Ambo University

College of Business and Economics

Department of Public Administration and Development

Management

Course Module on

Management of Local Development and Resource

Moblization(

October 2016
Ambo, Ehtiopia

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 Course Introduction

Traditionally, the governments of developing countries have employed conventional public

sector organizations—sectoral agencies and local governments—to provide infrastructure and
services at local level. More recently, social funds using highly decentralized, participatory and
demand-based methods such as community driven development (CDD) have demonstrated
considerable success in getting resources to their intended beneficiaries and in achieving rapid
impacts. However such innovative approaches have not always ensured adequate coordination
and integration of their efforts with broader public sector governance and service provision. This
has led many to question the sustainability of both the infrastructure and services they finance
and the institutions and capacities they support. If developing countries are to achieve the
national development goals, social and economic conditions will have to improve in areas where
the world’s poor and low-income majority live.

Dear learners, welcome to the course local development and resource mobilization. As its name
indicates the course has two parts; part one discusses about local development and the second
part discusses about resources mobilization.

The first part of the module, local development, has five chapters. The first part discusses the
basic concepts of local development, significance of local development, keeping the local in
perspective in local development, and making the local people responsible to local development.
The part also discusses about local development framework. Under this section issues such as
aims of local development framework, internal and external elements of local development
framework, and the focus areas of local development framework are discussed in detail.
Different approaches namely, decentralized sectorial approach, local government approach, and
direct community support approach to local development are also discussed in the first part of
the module. The other isuue discussed here is the role of government in promoting local
development. The roles of government which discussed in detail in this chapter are improving
the enabling environment, enhancing capacities for local development, and providing external
support to local development. Finally entrepreneurship and local development is presented and
discussed. This part discusses how entrepreneur community and culture contribute to local

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development, the contributions entrepreneurs to local development, and how to build
entrepreneur culture in a given community.

The second part of the course introduces students with concepts and theories in resources
mobilization and management that are needed in executing community economic development.
The course will cover all aspects of resources mobilization from planning for a resource
mobilization strategy to executing the laid down strategies. Methods of fundraising and the use
of ICT and different Social Media platforms for resource mobilization will also be covered. The
course will also provide clarity between resource mobilization and fundraising, which is in most
cases, is refereed to resource mobilization. Very often, we equate the term “resource
mobilization” with fund raising. Raising funds or money is only a part of resource mobilization;
in fact, it can be a target or an outcome of resource mobilization efforts. The source will enable
students appreciate the fact that resource mobilization goes beyond just cash resources. Thus the
course will enable students to build valuable contacts and networks, and garnering the interest,
support, and in-kind contributions of people important to organizations.

Course Objective
Dear learners, after completing the module, you will be able to;
 Comprehend the concepts of local development,
 Discuss and analyze local development framework
 Discuss the focus areas of local development framework,
 Design, implement, and evaluate local development plans,
 Analyze and synthesize local development policies, plans, and programs,
 Understand the concepts resource mobilization and management and differentiate the
different types of resources,
 Identify sources of fund raising , techniques of resource mobilization and formulate fund
raising strategy and objectives including community based resource mobilization
strategy,
 Design a strategic frame work for resource mobilization and prepare successful proposal
writing for fund raising,

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 PART ONE: MANAGEMENT OF LOCAL
DEVELOPMENT

Chapter One

Clarifying the Core Concept: Why Local Development?

1. Introduction
Before getting into the details of the concepts of local development it is better to understand
some basics of it. Local development is closely linked to development of the local economy.
Improving local food security, household income, and the quality of livelihood options as well as
encouraging growth in the number, scale, and profitability of both formal and informal sector
businesses are important aspects of local development. Local economic development is both the
means to any equitable, sustainable local development process and one of its goals. Investments
in empowerment, local governance, and local service provision should consistently focus on the
economic dimension of their impacts. A focus on the local goes beyond questions of
organizational scale and efficiency to the fundamental question of who is responsible for local
development. It is agreed that local development is primarily the responsibility of local actors,
both residents and those affiliated with nonlocal organizations who work locally as contributors
to development processes.
2. Chapter Objective

After completing this module you will be able to

 Define the concept local development
 Comprehend national and local development linkages
 Analyze the significance of local development
 Define local development actors and their responsibilities.

3. What is Local Development?

Dear learners, you might have heard of the concept local development. From your own
experience, how you define the concept local development? After defining the concept, read

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the next section, it will give you the highlights of the concept.

The purpose of local development is to build the capacity of a defined territory, a municipality,
rural area, or region, to improve its economic future and the quality of life for inhabitants. This
definition emerges from a consensus between global institutions such as the World Bank, United
Nations, and the Organization for Economic Development and Co-operation (OECD),
academics, and from experienced practitioners on the ground.

Local development makes an important contribution to national economic performance and has
become more critical with increased global competition, population mobility, technological
advances, and consequential spatial differences and imbalances. Effective local development can
reduce disparities between poor and rich places, add to the stock of locally generated jobs and
firms, increase overall private sector investment, improve the information flows with investors
and developers, and increase the coherence and confidence with which local economic strategy is
pursued. This can also give rise to better diagnostic assessment of local economic assets and
distinctive advantages, and lead to more robust strategy assessment.

Cities have become a focus for renewed efforts to promote local development over the past many
years. National governments are recognizing the need to empower cities and regions so that they
can take the decisions and interventions needed to optimize their relative economic performance,
and thus contribute more to national growth and development. In some contexts this has led to a
renewed impulse for the devolution of power and authority to local governments, and in others it
has led to efforts by state, national, and federal governments to better support local and regional
initiatives.

To exploit these opportunities, local governments may need to support the adjustment of their
local economies, reengineer their offer and leverage their assets to better compete in an
internationally open and knowledge driven economy. This includes fostering the skills of the
labor pool as well as improving the productivity of infrastructure, the attractiveness of the
business environment and the quality of life available. It can also involve explicit efforts to
“reposition” the local economy within contested international markets for locations.

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The comparative advantages of having, and using, development tools effectively at the local
level include:
 improved alignment of goals and strategies between different public sector players and
civic/private partners;
 pace and certainty of the response to investors and developers;
 scale of the development that is simultaneously feasible within the city;
 the quality and conclusiveness of negotiations over how risks and costs will be shared
between public and private entities;
 the availability of a mechanism to help capture value and shape benefits of investments
and development;
 the unlocking of under-utilized assets;
 increased flexibility, and profitability, in property markets;
 better linkages between property, labor, and investment markets and wider efforts to
foster entrepreneurship, and other sources of growth; and
 better co-ordination generally, leading to optimal resource mobilization against agreed
priorities.

Local development incorporates the following characteristics:

a) It is bottoms up

While the sensitivity to local needs and opportunities is important, it is also appropriate that
development priorities should be determined in an environment which reflects the interest of
local governments, the business sector, community groups and voluntary organizations. This is
not to argue for the redundancy of the top down perspective, which remains vital for keeping a
set of overarching policy and strategic contexts, and indeed for taking responsibility for some
aspects of implementation. The important issue is to search for and agree the balance.

b) It is integrative

Local development concerns itself with making connections vertically and horizontally between
stakeholders and across programs. Integration seeks to enhance the capacity for seamless policy
making and smooth management while recognizing that innovative organizational approaches

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must have regard to variations in authority and responsibilities, relationships with government,
strategic preferences and bureaucratic culture.

c) It is strategically driven

Local development, in order to be effective, rises above an association with a series of ad hoc
initiatives in any locality. A clear direction based on local understanding of local issues and
supported by a confident but realistic vision of the future is vital. Local development is about
long-term targeted action to create change, both in places and with people. In conceptual terms,
the challenge is to maximize the degree of fit between planning and delivery.

d) It is collaborative

Local development requires the involvement of multiple stakeholders, working together rather
than on an individual basis. It is an inclusive activity that embraces the volunteerism within the
community and voluntary sectors, elected representatives, public officials and private sector
participants. Collaboration in its fullest expression is apparent in partnership governance.

e) It is interactive

Local development should not be perceived as solely a technical activity better left to others who
appear more qualified. The hegemony of public officials and a dependency upon consultants for
expertise can be tempered by a local development approach which recognizes the knowledge
based input of local people and businesses into agenda setting and implementation. The requires
an ongoing investment in local capacity through a combination of community development
processes and initiative management skills thus allowing progress in one sphere to reinforce
progress in the other.

f) It is multi-dimensional

Local development embraces a wide range of concerns. It does deal with job creation, business
growth and connecting people to jobs within the locality. But it also extends across a wide range
of social action; it reaches out to the most marginalized in local society, but requires the
participation of those who may, in relative terms, be asset rich. Making places work better is a
further dimension of local development and thus physical regeneration and environmental
improvements are part of the product base.

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 g) It is reflective

Local development is always willing to learn from experience regarding what works well under
different circumstances and that could work better. Monitoring and evaluation can strike a
combination of terror and frustration into those using public money, and while accountability and
the probity of spending are necessary, it is frequently the case that sufficient opportunities for
open reflection and shared learning do not occur. Local development sustainability is dependent
upon these being in place and in this context monitoring and evaluation can be an important part
of the empowering process.

h) It is assets based

Local development requires some public funding since the arena in which it is operating is often
one of market failure or weakness. The private sector, nevertheless, should be expected to play a
significant part in local development, along with contributions from the community and
voluntary sector. It is this bonding of multiple funding with local resources and opportunities
which can stimulate local development to do more things better and lead to the desired goal of
sustainability.

4. Concepts of Local Development

If developing countries are to achieve their own national development goals and goals those set
at international level, social and economic conditions will have to improve in areas where the
world’s poor and low-income majority live. Getting the desired results requires strengthening the
institutions at the local level that provide public services and enhance economic opportunities not
only around capital cities and other metropolitan centers of trade and commerce but also in more
remote and less privileged regions.
Local development is closely linked to development of the local economy. Improving local food
security, household income, and the quality of livelihood options as well as encouraging growth
in the number, scale, and profitability of both formal and informal sector businesses are
important aspects of local development.
In addition to its contribution to household welfare growth in production and commerce provides

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the base for local resource mobilization (through service user fees, local government taxes, and
voluntary contributions) to finance the provision of public services. Economic growth also
contributes to the capital stock for investment in local development, including human capital
from investment in the education and health of farmers, workers, and entrepreneurs and social
capital from the strengthening of relationships among financial institutions, suppliers of inputs,
producers, and purchasers of goods and services in the marketplace.

A more integrated approach to local development would empower local people, associations, and
firms for economic development by increasing opportunities to invest and to produce and sell
goods and services and increasing their capabilities (access to capital, to knowledge and skills, to
technology and inputs, and to support services and markets) to profit from these opportunities.
An important focus of this economic dimension of empowerment is the informal sector.
Reducing regulatory barriers and providing targeted support such as microfinance services and
technical assistance to household and very small-scale producers and traders can help to extend
the benefits of local economic development to the poor and other marginalized social groups.

The sort of local development framework contributes to local economic development in several
ways. First, public investment in basic infrastructure such as roads, water supply, and
telecommunication facilitates local business activity. Second, improving the local business
enabling environment lowers the entry costs and risks associated with business development.
Third, increasing the responsiveness and accountability of public sector decision making and
administration reduces corruption and other rent-seeking behavior that often suffocate private
sector activity. Finally, the convening power of local governments and other local public
agencies, often focused through strategic planning exercises linked to local development, can
bring together local development actors from the public sector, community organizations, and
the private sector to promote a more integrated, self-reinforcing economic development process
at the local level.

Local economic development is both the means to any equitable, sustainable local development
process and one of its goals. Investments in empowerment, local governance, and local service
provision should consistently focus on the economic dimension of their impacts. The challenges

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faced by poor and low-income people and communities are not neatly segmented into the
sectoral categories used by policymakers and public managers. Children’s health status depends
on the delivery of health services, but also on the education of their mothers and on access to
potable water. Income growth depends on promoting more productive technologies, but also on
improving transport and communication links to markets. Public services are enhanced by better
governance of service delivery organizations, which depends on the capacity of people to hold
service managers accountable. This well-known complexity of development processes, in which
“everything is connected to everything else”, differs from the way most public sectors and
development assistance programs are organized.

The result is a mismatch between the way governments and development agencies organize their
work and the way households and communities perceive their problems and organize their own
efforts to solve them. Participatory governance processes do not follow the technocratic
boundaries established by sectoral interventions. A spatial approach provides the logic for
integrating efforts across sectors. A local approach also corresponds to the diversity of local
development processes. The physical environment differs from place to place: both the variety
of local ecosystems and the social and economic networks geographically bounded by highlands
and rivers provide a natural spatial frame for development processes. Logic of intervention
centered on the local space facilitates adaptation to local contexts, both to the diversity of natural
environments and the diversity of local development processes. Decentralizing government and
development assistance programs enables interventions to be more effectively tailored to diverse
local conditions.
What do you think that how local development and national development are linked?

5. The Significance of Local Scale

Dear learners, different scholars and researchers recommend local development plan to make
development more inclusive and pro poor. What are the benefits you know about planning at
local level?
______________________________________________________________________________

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How large a space is the appropriate organizing frame for local development? Is regional, local,
or community, scale best suited for integrating development processes on the ground? These
scales are not unambiguously associated with a particular physical extension. From a political-
administrative perspective community scale is typically associated with villages or
neighborhoods; local scale with districts, municipalities, and towns; and regional scale with one
or several provinces or states. From a geographic perspective community scale is again
associated with the settlement (village or neighborhood); local scale with the primary nodes in
market, transport, communication, and service delivery networks that link small towns and their
service catchments; and regional scale with broader urban-rural structures centered on major
transport links and medium to large cities.

