won’t even be up for consideration as a KPI.”[52] Even where psychosocial KPIs are utilized, once they are immersed in electronic data bases, the “data must fit the machine … and what fails to fit the patterns gets lost in the process.”[53]
Significant work was done in the decade between the mid 1970s to mid 1980s, seeking to establish a benchmark for measuring the Christianity of individuals or populations. It is no accident that this work began in the Social Sciences at the same time as KPIs began to step out of Universities and into general business. Around the mid 1980s, however, the studies ended as inconclusive. It was problematic trying to measure such intangibility as a person’s spirituality, at least using conventional psychoanalysis indicators such as self-esteem.[54] One study famously termed the “Shepherd Scale” used a questionnaire of 38 New Testament passages to survey individuals and communities.[55] It was found it could accurately gauge a person’s Christian lifestyle - as the author put it “to sort the sheep from the goats”. While not absolute, it was however a psychosocial metric, and did give a percentile rating of a person’s or community’s Christian maturity and lifestyle. If a church was willing to annually survey its congregation (and the congregation was willing to be surveyed), the Shepherd Scale may provide an indicator (CPI) of congregational well-being over time, no less than KPIs do of business.
Ivan Herald in 1987 found that conflict was a major hindrance to church growth.[56] Neil Ormerod and Shane Clifton in 2009 still supported the observation of conflict as a hindrance to church growth; reduction of conflict thus needs to be specifically included as a KPI.[57]
Other KPIs for church health, studies have found, include: eliminating conflict, a vision of growth, cultural inclusion, interdenominational openness, sufficient real estate for expansion, avoiding an introverted culture, opportunity for members, ageing and youth access.[58] Additional approaches to avoiding reification of KPIs can be borrowed from Accounting use of Zero Based budgeting, where all budget figures are reduced to zero at year end, and each budget value must be justified before being reinstated. This is a method which prevents budgets becoming entrenched and out of date (indeed prevents budgets becoming reified)[59] and is a method equally applicable to KPIs – all KPI targets are to be rendered zero, with each being justified and re-evaluated in terms of organisational culture, market direction, ecclesial impact, and theological anthropology, before being reinstated. The subtle risk with reification is that we give worship form to the processes and methods that we create.
Additionally it is pertinent to contemplate that KPIs are a particularly masculine worldview. This is seen in their historical development, and also as highlighted by Marilyn Waring in her 1988 book If Women Counted.[60] Waring makes the observation that for men within economic activity there is no downside. For example, clearing a forest is seen only as a positive in its timber production; the loss of diversity, decline in waterways, and loss of a future resource “are not counted” – but implicitly would be “if women counted (mattered).” This suggests a significant need for women to be involved in formulating KPI regimes.[61] Indeed as Schiff notes “give careful thought to who should be involved [in KPI formulation].”[62]
There is much in Christian books and literature on church growth, leadership and management, but KPIs are scarcely mentioned per se, let alone Christian orientated KPIs, yet these aspects listed above, together with a necessary propensity to embrace and be comfortable working with money, and perhaps where appropriate, the Shepherd scale, provide the essence of a church growth KPI or preferably CPI, Christian Potential Indicator – a psychosocial KPI regime for measuring church function and the ecclesia intangibles.[63]
Pentecostal Perspective
Contextually, it is a salient point that much of the Pentecostal movement and individual church success has come through a period without using KPIs, and upon a significant macro vision, flexibility and (entrepreneurial) adaptability. The emergence, development and growth of the Pentecostal movement and churches of all sizes, the denominational disposition ought to observe, has come through the work of the Spirit. In considerating of measurement of the Pentecostal movement in its various forms does bring to mind the scripture of David making a census of Israel, an event for which God was not pleased. David’s actions came at the point where he had received the blessing of a unified kingdom, and prosperity “beyond measure”. Perhaps it can be interpreted that God’s displeasure was due to the fact that God had blessed David, the magnitude of the blessing was manifestly obvious, yet by conducting a census, David was now measuring God’s performance.
Therefore, as church leaders seek to KPIs to measure their churches, there may be a need to pause and self -question: “are we measuring our church performance, or are we measuring God’s performance in our church?” From a phenomenological view “we can never know about things independent of our lived experiences as bodily engaged beings.”[64] It is imperative to abide the notion that KPIs are formulated and interpreted through our worldview, and this can be problematic if one’s worldview is influenced by an imported non-Christian economic philosophical one. It is possible to abide this philosophical difference, while still engaging the world within the spirit of the Great Commission. We are, as Shane Clifton noted “charged with ‘community formation’ and incarnating Christ and his message of the Kingdom in the local community”[65] - this in itself is a profound paradigmatic foundational CPI.
