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Mergers and the New Organizations

mergers and the New Organizations

I have provided counsel for a number of ministry mergers during my tenure as a consultant. I have seen more fail than succeed, but that will be another topic for another day. We hear of more mergers, by design, by necessity and sometimes survival.While it is helpful and interesting to discuss the why, when, and how of a merger, for this article I am going to offer some thoughts on what the outcome of mergers might be.

First, there will be fewer organizations. This may seem obvious. But what other trickle down effects will that produce? Will fewer organizations mean fewer services? Will fewer organizations mean fewer positions for qualified ministry staff? Will fewer organizations mean less sharing of the gospel?

Second, the new organization may be larger or smaller. They may be larger if two strong or reasonably healthy organizations merge. But one concern merging boards have is if the merger might make them weaker? Or will they take on the problems of the weaker organization? It seems from my experience that after a merger an organization will not stay the same. Change will continue during the first few years of the new organization. This may produce growth or scaling down.

They may be smaller if their ministry focus has changed and they need to simplify the way they operate. Missions agencies in the U.S. have changed dramatically in how they provide support and services to their missionaries overseas. One client of mine used to support over 2000 missionaries in the field. They now support around 600. From virtual communication tools, to generational shifts, some organizations will just be smaller and better for it.

Third, there will be different perspectives from donors about the new organization. How will donors/stewards accept this change? A merger could be well received if it makes the new organization: more effective, more efficient, better managed, have less duplication of services, demonstrates collaboration, and I could add a few more. You get the idea. The donor/steward is going to be VERY concerned about a merger. Communicating with donors before, during, and after the merger will be critical to maintaining their support.

Fourth, if the main motivation perceived as negative (i.e. merger for survival, cause is changing, etc.) the new organization may still have an uphill battle for survival. If the merger is perceived (or really is) mainly for survival, donors and staff will still be asking questions. Is the merger making us stronger? Is my giving just keeping a sinking ship afloat? Is there any vision for the future? Have they lost their way or is the cause being ignored?

These types of perceptions must be dealt with as the new organization goes through the merger. And if some of the negative perceptions are true, then the merger could sink the ship. I do not want to be overly pessimistic, but a merger does not always create positive momentum.

As I conclude this eNewsletter, I will share that I think many mergers are ahead of us. Change in ministry, donor trends, and changing program expectations will continue to have an impact on the organizations that "host" the ministries. It will be interesting to see how infrastructures and front line ministry change in the coming years and how our organizations will adjust accordingly. We will all be watching to see what God is doing!

In His service with you,

Dr. John R. Frank, CFRE, CSP