NNSI Research Report: The Nonprofit Capacities Instrument

blackboard with light bulb

By: Katherine Cooper

In recent years, funders and consultants have emphasized building nonprofit capacity – that is, the processes, practices, and people that a nonprofit has at its disposal that enables it to produce, perform, or deploy resources to achieve its mission. Many organizations have developed their own tools for assessing capacity; however, despite having a variety of available options, nonprofit leaders struggle to measure capacity. This is in part because a number of the exiting capacity tools are expensive or time-consuming for nonprofit leaders to complete. Additionally, the abundance of existing measures raises questions as to which is the best instrument to use and how to interpret results.

The question of evaluating capacity also proves challenging for researchers in that few of the existing instruments have been empirically tested to determine whether they reliably measure capacity across different nonprofit contexts. In a study that recently appeared in Nonprofit Management & Leadership, NNSI researchers Michelle Shumate and Katherine R. Cooper, along with Andrew Pilny (University of Kentucky) and Macarena Peña-y-Lillo (Universidad Diego Portales) sought to develop a measure of nonprofit capacity that would be relevant to nonprofit organizations regardless of their mission, location, or size. To this end, we reviewed an existing capacity measures to identify common survey questions. Over a five-year process, researchers tested these questions – in four different languages – on hundreds of nonprofit organizations around the world to develop a survey that would be useful regardless of nonprofit mission, size, age, or location.

What is the main finding of the study?

After analyzing results from around the world, we find that what is commonly referred to as “nonprofit capacity” should actually be thought of as “capacities.” Our statistical analysis suggested that nonprofit organizations might instead think in terms of eight capacities: financial management, adaptive capacity, strategic planning, external communication, board leadership, operational capacity, mission orientation, and staff management.

What are the implications for nonprofits?

  • The instrument’s designation of eight nonprofit capacities enables organizations to identify specific areas where they are successful and other areas that need improvement.
  • By creating a relatively short, self-administered survey instrument (45 questions), nonprofit leaders can assess their capacities without paying consulting or licensing fees to conduct or interpret results.
  • Because the Nonprofit Capacities Instrument has been empirically tested across diverse organizations, it allows for nonprofit funders or practitioners to compare data or benchmark results against other nonprofits.

References

Shumate, M., Cooper, K. R., Pilny, A., & Pena‐y‐lillo, M. (2017). The Nonprofit Capacities Instrument. Nonprofit Management and Leadership, 28(2), 155-174.