Pope will need vision, leadership to turn around church, management experts say
BY SANDRA GUY Business Reporter firstname.lastname@example.org March 13, 2013 6:34PM
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Updated: April 15, 2013 11:07AM
The Catholic church would easily rank in the Fortune 500 top businesses with its vast properties, 1.2 billion customers, 412,000-plus priests and global political influence.
So what should Pope Francis — the CEO of this far-flung empire — do to effect a corporate turnaround amid controversies ranging from tangled finances to sex-abuse coverups?
Turnaround experts at three Chicago universities say it is a tall order that the pope-selection process undermines.
But if the pope is to be a courageous turnaround leader, he will need to outline a grand vision, impose discipline within the ranks, reorganize staffing to meet demand, come clean about the church’s finances and reach out to outraged women and disenchanted young people — for starters.
“The turnaround CEO needs to have a vision, a sense of purpose, and be able to motivate his lieutenants to do the right thing and implement his strategy,” said Thomas Lys, accounting professor at Northwestern University’s Kellogg School of Management.
Such bravery is unlikely because the Pope is elected by what would be the equivalent of a company’s division presidents, rather than by a board of directors — and subordinates electing their own boss necessarily results in a “lowest common denominator” boss, Lys said.
After all, he said, “Do you really want to elect someone who is going to make your life miserable” by upsetting the status quo?
Lys, who is Jewish, said a huge issue for the Catholic CEO is that he is considered infallible.
“That’s a tall order,” Lys said.
One way a turnaround CEO would make his underlings’ lives miserable would be to redistribute priests and cardinals to countries where most Catholics now live. More than one-third — 39 percent — live in Latin America and the Caribbean; 24 percent in Europe; 16 percent in sub-Saharan Africa; 12 percent in Asia-Pacific; 8 percent in North America and fewer than 1 percent in the Middle East and North Africa, according to the latest Pew Research Center data.
Kevin Stevens, director of the School of Accountancy and Management Information Systems at DePaul University, said as the church moves “south” globally, the biggest issue turns back to the church’s roots in alleviating poverty and uplifting the poor.
That means the new pope would remind people “that what the church really is, despite its pomp and regalia, is an engaged laity and a commitment to the poor to reflect Jesus’ love,” said Stevens, who is Catholic.
To lead a turnaround, he would implement transparency to reinvigorate people’s trust and bring women into leadership roles to expand governance beyond a group of old men, Stevens said.
From a corporate governance viewpoint, he said, “The sexual abuse scandal requires the church to come forward, admit it and make amends for it.
“This is something that’s not going to go away until everyone ‘fesses up,’ ” Stevens said.
The same holds true for finances.
“A successful CEO would say, ‘We will open the [Vatican] Bank to a true outside inspection,” Stevens said.
Michael Brough, director of engagement at the National Leadership Roundtable on Church Management, a group of Catholic laypeople, priests and bishops who promote best practices in the church, said the new Pope could surround himself with experts to improve the church’s financial management.
From the congregational level all the way to the Vatican, the church could leverage its size to save money in buying goods and services; issue easy-to-read annual reports about finances, and improve communication to ensure laity have confidence in the “Good News” story as well as the caretaking of their donations, Brough said.
“If an institution has good financial controls, transparency and accountability, a lot of financial areas can be improved,” Brough said.
One area that needs such scrutiny is the Catholic school system, he said.
“A good leader would recognize that schools are facing challenges,” Brough said. “How can we provide a financially sustainable model so schools can continue to be there for the families who need them?”
James Schrager, a professor of entrepreneurship and strategy at the University of Chicago Booth School of Business, said that in order to turnaround the church, the pope must be an exceptional leader who quickly figures out what’s going on and makes smart decisions about how to right the wrongs.
“In any corporation, there is usually a great gap between reality and fiction,” said Schrager, who is known for steering a series of corporate turnarounds for the Pritzker family interests through their Chicago-based conglomerate, The Marmon Group.
“The answers are known inside the company, so he would need to be a very good listener.”
The CEO implements a winning strategy with two steps, Schrager said: “Getting rid of all of the bad stuff and building lots more new, good stuff.”