For many nonprofit organizations, capacity building is unfamiliar terrain. Leaders are mired in the daily operations of their agencies, and their hearts are invested in the work that they do. It can be difficult to see beyond the day—let alone the week or year—and focus on a long-term strategy for sustainability.

Capacity building (also called capacity development) is the process by which individuals and organizations obtain, improve, and retain the skills, knowledge, tools, equipment, and other resources needed to be more effective. While it isn’t always easy, capacity development is always worth the investment. More importantly, it often takes a mere mindset shift for nonprofit leaders to envision how capacity building can enhance their organizations’ efforts and achieve greater results.

A hanging chain that represents capacity building for stronger organizations.

It’s all about impact

Planning for the future while adapting to ongoing change affects decisions made by all organizational leaders. Capacity building provides the insights necessary to anticipate and prepare for impending change, differentiate products and services from competitors’ offerings, and increase employees’ stakes in the organization’s future. It is one key to showing how your organization solves real social problems in a meaningful way.

Additionally, capacity development helps nonprofit leaders to align existing programs and resources with overall business goals. One of the greatest requirements of funders, Board members, and other stakeholders is to define how you will use your resources in the immediate and long-term future. And building capacity is the path to such alignment and allocation.

The state of capacity building in your organization

Below are a few elements of capacity development. The health of these practices in your organization indicates your current capacity strengths and areas for improvement.

Board development. Vision casting, strategy setting, and program planning require the buy-in and governance of a strong Board of Directors. When it comes to the other elements of capacity building, board development sets the tone for your organization’s success.

Internal infrastructure. Organizational infrastructure refers to your organization as a living system, with each component’s health affecting the others. A systems perspective guides capacity building; this holistic approach to leveraging the planning, processes, people, and performance in your organization effectively empowers staff to deliver high-value services.

Fundraising. Today, more than ever, the donor is in control. Nonprofit leaders focused on capacity building hold their agencies accountable to donors’ expectations because they understand stakeholder loyalty and customer retention depend on it. Improving operational efficiency through increased capacity helps you deliver on these fundraising commitments.

Evaluation. Program evaluation is a critical process that feeds many different areas within the organization. Programs need a mechanism to periodically evaluate their performance. Something created once may sustain itself, but it will not grow and continually meet the needs of program participants unless it is evaluated and improved.

Leadership development. Leadership development expands the capacity of individuals in your organization to effectively fill critical leadership roles. Successful leadership development helps to execute your agency’s mission by growing the capabilities of your people and aligning them with your organization’s strategy.

The next step toward capacity building

Receive an in-depth look at these elements that lead to enhanced organizational effectiveness on March 24 & 25 at Tidewater Community College. I will facilitate Building a Stronger Organization, a two-day capacity building workshop. Develop the ability to enhance your organization’s efforts and achieve greater impact. After attending this training, you will be able to:

  • Describe why building capacity is important to achieving and sustaining long- term community-level changes
  • Assess the key elements of their capacity building including board governance, leadership, and infrastructure
  • Identify which aspects of capacity need to be addressed by their organization
  • Develop strategies to address specific elements
  • Create action plans to assess and build capacity.

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