“Use both sides of the Post-It Note.” Illustrative of the austerity and stewardship she had to instill at Kansas Christian Home when she became CEO in 2016, this catchphrase is Karen Sturchio’s way of teaching her staff how to balance mission and margin in a once-struggling organization. In a very competitive market with several nonprofit communities nearby, Kansas Christian Home is a mid-size single-site Life Plan Community that was just emerging from a salacious controversy when Sturchio took the helm as CEO—a role she initially thought was temporary. The Board asked her to complete a “top-down assessment” to evaluate the state of the organization.
What Sturchio found was enough to shake the resolve of any leader: financials that were late and in disarray; missing resident business files; employee files that were not much better; crises in every area of operations; and “not a single system in place,” in Sturchio’s telling. When she discovered that the organization was working on a cash basis, and the then-new business manager asked why the organization didn’t just use cash accounting, shock and disbelief were the best descriptors for her reaction. So, she went back to the Board and asked for help to conduct a deeper assessment. To stabilize the organization, she saw that much greater measures were needed.
Sturchio says she went back to a resource she’s used many times: a guide book from Oklahoma State, designed to help a first-time or new administrator wrangle their new role. From there, she reviewed contracts, asked for articles of incorporation, taught department heads how to read and report on financials, and gave clear guidelines on proper accounting techniques for tracking expenses and revenues. She taught her team financial management principles and put in place policies and frameworks that didn’t exist.
Yet in the middle of the mire, Sturchio also saw strength and hope. Residents were well cared for, with few issues, and the board was supportive. Team members were genuinely dedicated and leaders were eager to learn from her example. When she instructed department heads to publicly post all financial statements, PIPs, quality measures, and progress on strategic initiatives, she found that the transparency helped build trust, reassured those who had worried about the future of the organization, and inspired the community to work together to meet shared goals.
Kansas Christian Home is now stabilized and growing. It has upgraded its software, improved staff benefits packages, and spruced up the physical plant. Leaders have learned to watch for even small opportunities for stewardship—like eliminating 15 minutes-past clock-outs—and to work together to make up for losses in revenue by balancing it out with PPD, for example. Sturchio thinks nonprofits can learn from the way for-profits manage their business for efficiencies, to maximize reimbursements and “not leave anything on the table.” In terms of facilitating a financial turnaround, she advises that leaders keep a pulse on daily labor costs, reimbursement, case mix indexes, and cost reporting. Having a good mentor who inspires you, and providing good board education, are also must-haves. And while it’s important to remember that “hope is not a strategy,” Sturchio also emphasizes that the reason nonprofits like Kansas Christian Home make a difference is because of the focus on mission and residents’ lives.