What is Capacity Building?

Capacity building is vitally important, now more than ever. Read this section to learn more about what capacity building can accomplish for your nonprofit and where capacity building training is available. In this section you will also find suggestions for additional resources and specific tools that can be used for capacity building in your nonprofit.

There is a startling lack of awareness about what nonprofit capacity building is, especially when our society depends so heavily on the nonprofit sector to serve as the safety net for our communities. Simply put, nonprofit capacity building refers to activities that improve and enhance a nonprofit’s ability to achieve its mission and sustain itself over time.

“Nonprofits have an obligation to seek new and even more effective ways of making tangible progress towards their missions, and this requires building organizational capacity. All too many nonprofits, however, focus on creating new programs and keeping administrative costs low instead of building the organizational capacity necessary to achieve their aspirations effectively and efficiently…This must change: both nonprofit managers and those that fund them must recognize that excellence in programmatic innovation and implementation are insufficient for nonprofits to achieve lasting results. Great programs need great organizations behind them.”

Effective Capacity Building in Nonprofit Organizations,
Report for Venture Philanthropy Partners by McKinsey & Company (2001)

This assessment from one of the seminal studies on capacity building is still true today. The need for nonprofit capacity building is vitally important right now because the economic downturn is dramatically impacting the ability of nonprofits to serve individuals and communities. 

Capacity building is an investment in the future sustainability of a nonprofit.

Capacity building is not just about the capacity of a nonprofit today -- it's about the future. Distinct capacity building projects such as identifying a communications strategy, improving volunteer recruitment, developing a leadership succession plan, identifying more efficient uses of technology, and engaging in collaborations with community partners -- all build the capacity of a charitable nonprofit to effectively deliver its mission in the future.  When capacity building is successful, it strengthens a nonprofit’s ability to fulfill its mission over time, and enhances the nonprofit’s ability to have a positive impact on lives and communities.

  • Tools for working with (and getting the most out of) consultants (ImpactRising)

Why isn't there more funding available for capacity building?

Nonprofits individually and collectively must articulate the need for capacity building to funders and policy makers. We hope that the resources presented here will contribute not only to the body of knowledge about nonprofit capacity building, but also to the important work of various communities of practice around the country that are focusing on nonprofit capacity building as a way to ensure a stable and sustainable foundation from which to launch solutions to our communities' urgent challenges. 

Resources on capacity building for grantmakers (GEO)

Continue reading about why capacity building is needed.