From a social perspective community scale is typically associated with face-to-face relationships,
local scale with a broader network of interactions often mediated by associational or identity-
based institutions, and regional scale with relations that transcend the intimacy of the social
networks in which people know each other and are structured principally by impersonal
institutions. In practice the concepts of community, local, and regional scale need to be
interpreted contextually, depending on particular political-administrative, geographic, and social
characteristics in each country.

Whatever its physical extension “local space” is a concept of intermediate scale, above
household and community scale and below regional and national scale. Organizing the
development process at this level offers a series of advantages, some resulting from its being
smaller than the state and some resulting from it being larger than the community:
 Sufficiently small to facilitate communication so that management and governance
processes are well nourished by relevant and timely information.
 Sufficiently large to permit supporting some specialization of functions for technical and
administrative professionals and associated technology whose contribution is spread
across several service delivery units.
 Sufficiently near in scale to informal social networks, associations, and institutions of
traditional governance to facilitate engaging their social capital.

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  Sufficiently large to encompass several communities and so to benefit from economies of
scale and more efficient allocation of resources, especially for facilities requiring greater
population or economic bases of demand.
 Correspondence with the lowest levels of the public sector’s administrative and
governance hierarchies—the first level or two above the service delivery unit.

Subsidiarity—the principle that public sector functions should be undertaken at the lowest level
possible—is frequently cited as a guiding principle for decentralization policies and processes.
The local level is the lowest that permits integration of the different logics by which government,
society, and economy are organized. These include the spatial logics of;
 Public service and infrastructure hierarchies (for discrete units such as schools and
clinics and networks structures such as roads),
 governance (linking centers of political authority and administrative capacity with their
jurisdiction),
 social capital (networks of relationships based in identity-based affiliation and voluntary
association), and
 Economic geography (linking rural resource-based production to urban market centers).

While initiatives providing support at the community and service delivery unit level are
important contributors to empowerment, the subsidiarity principle suggests also strengthening
and engaging institutions of governance and management at the next higher level. At this local
level encompassing several communities it is easier to achieve synergies and efficiencies among
public sector and community level processes linked in a common local space. Neighboring
communities are bound together by what happens at the local level. Organizing at this level
facilitates the complementary contributions of public sector and community level processes to
improve governance, public service delivery, and the dynamism of economic activity.
Community and local level initiatives contributing to development in districts, municipalities,
and small towns should be mutually reinforcing.

6. The Importance of Local Responsibility

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Dear learners, local development cannot be realized without making the local stakeholders
responsible for it. How do you think that we can make local stakeholders responsible?
A focus on the local goes beyond questions of organizational scale and efficiency to the
fundamental question of who is responsible for local development. It is agreed that local
development is primarily the responsibility of local actors, both residents and those affiliated
with nonlocal organizations who work locally as contributors to development processes. People
living and working at the local level affirm their responsibility by making the decisions,
mobilizing and managing the resources, organizing the collective action, delivering the services,
and ensuring the accountability of officials that contribute to local development. Without this
commitment to responsibility by local actors, desired economic and social development is
unlikely to be achieved and sustained.
That said, local responsibility is unlikely to be sufficient to ensure that local development takes
place. Local development is conditioned by broader environments and may benefit significantly
from externally determined institutional conditions and external support. But appropriate
national institutions and supportive resource flows can only supplement local responsibility.
They cannot act as the motivational basis for local development or replace the commitment of
local people to make the decisions and take the actions required to produce beneficial change on
their own behalf.

Unless local residents, leaders, entrepreneurs, politicians, public managers, and service delivery
personnel feel responsible for improving the quality of their life and that of their neighbors, they
are unlikely to expend the effort to overcome the challenges, whether routine or daunting, that
constrain local development. This sense of responsibility will be significantly enhanced by
efforts to focus consistently on agency and action at the local level.

7. Keeping the Local in Perspective

Dear learners, whenever, development planning is undertaken keeping local in perspective is
unquestionable. What are the advantages of local perspective in development planning?

Local development is part of a broader development processes. It is enabled and constrained by

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regional, national, and global social, environmental, and economic factors. Local actors may
respond to broader social and ideological forces, including the influences of globalization, as
significantly as they respond to incentives and interests defined by their immediate economic and
political environments.

While the local society and economy are influenced by local power relations, resource
endowments, incentive structures, information flows, and value systems, they are also subject to
constraints and opportunities structured by national constitutions and legislation. The law
attributes rights, powers, and standing to citizens, community institutions, civil society
organizations, economic associations and firms, and local governments.

Laws and government policies also define the relations of each of these institutions and actors to
the state and thus its potential role in governance and public management. Many of the local
actors to whom responsibility, resources, and authority are allocated by national agencies and
programs are more strongly accountable upward than they are downward to other local actors.
National governments allocate resources, set standards, organize service delivery systems, field
and supervise civil servants, and regulate local nongovernmental action. Any realistic discussion
of how to promote local development must thus recognize the significance of regional, national,
and global factors—whether through the influences of the social and economic environment or
through hierarchical governmental policies, institutions, and programs.

Until recently, the governments of developing countries have employed conventional public
sector organizations (sectoral agencies and local governments) to provide infrastructure and
services to all parts of the national territory. When it became clear that these two approaches
were not fully meeting the demand for basic services among the majority of residents,
governments and their international partners developed new community level approaches to
accelerate investment and target resources more effectively at the community level. They
developed social funds and other public sector funds to channel resources to the local level.
Many of these funds, using highly decentralized, participatory, and demand-based methods such
as community-driven development (CDD), have had considerable success getting resources to
intended beneficiaries and realizing desired investments. Despite their accomplishments,

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however, these innovative approaches have had difficulty coordinating and integrating their
efforts with broader public sector institutions and processes, diminishing the effectiveness and
sustainability of their investments:
 Community-driven development and social fund programs, even when supported by large
projects, usually represent a small portion of national resources allocated to local investment
and service delivery. Thus while contributing at the margin to more effective local
development; they may have relatively limited effect on broader and larger processes.
 Service delivery units resulting from community-driven investments sometimes do not
receive adequate staffing and recurrent cost support from sectoral departments or local
governments.
 Exclusive focus on community-level planning processes (absent area-based strategic plans)
often masks allocation decisions resulting from funding agency procedures (for example first
come, first served) or made by funding agency officials (for example selection of beneficiary
communities based on internal criteria).
 Decision processes at the community level often are not effectively linked to priorities and
resource allocations established by democratically accountable local government authorities.
 Ensuring the technical quality of investments and building adequate community capacity for
operation and maintenance require considerable commitment by sectoral agencies that may
not be adequately involved in planning or supervising community investments.

Three approaches to managing local public investment and service provision have sometimes
been seen as competitive. Decentralized sectoral approaches rely on functionally specialized
organizations at the local level, with operational autonomy allocated through deconcentration or
delegation policies. Local government approaches promote territorially organized political and
administrative institutions, with policy and operational autonomy allocated through devolution
policies. Direct community support approaches, such as those frequently associated with
community-driven development, promote resource transfer and civil society empowerment
strategies that emphasize community organizations as institutions of collective action and
interlocutors between people and public service providers.

These three approaches have come to share several emphases as their conceptions of good

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practice have evolved: the empowerment of citizens in interactions with governance and service
provision institutions, the importance of beneficiary demand for determining service
characteristics, greater administrative autonomy among service delivery managers along with
greater accountability to citizens and service consumers, and enhanced local organizational and
human capacity for increased impact and sustainability.

Putting these shared principles into practice has been challenging. Despite this broad
philosophical agreement advocates of each approach have had difficulty integrating their efforts.
Policymakers and program managers have frequently championed one approach over the others,
because of different entry points and organizing principles and the distinctive professional
background and organizational role of their advocates. There has been no commonly accepted
conceptual framework applicable in the field for bringing together the complementary
contributions of the three approaches and exploiting their comparative advantages.

Chapter Summary
 The purpose of local development is to build the capacity of a defined territory, a
municipality, rural area, or region, to improve its economic future and the quality of life for
inhabitants.
 Local development is closely linked to development of the local economy in which
improving local food security, household income, and the quality of livelihood options as
well as encouraging growth in the number, scale, and profitability of both formal and
informal sector businesses are important aspects of local development.
 Organizing the development process at this level offers a series of advantages, some resulting
from its being smaller than the state and some resulting from it being larger than the
community.
 Unless local residents, leaders, entrepreneurs, politicians, public managers, and service
delivery personnel feel responsible for improving the quality of their life and that of their
neighbors, they are unlikely to expend the effort to overcome the challenges, whether routine
or daunting, that constrain local development.

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 Three approaches to managing local public investment and service provision have sometimes
been seen as competitive; decentralized sectoral approaches, local government approaches
direct community support approaches.

Self check Questions

1. Define the concept local development.
____________________________________________________________________
2. What are advantages of development efforts at local level?
______________________________________________________________________________
____________________________________________________________
3. What are the three approaches of local development and investment?
___________________________________________________________________________
_____________________________________________________
4. How development actors at local level can make local people responsible of local
development?
___________________________________________________________________________
_______________________________________________________________
5. Discuss the linkage between national development and local development?
___________________________________________________________________________
_____________________________________________________________

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 Chapter Two

Local Development Framework

1. Introduction
A local development framework is intended to help policymakers and program managers analyze
the approaches used to support local development in their country, the types and forms of
assistance to local actors associated with these approaches, and the challenges arising from each,
it does not provide a blueprint for promoting local development in any specific country. Such
analysis can be used to identify strategies and methods to fill the gaps, solve the coordination
problems, and improve the performance of weak elements that diminish the effectiveness of local
development in their country.

Local development framework has internal and external elements. The internal elements of a
local development framework include empowerment, local governance, and service provision.
The external elements include an enabling environment, capacity enhancement and external
support for local development. A local development framework focuses on strengthening
decentralized institutional arrangements for empowerment, governance, and service provision as
the building blocks of sustainable capacity for local development.

2. Chapter Objective

After completing this chapter you be able to

 Explain the aims of local development framework,
 Define and distinguish internal and external elements of local development framework
 Analyze the focus areas of local development framework,
 Synthesize the application of local development framework.

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 3. What Does a Local Development Framework Aim to Achieve?
Dear learner, every framework has its own objectives. Before reading the next section, would
you list down some of the aims of local development framework?
______________________________________________________________________________
______________________________________________________________________________
The framework in this chapter provides a way of understanding how governments and their
partners support local institutions of governance and service delivery. Because local
development is so complex, many kinds of service, resource flows, and assistance are needed to
achieve many kinds of results. It is sometimes difficult to understand how these efforts are
related and how to increase the contribution of each to the social and economic processes that
advance the well-being of households and communities.

Support for local development is usually fragmented. Some government agencies or externally
supported projects focus on empowerment and community organization, some on planning and
governance, and some on the provision of public facilities and services. Some follow a sectoral
approach, some a local government approach, and some a community support approach.
Understanding the framework helps to systematically describe how these efforts address cross
cutting issues in various sectors, at various levels, and through various approaches and how well
they fit together. A local development framework is intended to help policymakers and program
managers analyze the approaches used to support local development in their country, the types
and forms of assistance to local actors associated with these approaches, and the challenges
arising from each, it does not provide a blueprint for promoting local development in any
specific country. Such analysis can be used to identify strategies and methods to fill the gaps,
solve the coordination problems, and improve the performance of weak elements that diminish
the effectiveness of local development in their country.

A local development framework helps to integrate the efforts of various government agencies

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and aid financed projects at the local level, bringing elements together to contribute to a single
process. Rather than eliminating, merging, or subsuming the three approaches and the methods
they employ under a single new approach, the framework seeks to coordinate them more
coherently based on a common underlying logic. By providing a common set of concepts and
analytic tools, a local development framework can guide the selection of the most appropriate
strategies and methods for a specific context and their orderly, productive integration.

A local development framework provides a conceptual basis for strengthening institutions and
capacities for empowerment, governance, and service provision at the local level, contributing to
increased human, social, and economic development. Human development requires the provision
of health care, education, and potable water. Social development requires strong institutions
supporting inclusion, cohesion, and accountability. Economic development requires public
infrastructure, business development services, and “soft infrastructure” enabling investment and
enterprise. The capacities that sustain development include people’s knowledge and skills, social
capital, organizational capacity, and the institutional environment for good governance. A local
development framework provides analytical tools to support a more integrated local development
process that strengthens institutions and capacities at the local level to achieve three objectives:

 Increasing local access to public infrastructure, public services, and economic

opportunities: Access requires proximity. Integrating processes at the local level helps
bring a variety of facilities, services, and economic opportunities closer to where people
live and work.

 Increasing the empowerment of local actors: in various governance and service provision
settings by strengthening citizen voice and choice in local decision making and increasing
accountability to local civil society.

 Enhancing the sustainability of local development processes: by strengthening the

institutions, capacities, and collective resources that constitute the capital stock for local
development.

4. The internal and external elements of Local Development Framework

Dear learner, what are internal and external elements of local development framework?

