Supporting Grantee Capacity: Strengthening Effectiveness Together

In Supporting Grantee Capacity: Strengthening Effectiveness Together, we look at how funders approach building capacity with grantees. Through examples from foundations ranging in size, mission, and geography, we explore various strategies for capacity building and the types of awareness that funders can choose to incorporate in decision making to facilitate informed, thoughtful judgments about strengthening organizations.

Listen to our Strengthening Effectiveness podcasts, which elaborate on themes explored in the guide using the spoken wisdom of funders from around the globe; read our online-only case study examples of aspects of capacity building; print and share our illustrations of key themes entwined in capacity building; review our GrantCraft community survey results; and explore resources from the field in our related IssueLab special collection. Additionally, if you would like to share your experiences with capacity building through a guest blog post, let us know.

Discuss these resources and help spread the word using #supportingcapacity.

This guide and related content were supported by a generous grant from Open Society Foundations.

What's in the Guide?

  • Broadening the Grantee Capacity-Building Conversation: Funders worldwide are thinking about how to strengthen grantee organizations. We provide our definition and approach to capacity building and share important frameworks for the conversation.
  • Exploring Investment Approaches to Capacity Building: Foundations approach grantee capacity-building efforts differently and agree that there is not one correct investment approach. We provide a menu of investment approach options along with several examples exploring how and why each has been used in various situations.
  • Lenses to Focus and Inform Grantmaking: Decision making around capacity-building support comes down to the ability to make sound judgments. We share important ideas for funders to consider before determining if an investment should be made and how.
  • Knowing Your Own Capacity: Many funders do not truly have the capacity to undertake certain capacity-building efforts themselves. We share five important questions for foundations to reflect on to help inform what kind of capacity-building partner they would be.
  • Acknowledging Power Dynamics: Every funder-grantee relationship has power dynamics, which become especially important to recognize in conversations about capacity building. We share suggestions from funders about tuning in to these dynamics and how to create an environment that is as candid and level as possible.
  • Assessing the Impact: The Holy Grail: Measuring the impact of capacity building is challenging but important to encouraging greater investment within foundations and to the recipient organizations themselves. We provide process-oriented advice from funders about how to investigate impact from the beginning of a capacity-building engagement and what to do with what you learn.
  • Putting It All Together: This guide shares many perspectives about how to approach capacity building with grantees and also underscores that there are no right answers, only informed judgments. In these two composite case studies, we put you in the analysis and decision-making seat and encourage you to see how your ideas align with those of your colleagues.
  • Plus, special insert sections on 
    • When you're the lone voice for capacity building
    • Engaging the right capacity builders
    • How to address issus of grantee capacity
  • takeaways
    Deserts and Dilettantes How to Engage the Right Capacity Builders Within Marketplace Extremes

    Capacity builders provide invaluable support to foundations and nonprofits all over the world. While there are many providers doing good work with foundations and nonprofits, as the TCC Group identifies in Building the Capacity of Capacity Builders, quality and quantity problems within the capacity-builder marketplace also exist.

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  • takeaways
    When Reporting Out on Grantee Capacity Building

    Get better at telling grantee capacitybuilding stories. Storytelling is a powerful tool for assessing and publicly showing the value of capacity-building investments. Multiple funders shared, “We could do better at turning existing data — quantitative and qualitative — on capacity-building efforts into comprehensive stories that demonstrate why capacity building is an important investment for grantmakers to make.”

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  • takeaways
    Throughout Your Interaction with Grantees

    Engage your grantees in the evaluation design and implementation. Many grantees feel cautious or hesitant when working with foundations on capacity building, which can color the funder-grantee interaction, especially when it comes to assessment.

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  • takeaways
    Before Making Capacity-Building Grants

    Define your capacity-building theory of change. Being able to identify the primary purpose of your capacity building and then translating that into a theory of change is key to assessment.

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  • takeaways
    Assessing Impact: The Holy Grail

    Even grantmakers with deep experience funding capacity building sigh when asked, “How do you know capacity building makes a difference?”

    Read More »
  • takeaways
    How Should Your Foundation Take Action In Setting Parameters on Its Engagement?

    Even when grantees recognize their own capacity building as important, it’s not the reason they exist.

    Read More »
  • takeaways
    How Can Your Foundation Build Its Knowledge on Capacity Building?

    At most foundations, the levels of capacitybuilding skills and experience vary significantly because, as a number of funders put it, “Most foundations hire grantmaking staff more for their issue-based rather than their organizational development expertise.”

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  • takeaways
    Who are the Dominant Voices (Champions and Nonbelievers)?

