Organizational Assessment Overview
The Fieldstone Alliance Organizational Assessment is designed to lay the groundwork for building the capacity of an organization to better accomplish its mission. The assessment provides an overview of an organization’s current capabilities and identifies areas where changes will yield the greatest benefit. The process is based on the following understanding of what capacity building is and six interdependent factors that contribute to the health and performance of a nonprofit organization. (Also see related article "Six Components of Organizational Capacity.")
What Capacity Building Is
Capacity is an abstract term that describes a wide range of capabilities, knowledge, and resources that nonprofits need in order to be effective. Organizational capacity is multifaceted and continually evolving. The figure to the right depicts the elements of nonprofit organizational capacity. Capacity building involves planful, systematic development of an organization’s ability to deliver on their mission, including attention to all of these aspects of capacity.
Components of Nonprofit Organizational Capacity
The model shown includes six components of organizational capacity that are necessary for high performance:
- Mission, Vision, and Strategy
- Governance and Leadership
- Capital Structure (resource development, finance)
- Internal Operations and Management
- Program Delivery and Impact
- Strategic Relationships
These interdependent factors all contribute to the health and performance of a nonprofit organization. The model also suggests continual interaction between the organization’s external environment and its internal components.
Mission, Vision, and Strategy: The organization has a vital mission and a clear understanding of its identity. It is able to clearly articulate organizational values. It is actively involved in regular, results-oriented, strategic, and self-reflective thinking and planning that aligns strategies with the mission, values, and organizational capacity. The planning process involves stakeholders in an ongoing dialogue that ensures that the organization’s mission and programs are aligned and relevant to constituencies served.
Governance and Leadership: Members of the organization’s board of directors are engaged and representative, with defined and appropriate governance practices. The board effectively oversees the policies, programs, and organizational operations including review of achievement of strategic goals, financial status, and executive director performance. The organization is accomplished at recruiting, developing, and retaining capable staff and technical resources. Internal communications are effective, and the organization’s culture promotes high-quality work and respectful work relationships. The organization’s leadership is alert to changing community needs and realities.
Capital Structure (resource development, finance): The organization exhibits effective leadership in financial planning and management. Long-term financial strategies are in place. The organization successfully secures support from a variety of sources to ensure its revenues are diversified, stable, and sufficient for the mission and goals. The resource development plan is aligned with the mission, long-term goals, and strategic direction.
Internal Operations and Management: The organization has efficient and effective internal operations and systems. The organization utilizes information effectively for organizational and program management purposes. Asset, risk, and technology management is strong and appropriate to the organization’s purpose.
Program Delivery and Impact: The organization operates programs and conducts activities that demonstrate tangible outcomes and impact appropriate to the resources invested. The organization demonstrates a concern for quality and constant improvement. The organization utilizes program evaluation results to inform its strategic goals. The organization understands community needs and has formal mechanisms for assessing internal and external factors that affect the achievement of goals.
Strategic Relationships: The organization is a respected and active participant and leader in the community, and maintains strong connections with its stakeholders. It participates in strategic alliances and partnerships that significantly advance the organization’s goals and expand its influence. It communicates well with external audiences. To what extent does the organization have strategic relationships that advance the organization’s goals?
Each of the components serves a critical role in an organization’s overall effectiveness. Mission, vision, and strategy are the driving forces that give the organization its purpose and direction. Program delivery and impact are the nonprofit’s primary reasons for existence, just as profit is a primary aim for most businesses. Strategic relationships, finance, and internal operations are all necessary mechanisms to achieve the organization’s ends. Governance and leadership are the lubricant that keeps all the parts aligned and moving. All of these components are affected by the environment in which the organization exists.
Organizational Assessment Process
When assessing organizations and planning for change, it is important to examine each component separately, in relation to the others, and within the organization’s overall context. Organizations operate as complex systems in which a change in any one part of the system affects other parts and the functioning of the whole. For example, a change in leadership will affect the organizational culture, which can in turn change productivity levels and financial performance, for the better or worse. In addition, a variety of factors can influence an organization’s needs at any time, including:
- Age and developmental stage of the organization
- Size of the organization
- Kind of work the organization does
- Cultural or ethnic identity of the organization
- Environment in which the organization functions
These factors require an organizational assessment process that adapts to the timing and unique needs of the organization. Fieldstone Alliance has developed and tested a multi-phase organizational assessment process based on the elements described above. In consultation with the organization’s leadership, the consultant works with the organization through three phases: an information gathering phase, a priority-setting phase, and an action-planning phase. During each of these phases we combine the best thinking of your board, staff, and stakeholders with the expertise of an external consultant to result in a plan of action for you to use in strengthening your organization.
For more information, please contact Sandy Jacobsen at 651.556.4510 or email her at sjacobsen@FieldstoneAlliance.org