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______________________________________________________________________________
_____________________________________________________________________________
The internal elements of a local development framework include empowerment, local
governance, and service provision. The external elements include an enabling environment,
capacity enhancement and external support for local development.

4.1. Internal Elements of a Local Development Framework

Empowerment is the starting point for local development. Empowerment is the process of
enhancing an individual’s or a group’s capability to make and express choices and to transform
them into desired actions and outcomes. Both opportunity (the availability of options for
meaningful decisions and actions) and capability (the ability to make meaningful choices and act
on them or express them through institutions open to popular “voice”) are required.

Local governance is the way decisions are made and implemented by or on behalf of people in a
local area. It includes the allocation of authority to decision makers, authorization to use
collective financial and natural resources, provision of public goods and services, and holding
accountable those to whom authority is entrusted. In addition to local governments and other
local public sector agencies, local governance encompasses a variety of civil society institutions,
including resource users groups and citizen oversight bodies linked to public service delivery
units or local service delivery networks, community development committees, traditional
councils and authorities, voluntary associations, and nongovernmental self-help organizations.

Local service provision systems deploy and manage resources—financial, human,

technological, and information—to produce public facilities or services under the direction of
institutions of local governance. Local public service providers include deconcentrated structures
of central ministries, quasi-autonomous public agencies or enterprises, local governments,
private enterprises under contract to public agencies or local communities, nongovernmental
organizations (NGOs) financed by public sector grants, self-provision by service beneficiaries,
and coproduction by beneficiaries and publicly financed providers. Service provision includes
mobilizing and management of resources and the management of delivery organizations
(producers) that transform resources into infrastructure and services.

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The local development impacts resulting from these governance and service provision
arrangements include improvements in people’s welfare and the accumulation of human, social,
and economic capital. Human capital is accumulated by increasing the health and education
status of individuals, social capital by increasing the capacity for collective action by local
residents and organizations, and economic capital through increased capacity for investment by
individuals and firms. All three dimensions of local development contribute to empowerment by
increasing the capability of local actors to choose among a broad set of options in pursuit of
individual and collective goals.

Thus a local development framework identifies the elements of a self-reinforcing arrangement

through which empowered local actors contribute to governance processes and service provision
in order to accumulate and invest human, social, and economic capital for their mutual benefit.

4.2. External Elements of a Local Development Framework

Local development is conditioned by factors external to the local level. A local development
framework emphasizes an enabling institutional environment, capacity enhancement, and
external support for local development.

The enabling environment for local development includes formal institutions, such as laws,
policies, and organizational systems, and informal institutions, such as values, norms, and social
practices, that support empowerment, governance, and service delivery at the local level.

Capacity enhancement and external support for local development includes the provision of
resources to local actors—including public organizations, NGOs, CBOs and voluntary
associations—of such resources as funding, training and institutional strengthening, technical
assistance, and information.

5. Focus of Local Development Framework

A local development framework focuses on strengthening decentralized institutional

arrangements for empowerment, governance, and service provision as the building blocks of

22
sustainable capacity for local development.

5.1. Empowerment
Empowerment means having both the opportunity and the capability to participate.

a) Opportunities for People to Participate

Empowering people in the context of local development requires increasing the quantity and the
quality of their opportunities to participate in local governance and local service delivery. To
participate in local governance citizens need institutionalized opportunities to influence local
planning and policy processes, local decision making systems, and accountability mechanisms
linking decision makers and citizens. To participate in service delivery people need opportunities
to influence the mobilization and management of resources and the delivery of services through
voice (consultative and oversight mechanisms tied to service managers and frontline service
deliverers) and choice (among multiple providers) so that people and communities are not forced
to accept unresponsive service delivery).

Empowerment implies a special emphasis on redressing inequities in voice, choice, and access
across segments of the local population. Opportunities may not be equally available to all.
Differences in social status may give some people less opportunity than others for voice and
choice related to improving the quality of their lives. Rules and processes are needed to increase
everyone’s opportunities to participate effectively in local affairs. But even if the rules governing
access to institutions of governance and service delivery are equitable, implementation at the
local level may be discriminatory. Barriers to participation and access are frequently rooted not
in formal rules but in well entrenched practices of social exclusion. Empowerment strategies
need to address both formal and informal barriers to equitable access to opportunities in
governance and service delivery.

b) People’s Capabilities to Participate Effectively

In addition to improving opportunities, empowerment for local development requires increasing
the capability of people to exploit opportunities to participate through increased voice and choice
in local governance and service delivery. The capability to participate is determined in part by
people’s resource endowments—financial, material, informational, organizational, human, and

23
psychological. By increasing their endowments in these resources, people become more capable
of exercising opportunities to influence governance and service provision to better meet their
needs.

The capability to participate in governance and service delivery depends on more than individual
resource endowments. Social capital—the social networks and associated norms of reciprocity
and trust that enable people to act collectively—also determines how well people organize to act
collectively. Social capital includes bonding capital (ties connecting family members, neighbors,
and long-standing groups sharing a common identity), bridging capital (horizontal ties among
people with similar social and economic status who typically associate based on interest), and
linking capital (vertical ties linking people of greater power and status with others based on
identity or interest).

As local actors strengthen their individual and collective capabilities (by increasing human and
social capital), they are better able to influence government and community action by expressing
their preferences and choosing how best to satisfy their priorities for public facilities, services,
and livelihood opportunities. Empowerment is both a means and an end to local development.

5.2. Local Governance

Local governance describes the way authority is organized, legitimated, and employed within the
local space. It includes how plans and policies are formulated, how decisions are made, and how
those who make and implement decisions are held accountable for their actions and results
through both governmental and non-governmental forms of public or collective decision and
action. All institutions of decision and action in a local space contribute to local governance:
village committees, community organizations, water user groups, parents organizations linked to
schools, and voluntary associations, as well as local governments.

a) Local Planning and Policy Formation

Local governance begins before decisions are made by mayors, councils, village committees,
civil servants, and other local actors. Governance includes the way proposals are generated and
presented as a basis for decisions about what to do, how to do it, and with what resources. Like
decision making, these planning and policy formulation processes can be assessed for their

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inclusiveness, transparency, and openness to citizen and community input. Participating in
setting agendas, generating proposals, and discussing their merits links people to the institutions
of governance that are meant to act in their behalf by making and implementing decisions that
provide services and promoting local development.
Technocratic planning and policymaking processes, by privileging the role of professionals and
employing decision models that take little account of local knowledge and preferences, limit the
role of local people in preparing proposals. Participatory and deliberative planning and
policymaking processes, which promote the interplay between analysis based on objective data
and good professional practice and consultations on citizen perceptions and opinions, can
produce proposals that are both technically sound and responsive to local preferences. The
quality of planning and policy formulation can be enhanced and governance improved by
creating opportunities for community members and their representatives to engage in dialogue
with public officials—including politicians, administrators, and technicians—on the
identification, prioritization, and resolution of local problems.

Effective participatory local planning requires inclusive processes of consultation and links
among the planning, decision making, and accountability elements of local governance. Many
local planning processes, although internally well organized, are marginalized by weak
connections to the organizations that are authorized to make decisions and manage resources.

b) Local Decision Making

Local decision making organizes the way groups of people determine their priorities and how
they will satisfy them. An important part of local decision making is how individuals (politicians,
administrators, community leaders) and collective bodies (village committees, municipal
councils) are selected and authorized to set priorities and to mobilize, allocate, and oversee the
use of resources in their trust. Local decision making institutions frequently orient and oversee
action by executive or administrative organizations.

The quality of local governance is affected by the transparency of decision making, involvement
of local people and communities in decision making, and conformance by officials and citizens
to rules on the scope and exercise of authority. Village committees, service users groups, and

25
natural resource management groups can promote greater responsiveness and fairness in decision
making by local governments through increased transparency, inclusiveness, and consistency.
Better governance will contribute to more equitable and dynamic local development.

c) Local Accountability
The contribution of local governance to local development depends as much on the quality of
accountability as it does on the quality of planning and decision making. Accountability
mechanisms aim to ensure that executive action and resource use correspond to the policies and
plans approved by decision makers. Accountability links local decision making to
implementation of public sector and community-based initiatives and to the results they produce
at the local level. Thus accountability relates individuals and communities not only to
governance processes but also to service providers. Strengthening mechanisms of accountability
linking citizens, decision makers, and service providers promotes better responsiveness and
performance.

Accountability mechanisms include transparency and enforcement components. The

transparency component provides information on what is done, how, and with what resources
and results. The enforcement component provides rule-governed processes to ensure that those
entrusted to make and implement decisions and manage resources on behalf of others comply
with approved policies, plans, and management practices or face adverse consequences.

Public sector accountability systems tend to focus on enforcement of legal constraints, control by
administrative hierarchies, and selection of officials through elections in order to ensure
compliance with law and policies and responsiveness to citizen preferences and expectations for
honesty and competence. Recently, advocates of increased responsiveness of public officials to
local households and communities have promoted non electoral mechanisms of downward or
social accountability. People can also hold public officials, community organizations, and service
delivery units more accountable by increasing civic engagement through public expenditure
tracking, monitoring of service delivery, citizen advisory boards, public hearings, and broad
advocacy campaigns.

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 5.3. Local Service Provision
Local service provision deals with resource mobilization and management and service delivery
organization and management.

a) Resource Mobilization and Management

Local service provision requires an adequate resource base—the money, people, information,
and technology needed to turn decisions into public facilities and services. Some resources are
mobilized locally through voluntary contributions (including beneficiary time and labor) and
obligatory taxes and fees. Others are provided through transfers from outside organizations to
local governments and community organizations.

A local revenue base is an important foundation for sustainable empowerment and governance as
well as service provision. The greater sense of ownership among people who contribute through
taxes and fees to the costs of local infrastructure and services strengthens both citizen demand
and the accountability of public officials. And the greater degree of local discretion associated
with own-source revenues enhances the capacity for responsiveness by decision makers and
service providers. In most countries externally transferred resources are important contributions
to local development. Resource transfers from the central to local level are common everywhere
because taxing and borrowing powers are generally concentrated at the central level and because
there are significant differences in regional prosperity and resource endowments. These transfers
are usually even more significant in less developed local areas and those with a high percentage
of poor households.

Based on the plans approved by local institutions of governance, resources are allocated to
authorized tasks and the organizations delegated to perform them. Service providers—whether
public sector, private sector, or community based—are then are held accountable for how
resources are used and managed and for the public facilities and services they produce.
Sometimes public service delivery is complemented by conditional cash transfer programs in
which local organizations implement national policies by channeling resources directly to
households, enabling local actors to obtain goods and services in the marketplace.

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 b) Service Delivery Organization and Management
Service delivery organizations are responsible for producing the public facilities and services that
contribute to human, social, and economic development. In most cases public sector
organizations operating at the local level, whether pertaining to local governments or to
deconcentrated state agencies, organize and manage public service delivery. In other cases
services are produced (or coproduced) by community-based or other beneficiary organizations
that serve their own members. Service delivery is sometimes delegated to private organizations
(firms, NGOs, self-help and users groups) through grants or contracts to increase flexibility,
reduce costs, and make use of the technical and organizational capacities available in
communities and the marketplace. Improving service provision for local development requires
specifying appropriate institutional arrangements for the production and delivery of public
facilities. These include appropriately allocating roles among local organizations, according to
the context and conditions, and enhancing their capacity to fulfill these roles.
Dear learner, revise the above section and list the focus areas of local development framework
with respect to what it aims to achieve.
___________________________________________________________________________

Chapter Summary
 A local development framework is intended to help policymakers and program managers
analyze the approaches used to support local development in their country, the types and
forms of assistance to local actors associated with these approaches, and the challenges
arising from each, it does not provide a blueprint for promoting local development in any
specific country.
 The internal elements of a local development framework include empowerment, local
governance, and service provision. The external elements include an enabling environment,
capacity enhancement and external support for local development.
 A local development framework focuses on strengthening decentralized institutional
arrangements for empowerment, governance, and service provision as the building blocks of
sustainable capacity for local development.

Self check questions

1. What are the aims of local development framework objectives?

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 2. Discuss the internal and external elements of local development framework?
3. Discuss the focus areas of local development framework?

Chapter Three

Alternative Approaches to Local Development

1. Introduction

There are ways of providing infrastructure and services are decentralized sectoral approaches,
local government approaches, and direct community support approaches. They differ in their
organization principle, strategic orientation, and main intervention methods. This chapter
summarizes some of the main lessons for the three approaches about working effectively at the
local level, how it contributes to improved local governance and service delivery, and why each
alone is not sufficient to address the variety of development challenges faced at local level.

Under the traditional structure, professional, technical, and administrative expertise dominates
policymaking and management. Major decisions about service standards, service mix,
technology, and methods tend to made at higher levels, where such expertise is concentrated. At
the local level, near the base of the sectoral hierarchy, decision making tends to be operational.
Supervisors of service delivery units and local line department offices tend to be accountable
upward in the organizational hierarchy.

Local government approaches generally start by establishing and strengthening local government
structures and systems and their relations to the state and to local civil society. Traditionally,
they have emphasized the legal framework for local government; the political framework,
including electoral processes and council-centered procedures for legislation authorization and
accountability; and the financial framework, with a focus on sources of proprietary revenues,
fiscal transfers from the state, and budget and expenditure procedures.

