When the Shepherd’s Orphanage opened its doors just before the Civil War, the founders could not have known that it would eventually form the core of an institution that would serve this southern town on the edge of the Mississippi for more than 150 years. The orphanage was the first program of what would evolve into Christian Family Services, formally incorporated in the early 1970s when it grew to include a range of services to parents and families. Even as it grew, though, it kept its “soul”—pursuing a mission that is explicitly grounded in scripture to support the poorest and most vulnerable in the community.

CFS is not an independent organization: it is controlled by a large church hierarchy. In the early 70s, the sponsoring church decided to expand its community services beyond the orphanage. It used its various buildings to start new programs—among these an immigrant and refugee resettlement program, followed by programs for homeless people, victims of domestic violence, and people suffering from alcohol and chemical dependency. All of these operated relatively independently until the 80s when they were brought under the umbrella of Christian Family Services. Church officials hired an executive director to oversee all of the programs, and took steps to begin consolidating services and back office operations. As with many such attempts at combining existing programs, their progress in forming as a whole was slow.

For CFS’s entire 150-year history, the orphanage had been a constant—the flagship of CFS. However, in 2000, the decision was made to close it. As much as the decision itself rocked the organization’s sense of identity, the way the decision was made—it came down from the church, bypassing the board—damaged any sense of security felt by those working in the still frail conglomeration of programs.

CFS had become a large, complex organization with many people working at various levels. When the decision to close the orphanage was revealed to the staff and the public, people were frightened, wondering what it would mean for their programs and their jobs. They felt a sense of failure, seeing the inability to assure the viability of the orphanage as a major challenge to the mission and vision of the organization. The closing crystallized a deep-seated distrust that had been developing internally.

The fallout from the closing of the orphanage as well as other managerial and leadership concerns eventually led to the departure of the executive director. This individual had not been well known for including either community or staff in considering the agency’s future, and possibly was a convenient whipping boy for an overall bad process that threatened the relationships between the church and community—and between the organization and its employees. In any case, the lesson was taken at least at face value and new leadership was installed with a stated commitment to community and staff inclusion. This new direction is comprised of two well-seasoned leaders, one with a long history in community work and the other with a long history and influence with the church hierarchy. Staff is not completely mollified; they remain somewhat disengaged and seem to be taking a wait-and-see attitude.

Indeed, they have many other things to attend to. During this crisis the agency also experienced a decrease in funding, requiring every program to tighten its belt. CFS has been determined to maintain services at their current level despite the funding cuts, but it is struggling.

More than half of its $4 million annual budget comes from local, state, or federal grants. United Way, church contributions, fees for service, and private donations together make up the remaining half of the funding mix. The agency’s reliance on governmental grants worked well for a time, but recent policy changes along with increased competition and red tape have resulted in less money for more effort. Those working on the ground in the organization say that they are existing hand-to-mouth, with insufficient economic strength to do what they know is needed. Grant funding is directed to projects, but is insufficient to cover the full expense associated with those projects, and staff are too overworked to devote much time to seeking supplemental funding. Many grants come with a matching requirement, but the organization is not always able to raise the required match, and thus is not able to utilize the full amount of the associated grants.

The CFS fundraising strategy is a reflection of earlier days when each program operated independently. There is no centralized fundraising strategy or staff, leaving fundraising responsibilities on the shoulders of program directors. Program directors say that they could help with and participate in fundraising activities if there was a game plan—if someone was in place to create and manage the overall development strategy. They are even aware of opportunities for raising more money, but they do not have the time to investigate or pursue those opportunities.

Good financial management systems are always important, but with CFS’s current funding situation, making the most of every dollar is essential. Talking about financial management in this organization, however, is like opening a pressure valve. Staff talks about the challenges of trying to raise matching funds and how disappointed they feel when they are unable to raise a required match. Cash flow challenges also cause the organization to pay bills late on a regular basis. Staff acknowledged that they did not understand their budgets or how to use budgeting and financial management systems to get ahead of the game. They also expressed a desire to expand their understanding of the budgeting process, and even learn what should be included in a budget. They know that they need to identify gaps and be clearer about what financial resources are required, as well as devote more time to monitoring spending.

What would CFS look like if it were operating under optimal circumstances? The primary difference, say the staff, would be that people would not feel like they were working with inadequate resources and substandard facilities. They would not have ceilings that are falling down, staff would be able to go to training sessions, buildings would be safe and clean, parking lots would be paved, windows would open, and there would be adequate lighting. The staff would feel good about themselves and where they work. It would be a place where people felt they could really do their best.

