4 Examples of Successful Nonprofit Capacity Building [Copy These Strategies]

You’ve been tasked with building capacity at your organization—while it sounds great in theory, what does it actually look like in practice?

In this article, we will review several case studies where capacity building programs led to incredible successes at nonprofits. We will also cover lessons learned and explain how you can mimic this success at your organization.

Let’s dive in!

First things first: let’s define capacity building.

Capacity building is the opportunity to strengthen competencies and enhance infrastructure through investments in new technology, staff training, leadership development, DEI initiatives, strategic planning, and more.

Investing in capacity building is crucial because it increases an organization’s sustainability and impact, setting the stage for long-term growth. It can also help your organization operate more nimbly, prepare for unforeseen challenges, and identify solutions more efficiently and effectively.

Sheleia Phillips, the Principal at SMP Nonprofit Consulting, notes how crucial funding for capacity building is to ensure an organization’s sustainability:
‍

“[Capacity Building grants] are important because [they] help your organization not only today, but help you become more effective and sustainable over the long-term. Sustainability is key, we all want to be able to forward our mission—for years and years to come.”

With that in mind, you may be wondering—how do you build capacity at your organization?

There are countless ways in which nonprofit organizations can build internal capacity and set themselves up for future success. The best way to determine which types of capacity building will be most effective for your own nonprofit is to identify capacity building strategies that have worked well for other nonprofits across the sector.

Let’s take a look at several case studies of nonprofit organizations and foundations and explore how capacity building helped them and their partners thrive!

Fundraising is one of the most essential needs for nonprofit operations. However, it is consistently one of the least likely costs foundation’s will support through grant programs.

This is where capacity building grants come in!

Take for example The Evelyn and Walter Haas, Jr. Fund. This foundation is focused on supporting organizations that make breakthroughs, eliminate barriers, and change the rules in order to change the world.

To achieve this mission, the Fund has supported nonprofits by providing critical capacity building opportunities and flexible funding designed to strengthen leadership throughout the sector.

Crucially, the Fund provides capacity building to support nonprofits as they work to diversify revenue in the digital age. After engaging its network of grantees through surveys and peer-to-peer learnings, the Fund identified that fundraising capacity was a critical need among its partners. In response, the Fund launched the M3 Initiative (Message, Mobilize, Money) for grantees focused on providing services centered on immigration and LGBTQ+ human rights.

The Fund directs expert consultants to work with these grantee partners to develop effective strategies for donor engagement. The Fund sees this as an opportunity to connect smaller, less connected nonprofits to consulting agencies that predominantly work with larger, national organizations. Some of the consultants the Fund has hired to work with their grantee cohorts include:

• PowerLabs,
• Network for Good, and
• M+R Consultants.

‍

The Impact:

Its grantee partners have already noticed the impact of this capacity building work on their operations. One of the Fund’s grantees, PICO California, noted how they have been able to improve their social media strategy and develop sound messaging around their work to drive revenue growth.

According to Chris Mueller, who supported PICO California’s communications efforts:
‍

“I see the integration of these things [money, mobilize, message], more clearly than I ever have in terms of our work… We are starting to get into a good rhythm of how we integrate fundraising with social media and messaging and how we connect online action to offline action and fundraising.”

Through this work, the Fund is supporting smaller nonprofit organizations with less access to the resources and systems required to integrate effective digital fundraising strategies. With this type of support, grantees can strengthen their fundraising processes and compete with organizations in the sector who are on the front lines of fundraising and communications innovations.

Recruiting and retaining effective nonprofit leaders and staff is one of the most pressing challenges nonprofits currently face.
‍

The National Council of Nonprofits reports that nearly 75% of surveyed nonprofit organizations report job vacancies, 74% reporting vacancies in direct service and program positions, and 63% reported that the vacancies are a result of budget constraints. This is on top of the fact that demands for service have skyrocketed since the COVID-19 pandemic, with 28% of nonprofits reporting increases to service waitlists.

This is why staff capacity building is more crucial than ever. Capacity building is an effective tool to retain and develop an organization’s staff and leadership. Through workforce capacity building, nonprofits can:

• Implement practices to help the organization recruit and retain qualified workers;
• Boost morale by offering exciting, unique professional development opportunities for staff; and
• Strengthen leadership capacity and skills, contributing to an overall healthier workplace culture and sustained organizational growth.

According to a study from Walden University, an unnamed nonprofit organization (known as ABC Organization) implemented an action plan to build workforce capability and capacity. Some of their strategies included:

• Implementation of an HR software system;
• Creating a formalized training program and 90 day onboarding that focused on employee development; and
• Implementation of an internal communications plan.

Beyond this, ABC organization also was working to track key metrics to formally measure and analyze workforce engagement and performance. The organization also implemented workforce development opportunities outside of initial onboarding and training to build core competencies and increase worker engagement.

The Impact:

The organization conducted employee surveys and found that after these implementations, 83% of employees reported that they were strongly engaged and 96% of employees found value in employee training.