The Great Commission as a KPI Regime
There has always existed a KPI paradigm of no greater provenance than given by Christ himself in some of his final words:
“Go therefore and make disciples of all the nations … teaching them to observe all things that I have commanded you” Matt 28:19-20.[66]
Within this most famous ‘Great Commission’ exists a comprehensive KPI regime. The first part: “Go therefore and make disciples of all the nations” is a KPI of growth - to go from twelve disciples to ‘all the nations’ requires a significant numerical increase and is therefore a quantitative KPI, a pure growth target. The second part: “teaching them to observe all things that I have commanded you” is a psychosocial or qualitative KPI, which provides the benchmark for measuring the ecclesia. A healthy ecclesia, but also a healthy growth regime should reflect the qualitative psychosocial aspect of Matt 18:20. Our KPI regimes should contain both aspects of growth and a Christological community, as verily ordained in the Great Commission.
Conclusion
This discussion has suggested both that Christians are to engage in business at its variant levels and that Christian organisations ought to embrace an organisational and psychosocial KPI regime. It was also shown that KPIs are only ever indicative, their data is always historical, and yet they do form an essential part of responsible Christian organisational stewardship method when applied through an adequate psychosocial Christian philosophy, yet awareness is needed of the potential distortion and dehumanising of KPIs due to reification. The appropriate Christian response is that at all times one’s theology, and one’s Christology, should govern and determine the KPIs rather than KPIs governing one’s Christology, the final filter being that for which all things are done – for, by and with the spirit of Christ Jesus, and in accord with the KPI twofold benchmark Christ charged the church with, inculcated within the Great Commission.
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[1] The newness of the topic is reflected by the absence of any specific reference to Key Performance Indicators, or its abbreviation, KPIs, in the Christian literature that I could find.
[2] Roger F. Backhouse Penguin History of Economics (London: Penguin, 2002), p.110.
[3] Roger F. Backhouse (2002), p.168.
[4] Roger F. Backhouse (2002), p.135 – this philosophical change was a conscious decision for economics to be like physics.
[5] Craig M. Gray, “Is Entrepreneurial Activity Pleasing to God?” Journal of Markets and Morality, 5/1, (2002), p.130.
[6] Karl Marx., & Friedrich Engels, The Communist Manifesto (Victoria: Penguin Books, 2010), pp.134,227.
[7]
Donella H., Meadows, Dennis I., Randers, Jorgen. & Behrens, William W. III,
Limits to Growth: A Report to the Club of Rome on the Predicament of Mankind
(Universe Books, 1972).
[8] Ian Jagelman, “Church Growth: Its Promise and Problems for Pentecostalism” Australian Pentecostal Studies, 1, 1998 March, pp.23-40.
[9] Rick Warren, A Purpose Driven Church: Growth Without Compromising Your Message and Mission (Grand Rapids: Zondervan, 1995), pp.155-172.
[10] Shane Clifton, Pentecostal Churches in Transition: Analysing the Developing Ecclesiology of the Assembly of God in Australia, (Leiden: Brill, 2009), p.156 – the Frank Houston church plant grew from 9 people to over 1,000 within four years.
[11] Ben Witherington III, Work: A Kingdom Perspective on Labour, (Grand Rapids: Wm. E. Eerdmans Publishing, 2011), p.155.
[12] David Parmenter, “Should We Abandon KPIs?” Journal, Sept, (2013), p.42.
[13] Convential KPIs had a narrow focus on such financial measures as profit, return on investment and productivity – David J. Bryde, “Methods for Managing Different Perspectives of Project Success” British Academy of Management, 16, (2005), pp.119, 127.
[14] Ian Harper, Economics for Life: An Economist Reflects on the Meaning of Life, Money, and What Really Matters. (Victoria: Acorn Press Ltd, 2011), p.20.
[15] Bauer confirms that in recent studies most KPIs still displayed a focus on past business metrics as a guide to the current health of the company. Kent Bauer “Predictive Analytics: The next wave in KPIs” DM Review, Nov, 2005, p.68.
