Next Steps On The Road To Capacity Building
As we continue in this “perfect storm” of global economic uncertainty, increased donor competition and compassion fatigue, the need for self-reflection in our sector is critical. In response to this need, forward thinking organizations are looking toward long term sustainability so that they weather the future storms to come. These undertakings are known loosely as “capacity building”.
| Posted in Management on Sep 7, 2010 by
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Capacity building impacts all aspects of a nonprofit’s activities. Strategic planning, leadership development, technology investments and engaging in collaborations with community partners, are just a few examples of non-programmatic investments which make solid impacts on long term organizational health. When capacity building is successful, it strengthens a nonprofit’s ability to fulfill its mission over time, and enhances the organization’s ability to have a positive impact on lives and communities. When these activities are not successful, the results can be distressing on multiple levels.
That being said, many of the activities within the capacity building realm don’t have line items in our already tight administrative budgets, typically not by choice. While some financial commitments can be budgeted for out of available funds, most activities require additional financial support for implementation so as not to jeopardize the program itself. Traditionally, our funding partners have not always been excited to fund capacity building projects, for the very same reasons that we have not placed them as line items in our budgets. However, I am happy to say that this paradigm is shifting on both sides.
Capacity building grants are a growing trend among both private and public funders. While this trend is growing, these funding opportunities are still highly competitive and very challenging to pull off successfully. Multiyear capacity grants can be very messy for funders and nonprofits alike. Staff turnover, poor communication and unrealistic expectations on both sides can turn even the best intentions sour. Many organizations are not aware as to what qualifies as capacity building which makes writing proposals for funding challenging and do not help their case for funding. Funders have not always been open to hear that their grantees have not been able to fully complete their grant requirements due to lack of appropriate infrastructure to accomplish agreed upon goals.
While the challenges can be overwhelming, the payoffs can be extremely beneficial when both sides make a serious commitment to the growth process. Here are just a few ways in which you can best align your organization and your expectations for seeking capacity building support.
Capacity Building vs. Capacity Repair
As Susan Chandler of the Grantsmanship Center states, “Funders want to improve organizations-not rescue them.” (Susan Chandler, 2003) Capacity funding will not cure poor leadership, poor decision making or poor financial management. It will not assist with poorly defined projects or management that has been asleep at the wheel. Funders want to see organizations that have a history of good operational processes improve in order to go to the next level of functioning. Stability is the key here, not size or sophistication. In putting together a proposal, show your track record of success and stress its effects on the communities you serve, particularly emphasizing your organizations’ measureable improvement in target areas. While many of our organizations are used to stressing community needs, the approach here is different. Don’t approach capacity building activities as a problem to be addressed but as anopportunity for organizational growth and improvement. In doing so, emphasize how your organization (board and staff) are prepared to meet these challenges and what type of organizational outcomes you expect on the other side of the process.
Strengthen relationships with your current funders
Many grant makers and even private donors are beginning to see the benefit of offering capacity building funds to organizations with which they have established relationships. This is simply because it makes good long term business sense. If we view philanthropy within the context of a directed investment in the social sector, our donors want to see their investment produce the highest return possible. To do that, they are willing to provide the means to see their investment grow. Open and honest communication and trust building is the key to success in this process. When, we have properly secured, nurtured and maintained these relationships, then our funders truly become co-owners of our mission and capacity building becomes an activity that you do together over time.
The issue when taking on a capacity building process is not how to prevent problems from occurring, because they inevitably will. Unfortunately, growth can be a painful process. Rather, it's how to handle the situation when problems emerge. In fact, trying to prevent or avoid addressing these problems can ultimately reduce the organization’s likelihood for success. Frequently, change in and of itself is what many organizations dread or avoid, and this is what may impede their future success. However, it is often the key element to move an organization forward to its next level of growth.Be prepared to address the change process internally and with any potential funding partner. By seeing potential hurdles as part of the process, your funders can best support your efforts and adequately provide the assistance needed (both technically and financially) to help transcend the difficult process institutional change.
Congratulations to your organization for pursuing this process. In taking these steps, you are continuing down a path to long term sustainability and a truly mission driven organizational operation. Don’t be detoured because of financial challenges or the inevitable discomfort of change. As they say, whatever does not kill us, makes us stronger.
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