APPENDIX: CAPACITY ASSESSMENT GRID - ILJ

1 D E S C R I P T I O N The McKinsey CAPACITY ASSESSMENT grid is a tool designed tohelp nonprofit organizations assess their organizational capaci-ty. The grid should be used in conjunction with the CapacityFramework, which explains the seven elements of organization-al CAPACITY and their components. The grid asks the reader toscore the organization on each element of organizationalcapacity, by selecting the text that best describes the organiza-tion's current status or performance. The framework and thedescriptions in the grid were developed based on our team scollective experience as well as the input of many nonprofitexperts and practitioners. The grid may be used by nonprofit managers, staff, boardmembers and external CAPACITY builders and funders with thefollowing objectives: To identify those particular areas of CAPACITY that are strongestand those that need improvement To measure changes in an organization's CAPACITY over time To draw out different views within an organization regardingits CAPACITY .

2 Different responses to the grid among staff, Boardmembers and funders, for example, can be a valuablediscussion-starter within an organizationAPPENDIX: CAPACITY ASSESSMENT GRID77 Venture Philanthropy Partners The grid is not a scientific tool, and should not be used as is very difficult to quantify the dimensions of CAPACITY , andthe descriptive text under each score in the grid is not meant tobe exact. The scores are meant to provide a general indication a "temperature" taking, if you will of an organization'scapacity level, in order to identify potential areas for improve-ment. Furthermore, the results of the exercise should be inter-preted in the context of the organizatins stage of example, a score of 2 on organizational processes maybe sufficient for a new organization, and this area may notmerit immediate attention.

3 In fact, many organizations maynever get to level 4 on many elements. This tool is meant to be a starting point only. We encourageyou to adapt the grid to meet your own organization's capacityassessment N S T R U CT I O N SGUIDELINES FOR SURVEY ADMINISTRATORS Decide for which point(s) in time you want to assess the nonprofit'sorganizational CAPACITY , today, beginning of last year, 3 yearsago, etc. You may choose to assess the organization at twodifferent points in time, in order to measure changes in the people whom you want to assess the nonprofit(assessors); these can include nonprofit staff members, boardmembers, or external parties. Ideally, assessors should have a goodknowledge of the organization for all points in time chosen for ASSESSMENT Grid7879 Venture Philanthropy PartnersFor the human resources section, decide whom you wish toevaluate in the set of rows pertaining to "CEO/ED and/or seniormanagement team.

4 " Options include 1) CEO/ED only; 2) CEO/EDand senior management team considered collectively; 3) CEO/EDon the one hand and senior management team on the other; or 4)individuals taken separately. If you choose option 3 or 4, you mayneed to copy the relevant section for each separate person or groupof persons covered by the FOR THOSE FILLING OUT THE SURVEY(ASSESSORS) For each row, determine the description most suitable for the pointin time chosen and write the date ( , 6/99) in that box. If youare also conducting the ASSESSMENT for a second point in time,repeat the procedure with the corresponding date ( , 6/01). Mark the box that is closest to describing the situation at hand;descriptions will rarely be perfect. Interpret the text loosely whennecessary and keep in mind that you are trying to score yourorganization on the continuum of "1" to "4.

5 " You may select thelimit between two boxes if this seems most a row is not relevant to the organization assessed, designate therow "N/A"; if you simply have no knowledge, mark the row"N/K." A PDF file of the CAPACITY ASSESSMENT grid can be obtained onVenture Philanthropy Partners Web site, ASSESSMENT Grid80I. Aspirations Mission Vision clarity Vision boldness Overarching goalsII. Strategy Overall strategy Goals/performance targets Program relevance, and integration Program growth and replication New program development Funding modelIII. Organizational skills Performance management Performance measurement Performance analysis and program adjustments Planning Monitoring of landscape Strategic planning Financial planning/budgeting Operational planning Human resources planning Fund-raising and revenue generation Fund-raising Revenue generation External relationship building and management Partnership and alliances development and nurturing Local community presence and involvementCapacity ASSESSMENT GridCONTENTS 81 Venture Philanthropy Partners Other organizational skills Public relations and marketing Influencing of policy-making Management of legal and liability matters Organizational processes use and development IV.

