The Nonprofit Capacities Instrument

• Date: 01 December 2017
• DOI: http://doi.org/10.1002/nml.21276
• Author: Andrew Pilny,Katherine R. Cooper,Macarena Pena‐y‐lillo,Michelle Shumate
• Published date: 01 December 2017

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N M  L, vol. 28, no. 2, Winter 2017 © 2017 Wiley Periodicals, Inc.

Published online in Wiley Online Library (wileyonlinelibrary.com) DOI: 10.1002/nml.21276

Journal sponsored by the Jack, Joseph and Morton Mandel School of Applied Social Sciences, Case Western Reserve University.

 e Nonprofi t Capacities Instrument

Michelle Shumate, 1 Katherine R. Cooper, 1 Andrew Pilny ,2

Macarena Pena-y-lillo 3

1Northwestern University, 2University of Kentucky, 3 Universidad Diego Portales

Nonprofits are guided by internal efforts and external mandates to build capacity. How-

ever, scholars and grant makers are hampered by varied definitions of the concept, com-

peting but untested models, and the lack of a reliable and valid measure. This research

defines nonprofit capacity as the processes, practices, and people that the organization has

at its disposal that enable it to produce, perform, or deploy resources to achieve its mission.

An inductive-confirmatory two-study approach introduces and validates the Nonprofit

Capacities Instrument, a 45-item measure of eight nonprofit capacities derived from exist-

ing instruments. The capacities are (1) financial management, (2) adaptive capacity, (3)

strategic planning, (4) external communication, (5) board leadership, (6) operational

capacity, (7) mission orientation, and (8) staff management. Intriguingly, this research

demonstrates that nonprofit capacity is not a singular or second-order concept, but better

described in its plural form, nonprofit capacities.

Keywords: instrument validation , nonprofit capacity

CAPACITY-BUILDING INITIATIVES ARE common across nonprofit organizations, with

numerous organizations and programs designed to improve capacity (e.g., Americorp CTC

Vista, National Council of Nonprofi ts). In spite of this signifi cant investment, there is no

unifying defi nition or model of nonprofi t capacity (Christensen and Gazley 2008 ). More-

over, both researchers and funders lack the ability to compare similar organizations ’ capacity

or the relative eff ectiveness of diff erent capacity-building initiatives.

The purpose of this research is to introduce the Nonprofit Capacities Instrument, a self-

report measure of capacity that allows researchers, foundations, and practitioners to compare

the capacities of nonprofit organizations using a standard metric. This research makes two

contributions. First, we introduce a model of nonprofit capacity and demonstrate that it

should be understood as interrelated nonprofit capacities , not as a second-order multidimen-

sional construct (i.e., a single concept composed of multiple subdimensions claimed by exist-

ing conceptual models). Second and relatedly, this research answers Brown ’ s ( 2012 ) call for a

self-guided instrument that would allow for practitioners to assess their capacity without the

need for external facilitation.

Correspondence to: Michelle Shumate, Northwestern University, School of Communication, 2240 Campus Drive,

Evanston, IL 60208. E-mail: shumate@northwestern.edu.

Research Article

Nonprofi t Management & Leadership DOI: 10.1002/nml

156 SHUMATE, COOPER, PILNY, PENAYLILLO

Defi ning and Measuring Nonprofi t Capacity

Nonprofit capacity definitions differ in the number of dimensions of capacity, the scope of

application, and the universality of the concept across organizations (see Christensen and Gaz-

ley 2008 for a review). In this research, we define nonprofit capacity as the processes, practices,

and people that the organization has at its disposal that enable it to produce, perform, or

deploy resources to achieve its mission. This definition highlights that capacity ultimately is

about an ability to accomplish organizational goals and mandates.

The concept of capacity is not without controversy. Christensen and Gazley ( 2008 ) acknowl-

edge that reviews of the concept indicate “a fragmented and disarrayed approach to the use

of ‘capacity’ in conceptual and empirical work” (266). Their concerns include the use of syn-

onyms (e.g., ability ) or approximations of the term ( capacity building ), and whether capacity

is an input or output, resource or process, a uni- or multidimensional construct. Some defini-

tions of capacity are drawn from resource management. Most recently, Despard ( 2017 ) refers

to capacity as the “resources, skills, and functions a nonprofit organization needs to fulfill its

mission across multiple domains” (608). Despard draws this understanding of capacity from

previous scholarship (e.g., Andrews and Boyne 2010 ; Light 2004 ; McKinsey and Company

2001 ; Millesen, Carman, and Bies 2010 ). Our definition of capacity is consistent with defini-

tions from across the decades that emphasize capacity as ability (e.g., Yu-Lee 2002 ), such as

Honadle ’ s ( 1981 ) assertion of capacity as the ability for organizations to achieve their aims.

Having defined nonprofit capacity, we suggest a rationale for developing an instrument to

measure it. First, public administration and nonprofit researchers emphasize the importance

of the term and that it is multidimensional but disagree on the number and character of

capacities (Christensen and Gazley 2008 ). As Christensen and Gazley note, researchers have

generally selected a limited number of capacity dimensions and failed to develop robust mea-

sures of the concept.

Second, a singular valid measure of capacity is needed because so many similar, untested

instruments are used in the field (e.g., Bartczak 2005 ; Child Survival Technical Support Proj-

ect 2001 ; Levinger and Bloom 1997 ; PACT 1996 ; USAID Center for Development Infor-

mation and Evaluation 2000 ). Table 1 includes a brief illustration of some of the capacity

instruments that exist. The table highlights that capacity instruments differ in the number of

capacity dimensions, the types of dimensions that should be considered capacity, the format

of the instrument, and whether the instrument should be administered by a trained facilita-

tor or could be self-administered.

The existing instruments have problems that we seek to remedy in this research. First, all

but one (Despard 2017 ) of the current tools have not been empirically validated; there is no

evidence that these instruments reliably measure what they claim to measure. Second, non-

profits lack a self-evaluation tool that can also be compared to other organizational findings

for the purpose of improving organizational learning. Many existing capacity instruments

are time consuming and require an external facilitator (e.g., Gupta et al. 2006 ). This is prob-

lematic in that many organizations do not have the budget for external evaluation (Liket,

Rey-Garcia and Maas 2014 ) or lack the technical capacity to conduct the evaluation (Car-

man and Fredericks 2010 ). These limitations also mean that most capacity instruments are

unusable for benchmarking, or the process of “measuring and comparing an organization ’ s

business processes” to help improve organizational performance (Saul 2004 , 7). Although