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 2. Chapter Objectives

After cmpleting this chapter, you will be able to

 Comprehend the different approaches to local development,
 Discuss decentralized sectorial approach to local development,
 Analyze local government approach to local development,
 Comprehend direct community support approach to local development,
 Synthesize and integrate the three approaches to local development.

3. Approaches to Local Development

The three main ways of providing infrastructure and services are decentralized sectoral
approaches, local government approaches, and direct community support approaches. They
differ in their organization principle, strategic orientation, and main intervention methods. This
section summarizes some of the main lessons for the three approaches about working effectively
at the local level, how it contributes to improved local governance and service delivery, and why
each alone is not sufficient to address the variety of development challenges faced at local level.
All three approaches aim to provide public facilities and services and promote local
development. Each addresses the same challenge from a different entry point. Sectoral
approaches, because of their entry through functional specialization, tend to be better at
mobilizing technical capacity but less responsive to local demand and conditions. Local
government approaches, because of their entry through the institutions of territorial governance,
commonly ensure clear formal autonomy and accountability of local decision makers but are
often more politicized and less effective in managing service provision. Direct community
support approaches enhance empowerment and responsiveness to local priorities and conditions
but their entry point through community structure and processes often complicates coordination
with public sector organizations, which may be necessary to sustain service delivery and

30
infrastructure.

The following table summarizes these three approaches with respect to functions, territory, and
social units.
Dear learner read the table below, then compare and contrast the three approaches of local
development.
_____________________________________________________________________________
_

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 Alternative Approaches to Local Development

Decentralized Local government Direct community

sectoral approach approach support approach

Principle of
organizatio Function Territory Social unit
n
Develop Transfer policymaking
organizations at and fiscal powers to
Strategic local level that democratically elected Empower communities to
decide, organize, and act in their
orientation produce services and local governments that own interests
achieve service provide services within
goals their jurisdiction
Improve service Ensure local government Channel resources (funding
delivery coverage resources through and capacity building) to
and quality through intergovernmental fiscal community-based
codified methods arrangements, local organizations that provide
and staff training for government accountability their own infrastructure and
Main
deconcentrated through political services, often jointly with
operational
sectoral arrangements, and local public sector or private
method
departments, government capacity organizations
specialized through administrative
autonomous arrangements
agencies, and service
delivery units

Table: Alternative Approaches to Local Development

3.1. Decentralized Sectoral Approaches to Local Development

Countries have traditionally organized most service delivery using sectoral approaches. Public
organizations are conventionally organized around the functions they perform, such as the
delivery of health, education, water, and agricultural extension services. The organizations are
assigned responsibilities by government policy and resources by the government budget to meet
their functional responsibilities. They are set up as a series of departments with specialized
responsibilities and a hierarchical structure of administrative branch offices that manage a
network of operational units. The specifics of structure and management process vary with the

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technical characteristics of each sector, but this general logic of administrative organization has
been, and remains, widespread.

Under this traditional structure, professional, technical, and administrative expertise dominates
policymaking and management. Major decisions about service standards, service mix,
technology, and methods tend to made at higher levels, where such expertise is concentrated. At
the local level, near the base of the sectoral hierarchy, decision making tends to be operational.
Supervisors of service delivery units and local line department offices tend to be accountable
upward in the organizational hierarchy. In recent years sectoral systems have greatly
strengthened their capacity to better serve local people and communities by adopting
decentralized approaches that increase managerial flexibility at the local level and increase
accountability to local citizens and clients. The following sections summarize some good
practices for organization, governance, and management in the three main sectors: social,
infrastructure, and economic.

a) Issues Associated with Social Sectors

Social sectors provide health care and educational services. Access (especially to basic services)
is often considered a right, with universal provision often the goal. These sectors tend to require
a large, dispersed, and well-trained workforce, with considerable face-to-face contact with
clients. They tend to be management intensive, with high recurrent costs. Through service
hierarchies, basic services are provided at many primary level service delivery units, and
progressively more specialized services are provided by a smaller number of higher level service
delivery units, which are generally outside the purview of a local development framework.
To overcome the weaknesses inherent in the traditional bureaucratic model of organization,
social sectors have promoted a variety of good practices for improving management and
accountability:
 Administrative deconcentration that grants local branch offices and service delivery units
more autonomy in adjusting how they deliver services, plan their activities, and manage
their funds and staff.
 Liberalization of sectoral policies to permit entry by private service providers, whether
nonprofit NGOs or for-profit firms, as alternatives to public sector provision.

33
  Contracting in and contracting out to supplement public sector delivery capacity with
services provided by the private sector and to increase the quantity, efficiency, and
quality of services.
 Beneficiary governance through citizen boards or committees at the service delivery unit
or local service board levels to increase the accountability of service management and
delivery.

b) Issues Associated with Infrastructure Sectors

Infrastructure sectors build and maintain physical facilities supporting the provision of public
services and some private activities. The most common infrastructure sectors are transport, water
supply, electricity, and telecommunications. In addition, the infrastructure subsectors of the
social sectors are involved in the construction of buildings for social service delivery, such as
clinics, schools, and administrative offices.

Infrastructure services are commonly capital intensive and often technology intensive. They tend
to demand less labor, recurrent expenditure, and management for daily operations than do social
services, but they require substantial resources—financial, managerial, and technological—for
frequent periodic maintenance of physical facilities. Infrastructure services such as rural water
points, public buildings, and grain silos are provided in discrete facilities, while others such as
roads, urban water systems, and telecommunications systems are provided through network
facilities that link delivery points for consumers with higher capacity and more technologically
complex elements in a hierarchical network. As in the social service sectors, the focus of a local
development framework is on the lower order elements of network infrastructure sectors and on
small and medium scale discrete facilities.

The characteristics of infrastructure sectors have led to organizational arrangements for service
provision that differ from those in the social sectors. First, while public sector providers may
finance a significant share of infrastructure costs, contracted (usually private) organizations
generally take on the production of infrastructure services—construction, operation, and
maintenance. Second, different institutions are often responsible for providing different elements

34
of infrastructure services, often resulting in complex institutional arrangements with multiple
providers and producers at several levels. Third, many infrastructure services are partially funded
through user fees, which may exclude people who are unable or unwilling to pay for services.
Policymakers must decide between cross-subsidy options—typically for infrastructure services
considered essential, such as potable water—and cost-recovery systems that potentially exclude
or limit service levels for some consumers.

To meet the challenges of adequate resource allocation, appropriate investment strategies, and
effective management of operation and maintenance, infrastructure sectors have developed good
practices for increasing performance and sustainability at the local level:
 Demand-based provision of small infrastructure through community participation in multi-
sectoral investment planning and the use of willingness-to-pay as a trigger for investment.
 Strengthening the client focus of infrastructure services, including adapting standards and
service levels to the social and economic conditions of poor and low-income consumers.
 Coproduction of small-scale infrastructure and of the delivery level of network facilities
through community-level collective action, to reduce investment costs and strengthen local
institutional capacity for maintenance.
 Openness to a significant role for the private sector as a producer of infrastructure services,
both in construction and maintenance and in supply chains furnishing inputs for operation and
maintenance.
 Promotion of the role of local management bodies, locally based private sector operators, and
local cost-recovery mechanisms that increase the sustainability of infrastructure services.

c) Issues Associated with Economic Sectors

Economic sectors promote and support private sector production and marketing of goods and
services. Examples include agriculture and livestock, natural resources such as forestry and
fisheries, and small business development including local trade, industry, tourism, and other
services.

The activities of economic sectors are affected by the sensitivities associated with government
intervention in the private sector. Today, government agencies engage less frequently in the

35
direct measures once commonly taken to promote specific economic activities, such as public
funding of productive or commercial enterprises, price manipulation through subsidies and
regulation, and public sector marketing boards to bolster demand for locally produced
commodities.

Nevertheless, there is broad acceptance of some important roles for public sector support for
economic development. Public agencies provide technical assistance to producers, marketers,
and managers in transferring technology and disseminating improved practices. Public
organizations promote and often finance the provision of financial services such as savings
mobilization, insurance, and credit in situations where high transaction costs or risks impede
entry by private financial institutions. Public agencies frequently promote information flows
between sources of capital and business operators and between buyers and sellers in the
marketplace to facilitate investment and commerce. And regulatory reform and bureaucratic
simplification have contributed to economic development by reducing barriers to entry and
transaction costs.
Promoting local economic development has led to a number of good practices:
 Increasing the demand-based provision of economic support services, including technical
assistance, financial services, and market development assistance that address the priorities
and constraints identified by farmers, marketers, and entrepreneurs.
 Promoting and strengthening voluntary associations of producers, to reduce transaction and
information costs, strengthen peer-to-peer transfer of improved practices, and facilitate
collective action in purchasing, marketing, and common-property resource management.
 Strategic planning of local development to promote synergies between public service
delivery (including infrastructure investment) and private sector activity by targeting a few
production networks or businesses in which there is a local comparative advantage.
 Supporting local implementation of reform measures adopted by the central government,
such as deregulation, bureaucratic simplification, and clarification of property rights, and
vigorous capacity building and information campaigns at the local level to promote better
relations between public agencies and local entrepreneurs, including informal sector
businesses.
 Developing partnerships among public agencies, NGOs, and enterprises for the development

36
 of specific economic subsectors and financing targeted support services linked to these
subsectors.
Dear learner, what are the points you learned from the above section? Note it down and try to
understand the points.___________________________________________________________

3.2. Local Government Approaches to Local Development

Local governments are legally constituted sub-national governing bodies, formally independent
of the national government, which grants them political, financial, and administrative autonomy.
National constitutions and legislation establish the fundamental institutional framework and rules
for devolved local governments, especially their relations downward to their constituencies and
upward to the state. Local governments (municipalities, communes, district councils) are led by
an executive, often directly elected, and usually by a representative body or council, which
serves as a legislative body authorizing policy decisions and holding the executive accountable
for the exercise of its authority and its administrative actions.

Local government approaches generally start by establishing and strengthening local government
structures and systems and their relations to the state and to local civil society. Traditionally,
they have emphasized the legal framework for local government; the political framework,
including electoral processes and council-centered procedures for legislation authorization and
accountability; and the financial framework, with a focus on sources of proprietary revenues,
fiscal transfers from the state, and budget and expenditure procedures.

There is wide variation across countries in the functional responsibilities assigned by law to local
governments. In many countries responsibilities are limited to basic environmental management
(land-use regulation, waste removal, maintenance of public spaces like markets, parks, and
cemeteries) and basic infrastructure services (typically water supply, street, and drainage
networks). In some countries local governments have service delivery responsibilities for other
social and economic sectors, transferred to them from national ministries and their
deconcentrated branch offices. How much responsibility is transferred to local governments
often depends on their scale and capacity. Complex relations between local governments and

37
sectoral systems often develop, with a number of coinciding, sometimes ambiguously assigned,
responsibilities and resource flows.

Because a fundamental attribute of local governments is the link between their autonomy from
the state and their accountability to their constituency through elections, political dynamics often
dominate technical or managerial factors in decision making processes. In recent years an
increasing focus on managerial autonomy and accountability for improving public service
delivery has increased the emphasis on local government as a means of shortening the long-route
of accountability by reducing the social distances between those who govern public services,
those who manage them, and those whom they are intended to benefit. Many local governments
have also taken on the broader missions of reducing poverty and improving the quality of life of
their constituents. These local governments are increasingly becoming key agents of local
development.

Issues Associated with Local Government Approaches

Conventional local government approaches have focused on formal aspects of local government
systems, especially their legal, political, and fiscal dimensions. A popular reformist variant of the
local government approach advocates a broader notion of democracy than that implied by
electoral and representative mechanisms. Often described as “participatory planning and
budgeting” schemes, these approaches promote capacity building of local civil society linked to a
variety of processes that increase consultation of citizens by local government officials. These
approaches link civil society to local government decision making (including policy setting and
resource allocation) and to a variety of processes that increase information flow (transparency)
and accountability between local government officials and local civil society. By complementing
electoral mechanisms and council deliberations with an array of participatory mechanisms and
processes, these approaches have demonstrated an ability to increase the responsiveness of local
government resource management and service delivery by engaging social capital.

Traditionally, local government approaches have emphasized the separateness of local

governments from the central state and promoted their distinctive role as institutions of local
governance rather than implementers of national policies. In contrast, intergovernmental
approaches have emphasized local governments’ part in a complex, multi-institutional national

38
system of governance and public management rather than the distinctive characteristics
attributable to their political and legal status. Intergovernmental approaches emphasize local
governments as part of broader policy implementation, public finance, and administrative
systems, including each sector’s service delivery arrangements. To meet the technical and
institutional demands of each service sector, intergovernmental approaches seek to adjust vertical
and horizontal relationships so that local governments play appropriate roles in the governance
and management of policy implementation and service delivery alongside deconcentrated central
agencies.

An even more fundamental broadening of the local government approach focuses on a more
comprehensive concept of local governance in relation to local development. This local
governance perspective considers local governments less in light of their legal and political
status and more as institutions of collective action, similar in function to other local institutions
such as community committees and organizations, traditional authorities, voluntary associations,
citizen oversight bodies, and resource user groups. While recognizing that the statutory powers
granted to local governments privilege them relative to civil society based institutions of
governance, advocates of local governance do not view this as conferring any superiority to local
governments as public actors. The local governance perspective considers local governments in
relation not only to the state apparatus but also to the many others for collective action at the
local level. Each represents a particular arrangement of social capital and instrumental capacity
that can contribute to making decisions, mobilizing resources, and delivering services for local
development.