6 Human resources Staffing levels Board composition and commitment Board involvement and support CEO/executive director and/or senior management team Passion and vision Impact orientation People and organizational leadership/effectiveness Personal and interpersonal effectiveness Analytical and strategic thinking Financial judgment Experience and standing Management team and staff dependence on CEO/executive director Senior management team (if not previously covered) Staff and infrastructure Systems Planning systems Decision making framework Financial operations management Human resources management management recruiting, development , and retentionCapacity ASSESSMENT GridCapacity ASSESSMENT Grid82 Human resources management general staff recruiting, development , and retention Human resources management incentives Knowledge management Infrastructure Physical infrastructure buildings and office space Technological infrastructure telephone/fax Technological infrastructure computers, applications,network, and e-mail Technological infrastructure Web site Technological infrastructure databases and management reporting systemsVI.

7 Organizational structure Board governance Organizational design Interfunctional coordination Individual job designVII. Culture Performance as shared value Other shared beliefs and values Shared references and practices83 Venture Philanthropy PartnersI. ASPIRATIONS1 Clear need forincreased capacity2 Basic level ofcapacity in place3 Moderate level ofcapacity in place4 High level ofcapacity in placeMissionNo written missionor limitedexpression of theorganization s reason forexistence; lacks clarity orspecificity; either held byvery few in organization orrarely referred toSome expressionof organization sreason for existencethat reflects its valuesand purpose, but maylack clarity; held by only afew; lacks broadagreement or rarelyreferred toClear expressionof organization sreason for existencewhich reflects its valuesand purpose.

8 Held bymany within organizationand often referred toClear expressionof organization sreason for existence whichdescribes an enduringreality that reflects itsvalues and purpose; broadlyheld within organization andfrequently referred toVision clarityLittle sharedunderstanding ofwhat organization aspiresto become or achievebeyond the statedmissionSomewhat clearor specific under-standing of whatorganization aspires tobecome or achieve; lacksspecificity or clarity; heldby only a few; or on thewall, but rarely used todirect actions or setprioritiesClear and specificunderstanding ofwhat organization aspiresto become or achieve;held by many within theorganization and oftenused to direct actions andset prioritiesClear, specific,and compellingunderstanding of whatorganization aspires tobecome or achieve; broadlyheld within organization andconsistently used to directactions and set prioritiesVision boldnessNo clear visionarticulatedVision exists butfalls short ofreflecting an inspiringview of the future and ofbeing demanding yetachievableVision is distinctivealong only one offollowing two attributes:reflects an inspiring viewof future.

9 Demanding yetachievableVision reflects aninspiring view offuture and is demandingbut achievableMcKinsey CapacityAssessment Grid84 Overarching goalsVision (if it exists)not explicitlytranslated into small setof concrete goals, thoughthere may be general (butinconsistent andimprecise) knowledgewithin organization ofoverarching goals andwhat it aims to achieveVision translatedinto a concreteset of goals; goals lack atleast two of following fourattributes: clarity,boldness, associatedmetrics, or time frame formeasuring attainment;goals known by only afew, or only occasionallyused to direct actions orset prioritiesVision translatedinto small set ofconcrete goals, but goalslack at most two offollowing four attributes:clarity, boldness,associated metrics, ortime frame for measuringattainment; goals areknown by many withinorganization and oftenused by them to directactions and set prioritiesVision translated intoclear, bold set of (upto three) goals thatorganization aims toachieve, specified byconcrete to measuresuccess for each criterion,and by well-defined timeframes for attaining goals;goals are broadly knownwithin organization andconsistently used to directactions and set priorities85 Venture Philanthropy PartnersII.

10 STRATEGY1 Clear need forincreased capacity2 Basic level ofcapacity in place3 Moderate level ofcapacity in place4 High level ofcapacity in placeOverall strategyStrategy is eithernonexistent,unclear, or incoherent(largely set of scatteredinitiatives); strategy hasno influence over day-to-day behaviorStrategy existsbut is either notclearly linked to mission,vision, and overarchinggoals, or lackscoherence, or is noteasily actionable;strategy is not broadlyknown and has limitedinfluence over day-to-daybehaviorCoherentstrategy hasbeen developed and islinked to mission andvision but is not fullyready to be acted upon;strategy is mostly knownand day-to-day behavior ispartly driven by itOrganization hasclear, coherentmedium- to long-termstrategy that is bothactionable and linked tooverall mission, vision, andoverarching goals; strategyis broadly known andconsistently helps drive day-to-day behavior at all levelsof organizationGoals/performancetargetsTarg ets are non-existent or few;targets are vague, orconfusing, or either tooeasy or impossible toachieve; not clearly linkedto aspirations andstrategy, and may changefrom year to year; targetslargely unknown orignored by staffRealistic targetsexist in somekey areas, and are mostlyaligned with aspirationsand strategy.