Capacity Building

Dr.S.Sundar, Director

Gnanam School of Business.

Corporate vs. CSOs

Corporates

• Profit Maximization
• Market Share
• Competition
• Diversification

CSOs

• People’s Well-Being
• People own things
• People raise voices
• Integrated Development

Activities of CSOs

} Create awareness

} Protect human rights

} Encourage rehabilitation

} Gainful employment

} Combat man made crisis

} Protect environment

Advantages of CSOs

→ Ability to experiment freely

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→ Flexible in adapting to local needs

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→ Enjoy Good rapport with people

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→ Ability to communicate at all levels

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→ Ability to recruit experts and highly motivated staff

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→ Less restrictions from the Government

Capacity building - definition

• Capacity building is a set of activities and decisions that strengthens an organization’s operations and enables it to better achieve its MISSION.

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CSO lifecycle

Organizational Capacity

The combined influence of an organization’s abilities to govern and manage itself, to develop assets and resources, to forge the right community linkages, and to deliver valued services – all combining to meaningfully address its mission”

capacity-building efforts can focus in many different organizational areas

Capacity building

• Capacity building can take many forms, such as:
• Professional development for staff and board members
• Opportunities for peer learning, networking or leadership development
• Creating or re-examining organizational plans
• Initiating collaboration with other non-profits
• Developing new sources for earned income

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Levels of capacity building

• Individual: refers to the process of changing attitudes and behaviours-imparting knowledge and developing skills while maximizing the benefits of participation, knowledge exchange and ownership.
• Institutional: focuses on the overall organizational performance and functioning capabilities, as well as the ability of an organization to adapt to change.
• Systemic: emphasizes the overall policy framework in which individuals and organizations operate and interact with the external environment.

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Benefits of Building Capacity

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• For your organization
• Increase organizational sustainability, efficiency and effectiveness
• Enhance ability to provide social services
• Create collaborations to better serve those most in need

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• For those you serve
• Increase program effectiveness
• Increase ability to deliver more effective programs that produce positive beneficiary/society/donor outcomes

Benefits of Developing Capacity

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1. Increased Revenues
2. Attracting more Volunteers
3. Attracting more Contributions
4. Do More Good work
5. Improve Productivity

Why doesn’t capacity building happen naturally?

• Projects are the Priority
• Lack of Understanding
• Awareness of Options
• Cost - Money & Time
• Donors Don’t Pay
• Silo Behavior

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Most important capacity building needs

Most important capacity building needs

Relevant to our Times

The current economic climate has led to:

The flipside is that it has also given CSOs an opportunity to become stronger:

• By assessing it’s strengths/weaknesses
• Filling in its weaknesses and building on its strengths

Reduced Funding

Increased Need

“Please describe what you believe would be the most helpful way(s) to meet your organization's most important capacity building needs.”

What would help?

Capacity building

building organizational capacity is an ongoing process

“the application of knowledge and expertise to the enhancement of those factors that contribute to

organizational effectiveness”.

Capacity building areas

Capacity Builders

CHC

Nov

• Foundations/Trusts
• Associations
• Government Organizations
• Management Support Organizations
• Consultants
• Academics

Vision and Mission

Leadership

(Board, Staff, Volunteers)

Resources

(Financial, technological, Human)

Outreach

(Dissemination, public education, collaboration, advocacy

Products and services

(Output, Outcome, Performance)

A framework for Capacity Building

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Leadership Development

Financial Sustainability

Program Effectiveness

Capacity Building

Three kinds of capacity building that can be critical to an organization’s wellbeing:

Importance of leadership

• Leaders motivate others to create action
• They envision and state the organization’s goals and establish systems and mechanisms to achieve those goals.
• The work to raising resources to make the vision a reality
• Effective leaders enhance an organization’s image, prestige and reputation within the community and establish partnerships, collaborations, and relationships to reach the goals of the organization.
• Strong leaders can bring success to the organization through their sense of ownership in the work and setting standards for performance

Building leadership capacity

• 1. Enhancing existing leadership

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• Administrative and procedural policies can be reviewed and updated to streamline operations
• Training can be provided to staff and volunteers to upgrade skills or promote team building.
• A board strategy can be formulated to provide direction to the board in decision making
• Interventions an be planned for board members to develop insights into their roles and responsibilities.
• 2. Developing new leadership

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• Current leaders must be aware of the need to mentor new leaders
• New leaders may bring in new ideas and energy into the organization and stimulate work
• Young leaders must be groomed to be prepared to carry on activities in future years

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Leadership Development

Financial Sustainability

Program Effectiveness

Capacity Building

Three kinds of capacity building that can be critical to an organization’s wellbeing:

A Central CSO Challenge

Why do so many CSO run into financial difficulties, despite their excellent programs, and what can we do about it?