All three variants of the local government approach—participatory budgeting, intergovernmental

systems, and local governance—aim to strengthen democratic responsiveness and accountability
and to develop more effective collaborative arrangements among local governments, state
agencies, and local civil society institutions in the interest of more effective and dynamic local
development.
Dear learner, what are the merits and demerits of local government approach to local
development? Would you list down them? __________________________________________

3.3. Direct Community Support Approaches to Local Development

39
Direct community support approaches channel assistance, including funding and capacity
building investments, directly to communities to increase empowerment, improve responsiveness
to citizen demands and priorities, accelerate service delivery, and improve the quality of life of
poor and marginalized social groups and households targeted by support to communities.

Community support approaches are frequently employed where conventional public service
delivery systems, whether sectoral or local government, are not sufficiently rapid, flexible,
accountable, or innovative. Dedicated institutional arrangements are often used to meet a
specialized need for which no existing public agency or program is adequately prepared.
Community support approaches have been used to respond to short-term demands for assistance
to a large number of households or communities, such as post-conflict reconstruction or
resettlement schemes, and to crises such as the HIV/AIDS pandemic and natural disasters, which
require a large-scale, rapid, and multifaceted response.

Community support approaches are also applied as temporary “bridging” mechanisms when the
public sector has proved ineffective in providing basic services because of institutional collapse,
severely unresponsive governance, unaccountable resource use, or ineffective management. In
these troubled settings direct community support can also provide the foundation for
reconstituting public sector arrangements for service provision based on the principles of good
governance and sound management they promote. Community support approaches are also
sometimes employed to meet complex interrelated social and economic development needs at the
local level, for which the functional specialization of public sector organizations impedes an
effective response. Dedicated agencies linked to particular disadvantaged groups such as ethnic
minorities, residents of remote regions, and women or youth often employ community support
methods.
Community support approaches are used when short-term policy decisions are inconsistent with
standing institutional practices. For example, such an approach might be used to channel public
resources to communities or households on an exceptional basis to provide capital or inputs for
productive activities, rather than make this redistributive program part of the government’s
permanent agricultural or business development system.

40
Recently governments, often with support from donors and international financial institutions,
have created targeted public sector funds such as social funds and rural development funds that
finance small investment projects proposed by, and sometimes managed by, communities.
Occasionally, community-targeted funds finance recurrent costs related to local service
provision. Some funds provide assistance directly to households, while others provide resources
to community organizations, local governments, or public service delivery agencies.

Issues Associated with Direct Community Support Approaches

Direct community support approaches raise several issues related to their substantive focus on
communities and to their implementation strategy and arrangements. The community support
approach emphasizes the primacy of civil society as the source of demand for public services. By
building the capacity of communities to organize the expression of this demand and to contribute
to service provision, this approach often results in more locally appropriate prioritization of
investments and services than do supply-driven public sector systems. The participatory
community-based governance processes characteristic of community support approaches are
vulnerable to the same risks and dysfunctions that can afflict local government decision making
and management: capture of power and resources by elites, entrenchment of barriers to
transparency and accountability by rent-seeking community leaders, and appropriation of
benefits by majorities in ways that perpetuate inequality and imperil responsiveness to the needs
of marginalized groups.

Community support approaches promote demand-responsive priority setting and resource

allocation at the community level, but policies and rules governing the provision of funding for
community investments often limit eligible investments. Specific kinds of investments may be
excluded for reasons unrelated to local needs and priorities. For example, many public sector
funds disallow productive investments or channel such proposals to credit facilities that operate
on a more commercial basis. When investment eligibility rules are much narrower than the range
of community proposals, community support approaches may stifle the very demand they aim to
promote.

Targeting also raises questions. Because many community support programs are poverty
focused, the criteria for resource allocation are often more stringent than for conventional public

41
investment programs. Combining detailed decision criteria for resource targeting with demand-
driven allocation mechanisms requires sophisticated decision sequencing skills of community
leaders, local officials, and planning facilitators. The sustainability of community-initiated
investment is also a concern, especially where service delivery requires continuing public sector
intervention in ongoing operations. The productivity and sustainability of such investments will
require coordination and often collaboration between community support initiatives and
government planning, investment, and service delivery systems.

Community support programs supported by NGOs and donor projects often work in a particular
region of a country, resulting in a proliferation of projects, each employing different methods and
procedures. While these local projects may facilitate adaptation to local conditions, they often
suffer from coordination and coherency problems, especially at the interface between community
initiatives and the public sector. Standards and methods need to be harmonized for community-
based organization, planning, and management and coordinated with decentralized public sector
institutions, whether sectoral or local government.

Larger scale community support programs, frequently associated with national or regional
community-targeted public sector funds, may suffer less from this proliferation problem but at
the risk of excessive standardization and bureaucratization. In the extreme, as such large-scale
programs institutionalize standard practices across a large number of diverse local areas; they
can lose one of their main advantages, their demand responsiveness. Balancing scale and
flexibility is a challenge to any large-scale public sector program. Community support
approaches are usually associated with community investment funds intended to increase the
capacity of governments and projects to respond to community demands. The funds are an
incentive for community participation in planning, and they create opportunities for capacity
building through learning by doing. Despite the proven effectiveness of linking community-level
funding, planning, and capacity building, a focus on development plans identified with access to
funding mechanisms may make it more difficult to organize communities to undertake collective
action to resolve local development problems unrelated to investments.

Community-driven development, an approach supported by the World Bank and its partners,

42
promotes community empowerment and capacity building by allocating decision making and
resources to community organizations. While frequently associated with community-targeted
public sector funds, community-driven development is a strategic approach to promoting
grassroots development that is not necessarily associated with project modalities. While sharing
many objectives and methods with community-targeted social funds, the community-driven
development approach can be applied as a reform strategy or an organizing principle for public
programs and agencies or as a methodology for dedicated projects or government programs.

In some cases programs create specialized public agencies to manage the disbursement of grants
to communities or intermediaries (a variant of the fund-agency discussed above) or to organize
technical assistance and capacity building for local actors. In others community-driven
development programs support communities through NGOs or local governments. In the local
government partnership arrangement, community-driven development can promote changes in
the relationship between communities and local governments based on the assessed comparative
advantages of each. In the NGO partnership arrangement, NGOs may function as local
extensions of central fund-agencies or as promoters of community capacity for collective action
and of increased accountability in the relationships between communities and public sector fund-
agencies.
Dear learner, list down the advantages and disadvantages of direct community support
approach to local development. __________________________________________________

3.4. Integrating the Three Approaches of Local Development Framework

A local development framework draws on concepts underpinning the decentralized and
participatory methods employed by practitioners of sectoral, local government, and direct
community support approaches. Sectoral experience on how to effectively organize, manage, and
deliver services at the local level is linked to the systems of decentralized governance associated
with local governments: multi sectoral planning, resource mobilization and management, and
mechanisms of democratic accountability. Such public sector approaches are complemented by
methods drawn from direct community support approaches for promoting more consequential
and inclusive empowerment and strengthening grassroots participation and social capital for

43
 Figure: Integrating Approaches for Local Development

Decentralized Local
Sectoral Government
Approaches Approaches

Integrated
Approach to
Local
Development

Direct
Community
Support
Approaches

governance, collective action, and infrastructure and service coproduction. Context-appropriate

institutional arrangements and capacities that build on the contributions of each of these
approaches can improve governance, public services, and the welfare of households and
communities.

Each approach offers useful methods for promoting local development, but each has limitations.
Linking the approaches offers opportunities for significant synergies but must find ways to ease
the tensions arising from their different principles of organization, strategic orientation, and
operational methods. A local development framework that brings the three approaches together
in a way that allows policymakers and program managers to select the methods best adapted to
the local conditions they face can assist in formulating more effectively integrated strategies for
improving local governance and service provision.
The above figure depicts a more integrated approach to local development based on the
contributions of the three approaches. It emphasizes relations among the three approaches,
suggesting a “zone of convergence” in which their coordination and integration can be facilitated
by employing a common conceptual framework. Elements drawn from the three approaches can
be selected and linked according to their fit with local conditions to assist policymakers and

44
program managers to formulate a context-appropriate strategy for local development.

A local development framework does not eliminate the tensions and challenges associated with
linking alternative approaches or the operational problems associated with institutional reform,
capacity building, governance, and service delivery at the local level. Its promise is more
modest: to provide a more coherent and consistent way to analyze and understand the challenges
that confront policymakers and program managers in supporting local development and to assist
in organizing knowledge to help them formulate and coordinate sectoral, local government, and
community-focused initiatives to meet those challenges.

An approach to local development based on this framework would organize interventions around
local territorial units, typically at the level of local governments or the equivalent tier of a
country’s administrative hierarchy. Strategically, it would aim to build on existing institutional
arrangements and organizational capacities to develop an effectively integrated system
supporting greater empowerment, improved governance, and better service provision. It would
link community organizations, local governments, deconcentrated sectoral agencies, and private
organizations more coherently to improve the way public decisions and actions are organized at
the local level. A spatially framed approach that links these local organizations through their
respective roles at the local government, service delivery unit, and community levels promises to
improve coordination, synergy, and efficiency in local development processes.

While the basic elements of the local institutional system (community organizations, local
governments, decentralized sectoral agencies, and service delivery units) would be part of any
institutional arrangement for local development, their roles and relationships will vary according
to context. In some cases communities will be the most legitimate venue for local decision
making and resource management, while in others local governments will be more prominent. In
some cases decentralized sectoral agencies will manage nearly all service delivery, while in
others NGOs or private firms will also have significant roles. This contingency of the
institutional arrangements for local development comes from the great variation across countries
and even across regions within countries in the legitimacy and capacity of the local actors
through which governance and service provision are organized.

45
Dear learner, list the advantage of integrating the three approaches to local development.
______________________________________________________________________________
______________________________________________________________________________

Chapter Summary
 The three main ways of providing infrastructure and services are decentralized sectoral
approaches, local government approaches, and direct community support approaches. They
differ in their organization principle, strategic orientation, and main intervention methods.
 Countries have traditionally organized most service delivery using sectoral approaches.
Public organizations are conventionally organized around the functions they perform, such as
the delivery of health, education, water, and agricultural extension services.
 Local government approaches generally start by establishing and strengthening local
government structures and systems and their relations to the state and to local civil society.
Traditionally, they have emphasized the legal framework for local government; the political
framework, including electoral processes and council-centered procedures for legislation
authorization and accountability; and the financial framework, with a focus on sources of
proprietary revenues, fiscal transfers from the state, and budget and expenditure procedures.
 Direct community support approaches channel assistance, including funding and capacity
building investments, directly to communities to increase empowerment, improve
responsiveness to citizen demands and priorities, accelerate service delivery, and improve the
quality of life of poor and marginalized social groups and households targeted by support to
communities.

46
 Elements drawn from the three approaches can be selected and linked according to their fit
with local conditions to assist policymakers and program managers to formulate a context-
appropriate strategy for local development.

Self check Questions

1. Discuss the sectors under decentralized sectorial approach to local development.
2. What kinds of solutions are to be taken in order to address the challenges of infrastructure
provisions?
3. What are the advantages of local government approach to local development?
4. Discuss the issues related to direct community support approach to local development.
5. What is integrated approach to local development?

Chapter Four

The Role of Governments in Promoting Local Development

1. Introduction

National and regional governments can promote local development by improving the enabling
environment, enhancing capacities for local development, and providing external support. Even
though different stakeholders involve in local development, it is the state which can play the
fundamental role in promoting and acting in the realization of local development. This chapter
discusses the role states in promoting local development.

2. Chapter objective

After completing this chapter you will be able to

 Comprehend the role of state in local development,
 Discuss the ways how government can create enabling environment to local
development,
 Analyze how government can enhance the capacities of local areas to promote local
development,
47
  Discuss different types and methods of external support of government in order to
support local development.

3. Improving the Enabling Environment

Dear learner, in order to develop a given local area, favorable economic, political, and social
environment is very important. From this perspective, what do you think that the role of
government in creating favorable environment?
______________________________________________________________________________
_____________________________________________________________________________

Local development requires an institutional environment favorable to local initiative. Both the
formal institutions of governance and the informal institutions of the wider society and economy
contribute to the enabling environment for local development through the rules, norms, and
resource endowments that support action and accountability by local people and organizations.
Empowerment depends strongly on the standing of individuals, voluntary associations, and
communities in national constitutions and laws. Opportunities for local action are influenced by
political and civil rights and by the property rights regime under which local actors operate.
Norms grounded in culture and ideology also promotes or constrains the opportunities available
to women, children, poor people, people with disabilities, and other groups to participate and
influence local development processes. Empowerment efforts at the local level alone may not be
able to overcome these broader constraints; national leadership is often required to change
discriminatory attitudes and provide a foundation for equitable empowerment.

Local governance is also conditioned by law and social practice. National legislation provides
the formal rules that legitimate such forms of local collective decision making and collective
action as voluntary associations, community organizations, and local governments. Legislation
also grants local organizations the legal standing, rights, and relations to the state that are
fundamental to effective local governance processes. Broad societal norms, such as the
propensity for solidarity, the acceptance of social hierarchy, and relations to authority and
leadership, also influence the quality of local governance.