[16] Sara Värlander, “The Interplay of Reificative and Participative Processes of Customer Knowledge Creation: An Exploratory Study of Commercial Lending” Journal of Financial Services Marketing, 12/4, (2008), p.287.
[17] The concept is developed further in a later section of this paper.
[18] The Macquarie Dictionary: Second Revision. editor in Chief. A Delbridge. (The Macquarie Library: Chatswood, 1987), p.1115. It is further emphasised linguistically within such titles as The Morphology of Biblical Greek by Daniel Wallace, (Grand Rapids: Zondervan, 1994), where the extraordinary transformation of words and terms over time is studied. The relevance to KPIs linguistically comes from the fact that KPIs are formed, described, expressed and comprehended within language, and then applied to dynamic organisational contexts.
[19] Garrett Cronin “Measuring Strategic Progress: Choosing and Using KPIs” Accountancy Ireland, Aug 1, (2007), p.31.
[20] Kent Bauer (2005), p.68.
[21] Kent Bauer (2005), p.68.
[22] Kent Bauer (2005), p.68.
[23] The current data KPI method is also questionable as, for example, when measuring current revenue, a particular day’s revenue is always assessed at the end of that day, and is thus already “past” data – this is particularly pertinent in the fast moving volatile environment of real-time financial markets. The method is further problematic within corporate measurement, as “current” can mean data that is from the past year – anything up to twelve months old, thus KPIs are only ever historical.
[24] Peter Berger and Thomas Luckman, The Social Construction of Reality: A Treatise on the Sociology of Knowledge (London: Penguin Books Ltd, 1991), p.106.
[25] Encyclopaedia Britannica Micropaedia Vol. IX, p.922; Macropaedia Vol. XI, p.938.
[26] Peter Berger and Thomas Luckman, (1991), p.106.
[27] R. Paul Stevens, Doing God’s Business: Meaning and Motivation for the Market Place. (Grand Rapids: Wm. B. Eerdmans Publishing, 2006), p.69.
[28] Garrett Cronin, (2007), p.31 – specifically he states: “management may have concerns about the reliability of KPIs and be uncomfortable about providing them externally”.
[29] Considering that Australian bank annual profits in recent years have individually been in billions, and with growth KPIs as high as 29%, the figures of this illustrative scenario would actually represent a small financial institution. The Australia Institute, in its submission to the Federal Government, presents a scenario using purely illustrative figures of $1,000 Billion – “suppose there were a large amount…perhaps $1,000 Billion…” - Submission to the Financial Services Review 2014, The Australia Institute. ed. David Richardson. (Canberra: AIS, 2014), p.33. The point is further developed in this section with actual data quoted by the former Governor of the Reserve Bank.
[30] In a culture of growth, the permanency of a company is perceived in its hold on market share, which is not measured by its profit but by its growth. Static profits (irrespective of their size) are deemed as a sign the company is slipping against its competitors. That this may be irrational, and that experienced executives respond in this way, is precisely the point, which the fact of the GFC has made manifest.
[31] Quoted in: Submission to the Financial Services Review 2014, The Australia Institute. ed. David Richardson. (Canberra: AIS, 2014), p.6. Therefore while those bank branches were able to report growth, the growth was deemed too low, and they were treated as though there was zero growth, and closed down, even though the profits were in millions. This shows, that in the presence of these 29% growth rate KPIs, the prior illustrative growth rate of 10%, even if achieved, could be deemed a failure, being 19% below target.
[32] Bank market growth is measured not in traditional production and sales terms, but by the gross level of loans it has provided – the size of the loan book.
[33] Peter Berger and Thomas Luckman, (1991), p.106 – the authors note also that we lose the presence of mind that the reified phenomena (in this case KPIs) are an opus proprium – just something we created.
[34] Noting that the CEO job contract depends upon meeting KPI growth targets.
[35] Growth is also reified within society, and thus pressure for growth is externalised, coming from outside of the organisation. This externalised reification of an internal growth policy is significant in the CEO and Board losing power over the organisation.
[36] Trust or belief in KPIs being able to ensure best performance is itself a reified concept – and is still believed even though the GFC proved that notion to be incorrect, and a myth.
[37] David Parmenter, (2013), pp.42-43. His critique also asserts “the manipulation of performance reports for the sole benefit of one’s pay packet” is a serious problem (p.43).