    This may be a tougher topic to discuss openly, but certainly one raised consistently.

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  • takeaways
    How Can Your Foundation Sharpen Its Capacity-Building Purpose?

    Interviewees suggested that it can be useful to periodically come back to the question of “why capacity building?” at your foundation and compare that to how capacity building is manifesting with grantees.

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  • takeaways
    What Is Your Foundation’s History of Grantee Capacity Building?

    Even if you think the answer is “none,” don’t skip this reflection.

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  • takeaways
    Knowing Your Own Capacity

    Sometimes foundations jump into grantee capacity-building without taking stock of their own internal capacity to undertake this work.

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  • takeaways
    Control Lens

    The issue of control clearly relates to power and is important to honestly reflect on.

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  • takeaways
    Defining Roles and Goals Lens

    More than anything, it’s important to dedicate time with grantees to discuss roles and goals.

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  • takeaways
    Culture Change Lens

    In addition to having an awareness of internal and external grantee circumstances, understanding the role institutional culture plays can support the success of capacitybuilding investments.

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  • takeaways
    Context Lens

    Funders know that capacity building isn’t one-size-fits-all. But funders and grantees both shared stories of foundations that bring in approaches with little to no regard for contextual circumstances facing nonprofits in a specific community.

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  • takeaways
    Relationship Lens

    The way in which funders engage and build relationships with grantees matters deeply.

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  • takeaways
    Lenses to Focus and Inform Grantmaking

    Funders and nonprofits shared a number of different lenses through which they can look to bring greater focus to capacitybuilding investments.

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  • takeaways
    Capacity Building Through Collaborations - Among Funders and Beyond

    Some foundations are teaming up to address capacity-building challenges, sharing issues, problems, and opportunities that come along in an area of common interest.

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  • takeaways
    Types of Capacity-Building Providers and Some Ways to Learn More About Them

    Some funders are connected with certain circles of capacitybuilding providers, and others are less familiar with who provides these services.

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  • takeaways
    General Operating Support (or Unrestricted) Grants

    While some funders remain unsure as to whether grantees actually prioritize their own capacity building when given general support, others view unrestricted funding as a fundamental investment in organizational capacity and sustainability.

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  • takeaways
    Capacity-Building Grants and Awards

    Some foundations give grants that are either partly or entirely focused on building an individual nonprofit’s organizational capacity.

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  • takeaways
    Exploring Investment Approaches to Capacity Building

    There are a number of ways funders can support grantee capacity-building efforts. In this section, we break down different support opportunities, including examples of considerations funders have made when implementing them.

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  • takeaways
    What Is Capacity Building and Why Is It Important?

    Capacity building is fundamentally about improving effectiveness, often at the organizational level.

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  • takeaways
    When You Have to Stop and Address Grantee Capacity

    For the most part, funders agreed that grantees need to drive capacity building. We heard, “If a grantee doesn’t want it, don’t force them to undertake it.” But what about if you have a long-time grantee that’s a critical player in a field you’re trying to make change in, and you feel you cannot justify renewal funding without the organization addressing a capacity issue. For example, what if its governance or financial management practices are questionable, bordering on illegal? Or what if you fund an organization to conduct a self-assessment and it uses that to show “we’re fine — we don’t need help,” but you know there are very serious issues that must be addressed? What do you do if you can’t renew without the organization‘s addressing issues of capacity?

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  • takeaways
    Power: Beware…

    Here's what funders and nonprofits shared that funders should be aware of with power.

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  • takeaways
    GrantCraft’s Capacity Building Survey Results

    In May 2014, GrantCraft surveyed the field to learn what we could about capacity building. 260 funders and nonprofit practitioners graciously replied and very much helped to shape our guide Supporting Grantee Capacity: Strengthening Effectiveness Together. We couldn't include all of the interesting insights from the survey in the guide, so we're happy to share that data here with you.

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  • takeaways
    When You’re a Lone Voice for Capacity Building in Your Foundation Ways to Broaden Your Base of Internal Support

    Most of the grantmakers we interviewed believe in capacity building as an important strategy. Yet we know there are many reasons other funders hesitate to engage in capacity-building funding.

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  • takeaways
    Power: Do…

    Here are some suggestions that funders and nonprofits shared for how to make power dynamics benefit a capacity-building relationship.

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  • takeaways
    Power: Recognize…

    Here's what funders and grantees want to make sure that funders recognize about power, particularly in capacity-building relationships.

    Read More »
  • takeaways
    Power Dynamics

    Power dynamics exist in every funder-grantee relationship. But when we spoke with funders and nonprofits about capacity building, we spent a lot of time on the subject of power.

    Read More »

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