48
Local service provision depends on a variety of nonlocal factors. National policies set standards
for public services and define the institutional arrangements through which they are provided,
including the roles of communities, local governments, sectoral agencies, NGOs, and private
firms. National governments and externally funded NGOs also provide access to many resources
supporting local service provision. Further, both formal and informal institutions that affect the
functioning of the private sector may influence the availability and quality of public services.

In some countries poor governance compromises all development efforts through corruption, the
capture of public organizations and resources by powerful elites, and the exercise of government
authority without accountability. In others public organizations perform poorly because of
inadequate systems and undertrained, underequipped, poorly supervised, and weakly motivated
personnel. Where public sector dysfunction is pervasive, national institutions can constitute a
disabling environment for local development. In the short run a viable local development process
will then depend on measures to promote greater empowerment and improved local governance
and local service provision despite rather than based on the broader institutional context. In the
longer run effectively and sustainably promoting local development requires a favorable
enabling environment for local actors.

a) Make National Governance More Supportive of Development

The constitutional rights of individuals determine their opportunities to pursue individual and
collective interests through participation in public life. The legal standing of voluntary
associations and communities contributes to the legitimacy and efficacy of grassroots collective
action. Laws and public sector rules also ensure the rights and opportunities of individuals and
community groups to demand transparency and accountability from local governments and
service providers. The central government’s policies and posture toward communities are also
important enablers of local development. Government recognition of community-based
institutions within a country’s governance system is critical to the way communities are linked to
the public sector as a legitimate venue for the expression of demand, for resource management,
and for collective action.

Local government legislation and the mechanisms for intergovernmental finance and

49
management also influence the conditions for participatory local development. Public sector
decentralization, through devolution, deconcentration, and delegation, establishes a framework
for greater local initiative. The powers and functions assigned to local governments permit
citizen and community demand to influence the allocation of resources and mix of services. The
rules and procedures for allocating funds to the local level and the scale of local revenues and
discretionary funds enable responsiveness by local governments and sectoral departments to
local planning, budgeting, and decision making.

Finally, sectoral policies establish the setting in which local governments and community
organizations participate in service delivery governance. Sectoral policies define the
opportunities for local input in setting service priorities, standards, and levels and by structuring
the institutional arrangements for citizen participation and oversight of infrastructure and service
delivery. National public sector systems such as fiscal systems, civil service procedures, and
procurement rules also affect the environment for local service delivery.

b) Foster a Civil Society Supportive of Local Development

Societal values, norms, institutions, and capacities are also important contributors to the enabling
environment for local development. Empowerment is greatly facilitated in societies where
principles of equity and social justice are widely accepted. Local development depends on an
understanding within the broader society that governance and development are not merely
governmental responsibilities but require the active participation of individuals, communities,
and voluntary associations. And equitable local development requires the inclusion of frequently
marginalized social groups as contributors to governance and service provision and as service
beneficiaries.

Legitimating various forms of social capital, in the political and social marketplace of ideas as
well as in law and policy, creates a favorable environment for the local initiative and pluralism
required for dynamic local development. Governments, religious leaders and organizations,
NGOs, and scholars can all contribute to an environment that widely recognizes the importance
of the social networks through which people meet many of their needs. Recognition of these
associational and informal institutions is an important basis for developing their capacities to

50
assume a greater role in community and public affairs. Widespread acceptance within civil
society of such principles as the transparency and accountability of public organizations also
underpins the legal and administrative mechanisms for enforcing norms and rules governing the
behavior of public officials.

Dear learner, civics societies can play a role in promoting local development. What kinds of
roles do you think that civics societies can play in local development?
______________________________________________________________________________
______________________________________________________________________________

4. Enhancing Capacities for Local Development

Capacity enhancement goes well beyond technical and professional training. More effective
collaboration between public sector and nongovernmental organizations, more responsive and
legitimate forms of social capital, better performing organizations, and individuals more capable
of working together to solve problems also enhance the capacity for local development.

a) Reorient the Local Public Sector

Enhancing the capacity of the local public sector for effective local development often means
realigning the links among the public sector organizations that govern and deliver services at the
local level and between them and local other nongovernmental actors. Also important for
enhancing capacity in support of local development is increasing the influence of citizen,
community, and broader civil society contributions to governance through participatory
planning, decision making and accountability arrangements. Opening the local public sector to
civil society participation frequently requires significant change in the way public organizations
operate and greater capacity of public officials to seek and use information from civil society.

To be more responsive to citizen priorities both decentralized sectoral and local government
agencies need to take on greater responsibilities and manage increased resources, accompanied
by more effective participation and accountability mechanisms. Each of the many public
agencies operating at the local level works with others to coordinate their activities, as well as
with the community representatives and beneficiary groups that are their clients. By
strengthening not only individual service units and agencies but also the network of relationships

51
among them, improved communication, coordination, and collaboration can contribute to more
dynamic local development.

Further, a local development framework suggests the importance of effective relationships

between public agencies and a variety of nongovernmental actors, including community
organizations and voluntary associations, NGOs, and private sector service providers. Some of
these local organizations express local demand and hold public service providers accountable,
some provide services that supplement or complement public sector delivery, and some mobilize
resources and engage in co-provision arrangements with public or nongovernmental service
providers. Clarifying and strengthening these relationships can make service delivery more
effective.

b) Build Social Capital

People participate in local development processes through collective action. Community
organizations, resource and service users groups, producer and other voluntary associations, and
other organizations are vehicles for local people to engage in participatory planning and
oversight of public decision making, in service delivery, and in other local governance processes.
These institutions also provide venues for collective mobilization to solve specific problems
through direct action, such as self-help infrastructure improvement or maintenance, community-
based regulation of natural resource use, and cost sharing for social or economic support services
not provided by the public sector.

The capacity to organize, decide collectively, mobilize resources, communicate through

representatives with external organizations, and ensure compliance with mutually agreed
decisions requires relationships of trust and leadership among group members and recognition of
the legitimacy of collective action. Social capital supporting this trust, leadership, and legitimacy
is a key foundation for local development and an important dimension of capacity enhancement.
Social capital underpins both community-based development initiatives and efforts to improve
the quality of governance at the local level. Investments in social capital that strengthen both
voluntary associations and informal institutions of collective action are fundamental to
promoting a local development process that balances governmental and nongovernmental

52
initiatives.
c) Strengthen Local Organizations
Public sector agencies, associations, NGOs, and firms are all important to local development.
Their organizational capacities often need to be strengthened to increase effectiveness in setting
priorities, mobilizing and managing resources, and producing the facilities and services that
benefit local households and communities. Developing simple, effective organizational systems
is an important contribution to capacity enhancement for local development. The sectoral
organizations that manage, supervise, and support local service networks and service delivery
units require management structures, administrative systems, personnel, and financing to fulfill
their missions. Local governments require similar capacities plus those related to governance,
development planning, and revenue collection. NGOs, local associations, and community
organizations require capacities to plan, manage, and deliver services and to organize and
represent their members and constituencies
.
d) Increase Knowledge and Skills among Local Actors
The individuals who are agents of local development—whether as community members and
leaders, association officeholders, NGO staff, local government officials, civil servants, or
entrepreneurs—require better knowledge and skills to be fully effective. Local organizations
need people who are capable of planning, managing, and monitoring public initiatives and of
designing and implementing the improvements to infrastructure, public service delivery,
productive activities, and commerce demanded by communities and households.

Increasing technical and managerial capacity is important for effective local development, but
equally important is strengthening adaptive capacities—skills employed in problem-solving
processes requiring extensive face-to-face interaction. By increasing the capacity of people and
officials to work together flexibly and creatively to solve problems, the enhancement of adaptive
capacity complements the enhancement of technical capacity to ensure an adequate human
resource base for local development.
Dear learner, actors of local development need to be capacitated in order to achieve the
intended goals of local development. List down the actors and discuss how their capacity can
be development so that they can contribute to local development.

53
_____________________________________________________________________________
_____________________________________________________________________________
__

5. Providing External Support for Local Development

External support for local development includes finance, technical assistance, and information.

a) Finance Local Development

Along with improving the enabling environment and enhancing capacity, additional financing is
often necessary to supplement budget and community resources for promoting local
development. Additional funding is frequently required to finance local investments, service
delivery, and capacity building in response to citizen and community demand.
Central government budgets have traditionally provided funding for local development through
budget allocations to deconcentrated sectoral agencies or transfers to local governments. Various
special purpose funding arrangements, including social and other public sector funds, have
broadened the array of mechanisms for channeling resources to the local level. The use of
intergovernmental transfers and grants from special purpose funds may be subject to specific
conditions or may be left to the discretion of local governments.

Development assistance agencies, including international NGOs as well as bilateral and

multilateral donors and lenders, often provide resources to support local development. This
funding may be channeled through standard fiscal administration mechanisms or through
dedicated financial management systems. Funding may be micro-project based, responding to
specific, usually solicited, proposals, or grant-based, providing funding based on pre-established
formulas. Some funds coordinate allocation and disbursement mechanisms with government
budget processes and systems, while others operate independently.

Resources can be channeled to the local level in various ways. Some public sector funds transfer
supplemental resources to local public agencies, whether sectoral departments or local
governments. Many transfer resources directly to community organizations and associations,

54
while others provide funds to intermediary NGOs that work with these organizations and
associations. Regardless of the specific funding mechanisms, the relationship of external
resources to the public finance and service delivery systems is a frequent concern, to ensure both
coordination of investments and sustainable funding for operation, maintenance, and service
delivery.
b) Provide Technical Assistance to Local Organizations
To contribute fully to local development, local organizations often require skills and knowledge
that their own personnel do not possess. While capacity building programs aim to improve the
human resource base available to local organizations over the medium term, technical assistance
is often required to bridge capacity deficits in the short term. And local organizations often
require specific capacity on a short-term basis to meet specialized needs for which it may not be
economical to maintain permanent personnel.

Technical assistance for local development can be made available in a variety of ways.
Organizations such as NGOs, consulting firms, and academic institutions can often provide
technical assistance for local organizations. Within the public sector specialized government
agencies (including sectoral ministries) can provide technical services to local-level service
providers. For example, regional engineers can provide design services during the planning stage
of infrastructure investments for a local organization whose own capacity is sufficient to manage
implementation, operation, and maintenance.

Externally funded projects often set aside resources for technical assistance to supplement local
capacities. While often useful, long-term technical assistance is frequently criticized for being
excessively supply driven and for reducing incentives to develop adequate local capacity to meet
long-term demands. Thus some externally funded projects have opted for the judicious use of
long-term technical assistance combined with demand-responsive short-term technical assistance
mechanisms linked to investments in local capacity enhancement.

c) Increase the Availability of Information to Local Actors

Decisions made by local actors can benefit from knowledge accumulated by others working on
local development elsewhere. Both horizontal and vertical exchanges can provide valuable

55
support to local development efforts. Horizontal exchanges of knowledge and experience among
local actors can accelerate learning about what works and what does not in similar environments.
Because of the complexity of local development, information on technical, organizational, and
process aspects of local empowerment, governance, and service provision can help local decision
makers choose an appropriate mix of elements to suit the local context. Vertical exchanges
involve the transfer of knowledge and expertise from national organizations and specialists to
local actors. Often, in addition to developing tools and analyzing local experiences, national
organizations also facilitate horizontal exchanges that promote peer-to-peer learning and act as
conduits for information at the international level that may be relevant to organizing local
development within a country.

The universe of innovations, experiments, and investments in methodological development

across many developing country contexts constitutes a wealth of experience. International
organizations and national government can make significant contributions to local development
by organizing this intellectual capital and increasing the availability of relevant information to
local actors.
Dear learner, what kinds of external support that government can provide to promote local
development?

Chapter Summary
 National and regional governments can promote local development by improving the
enabling environment, enhancing capacities for local development, and providing
external support.
 Local government legislation and the mechanisms for intergovernmental finance and
management also influence the conditions for participatory local development. Public
sector decentralization, through devolution, deconcentration, and delegation, establishes a
framework for greater local initiative.
 Legitimating various forms of social capital, in the political and social marketplace of
ideas as well as in law and policy, creates a favorable environment for the local initiative
and pluralism required for dynamic local development.

56
 More effective collaboration between public sector and nongovernmental organizations,
more responsive and legitimate forms of social capital, better performing organizations,
and individuals more capable of working together to solve problems also enhance the
capacity for local development.
 The capacity to organize, decide collectively, mobilize resources, communicate through
representatives with external organizations, and ensure compliance with mutually agreed
decisions requires relationships of trust and leadership among group members and
recognition of the legitimacy of collective action.
 The universe of innovations, experiments, and investments in methodological
development across many developing country contexts constitutes a wealth of
experience.

Self Check Questions

1. Discuss how local development and local institution development is interrelated.
2. Discus the roles of civics societies in promoting local development.
3. How do you think that government can develop capacity of local actors of local
development?
4. Discuss the types and methods of external support of government to promote local
development.