[38] David Parmenter, (2013), p.43.
[39] It is noteworthy that the Peak Bodies for these professions did not raise any alarm about the impending crash – growth had become socially reified within the professions, and seen as unassailable.
[40] J. Stiglitz, “Commission of Experts of the President of the United Nations General Assembly on Reforms of the International Monetary and Financial System” Report, (NY: United Nations, 2014) - quoted in The Australia Institute (2014), p.2 and note 1.
[41] Part of this church growth has come through debt-financed asset increases, about which The Australia Institute cautions: “Debt-financed asset price increases are often a good example of things that cannot go on forever, and will stop” - The Australia Institute (2014), p.4.
[42] cf Romans 9:14 “What shall we say then, is there injustice with God? Certainly not!” – NKJV.
[43] Garret Cronin, (2007), p.30. This is a major point of this paper, as in my experience churches and Christian organisations largely mimic the standard “business” KPI regime philosophy.
[44] Furthermore, what do we mean by ‘performance’ with respect to a church or Christian community, and how does that differ from conventional business performance for which KPIs were devised?
[45] This can lead to a sense by staff of never being able to do enough, never being able to ”empty the In-tray” and not quite knowing when one has done enough. This can mean KPIs manifest in a similar way to the endless propitiation connected with Old Testament gods.
[46] David J. Bryde, (2005), p.126.
[47] Quoted in David J. Bryde, (2005), p.126.
[48] David J. Bryde, (2005), p.127. Bryde notes that formal methods to manage the psychosocial KPIs were not as prevalent, and were not perceived to be as important.
[49] David J. Bryde, (2005), p.129.
[50] For example many may be good singers or musicians, but only a small number can be in the church band or be worship singers on stage. This is a feature of many social contexts.
[51] Sara Värlander, (2008), p.290.
[52] Craig Schiff, “Another Look at KPIs” DM Review, July, (2005), p.41.
[53] Sara Värlander, (2008), p.290.
[54] Apparently Christians do not register well on self-esteem metrics, as for example traditional secular self-esteem ideals do not correlate to the positive self-esteem gained from ‘knowing who you are in Christ’. This suggests a need for Christian specific self-esteem definitions.
[55] Rodney L. Basset, Ronald D. Sadler, Eric E. Kobischen, David M. Skiff, Ivy J. Merrill, Barbara J. Atwater, and Paul W. Livermore. “The Shepherd Scale: Separating the Sheep from the Goats” Journal of Psychology and Theology, 9(4), (1981), 335-351.
[56] Ivan J. Herald, The Place of Conflict Resolution in the Growth Patterns of Churches within the Pentecostal Spectrum, Master of Arts Thesis Pacific College in association with Luther Rice Seminary, 1987.
[57] Neil J. Ormerod & Shane Clifton, Globalisation and the Mission of the Church (London: T & T Clark, 2009), p.20. The aspects of conflict are well beyond the scope of this paper, suffice it is to mention here, the need for conflict to be monitored with appropriate KPIs. Most often conflict is assessed in terms of internal matters between staff. In a church it is not only staff conflict, but congregational conflict, and any conflict the church may have with the culture of the society it is trying to reach.
[58] Ivan J. Herald, (1987), p.407 – quoting from C. P. Wagner (1978).
[59] “Reification may involve best practices, budgets, statistics, ratios, documents, standard procedures, policies, technological systems and plans” – Sara Värlander, (2008), p.289.
[60] Marilyn Waring, If Women Counted: A New Feminist Economics (London: MacMillan, 1989) – being the full title; the original work was published in 1988 under a different publisher.
[61] This implicitly suggests that if Henry Ford had psychosocial KPIs in place he would not have been able to ignore the impact upon his workers of speeding up of the assembly line for the sake of production targets. The underlying concern for workers, via the Union movement, was in effect unions applying a psychosocial KPI in the absence of Ford doing so. It follows that an organisation which fails to embrace the psychosocial will receive criticism from external parties, as the psychosocial ‘justice and fairness’ is a reified concept within society, and arguably central to Christology.
[62] Craig Schiff, (2005), p.41.
[63] This CPI is not to be confused with the standard economic C.P.I. (Consumer Price Index) abbreviation.
[64] Sara Värlander, (2008), p.290.
[65] Shane Clifton, Pentecostal Churches in Transition, (2009), p.182.
[66] NKJ translation.