Capacity Building 3.0: How To Strengthen The Social Ecosystem
Capacity Building 3.0: How To Strengthen The Social Ecosystem
Capacity Building 3.0: How To Strengthen The Social Ecosystem
Briefing
Paper
Introduction
In recent years, the social sector has evolved to incorporate multiple stakeholders and organizations
to solve social issues, working together in a larger ecosystem to increase efficiency, effectiveness,
and scale. The process of building the systems, structures, and skills necessary for success in this
environment, commonly referred to as capacity building, has played an active role in the social
sector since at least the 1970s.
As a term, capacity building has been maligned for vagueness, overuse, and even for being
a distraction from the core ethos of doing good. Alternatively, it has also been lauded as a measure
of good stewardship, the driver of efficiency and effectiveness, and the key to ultimate success.
The conversation on capacity building has not kept pace with the evolution of the sector. The practice
of capacity building has continued to grow and change, evolving to meet emergent needs like impact
investing or scaling. But, in so doing, the term itself has stagnated, as the frameworks for discussion
have lacked a cohesive dialogue. As a sector, we still tend to think and talk in narrow terms of the
capacity of nonprofit workers, nonprofit organizations themselves, or cohorts of grantees (De Vita
& Fleming, 2001). We neglect to include the host of other actors that comprise the entire social ecosystem,
including funders, the private sector, government, management support organizations, and their various
networked combinations. Finally, even as we adopt new ways of doing capacity building, we only
crudely (if at all) distinguish between capacity and the process of capacity building.
Contents
2 Introduction
4 A Basic Distinction
5 An Evolution in the Who
8 An Evolution in the What
12 An Evolution in the How
18 Conclusion
20 Appendices
27 Acknowledgements
28 References
TCC GROUP
Reflecting on TCC Groups 35-year history of designing, managing, and evaluating capacity building
in a variety of formats, it is clear to us and to those with whom we work that the field is ready for an
evolution in the ways we talk about capacity building. A foundation has already been laid for this new
conversation by the diverse and thoughtful practice of many in the sector. We hope that by identifying
the issues and providing a framework for discussion, we can enable the field to further advance
capacity-building strategy and practice, thereby enhancing the work of a wider range of dedicated and
conscientious actors looking to have a positive impact on society.
Our intent with this paper is to frame the discussion in the field, not to claim ownership over any
particular ideas. Many individuals and organizations are moving in this direction, which is exactly
what we want to encourage through a fieldwide dialogue and moment of reflection. While considerable
research was conducted for this paper, and we have been an active part of a community of capacity
builders for many years, this paper is not intended as a comprehensive literature review, and we seek
additions to the list of sources that speak to the concepts and practices outlined in this framework.
Contact us at cb3.0@tccgrp.com or tweet #cb3.0. We welcome the opportunity to recognize the work
of others alongside those already cited in this paper.
This paper is organized in the following way: The first section, A Basic Distinction, covers
fundamental concepts, terms, and definitions of capacity and capacity building critical to our discussion.
The second section, entitled An Evolution in the Who, examines who needs to build capacity and
how that understanding has evolved over time. The third section, entitled An Evolution in the What,
assesses how capacity in capacity-building has evolved, arriving at a new organizational actualization
framework. The fourth section, An Evolution in the How, highlights the emergence of new methods
for accomplishing capacity building and details the new innovations and techniques that are being
used by those doing effective capacity building.
A Basic Distinction
A longtime criticism of the term capacity building has been that it can mean just about anything to
anyone. Such confusion arises primarily when capacity building is conflated with capacity. Capacity
describes the skills and ability to make and execute decisions in a manner that achieves effective and
efficient results. Capacity building is the process of developing those skills and ability. This distinction
between capacitythe Whatand capacity buildingthe Howis fundamental to understanding the
conversation in the capacity-building field.
There is a third component to capacity building that has gone largely unexamined: The Who.
Unfortunately, the question of who is or ought to be involved in capacity building is frequently
ignored, under the assumption that it is either obvious, or worse, that it is irrelevant. Thankfully, the
use of broader ecosystem thinking has opened a conversation that has both expanded the definition
and honed the focus of which actors within an organization, and within a social ecosystem, need
to build capacity.
The remarkable thing (or perhaps it is unremarkable given the pace of change) is that the fields
understanding of all three elements (what, how, and who) has evolved considerably in the last 30 years,
but it has done so unobtrusively and through fragmented iteration. The remainder of this article
will recount the evolution in the what, how, and who, articulating from where they have come and
to where the current environment demands that they go.