57
 Chapter Five

Entrepreneurship and Local Development

1. Introduction
Finding and implementing successful local economic development strategies in a given local
area has become more important in recent years as local officials struggle to stimulate stagnant
or declining economies and stem population losses. Different local areas, in general, have
experienced a significant restructuring as higher paying manufacturing jobs are replaced by
lower-paying service jobs. While local development practitioners are concerned about these
changes, they all too often have neither the staff nor expertise to mount a successful business
recruiting campaign and find it hard to compete with larger centers for relocation jobs.

The changing economic environment, combined with increased pressures on local areas to
replace lost jobs or create additional jobs, forced local development practitioners to seek
alternative strategies. Entrepreneurship as a development strategy is one such approach that has
become prominent especially in the past decade as practitioners recognize the limited number of

58
firms relocating and the resulting competition for these businesses. This chapter discusses the
role of entrepreneurship in local development.

2. Chapter Objectives
Dear learners, after completing this chapter you will be able to
 Analyze the relation between entrepreneurship and local development.
 Comprehend the significance of entrepreneurship in local development.
 Explore how to develop entrepreneurship culture in a given local community.

3. Why Entrepreneurship?
Dear learner, before getting started the next part, would you list down how entrepreneurs can
contribute to development of local area?

Community leaders must make a case for entrepreneurship before investing time and energy in
building an entrepreneurial environment. For the most part, local communities should pursue a
broad-based approach to social and business entrepreneurship—those with high growth potential
as well as those who can meet local needs. Microenterprises, those that employ four people or
less, are considered part of a local development strategy for three major reasons:
1) they allow the disadvantaged to build assets and accumulate wealth;
2) they create the bulk of new jobs; and
3) microenterprise entrepreneurs tend to become more involved as leaders in their
community.
Both social and business entrepreneurs are essential for the quality of life in local areas. They
often offer essential services and products such as grocery stores, automobile repair, and health
care. They also make life more vibrant and interesting for residents in fields such as recreation,
retail, and financial services. They often provide leadership to stimulate social and business
ventures and can create more philanthropic opportunities to strengthen local life. Rural
entrepreneurs can also provide a laboratory for business and social innovation; produce high-
quality, locally controlled food and fiber resources; protect and restore the environment; and
provide new opportunities for immigrants and the disadvantaged.

59
High school graduates leave rural areas for better employment opportunities and there are too
few high-paying economic opportunities to bring them back to their home areas later in life.
While they realize that youth represent the future of rural communities and their ability to
prosper, or at least survive, rural community leaders and development practitioners are often
unsure how to change the local economic climate and policies to successfully deal with this
issue. Rural communities often pursue policies or strategies that were successful in the past,
hoping that these efforts will succeed in the future. Industrial attraction practices, based on
offering low-cost sites and wages, attracted many businesses and jobs in earlier times. However,
this approach is becoming less effective now because of even lower costs in offshore locations
and increased competition among states to lure the relatively few large businesses seeking to
relocate.

Promoting small business start-ups and development has been recognized as a strategy for many
years following research showing that a majority of the employment growth was in small
companies. An aging population in rural areas and smaller markets than in large regional centers
can mean less interest and fewer opportunities for business starts. Young families have migrated
to larger centers which, in and of itself, can mean a smaller pool of potential people interested in
starting businesses. At the same time, an in-migration of early retirees with considerable wealth
and growing numbers of foreign-born populations can offer potential opportunities for new part-
time business ventures either directly or through financial investment.

The changing economic environment, combined with increased pressures on rural areas to
replace lost jobs or create additional jobs, forced local development practitioners to seek
alternative strategies. Entrepreneurship as a development strategy is one such approach that has
become prominent especially in the past decade as practitioners recognize the limited number of
firms relocating and the resulting competition for these businesses.

Social and business entrepreneurs provide other economic benefits as well. They increase wealth
in a community through external grants and investments and through links with external markets.
Small enterprises account for half of the new jobs created. One can argue that entrepreneurial

60
organizations are more efficient and dynamic because they can respond more quickly to change
than highly structured large organizations.

Entrepreneurship is a centerpiece for local economic development. Large businesses often ignore
local needs and create a sense of dependency while local entrepreneurs are more closely tied to
place, less resistant to relocation, and have a tendency to be good neighbors. While
entrepreneurship is a logical economic development strategy for local communities, one should
note that entrepreneurship tends to be a long-term solution to economic issues rather than a
panacea that easily translates into family-supporting wages and benefits. It can also be part of a
broader economic development strategy that includes increasing the recirculation of money in
the community, such as though public services, and community and regional facilities;
expanding purchases by nonlocal people; and recognizing the role of retirement benefits and
unemployment compensation as a flow of income into the community.

Small businesses are very important in local areas with small markets. For this reason, special
attention is paid to the importance of small businesses, entrepreneurial or otherwise, in local
development. Scholars examine the breadth (quantity of entrepreneurs) and depth (value created)
of self employment in regional economies across the nations. They also examine spatial
variations in the importance and effects of entrepreneurship in metro and non metro counties,
testing for the effects of human capital, amenities, financial capital, and infrastructure based on
proprietor employment and income data. The results from this study demonstrate that
entrepreneurship, as measured by proprietors, is influenced by, among other factors, the
concentration of foreign-born residents, amenities, financial capital, infrastructure, regions of the
nations, and whether a county is micro- or metropolitan.

4. Significance of an Entrepreneurial Culture to Local Development

Dear learners, how you define culture? Can a culture of a given community affect
entrepreneurship?

There are cultures within a community that nurture, tolerate, or discourage the creation of new

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enterprises. Communities with cultures that value independence, innovation, diversity, and
wealth creation can be viewed as entrepreneurial-friendly while those that place higher values on
conformity and homogeneity or that tend to be overwhelmed by their deficits and problems can
be viewed as entrepreneurial tolerant or resistant.

Typically, a community has several cultures within a dominant culture. These cultures can be
ethnic, gender, or values-based clusters of people with shared interests. For example, a group of
entrepreneurs, small manufacturing firm owners, or pro-environment entrepreneurs may have
their own informal networks, values, and resources that are shared. They don’t necessarily
oppose the dominant culture but operate within it on their own terms.
Entrepreneurial cultures can inspire entrepreneurs to emerge. This type of culture is expressed
through a can-do attitude that is manifested in symbols and behavior that value entrepreneurship;
it can include award ceremonies, value statements, community-minded visions, local policy,
investments, and other approaches.
A community that only tolerates entrepreneurs and doesn’t welcome them could be viewed as
having a non entrepreneurial culture. The focus on the collective rather than individual success is
one of several factors hindering an entrepreneurial culture along with inadequate access to
financing and capital, lack of educational opportunities, and limited access to external markets.
This results in little questioning about current economic strategies and more focus on problems
rather than assets. Some scholars assert that an entrepreneurial culture is about a framework in
which entrepreneurs have the potential to emerge and local economic resilience is promoted.
Others argue that an entrepreneurial community has three major characteristics:
1) a critical mass of entrepreneurs who are capturing new market opportunities;
2) a group of entrepreneurs with a distinct community within the community characterized
by a strong support network and mutual self-help; and
3) the community as a whole is open to change.
Entrepreneurial-friendly communities have places that appeal to creative individuals. That is,
they nurture the arts, promote a healthy civic life, honor diversity, and celebrate their cultural
uniqueness.

5. Building an Entrepreneurial Culture

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Dear learners, the following section discuss how to build a n entrepreneurship culture in a
given community. From your own experience, list the methods that can be used to build
entrepreneurship culture.

What can a community do to encourage entrepreneurship or to strengthen or build an

entrepreneurial culture? The answer is multifaceted. An entrepreneurial culture is based on two
premises: shared learning and a systems approach. The first premise, shared learning, is about
building a learning community. Learning isn’t simply the act of acquiring information; it is about
developing the capacity to produce the results that are truly desired. A learning community can
be defined by its ability to learn new knowledge, discover new insights, share this knowledge
with the community, and modify its behavior so as to reflect this learning.

The second premise is about strengthening the entrepreneurial system. A major shortcoming of
local economic development is that it does not consider which critical components are missing or
how they operate in isolation from each other. An entrepreneurial culture cannot be imposed
from the top down nor can it be isolated from other aspects of community life, especially
community goals and visions or programs involving the arts, health care, or education.
Essentially, a human system can be characterized by three criteria:
1) the whole is greater than the sum of its parts,
2) all parts are interdependent and affect each other, and
3) a living system perpetuates itself by self adapting to its context
The following part discusses on seven practical strategies for building an entrepreneurial climate:

a) Create Opportunities to Learn, Question, and Think Differently about

Entrepreneurship
Leaders can create opportunities for people to learn, to question, and to get out of old ruts. Some
scholars argue that an entrepreneurial culture places a significant value on storytelling. Stories
serve as an inspiration for aspiring entrepreneurs and also legitimize individual entrepreneurs to
investors, competitors, and others who make resource decisions based on their interpretation of
the stories presented to them. The stories about the ups and downs of entrepreneurship are
especially valuable for understanding the complexities of finance, product development,

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marketing, and management. When aspiring entrepreneurs tell their stories, they get to the heart
of the issues with which they are wrestling. The metaphors associated with the entrepreneurial
stories also provide insights into the entrepreneurs’ own perspectives and aspirations and can
inspire others in the community. The conventional metaphors of entrepreneurship as a journey,
parenting, building, passion, race, or war illustrate the multifaceted, even paradoxical, process.
Storytelling provides meaning to the entrepreneurial process; it can be manifested in
celebrations, awards, and testimonials.

Self-assessment surveys can also trigger new conversations and reflections about attitudes,
capacity, and the climate for entrepreneurship. The entrepreneurship survey and other tools can
be posed to elected leaders, economic development professionals, and social and business
entrepreneurs to foster different perspectives about the entrepreneurial capacities of the
community. Even a simple question such as “Where has entrepreneurship succeeded in our
area?” or “Are we entrepreneurial-friendly?” have engaged communities in soul-searching
conversations about attitudes, technical and financial assistance, infrastructure, and a range of
other issues associated with an entrepreneurial culture.

b) Welcome Fresh Voices and Embrace Diversity

A systems approach to entrepreneurship includes symbolic diversity—a community-level
orientation that inspires communities to engage in constructive controversy. Local communities
provide settings in which people see each other in a variety of roles; however, communities tend
to suppress controversy such as the need for a new landfill to avoid feeling uncomfortable when
meeting the person concerned at meetings or the bowling alley. Absence of controversy can be as
dangerous for communities as conflict.

Communities can depersonalize politics where controversy is accepted: people can still disagree
with one another but still respect each other. Symbolic diversity can be stimulated by a focus on
process rather than on winning. It calls for a broader definition of group identity which expands
the “we” with fewer “theys” and with more permeable group boundaries.
Symbolic diversity is also achieved by welcoming fresh voices, especially those of the young,
artisans, teachers, healthcare workers, and entrepreneurs. Some researchers argue that

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communities are likely to become more prosperous if they welcome diverse viewpoints and
become a haven for creative workers. One study suggests that natural resource amenities such as
hiking trails, water sports, hunting, and fishing as well as a cluster of arts, humanities, and
educational opportunities provide the creative juices to attract entrepreneurs and other
innovators.

c) Mobilize Resources for Entrepreneurs

Resource mobilization is a key aspect of an entrepreneurial social infrastructure. Rural local
areas are characterized with slow growing or decreasing real incomes and a decreasing tax base
in some instances, and they are increasingly being asked to rely on their own resources for rural
development and entrepreneurship. Entrepreneurship is facilitated when communities can share
some of the entrepreneurs’ risks in the form of money, space, communications, and equipment.
Entrepreneurial communities are willing to commit funds, through additional taxes or
reallocation, to provide the physical or human capital resources for entrepreneurs to succeed.

d) Cultivate Networks for Entrepreneurs to Thrive

An entrepreneurial culture fosters networks for entrepreneurs to prosper. Both formal and
informal networks are essential for information flows and key linkages. It is essential that voices
other than traditional elites be heard in these networks. Diverse leadership, including men and
women, different ethnic backgrounds, and different income levels, must be nurtured during this
process. While some people may find it uncomfortable to be around others unlike themselves, an
entrepreneurial culture needs diversity.

A community must reach out to these diverse constituencies and include them in leadership
networks to stimulate new social and business ventures. Entrepreneurial communities are able to
grapple with difficult problems and rephrase them in more inclusive ways that allow diverse
voices to be heard. They think about issues from a systems perspective rather than isolate
entrepreneurship from the broader community. Horizontal networks are also essential.
Entrepreneurs tend to learn best from those most like themselves, rather than experts. Vertical
networks encourage a two-way flow of information. Entrepreneurial communities cannot depend
exclusively on local resources but need to link with others outside the community for

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information and resources.

e) Focus on Assets Instead of Deficits

There are two major approaches to economic development. One is known as the deficit or needs-
based model in which the community is viewed as a collection of needs or crises. Under this
model, the community concentrates on what it lacks and seeks external resources to correct those
needs. Unfortunately, the deficit approach can demoralize residents because they can often feel
overwhelmed with the task at hand. The alternative approach is known as asset-based community
development. It is also known as asset mapping because a community’s assets are mapped,
including individuals, organizations, and other community characteristics. In the asset approach,
the primary building block for entrepreneurship or other community initiatives includes those
community assets most readily available, especially those resources located in and controlled by
residents.

