Here lies the huge question: do churches actually need a risk management plan? Does taking into account the uncertainties surrounding a church's organization actually have benefit, or is it a waste of time and resources? This is crucial for a church to answer, and can be the difference between having a vibrant, enriching existence and having to close the doors for good.
In this day and age, any corporation that wants to see a future beyond the next few quarters is actively engaging in identifying its risks and determining how best to manage them. This is not just limited to financial institutions looking to minimize risk on an investment; these companies can be focused on consumer goods or services, resource development, transportation or entertainment. Even governments and non-profits are looking into managing their risks, because they know they're better off being aware of what uncertainties they face than being blind to them. Credit rating agencies like Moody's, S&P and Fitch are now actively looking for risk management plans when evaluating a company--they know that a corporation that takes risk seriously is one that is prepared to weather difficult storms and thrive in positive times.
The reality is that simply identifying risks can be incredibly beneficial to an organization. It aids with decision making, gives a clearer picture of overall health, and helps manage the likelihood of any sort of event, be it positive or negative. Because of this, churches could gain an incredible amount from starting to focus on their risks, instead of remaining unaware of what uncertainties they may be facing.
With every service, every outreach activity, and every meeting, there are inherent risks that a church faces. These can range from physical, such as a sanctuary's structure and the heating and plumbing, to the financial, such as offerings and expenses, to the relational, such as feelings and opinions between members and the leadership team. These risks aren't impossible to identify, and once they are they can be taken into account as a part of the church's business. Will the roof hold up for another winter? Better to find out than to be caught off-guard. How much would offerings have to drop before the budget would be in serious jeopardy? It wouldn't be difficult to calculate, and can lead to contingency plans should the event occur. How have members been reacting to a new worship leader or style? Knowing this may help boost turnout to services.
So, then, do churches NEED to engage in risk management? Of course not. Clearly, many have been able to get along fine without it. But are there benefits to doing it? Absolutely. Just look at the corporate world, or ask a worshiper whose church had one traumatic event and ended up losing half the congregation. Identifying and managing risk can help churches avoid negative outcomes, increase the likelihood of positive ones, and run a better, more-efficient overall.
With those three introductory entries out of the way, let's dive in to the different types of risks churches face.
