Capacity Building: How Do We Expect Nonprofits to Succeed Without It?

December 12, 2013
By Justin Piff
To understand why I’m passionate about nonprofit capacity building, you must first understand that I’m passionate about nonprofits and the work they do. I view the nonprofit sector as essential to meeting the needs of our country’s most vulnerable residents. Providing medical and mental healthcare, education, food, and shelter—to name a few—are some of the most important things we can do for those who don’t have the opportunities or resources to provide these things for themselves. I want the organizations engaged in this work to thrive, to make an impact, and to adapt to ever-changing regulations, political climates, public perception, and community needs. And I want the dedicated staff of such organizations to like where they work, and to have the tools necessary to do their jobs well.

Many have argued that a dollar spent on organizational infrastructure – like technology, staff training, or strategic planning – is one less dollar spent toward serving clients. In the most literal sense, this may be true, but only in the short-term. This logic minimizes the longer-term value of building strong, sustainable organizations. A simple analogy can be made to how we treat our cars: How many of us would forego oil changes, new tires, and general maintenance because “we should only spend money on gas, which is all we need to make our cars go.” Clearly, we need to invest in our engines and other machinery (as well as the people who drive them) to ensure that our vehicles can reach their destinations now and for years to come. So, too, is the case for nonprofit organizations.

Issue Brief Cover 01

The issue of nonprofit capacity building has received much attention recently. Underpinning Dan Pallotta’s TED Talk, Guidestar’s “overhead myth” initiative, and Bill Shore’s recent Chronicle of Philanthropy blog is support for investments in organizational infrastructure to further the missions of nonprofit organizations. Spending money on services is important – and of course, service is why nonprofits exist – but investing in the people, technology, and processes of a nonprofit is essential for its long-term health and impact.

Fortunately, funders are increasingly recognizing the importance of nonprofit capacity building. Grantmakers for Effective Organizations encourages its members to invest in nonprofits by providing capacity building and operating support. Here in Philadelphia, The Pew Charitable Trusts has partnered with the OMG Center to award more than $5 million to more than 120 local nonprofits to support capacity building in six areas: management information systems, financial management and planning, leadership development, evaluation and outcomes systems, program planning and development, and strategic planning. Such capacity building efforts have provided organizations with extraordinary opportunities to raise money, streamline processes, improve services, evaluate programs, and develop leaders—all for the future benefit of the clients they serve.

These are worthy endeavors, and in fact, what we would EXPECT any successful corporation to do. Yet, for some reason, we fail to recognize their importance in the name of “serving more clients.” When it comes to capacity building support, we need to stop asking, “Why do they need it?” and start asking “How do we expect them to succeed without it?”

Justin Piff, Project Manager, OMG Center for Collaborative Learning

Justin Piff

Tags: Capacity building, Grantmaking, Philanthropy, Social sector trends, Strategy development
See more from: Justin Piff
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