Evidence of low morale shows up in a variety of ways: quality of service delivery seems to be slipping, the level of complaints about work conditions is increasing, and participation in the organization’s United Way campaign has been lackluster. Someone commented that the staff now seems to be focusing more on internal rules and regulations than on the clients—a major departure for an organization that prides itself on being mission directed and presenting the face of Christ to all who enter.

When asked to characterize CFS’s current board of directors, one of the participating board members said “nonexistent”—an opinion shared by other staff and board members. The board had been active in the past, but had gradually “shut down” in recent years due to the information-controlling tendencies of the previous executive director, combined with clear evidence that authority rested with the sponsoring church hierarchy anyway. An advisory group convened by the church created further confusion, blurring the lines of responsibility among all involved. It was previously thought that the board’s job was, at least, to advise the church on decisions. The board never had final decision-making authority—that authority rested with the responsible member of the hierarchy in the sponsoring church, who also appointed members from a slate of recommendations submitted by a nominating committee. CFS’s new leadership has negotiated with the church and secured an assurance that, in the future, the board’s opinion will be respected. This is predicated on the agency’s ability to make the current board—comprised of seven white males—more diverse, adding youth and clients as well as “deep pockets” who could help with fundraising.

Commentary by Kristen McCormack

Christian Family Services has clearly seen better days, but fortunately, the organization can take some significant steps to restore itself to its former glory. It needs to start with governance, then turn its focus to mission, then tackle programs and fundraising.

The new director of CFS needs to clarify, communicate, and support the role of the church and the board—whatever that role is. The organization’s legal structure is not clear in the case. Who ultimately has fiduciary responsibility for the organization? There’s nothing worse than responsibility without authority—fix this quickly! In the long term, the CFS leaders have two choices: they can either work on gaining support for creating an independent board that includes some church representation, or they can move back to becoming a fully affiliated church program. There are pros and cons to both sides, but the middle is definitely not good. This could take a little time, so in the meantime I recommend the following:

CFS is a faith-based organization that has drifted from its mission over time. The organization needs to define its true source of authority, so that the group can reaffirm its mission. All stakeholders must make a conscious effort to revisit the original mission in order to move to the next stage—prioritizing programs and fundraising.

When governance and mission are clear, it’s easier to look objectively at each program and measure it against predetermined criteria. For instance, how many people does each program serve? How connected is the program to the mission? What percentage of each program is funded? The authority group needs to set criteria by which to measure each existing program with the intent of combining, eliminating, or expanding each one, with participation from all stakeholders.

Lastly, there’s fundraising, which can be addressed when all the other issues are resolved. I sense that the organization was privately funded, perhaps by individuals, for many of its early years, but was caught in the seduction of readily available government contracts starting in the 1970s. If CFS returns to its faith-based roots, the fundraising strategy should follow—with a heavy emphasis on grassroots programming, and volunteers and individuals contributing up to 60 percent of the budget. The faith-based nature of this organization can serve as its strength and should be built upon. On the other hand, if it goes the more independent secular or professional route, it should follow its current fundraising matrix, increasing individual giving to up to 10 percent of the budget, taking advantage of the federal government’s interest in funding faith-based organizations, and raising its corporate and foundation funding.

Commentary by Margaret A. Leonard

Christian Family Services has a rich history and a powerful mission, and is simply experiencing growing pains that can be addressed and resolved. The following three strategies could leverage momentum.

First, CFS needs to restructure its relationship with the sponsoring church. Church-based groups and women’s religious congregations can provide several best practice models of sponsorship that describe how the sponsoring church can ensure that CFS carries out its mission. The church also needs to grant full powers of governance to the CFS board of directors. Providing these models to the sponsoring church and assisting them in developing a sponsorship document and policies are an important first step.

Second, CFS should enlist external help to take the organization’s pulse. Staff, constituents, board, and community have experienced stress and confusion with the closing of the orphanage; the executive director’s departure and replacement; and the integration of diverse programs—all of which can wreak havoc on an organization’s morale. External help should be sought for the design and implementation of a listening process to evaluate organizational morale. This process would include staff, constituents, selected members of the larger community, and the board. Individual or small group sessions would focus on strengths, weaknesses, the state of the mission, and next steps. Subsequent larger group meetings would consist of sharing the content and the analysis, and engaging staff in a process of change.

Finally, CFS needs to build a new board with representatives from the larger community (particularly those with financial and fundraising expertise). The board must include constituents and a representative from the sponsoring organization, and should assess each person’s commitment to the mission of the organization.
After completing these steps, the sponsoring church should engage the new board and the staff in a day of retreat and reflection on the organization’s core mission, so that the mission is articulated and owned by all. The church should engage core members of CFS—the folks who bring to life the mission—to plan and present at this retreat.

It appears that CFS has good executive leadership. The executive director, in partnership with board and staff, can address the strategic planning and evaluation that will need to take place after this process.