top of page

What Is Capacity Building, Why Is It Needed, and How Does It Help Nonprofits?

Running a nonprofit can be very rewarding as you watch individuals and communities overcome challenges through the assistance provided by your programs. But nonprofit leadership can also be challenging as you face the increased numbers of people needing services, high turnover in your team, funders increasing their reporting requirements, and inefficient administration tools such as paper forms and Excel spreadsheets. An important strategy for overcoming these ongoing challenges is an intentional focus on capacity building.

What is Capacity Building?

Operational capacity means the amount of work your organization can complete with a given set of resources. In the social good sector, operational capacity translates to the amount of services your nonprofit can provide with your current team, financial resources, and technological tools. Capacity building is the act of increasing operational capacity through increased access to resources and better use of the resources you have.

Focusing on capacity building means you will have more available capacity to serve your beneficiaries in the short term, but it also improves the chances of long-term success for your organization. Change takes time, and the future is unpredictable. Capacity building means you will have the capabilities required to address needs now and in the coming years.

Building your skills and capabilities can also improve your fundraising. Funders invest in nonprofits which have the capacity to fulfill their missions. Capacity building makes you more competitive for grant applications and fundraisers.

Different Kinds of Capacity Building

There are three primary types of capacity building projects that your nonprofit should prioritize. The first is individual. People are the most valuable resource of your organization, and increasing the capacity of individual team members creates a greater capacity for the entire organization. Which leads to the second type, organizational capacity. Increasing your organization’s ability to deliver services leads to more individuals benefiting from your programs and a greater societal impact.

The last type of capacity buildings is at the ecosystem level. Your nonprofit does not exist in a vacuum and no organization can address every kind of need that exists. Communities prosper when a variety of organizations within the social good sector work together, leaning on each other’s strengths to expand and improve services. Capacity building with the ecosystem in mind provides the best opportunity to develop a broad impact.

How to Implement Capacity Building

Prioritizing capacity building for your organization may seem daunting, but you can accomplish it with a few straightforward strategies.


Leaders who create strong performance cultures view ongoing training as the lifeblood of the organization. Your team members will reach their highest capacity when provided support and encouragement in both their job-specific skills and their professional development. Successful training occurs in a variety of formats and experiences. Formal training opportunities include workshops, conferences, and written materials. Less formal strategies include mentoring, job shadowing, and hands-on trial and error. Mixing the two approaches will provide your team the best chance of success.

Feedback and Accountability

Nonprofits with strong performance cultures value feedback and accountability. Leaders who prioritize capacity building welcome feedback from stakeholders on topics, including product development, operations, and client satisfaction. They also seek and consider assessments from their team members regarding their management styles, opportunities for organizational improvement, and staff satisfaction. Accountability is an essential piece of any successful organization. Your team members need to know what they need to do, why it is important, and then be held accountable for making sure it happens.

Enabling Constructive Change

Few people look forward to experiencing change, many even fear change. But progress and improvement are not possible without embracing changes to methods, practices, or tools. Constructive change means altering your organization in a way that provides positive results. The most successful nonprofit leaders redirect organizational energy in ways that enhance quality and improve effectiveness.

SureImpact is a purpose-built impact management platform that is designed for social-good providers by social-good providers. SureImpact’s simple and collaborative case management and outcome tracking tools are designed to help nonprofits manage, measure, and communicate their social impact while also building their capacity to create constructive change.

For more nonprofit leadership tips, see “How to Ensure Your Nonprofit Thrives in Uncertain Communities.”


bottom of page