Government-funded contracts are widely known to test the internal capacity of non-profit organisations (NPOs). Smaller faith-related NPOs are considered to be particularly lacking in the capacity needed to manage such contracts. Based on the uneven experiences of ten small faith-related
non-profit organisations in a federal initiative in the United States, this article details four capacity areas critical to effective adaptation to the demands of government contracts: professional leadership, human resource management, strategy development and organisational alignment, and
prior contract experience. Besides these internal organisational capacities, a key external factor found to predict effective adaptation is the capacity building given by support organisations that share the same faith orientation. However, two other factors explain the lack of pervasive adaptation,
namely the financial strength of support organisations and funder perception of effective performance. The research contributes to neo-institutionalist arguments that attention to capacity and capacity builders may explain variations in adoption of practices that support public service delivery
among small faith-related NPOs.
- ingentaconnect article page [Link]