Mission and Program

What you do and why you do it

Capacity

Capital

What you have and how it is distributed: Assets, Liabilities and Net Assets

Your ability to do what you do:

Supporting infrastructure (e.g., people, space, and processes)

Need to Move Beyond Breaking Even

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Like any organization, nonprofits need to cover the ‘full cost of delivering programs

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• Tax Status vs. Business Model
• Full Costs > Operating Expenses

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Full costs include:

Operating Expenses

Fixed Asset Additions

Debt Principal

Working Capital

Reserves

Depreciation

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Leadership Development

Financial Sustainability

Program Effectiveness

Capacity Building

Three kinds of capacity building that can be critical to an organization’s wellbeing:

Why is Program evaluation Important?

1. Boosts Program Effectiveness
• CSOs need to capture information about their programs in order to manage it, learn from it and improve the future of the program.

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• Supports Fundraising Efforts
• CSOs need concrete information about the impact of their programs in order to convey that they are effective to potential funders to increase funding for their programs.

Don’t organizations already know this?

• CSOs are generally funded to implement and report
• on program completion

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• Organizations are rarely funded to evaluate their programs
• Forfeits valuable lessons learned to make future programs more effective
• Repeat the same mistakes over and over again
• Or miss the opportunity to replicate successes
• When they could alternatively be getting better

Program evaluation as a Capacity Builder

• CSOs must develop the capacity to conduct their evaluations

—not only as a reporting mechanism—but primarily as a tool to:

^⯍ Improve programs

^⯍ Achieve better outcomes

^⯍ Inform non-profit’s organizational development

Program evaluation as a strategy

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Feedback Loop

What program evaluation can do to the CSO:

• Increase staff knowledge of program evaluation concepts and their importance and link those concepts to organizational learning and improvement
• Increase capacity of nonprofit organizations to document and evaluate their outcomes and to use evaluation data to inform their organization’s development and programming
• Integrate evaluation as a regular part of the organizational culture, and not external to - or independent of - the organization.

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Which Capacities to develop?

Types of capacity building

• Short Term
• Technical Assistance
• Long Term
• Multi-Dimensional
• Training & Education
• Funds-Focused Support
• Capital Resource
• Executive Coaching

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Effective capacity building

• Comprehensive
• Customized
• Competence-Based
• Timely
• Peer-Connected
• Assessment-Based
• Readiness-Based
• Contextualized

Ingredients of capacity building

Internal Leadership

Applying a mission-centered, focused, and inclusive approach to making decisions, as well as inspiring and motivating people to act on them

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Fundraising Skills

Developing resources necessary for efficient operations, including management of donor relations

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Program Staffing

Making staffing changes as needed to increase and improve programs and service delivery

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Empowering

• Promoting proactivity, learning, and a
• belief in the value and ability of staff and client

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Leader Vision

Formulating a clear vision and motivating others to pursue it

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Typical organization needs

• Financial Management
• Legal Assistance
• Facility Planning
• Fund Development
• Communications
• Governance Training
• Program Design & Development
• Advocacy

• Human Resources Management & Training
• Strategic Planning
• Leadership Training
• Technology
• Operations Support
• Organization Development
• Ethics Education

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9 Principles of Capacity Building

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• Every organization is capable of building its capacity.
• Trust between the organization and provider is a must.
• The organization must be ready for capacity building.
• Ongoing questions mean better answers.
• Team and peer learning are effective capacity building tools.
• Capacity building should accommodate different learning styles.
• Value the organization’s unique history and culture.
• All people and all parts of the organization are interrelated.
• Capacity building takes time.

Holistic Capacity Development

Three steps for capacity building

• 1. Understand existing capabilities and identify gap areas
• The first step is to do a diagnostic and identify the areas that need to be addressed.
• 2. Prioritize the areas you will invest in
• It is important to prioritise mission-critical gaps rather than attempt to address all components simultaneously. Look for areas in which a small investment can make a substantive difference to your organisation.
• 3. Have stakeholder conversations
• Multiple stakeholders need to be convinced about the cost of impact and the importance of funding all the costs.