WHO
Individuals
Organizations
Groups of
Organizations
Ecosystems
what
Knowledge
Skills
Operational
Systems
Effectiveness
how
Training
Technical
Assistance
Experiential
Peer Learning
TCC GROUP
TCC GROUP
are learning how to incorporate varied players into the social-sector space, such as for-benefit
organizations, B-corps, and social-venture firms. They continue to see a professionalization
of their staff and are adopting new (and revisiting old) organizational structures. What has not
changed is their commitment to a mission, which serves as the anchor for effective capacity building.
Networks: Networks, coalitions, movements, campaigns, associations, collective-impact
effortssuch collaboration is not limited to nonprofits working with each other or to distinct
funder collaboratives. Increasingly, we see cross-sector collaboration becoming the norm and
each of those actors seeking to better understand and execute their own roles. The effectiveness
of these various interorganizational relationships is more than just the collective capacity of the
participating organizations. Rather, they all have capacity needs as distinct operational entities.
Several resources have begun to articulate capacity needs of networks2 and, given their prominence
in the sector, additional work is clearly warranted.
Business: Businesses have become increasingly more sophisticated in their roles as corporate
citizens. As stakeholder pressure on companies continues to increase, companies recognize
that they face higher expectations to rethink their products and services to be more beneficial
for society, more beneficial for the company, and to address global social issues that align with
their core business (such as health-care issues for pharmaceutical companies or economic and
community development for financial-service companies). This has also given rise to social venture
firms and a growing number of B-corporations (Surowiecki, 2014). As companies recognize the
need to take a more active role and to develop and build more sophisticated approaches to addressing
issues, there is a need for an internal cultural shift that focuses on building social-sector leadership
capacity. Forums like Business for Social Responsibility, Boston College Center for Corporate
Citizenship, and others are highlighting this need, and consulting firms with knowledge and
experience within the sector are providing support, as companies move quickly in this direction.
Government: Whether through funding innovation or serving as the primary financier of
scaling efforts, government at all levels plays a critical role within the social sector. Issues and
ideas of the day such as social impact bonds, government sponsored prizes and competitions,
the Corporation for National and Community Service, and an ever-increasing focus on effective
use of public dollars all highlight areas where government capacity is critical to achieving
social goals.
2. For additional information and resources see: Jared Raynor. (2011) What makes an effective coalition: Evidence-based indicators of
success. Los Angeles: The California Endowment and TCC Group; Working better together: building nonprofit collaborative capacity. GEO
Funders. (2013). Retrieved from http://docs.geofunders.org/?filename=geo_2013_collaborative_capacity.pdf; Needle-moving collective
impact guide: Capacity and structure. The Bridgespan Group. Retrieved from http://www.bridgespan.org/Publications-and-Tools/
Revitalizing-Communities/Community-Collaboratives/Guide-Community-Collaborative-Life-Stages.aspx#.VFE7hvnF-So
TCC GROUP
Organizational
Actualization
Organizational
Functionality
Knowledge
and Skills
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TCC GROUP
At a higher level, it will require collaborative skills with a range of partners while simultaneously
managing a defined leadership role. This will necessitate an ability to communicate in multiple sector
languages and meet partners in co-defined outcome arenas.
Capacity to structure itself in response to its ecosystem. Not only do organizations need
adaptive skills, they need to consider adaptive structuresones that maintain core identities, but
are fluid around the edges, sometimes ceding decision-making and implementation, sometimes
leading it. Structures include formal and informal coalition and network designs, as well as other
forms of collective governance and shared leadership. For many organizations it may also mean
capacity to function as an actor within a defined or emergent movement.
How an organization
responds to its ecosystem
R&D Evaluation
and Learning
Change Management
Power Analysis
Inter-Reliant Funder
Capacity and Non-Grant
Funder Activities
Network Analysis
Organizational
Lifecycle
Issue Lifecycle
Advocacy
Collaborative Skills
Defined Leadership Role
* Coalition and Network functioning is from Raynor (2011); Collective Governance/Shared Leadership is adapted from the
Management Assistance Groups Network Leadership Innovation Lab; Capacity to Function as Movement Actors is from
Grantmakers for Effective Organizations (2013).
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Peer Mentoring
Training/Workshops
Peer Exchange
Consulting
Referral of Resources
(e.g. books, articles, etc.)
Coaching
12
TCC GROUP
Disseminating Knowledge/Information
In the CB 1.0 How, the approach was about giving people better and more information. The most
common approach was largely through trainings to groups of participants. Other activities included
targeted consulting services as well as developing and giving access to better libraries of resources.
