Capacity Building: Pulling It All Together

These composite case studies are meant to provide an opportunity for readers to synthesize and reflect on topics discussed throughout this guide. We present two here: one to reflect on a decision made by a fellow grantmaker and another in which you decide the outcome. Consider your own reactions, but also speak with others and see what you learn from those conversations. There’s no one way to approach the scenarios presented, so it can be useful to see what you might discover by hearing from different perspectives. Add your thoughts in response to the discussion questions on our website.

Scenario 1: Analyze What a Funder Did

The grantee’s ask and funder’s decision: A start-up nonprofit promoting economic justice for women and girls in Cambodia approached the XYZ Foundation with a $25,000 proposal to support the creation of a three-year strategic plan. The head of the women and girls portfolio at XYZ met with the nonprofit’s staff (at the encouragement of one of XYZ’s board members) and decided to recommend the full $25,000 requested with two stipulations: 1) that the nonprofit hire a consultant of its own choosing, that the XYZ Foundation staff approves, to support its strategic planning process; and 2) that the two nonprofit leaders participate in the XYZ Foundation’s women and girls portfolio peer learning network.

Background on the nonprofit: The start-up nonprofit was founded a year and a half ago by two millennial women, one born and raised in Cambodia who just recently completed an MBA and the other a Cambodian American with four years nonprofit experience at a well-established women’s leadership organization in the U.S. The nonprofit has run an in-country program for the last year and a half and become known for its small business development program supporting entrepreneurship among young women in Cambodia. The organization’s current operating budget is about $80,000, funded by multi-year grants from USAID and several grants from internationally focused foundations (two foundations out of the U.S., one widely known private foundation and the other a small family foundation). This nonprofit’s board of directors includes five nonprofit leaders: three executive directors of U.S.- focused nonprofits serving Asian Americans and two NGO executive directors in Cambodia. These five bring a range of content expertise in community and economic development. Background on the foundation’s capacity building approach: The XYZ Foundation is an internationally focused private foundation that gives about $10 million in grants each year across three issue areas (women and girls, environment, and health) in the Global South. Its six program officers have given ad hoc capacity-building support to grantees, as requested by applicants, but staff are now trying to determine a more strategic organizational development approach across all of XYZ’s grantmaking. The XYZ Foundation usually gives capacity-building support to longstanding institutions that have already received program grants, but this request came in through one of XYZ’s board members, who is a high school friend of one of the nonprofit’s board members.

Starter Discussion Questions:

  1. How might looking at this grant through different lenses help strengthen its impact? For example: Has the relationship groundwork been laid to candidly and frankly discuss capacity building with this grantee? What control issues might exist between grantmaker and grantee that could get in the way of the success of this capacity-building grant?
  2. What kind of assessment is realistic and appropriate for this grant? What do you think a grantmaker in this situation and this grantee have the capacity to measure?
  3. Overall, what’s your sense of whether this request was right to fund? What are the variables that you think could most impact the success or failure of this grant? What advice would you give a colleague if he/she approached you with this scenario?

Scenario 2

The ask: The executive director of a nonprofit that you have funded for several grantmaking cycles approaches you for $100,000 to hire a consultant to support its executive director transition.

Background on the nonprofit: This grantee is a U.S.-based national nonprofit support organization with offices in New York City, Los Angeles, Chicago, and Washington, DC. The organization, founded in 1987, has a $5 million operating budget and about 20 staff. While most funding comes from grants, about a third of revenue is from its nonprofit consulting practice focused on strategic planning and board development. The executive director has run the organization for more than 10 years. Rumor has it he plans to retire in the next couple of years. Your grant support to this nonprofit has always been program based, but this time the executive director has come to you with this capacity-building request. The ED isn’t exactly forthcoming about the timing of the transition. You also know the organization is going through a number of executive and board changes — a new COO and new board chair — while also having just completed a strategic planning process. You’ve seen the new strategic plan, and it appears almost identical to the last five-year plan. The consultant the executive director wants to hire works for the firm that conducted the strategic plan for his organization.

Starter Discussion Questions:

  1. What experience do you bring with capacity building that can inform your decision-making process for this request? What capacity for capacity building exists within your foundation that you can draw on to help you?
  2. How might issues of power be at play in this capacity-building grant? What could be done to address those? What power do you have in this situation to ensure that the grant produces real, not cosmetic, change?
  3. Bottom line — would you fund this request? If so, as requested or how? With any conditions or no?

What do you think? Discuss below:

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