What is Capacity Building?

We have written multiple articles now on using the right words in your proposal and organization. For this article, we will look at one specific term. ‘Capacity building’ is a widely-used word in philanthropy. Donors use it, NGOs use it, evaluators use it, fundraisers and proposal writers use it often as well. Other common variations include capacity development, improving capacity, strengthening capacity, etc.

But how does such a common term seem to have no clear meaning? This article will look at the ways capacity building is used in philanthropy and when it does and does not work.

How is it used?

The first point of confusion is that ‘capacity’ has multiple definitions. Here are just some definitions by Oxford Dictionaries of the word capacity:

1. The maximum amount that something can contain.
2. The amount that something can produce.
3. The ability or power to do or understand something.
4. A specified role or position.

Not only does the term have various meanings, it can also be used in many different contexts. Here are some examples of where you may find it used:

• Building a high-capacity NGO
• Capacity-building grant
• Building capacity in the community

Confused? That’s OK. The term ‘capacity building’ has become generic to the point that can mean a lot of things. Here is what each of the above examples most likely means.

• Building a high-capacity NGO: Helping an organization gain the skills and ability to run programs successfully and continue its success in the long-term.
• Capacity-building grant: Funding used for core costs like hiring additional support staff, team training, purchase of better or more efficient tools, etc.
• Building capacity in the community: Helping train, educate, or advocate for beneficiaries to gain the skills and ability to improve their lives.

Why is it used?

Because of its various meanings, ‘capacity’ has become a way to say a lot with just a little. This word is both very useful and very troublesome because it is so vague.

For example, an NGO may want to write a proposal for a capacity-building grant. ‘Capacity-building’ may sound more appealing to donors than ‘general support’ or ‘unrestricted funding.’ It shows that the NGO is focused on improving its overall efficiency and increasing sustainability. It is also simply easier to ask for capacity-building resources than to list out each individual line item. It saves both the NGO and donor time to read, and also allows for more flexibility in the grant when approved.

However, the same flexibility may become a problem later on. Since the meaning here is not directly stated, the NGO and donor may have different expectations for how the grant can be spent. For example, an NGO may assume a capacity-building grant is perfect for purchasing their own office building. Some donors may agree, some may disagree. If the NGO does not check beforehand, or the donor does not confirm their expectations, there could be trouble later on.

In conclusion, ‘capacity building’ can be a very useful term in many circumstances. However, something too broad can also have no meaning at all. It is fine to continue using this term, but do take care to properly explain what you mean by using the term so that there is less confusion later on.

What other ways have you seen ‘capacity’ used? Help spread the word and let us know in the comments!