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and a broader MSO movement developed in state alliances for nonprofits. The Center for Effective
Philanthropy built on its work measuring grantee and donor perceptions to study the extent to which
foundations actually employ strategy in their work and how CEOs perceive, measure, and drive
performance. Grantmakers for Effective Organizations (also started in 1998) convenes sector-wide
conversations on scaling social impact, including philanthropys role in supporting nonprofit scaling,
and the grantmakers role in supporting movements. Net Impact is a nonprofit comprised of 50,000
members and 300 chapters that advocates for business schools to continually develop their
social-responsibility coursework. It provides students with the tools they need to help their future
employers adapt to their role as corporate citizens.
Base elements of Capacity 2.0 included using diagnostic tools, getting teams involved, and
diversifying capacity-building activities and support types. Each of these is elaborated upon in the
table Capacity 2.0: Infrastructure Evolution.
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TCC GROUP
15
Engaging diversity, equity and inclusion. While sensitivity to aspects of culture (cultural
competency) has long been recognized as important, CB 3.0 requires a more dedicated and
deliberate sensitivity to cultural issues within organizations and across organizations.
As workplaces continue to become more diverse in terms of race, ethnicity, gender, religion,
education, socio-economic background, and more, it is no longer sufficient for capacity builders
to help organizations cope with diversity. They need to have the skills and knowledge to help
organizations actively leverage that diversity for improved outcomes. With the increasing number
of nonprofits and funders actively concerned with diversity, equity, and inclusion (DEI), the tools
of capacity building must adapt to incorporate diverse voices, foster inclusion as an ongoing
practice, and serve a larger equity agenda. For example, the D5 Coalition has commissioned
a series of research projects about DEI practices, including a comprehensive overview of foundation
DEI programs, policies, and practices.
Creating targeted diagnosis and entry. We believe one of the hallmarks of CB 3.0
to be a detailed assessment of an organizations past, present, and future organizational realities.
In a 2014 interview featured in Nonprofit Knowledge Matters, Lori Bartczak, Vice President of
Programs at Grantmakers for Effective Organizations, explained that a contextual, continuous,
and collective approach allows grantmakers to provide effective capacity-building support:
[We have] learned that one solution does not fit every problem, because each
leader and organization is unique, and circumstances are always changing, so
capacity building has to be contextual, i.e., tailored to meet the unique characteristics
and needs of individual nonprofits influenced by variable characteristics such
as the organizations geography, life-cycle stage, and revenue sources, among
other factors.
It is not about selecting either an assets or deficits approach. Capacity must be built starting
from where an organization is now, understanding where it has come from, and strategizing
about where it is going. No longer can a false dichotomy exist between strategic planning and
capacity building; all capacity building must be strategic in both its intent and its positioning.
In the nonprofit stakeholder profile found in the appendix of this report, we share an example
of a six-step process for conducting a detailed diagnosis and capacity-building assessment.
While it is found in the nonprofit section, the six steps could easily apply to all organizational
types. It includes an analysis of where an organization sits within the larger ecosystem and
investigates who in the organization needs to change.
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TCC GROUP
Civil
Society
Community/Network
Capacity
Organizational
Capacity
Individual
Department
Directing focus inward and outward. Capacity building has primarily been seen as something
that funders looked outward to provide to grantees and that nonprofits looked inward to provide
for themselves. Businesses had proven management processes they pushed out to others to adopt
and capacity builders passed along those processes in contextualized packages. In CB 3.0, all actors
simultaneously focus inward on their own capacity and seek to outwardly enhance the capacity
of their entire network of stakeholders. Nonprofits manage expectations of donors and are able
to provide feedback on what is working through tools like the Center for Effective Philanthropys
Grantee Perception Reports. Businesses listen to stakeholders about what effective corporate
citizenship means in a given context and those stakeholders demand accountability. The process
is one in which the actors in the social sector must be committed to building their own capacity and
providing capacity support to their ecosystem.
Assessing capacity-building progress. Both those doing capacity building and those working
to build capacity need to frequently assess what is working and why. This requires clearly defined
intent behind capacity-building efforts as well as thoughtfully developed indicators of progress.
Ideally this will be done as part of a capacity-building planning process. Good assessment processes
will obtain feedback from multiple stakeholders, not just the individuals directly involved.
Assessment should also include elements of quality judged against best practices in the field.
Finally, feedback from capacity-building assessments should be rapid enough that changes can
be made to improve the on-going work.
