Grantmaking, NGO Interest

Great capacity building is the stuff of the future

30 November 2010

Capacity building should be undertaken deliberately and be communicated clearly through an organisation.

Written by Tracey Henry, CEO of Tshikululu Social Investments.

How do grantmakers try ensure that our civil society partners have the capacity to be sustainable, and should they even invest in such a search? It depends on how both donors and NGOs approach this work. Driven as a simple funding fashion, or imposed on developmental organisations top-down, it will be money wasted and will cost us opportunity. Taken seriously, in real partnership and with a long-term view of its need, it can be just the ticket to success.

I cannot help but notice that “œcapacity building” has become a common buzz word in the donor and development world. So it is that many organisations claim to be doing some kind of capacity building, often both internally and externally. Many grantmakers are asking questions about how they can leverage limited resources through such things as “œbuilding effective partnerships” and capacity building programmes.

Yet capacity building is sometimes wrongfully thought of as a “œcheaper option” to providing funding and that it can be done by the growing swell of corporate volunteers wanting to make a difference in their local communities. I would argue that capacity building is far more complex and requires careful consideration from donors and NGOs in terms of what we mean and aim to achieve by it.

The essence of capacity building lies in actions that improve organisational effectiveness and that support the achievement of stated mission and strategic objectives. This makes it similar to normal business concepts of organisational development, organisational effectiveness and/or organisational performance management. But when we think of these concepts in the development sector we sometimes forget the lessons of business and insist on quick fixes to often complex problems.

It’s easy to say that enhancing sustainability should be the key focus of any capacity building activity. But there is often confusion, especially among donors, as to what this means. In some cases, they expect it to result in NGOs raising their own income and so becoming financially independent. However, the vast majority of NGOs will not be able to achieve this goal. For these, sustainability properly means something else – the ability to consistently, continuously and efficiently raise, manage and deploy funds in order to implement programmes effectively and to achieve set goals which ultimately benefit communities in which they operate. This understanding of what sustainability means is critical.

Which isn’t to undermine the need for capacity building in NGOs. Properly done, it is an extremely worthwhile investment that can have significant long-term impact, both on specific organisations and through them on specific social problems. Strong implementation of programmes is not enough to bring about lasting change – “œgreat programmes need great organisations behind them.”

Done poorly or haphazardly, it can be a waste of time, energy and money and damage both organisations and beneficiary communities. This is especially the case if unqualified, inexperienced people are brought in for short periods of time to “œcapacitate” people and organisations and leave back practices and advice in their wake, with loner term negative effect.

Rather, capacity building should always start with a thorough situational assessment to determine the needs, desires and skills-potential of a given organisation since top-down, “œtraining for training’s sake” initiatives rarely succeed.

An example of the latter would be to provide corporate management expertise to run financial management programmes for NGOS. In itself this can add value; but funding for capacity building should complement, and not replace, programmatic funding. Capacity building should supplement a donors existing, and preferably long-term, funding partnerships to ensure financial support throughout the capacity building continuum (that spans assessment-to-consultation-to-training-to technical assistance-to mentorship). It comes with the understanding that building the capacity of any organisation takes time and that there are no silver bullets.

Capacity building should be undertaken deliberately and be communicated clearly through an organisation. Perhaps most importantly, leaders must “œbuild the capacity to build capacity” by freeing up management time and organisational resources to be able to focus adequately on the capacity building tasks at hand. To work, capacity building must be tackled as a long-term process that needs patience and commitment, both from organisations and their grantmaker partners.

Here are some thoughts for donors:

• Recognise the challenges of investing in capacity building so that you can achieve the best results.

• Many donors do not really want to fund true capacity building because it can be perceived as a supportive, rather than core, activity, tied up with expectations that NGO administrative costs should remain as low as possible.

• Capacity building is never easy in any sector – corporate or not-for-profit. It is always time consuming and often expensive (“œhard to fund, hard to launch and hard to implement”). Therefore any capacity building programme proposed for funding should clearly state the systemic changes it aims to achieve and what measures will be used to track progress.

• Because NGOs often glorify their results-driven project work over their critically important back-office work and strategic planning, grantmakers can be lulled into scepticism of the relevance of business practices to development work. They be beware of this and rather pose serious questions about what makes an organisation tick and how to support their funding work with other efforts to strengthen NGO foundational stability.  This doesn’t imply the imposition of capacity building work on NGO partners, just that grantmakers can usefully support their development partners to reflect on capacity building, stability and growth, and not exclusively on flashy and immediate delivery.

• Nor should these efforts limit themselves to only one or two approaches. The developmental part of our economy is particularly dynamic and capacity building approaches should be too. They could include the granting of core operating funds, funding for structured fundraising initiatives, financial support for the management of  development funds, training and the hosting of development sessions, support for coaching and mentoring, and exploring greater cross pollination of knowledge and experience among NGOs.

• Finally, it is probably well to remember that the NGO sector’s traditionally high staff turnover will necessarily reduce the positive impact of capacity building work. It is therefore important that capacity building interventions focus on whole-organisation development, including in areas of succession planning, talent management, learning and development and retention strategies.

Driven by proactive, dedicated grantmakers in true partnerships with an involved NGO leadership, this is work that can have much longer term beneficial effect on organisational stability, growth and positive social change than mere funding alone. Done well, it can build a stronger civil society as a strong legacy to our future.