The first major problem with the Shepherding Movement was that it was extremely adverse to institutionalism, as was much of Charismatism, and thus could not see that what they were doing was essentially creating something analogous to a denomination. The Fort Lauderdale Five were Idealists who believed there could be “organic unity” and discipleship without actual institutionalism. As Idealists, they believe they could just minister to all regardless of the practical reality of church and denominational differences and divisions.
The second major problem with the Shepherding Movement is their unbiblical ecclesiology resulting in an errant view of church office and an errant view of authority. They embraced the idea of “every-member ministry” to such an extreme that anyone and everyone could be a shepherd, thus opening up the ministry to those who were neither called nor trained for the task. Their errant view of authority also gave rise to the excesses and abuses of authority, as they did not have a proper view of authority as it relates to Christian liberty.
The following paragraphs are an excerpt from the article (or mini-book by the time it is completed) I am working on which gives a brief overview of the history of the Church. The Shepherding Controversy is important for all Christians not just because of its practical outworking in some branches of Charismatism, but also because it is an object lesson of what happens when anti-institutional Christianity suddenly encounters texts in Scripture that promotes institutionalism.
[Protestant] Charismatism, with its naive biblicism, rejects most of historic Christianity as it tries to be "fully biblical." The restorationist impulse is prevalent throughout the entire Charismatic Movement. Distorting the Reformation of Sola Scriptura into the principle of Solo Scriptura, Protestant Charismatics are notorious for always claiming that they are just following the Bible (as if their opponents do NOT!) Thus, the Charismatic Movement will always reinvent the wheel. Compounding this problem is an over-realized eschatology, and we have the conditions for the Shepherding Controversy.
We note that the Fort Lauderdale Five, the guys behind the Shepherding Movement in the '70s and early '80s, attempt to reach out to all the Church. Given the anti-institutional nature of Charismatism, this of course means the "Invisible Church." Since there are no denominations in heaven, so denominations are likewise irrelevant on earth. The Church should be one, united in Christ. So if denominations are utterly irrelevant, if unity is so paramount, then what's wrong with the idea of trans-local discipleship? Is the pastor of the sheep being discipled merely being jealous because of the influence someone outside his church has on a member of his church? But I thought we are all united in Christ and thus we should not have such petty jealousy? So are denominations important or are they not? The Charismatic critics of the Shepherding Movement seem to want their cake and eat it too. Is denominationalism actually bad? Then why object to trans-local discipleship?! Furthermore, it is extremely ironic when the Charismatic critics object to trans-local discipleship. Just what does anyone think they are doing when charismatic churches reach across denominational lines (ignoring them really) to minister to other charismatics?! Pat Robertson and the Full Gospel fellowship does it, circumventing institutional denominational lines, but then do they cry foul when someone does it to them?!
On this first point, the Shepherding Movement likes its critics similarly wants to have its cake and eat it too! How can one set up an entire hierarchy comprising churches and ministers and and then claim that they are not a denomination? This is disingenuous, for then what is the reach of this "hierarchy"? Since all of these shepherding relationships are not public, it is understandable that much suspicion be cast on the movement, for who knows whether one's pastor is actually submitted to (and thus under the authority of) one of the Fort Lauderdale Five?
The second point is the radicalization of the idea of "every-member ministry" (the idea that essentially all Christians are able to and may minister like pastors and elders and deacons, thus there is no such idea of the special office). If there is no special office in the church, then the Shepherding Movement's concept of appointing intermediate level shepherds from the "laity" is logical. Since everyone can do the ministry which was once retained for the special office, then the only criteria left is perception of spiritual maturity and whether the person is willing and could commit the time to do the work. Criticism of the Shepherding Movement being a pyramid authoritarian scheme is unwarrented. Swap the "shepherds" with clergy and you will get the episcopal system of church government, so the hierarchy by itself does not necessitate abuse. The problem is the radical "every-member ministry" results in the potential for all manner of abuses by people who are uncalled and untrained for the work they are entrusted with. The Shepherding Movement is thus merely being consistent with the idea of "every member ministry" and thus much of Charismatism have no moral high ground to critique them on this point.
The third point is of course that they have an unbiblical view of authority as it relates to Christian liberty. Much Charismatic criticism it seems are basically unbiblical knee-jerk reactions to the idea that God has actually ordained HUMAN authority over them; radical individualists chafe at the idea that somehow they have to answer to God-ordained HUMAN authority. The problem with the Shepherding Movement as it relates to authority is that it abuses authority, which is not surprising since, well, what can you expect from untrained and uncalled people who are suddenly given almost total power over another person? As Lord Acton says, "Power tends to corrupt, and absolute power corrupts absolutely." One should not be surprised that untrained and relatively young Christians, given much power over the lives of others, would actually abuse that authority; that abuse is guaranteed to occur!
Much better is Scripture's view of authority as it relates to Christian liberty. As the WCF states:
II. God alone is Lord of the conscience, and has left it free from the doctrines and commandments of men, which are, in any thing, contrary to His Word; or beside it, in matters of faith, or worship. So that, to believe such doctrines, or to obey such commands, out of conscience, is to betray true liberty of conscience: and the requiring of an implicit faith, and an absolute and blind obedience, is to destroy liberty of conscience, and reason also.
III. They who, upon pretence of Christian liberty, do practice any sin, or cherish any lust, do thereby destroy the end of Christian liberty, which is, that being delivered out of the hands of our enemies, we might serve the Lord without fear, in holiness and righteousness before Him, all the days of our life. (WCF 20.2-3)
Christian liberty is given to all believes, yet the liberty ends where the law begins (just as liberty begins where the law ends). Authority within a church therefore follows the word of God, and it is only to be obeyed insofar as it conforms to God's Word and God's Law. Where Scripture does not speak however there is liberty, and no person can bind the conscience of another on such matters.
The Shepherding Movement misunderstanding of authority is what give rise to the specter of shepherds dictating to their sheep who they can date and who they should marry, among other "excesses" of that movement.
The Shepherding Movement is not dead, although it has officially disbanded. Its doctrines can be found in the G12 movement (which in Singapore is found in Lawrence Khong and FCBC), and possibly many other charismatic movements. While the critics like to paint the Shepherding Movement as alien to the Charismatic Movement, even "demonically-inspired," the fact of the matter is that the Shepherding Movement drank from the same well as the Charismatic Movement. Their ecclesiologies are remarkably similar, and both unbiblical. The only major difference between the Shepherding Movement and its critics is that the former focus on visible church unity through formal accountability while the later focus on invisible church unity without formal accountability.
As long as Charismatics continue to be anti-denominational and anti-institutional, they are always susceptible to errors such as the Shepherding Movement. There will always be Charismatics who react against the "invisible church" mindset and focus more on the visible church, and since they are still operating with the same foundationally errant paradigm, all manner of error and abuses may arise.