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Conclusion
The world has changed, but the social sectors understanding of capacity and capacity building have
not kept pace. Nonprofits, funders, and companies are acting together more often, whether forced
by budget cuts or drawn by the promise of collective impact. Our frameworks for conceptualizing
capacity and the processes needed to build it for a networked world need to catch up.
In a Capacity Building 3.0 world, all of the stakeholders in the sector should be candidates for
capacity building. This who of capacity building includes nonprofits, funders, businesses,
government, and MSOs. Further, unique combinations of these actors coming together creates
a need to increase corresponding network capacity.
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TCC GROUP
Key capacities go beyond individual skills or even organizational skills in Capacity Building 3.0.
The what of capacity building includes the ability to understand the ecosystem in which the
organization is operating, the skills to respond to that ecosystem, and the structures for operating
within that ecosystem.
In a Capacity Building 3.0 world, the execution of capacity building should include thoughtful
analysis and draw on every actor as both a capacity builder and capacity-building recipient.
The how of capacity building will include embracing change-management support, engaging
diversity, and strategically positioning the work within an ecosystem context rather than solely
an individual or organizational context.
The work of capacity building is not just the domain of consultants or MSOs. Capacity Building 3.0
is the domain of every actor in the social sector. Each must intentionally commit to responsibly position
itself and effectively execute activities in its defined ecosystem of social good. But that is not alleach
actor must also commit to helping other actors in their ecosystem do the same. By focusing on the
who, the what, and the how of capacity building, TCC Group believes the field can significantly
advance the important role of capacity building, thereby advancing social impact addressing the
numerous issues of todays complex world. We look forward to working with our colleagues in the
sector to make this a reality.
What
How
CB 1.0
Individuals
Technical Assistance
CB 2.0
Organizations,
Primarily Nonprofits
Functionality
and Effectiveness
Sequenced Interventions
Organizations, Groups
of Organizations
Actualization, Relational
Contextualization, and
Embeddedness
Effective Consumers
Funder Capacity
Engaging Diversity
Network Capacity
Change Management
Support
CB 3.0
Systems, Movements
Corporate Capacity
Coalition Capacity
Cohorts
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Appendices
Stakeholder Profile: Funders
Funders are distinctive actors within social ecosystems. They are primarily identified with their
ability to make grants of money, but they also have other tools like voice, knowledge, and reputation.
Applying this range of tools requires particular forms of capacity, which only partly overlap with those
of other actors. But, too often, funders overlook the need to build their own capacity. As a result,
they miss opportunities to leverage the full range of their assets toward social impact. Part of Capacity
Building 3.0 is acknowledging the what of Funder Capacity, defining the who, and clarifying the how.
There are many ways to define and classify the full range of roles that funders play. GEO, for
example, uses the rubric of Investor, Broker, Learner, Connector, Influencer with respect to funder
roles in supporting movements (Grantmakers for Effective Organizations, 2013). At TCC, we have
found it helpful to think in terms of four roles that funders play in their work more generally:
Investing (of financial and human capital), Including (engaging diversity and practicing stakeholder
engagement), Informing (leveraging the knowledge the foundation has internally and sharing it
externally), and Influencing (using reputation and other assets to shape outcomes directly). In the
table on the next page, we group distinctive funder capacities within these four categories.
What are the ways that funders can better participate in social ecosystems, and the capacities
associated with those forms of participation?
20
TCC GROUP
Investing
Including
Informing
Influencing
21
22
TCC GROUP
The Fundamentals
The Accelerators
23
24
TCC GROUP
25
26
TCC GROUP
Acknowledgements
We would like to thank the many people who provided assistance with this paper, in particular, our
smart and thoughtful colleagues at TCC Group, present and past. In the latter group, Paul Connolly,
Sally Munemitsu, and Peter York did extensive work on concept elements of CB 3.0. Leonor Alfonso,
Kathleen Enright, and Dennis McMillian all provided very helpful feedback on drafts of the paper.
Finally, we would like to thank our fantastic clients and peers in the sector with whom we get to share
the capacity-building journey day by day. It is their passion and dedication that inspires us in our work.
This is an ongoing conversation, and we hope to have helped organize a few of the disparate strands.
We look forward to participating with our social-sector colleagues in a more targeted and nuanced
dialogue about the future of capacity building. The needs of the day demand no less.
Have a reaction to CB 3.0? Email us at cb3.0@tccgrp.com or share it on twitter using #cb3.0
Calling all members of the social sector: Have something to contribute to the evolution of capacity
building? We would love to hear from you!
27
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Notes
Notes
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