Additionally, the addition of an improved HR software system allowed the ABC organization to continue honing and improving workforce processes by securing employee feedback and tracking key metrics and performance indicators, helping them identify areas of improvement and workforce successes.

To learn more about nonprofit workforce capacity and where to find sources of fundraising for staff capacity building, take a look at Instrumentl’s article “How to Find Grants to Fund Training and Capacity Building”.

Implementing effective technology at your nonprofit is vital.
‍

As our world becomes increasingly more and more reliant on digital processes and software to operate, nonprofits need to invest in systems that help reliably streamline their processes.

It will come as no surprise to seasoned nonprofit professionals that staying up to date with technology is a major problem. Technology is expensive and systems can become outdated within a short period of time, meaning nonprofits have to direct funding to updates and new procurements every several years.

Organizations like Net Friends exist to help businesses and nonprofits by offering all-inclusive IT systems and security. They have worked with nonprofits like CAHEC (Community Affordable Housing Equity Corporation) to meet their unique needs as an affordable housing provider and equity syndicator.

Before working with Net Friends, CAHEC had developed an IT roadmap but their then IT provider was not helping them meet their goals and objectives. At the time, CAHEC was experiencing a number of IT issues, including:

• Delayed resolutions to common IT issues;
• Experienced roadblocks due to a number of on-hold IT projects; and
• Required expert guidance to meet the objective laid out in their IT roadmap.

By working with Net Friends, CAHEC was able to upgrade their systems and work with experts to improve processes and develop efficient solutions to minor and more complex IT issues.

The Impact:

Instead of waiting on an unresponsive IT system provider to work on simple issues, CAHEC was now able to work with a partner who provided 24/7 urgent help desk support and focus on long-term IT projects and improvements to infrastructure with the guidance and support of Net Friends staff.

According to CAHEC’s Information Systems Specialist, Garrett Cobb:
‍

“The NOC and IT Support teams know what they are doing from tier 1 to the higher support specialists. It is a huge burden off my shoulders knowing that there is very little that the desk can't handle.”

By investing in IT systems and support, CAHEC was able to turn their focus toward bigger projects and the broader work of their organization—and leave the basic IT issues to their new provider.

Building organizational capacity through technology procurement is not limited to broad IT systems and support. It can also mean investing in technology that improves key areas of work such as service provision, fundraising, and HR.

Instrumentl is crucial fundraising software that will help you drive revenue growth and secure grant funding. Instrumentl provides users with a database of over 400,000 funders and 15,000 active grants and utilizes smart-matching algorithms to connect nonprofits with opportunities aligned with their most urgent funding needs.

‍

Learn more about Instrumentl’s ROI with these customer success stories.

Capacity building can be much more than training, workforce development, or investments in technology and infrastructure. Many grantmakers are giving nonprofits the opportunity to build their capacity by offering sustainable awards in the form of multi-year grants.

Multi-year grants are key to a nonprofit’s long-term success.
‍

Unlike one-year grants, multi-year grants are designed to alleviate the administrative burden of reapplying for renewal grants year after year while also eliminating the uncertainty that comes along with that process.

Multi-year grants allow nonprofits to operate flexibly, planning and budgeting with the confidence that they have secured revenue for many years to come.

Lois Greco, the Senior Vice President and Evaluation Officer at the Wells Fargo Regional Foundation, says just that:
‍

“[The Wells Fargo Regional Foundation] knew that we were addressing a long-term problem, so we needed a long-term solution….You wouldn’t buy a house with a one-year loan. So why would you make a one-year grant to fund a 20-year solution?”

The Wells Fargo Regional Foundation focuses on community driven development, addressing the root causes of local social and economic problems by leveraging the strengths and expertise of residents.

The Impact:

Knowing that the foundation is addressing complex, structural issues, the Wells Fargo Regional Foundation implemented three key grant programs that address the most critical needs of the community in different ways—planning grants, implementation grants, and renewal grants:

• Planning grants create neighborhood revitalization plans that are led by community members and residents;
• Implementation grants are five-year awards that fund programs identified in neighborhood revitalization plans; and
• Renewal grants are five-year grants that help those programs succeed once they have been implemented, facilitating flexible iteration based on community feedback.

‍

Not only does the Wells Fargo Regional Foundation provide critical financial support to community nonprofits, they also build organizational capacity to help nonprofits work with community residents to identify needs and find solutions. The Foundation provides grantees with access to consultants, technical assistants, and data analysis and mapping tools to help them sustain their projects over the long-term.

Capacity building is a critical strategy for nonprofits who want to spark long-term growth and ensure the sustainability of their organization. By investing in capacity building for workforce systems, IT infrastructure, and fundraising, you can ensure your nonprofit has the ability to weather any storm.

Ready to learn more? Instrumentl has you covered!

You can view the informative webinar, Unlocking Opportunities: 5 Tips for Discovering Capacity Building Grants, from industry expert Sheleia Phillips and learn how capacity building grants can transform your work and take your nonprofit to the next level.