Each community can map its individual assets, including skills, talents, experiences, income, and
individual and home-based businesses. There are also organizational assets: business and citizen
associations, religious groups, and other informal networks. Secondary building blocks include
those assets which are within the community but controlled by outsiders. An asset-based
approach to entrepreneurship begins with a comprehensive analysis of a community’s positive
core and then links that knowledge to the heart of any strategic change. It is a discovery of
everything which brings a system to life. An asset-based approach links people to the hidden and
obvious potentials in their community. They can see changes they never thought possible, and
people can be mobilized with enthusiasm, confidence, and energy. It tends to bring out the best
of “what is” and “what can be.” For example, compare the following two questions. The deficit
based approach question might ask, “Why don’t we have many entrepreneurs in our
community?” In contrast, the asset-based approach question might be, “What makes
extraordinary entrepreneurship possible in our community?” The former question encourages
self-doubt while the latter can trigger spontaneity, discovery, dreams, and innovation.

Dear learners, pause for time! Can you list down the main points of the above section?

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 f) Build a Shared Vision about Entrepreneurship
A community-based vision is the big picture about where the community or region is headed. A
community vision about entrepreneurship cannot stand alone; it must be fully integrated with
other aspects of a broader vision about community directions. Ideally, the process involves the
key strategies mentioned earlier such as creating opportunities to learn, question, and think
differently about entrepreneurship and focusing on community and regional assets.

Shared visions about entrepreneurship must be integrated within the context of a community’s
uniqueness, its values, and its people. It should involve opportunities to learn, to question, and to
think differently about entrepreneurship. Fresh and diverse voices must be welcomed. The vision
should pay attention to the creation of more resources for entrepreneurs and networks that will
allow entrepreneurs to thrive. Typically, the visions focus on assets rather than deficits.
Increasingly, rural communities combine their efforts to develop a shared vision for their region.
The shared vision must also nurture leaders who can advocate for entrepreneurs and can
stimulate collective action and policy changes.

g) Foster Entrepreneurial Leaders and Advocates

The seventh strategy for fostering an entrepreneurial culture involves leadership. Low population
density in rural areas suggests a lack of a critical mass of leaders for concerted action. So,
entrepreneurial leaders and advocates must be nurtured through public or civics organizations in
order to fill the human capital gap.
An entrepreneurial culture is not characterized by decentralized or centralized leadership but by
many interrelated centers of leadership—polycentric leadership. That is, an entrepreneurial
community will have a series of circles which represent elements in the community such as
finance, local government, social services, the arts, youth, and other groups. Leaders from these
groups will be able to make decisions that are guided by shared visions.

Polycentric leadership works well if it moves beyond the superficial elements of team building
(e.g., communications, courteous behavior, and strong relationships) to team learning. Leaders
can learn to collectively think together about entrepreneurship and to move in a coordinated way,
just as a flock of birds moves in coordinated patterns. Opportunities must be created for team

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learning about entrepreneurship in which questions are asked about systems and assets as well as
reflecting on some of the tough questions:
 What do we know about entrepreneurship?
 What do we need to know?
 How does entrepreneurship complement or challenge our values?
 Do we have a shared vision about entrepreneurship, and how should we act on that
vision? and
 What kinds of policies need to be changed to foster entrepreneurship?
Venues such as conferences, workshops, roundtables, and think tank settings can create a climate
for entrepreneurial leaders to emerge. In order for a community to be officially designated as
entrepreneurial-friendly, a community must take several key steps:
1) identifying a local organization and champion to lead a community-based
entrepreneurship strategy;
2) increasing community awareness about the needs, resources, and benefits of home-grown
businesses;
3) enhancing relationships with state and federal resource providers and others in
educational sessions to help local leaders learn how entrepreneurs can be supported;
4) identifying potential, existing, and growth-oriented entrepreneurs;
5) identifying unique local assets that can support and foster entrepreneurship such as
historic features, nature-based venues, and educational strengths; and
6) visiting and interviewing local entrepreneurs.

Dear learners, how can a given community have a shared vision? How having shared vision
can contribute to building entrepreneurship culture?

Chapter Summary

 Microenterprises are considered part of a local development strategy for three major
reasons: they allow the disadvantaged to build assets and accumulate wealth; they create
the bulk of new jobs; and microenterprise entrepreneurs tend to become more involved as
leaders in their community.

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  While entrepreneurship is a logical economic development strategy for local
communities, one should note that entrepreneurship tends to be a long-term solution to
economic issues rather than a panacea that easily translates into family-supporting wages
and benefits.
 An entrepreneurial community has three major characteristics: a critical mass of
entrepreneurs who are capturing new market opportunities; a group of entrepreneurs with
a distinct community within the community characterized by a strong support network
and mutual self-help; and the community as a whole is open to change.
 An entrepreneurial culture is based on two premises: shared learning and a systems
approach.
 Entrepreneur culture can be built by; create opportunities to learn, question, and think
differently about entrepreneurship; welcome fresh voices and embrace diversity; mobilize
resources for entrepreneurs; cultivate networks for entrepreneurs to thrive; focus on
assets instead of deficits; Build a Shared Vision about Entrepreneurship; Foster
Entrepreneurial Leaders and Advocates.

Self Check Questions

1. Define the term entrepreneurship. How it contributes to local development?
2. Discuss the significance of entrepreneurship culture to local development.
3. What are the characteristics of entrepreneurial community?
4. Discuss on practical strategies for building an entrepreneurial climate.

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 PART TWO: RESOURCE MOBILIZATION AND
MANAGEMENT

Chapter One

An Overview of Resource Mobilization and Management

Introduction

To run any organization resource is the input, also to be successful resource mobilization and
management process is very essential. Resource mobilization is a process of raising different
types of support for a given organization. It can include both cash (financial) and in-kind
(nonfinancial) support. It is a process of identifying and obtaining resources for a given
organization. As Civil Society Organization (2012) definition, resource mobilization includes
three concepts these are organizational management and development, communicating &
prospecting, and relationship building in order to diversify and expand resources. Now days, to
survive in this competitive environment, resource mobilization and management help to

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formulate an independent budget, to decrease dependency on others, to expand deep relations
with the stakeholder and community, to clean the image of the Organization in order to expand
relations and to run programs based on the genuine needs of the community and to advocate for
such programs.

Chapter Objectives

Dear students, at the end of this chapter, you will be able to:
 Define resource and resource mobilization
 Identify the triangle and forms of resources mobilization
 Describe resource mobilization terms and concepts
 Explain the purpose and importance of resource mobilization
 List down the basic principles of resource mobilization
 Explain the basic approaches of resource mobilization
 Explain resource mobilization and development linkages.

1: Basic Concepts on Resource Mobilization

1.1. Definition of Resource

A resource is the human (skills, knowledge and concepts) and goods like money, materials,
information, energy essential for attaining the objectives of an organization or individual. As a
result, the human (members, board and employees) that do not contribute to achieving our
organization's mission cannot be regarded as 'Resource'. Resource is that which is used. Like:
Money, Information, Materials, Energy or Skills. If any human cannot be used for achieving the
mission (objectives) of the organization, then that will not be regarded as human resource. For
example, if the country's population is utilized then it will be helpful in attaining the country's
objective, but if not then it's only a crowd, which will give birth to more complex problems.
Another example, the rivers flowing in Ethiopia can give energy if used and so is Resource but if
not then it is only a source.

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Dear Students, can you define the term ‘Resource’ in your own words?
______________________________________________________________________________
_____________________________________________________________________________.

A resource is broadly seen as AN ENABLER.

Examples
 An organization needs a mixture of financial and non financial resources to ENABLE it
drive the realization of the strategic plan and/or resource mobilization strategy
 Human and financial resources will be essential in implementing business plan
 A computer is an essential resource for office and out of office work

1.2. Types of Resources

In general terms, Resource is understood as materials, goods or services that help fulfill the
organization's needs. Materials, money, human, means and time are Resources that are used by
Group, organization and individuals to fulfill their objectives. Resource is required by every kind
of organization to fulfill its objectives. It is essential to know the type of resource, its normal
availability and the estimated cost to attain the require resources in order to carry our works as
per the objectives of the Organization. On the basis of this information, the primary plans of
resource mobilization should be established, checked and if needed repeated.

 Reasons for the requirement of resources for the Organization:

 In order to continue with its work and achieve the works and targets.
 In order to begin or plan for new work.
 In order to enhance or maintain relationship with the community, individuals,
Government Organizations, Private organizations or donor agencies.
 For the development of the various conditions of the Organization.

 Normally, the various types of Resources have been classified as below:

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Money/Cash: Wealth/Cash is essential in order to run the existing programs, pay cost of goods
and salary and to carry out new works. Wealth/Cash can be increased through various means like
membership fees, grant received as per or without request, local fund, donations and various
other sources such as NGO, INGO or external funding.

Technical Assistance/Cooperation: Every Organization will not have people essential for
carrying out various types of activities, project and programs. Apart from that, every
organization may not have the necessary fund to appoint essential efficient employees. Technical
cooperation can be made by any Organization by providing the amount essential for appointing
such efficient employees for a special project or the efficient employee helping for a fixed
timeframe. Some organizations provide technical cooperation through trainings.

Human Resources: Every type of Organization will require people/personnel to ensure that the
Organizational role and works are fulfilled. For essential human resources, the Organization will
make different provisions. The Organization can appoint some permanent employees while the
remaining appointments are made as per requirement. The permanent employees are taken as
internal resources of the Organization while employees appointed for a specific time period are
regarded as external resources. Many NGOs utilize dedicated and regular volunteer groups in
order to fulfill the need of human resource.

Physical Goods: They are physical goods resources. For example, the Organization's activities
or availability of the project are taken ahead together by the tools. It is essential for the
Organization to spend on such goods in order to train on main activities of the
project/organization. Examples of resources like office tools, furniture, training tools and raw
goods, vehicles and other machines have been classified under the Physical Goods.

Free Service and Facilities: A non-profit-making Organization gives many physical goods,
service and facilities only in minimum cost. As a result, provisions for free services in the
Project/Organization should be made through community support. Apart from this, other
Organizations provide the non-profit-making Organizations to use these facilities (eg. Computer,

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Telephone, Photocopy Machine and Internet); which is a form of free facility.

Dear larners; Take an organization around your area and identify what kinds of resources are
used by the organization?

1.3. Possible Sources of Resources

Dear learns, from the previous topics, it is believed that you have got a broad concept about
resource. As resource is the most important factor in any organization, it is essential to know
the sources of resource.
Can you List the main sources of resource?

Source of resources can be from domestic (internal) or external sources (George M., 2008). For
most countries, the bulk of resources for development are mobilized domestically rather than
externally (National and international organizations working in the community, or with programs
that area available to the local community).

Dear students, as we can see, resources can be internal (domestic) sources and external sources.
Now we will see the meaning of these two sources.

Internal (domestic) sources

Domestic resources stem from households, firms, and governments. Households generate
savings; firms generate profits and net earnings; and governments generate taxes and other
public revenues.

External sources
The external sources can be grouped under four headings:
(1) Foreign direct investment and other forms of private foreign investment;
(2) Export earnings from international trade;
(3) Foreign aid and technical cooperation; and
(4) Proceeds of debts forgiven by international creditors.

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Dear learners; Explain the difference between internal and external sources of resources?
_____________________________________________________________________

1.4. Definition of Resource Mobilization

Resource Mobilization is a process, which will identify the resources essential for the
development, implementation and continuation of works for achieving the organization's
mission. In real terms, Resource Mobilization means expansion of relations with the Resource
Providers, the skills, knowledge and capacity for proper use of resources. Resource Mobilization
does not only mean use of money but it extensiveness denotes the process that achieves the
mission of the Organization through the mobilization of knowledge in human, use of skills,
equipment, services etc. It also means seeking new sources of resource mobilization and right
and maximum use of the available resources.

Therefore, resource mobilization involves the development of capacity to "steal the donors’
heart" by winning them over to the cause of the organization.

Resource Mobilization entails obtaining various resources from a multitude of partners, by

different means. Thus resource mobilization could be seen as a combination between:
1. Resources: elements necessary for running of an organization,
2. Mechanisms: means which make it possible to obtain resources directly,
3. Partners: persons and/or institutions providing resources.

Looking closely at this definition, we can see that resource mobilization is actually a process that
involves three integrated concepts namely: organizational management and development,
communicating and prospecting, and relationship building.

Each concept is guided by a number of principles which are further elaborated below:

a) Organizational Management and Development

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Organizational Management and Development involves establishing and strengthening
organizations for the resource mobilization process. It involves identifying the organization’s
vision, mission, and goals, and putting in place internal systems and processes that enable the
resource mobilization efforts to be successful.

These include:
 Identifying the roles of board and staff;
 effectively and efficiently managing human, material, and financial resources;
 creating and implementing a strategic plan that addresses the proper stewardship and
use of existing funds on the one hand, and
 identifies and seeks out diversified sources of future funding on the other.
This concept is based on the following principles;
1. Resource mobilization is just a means to the end, the end being the fulfillment of the
organization’s vision;
2. Resource mobilization is a team effort, and involves the institution’s commitment to
resource mobilization; acceptance for the need to raise resources; and institutionalizing
resource mobilization priorities, policies and budget allocation;
3. The responsibility for the resource mobilization effort is shared by the board, the
president or the executive director, and the resource mobilization unit;
4. An organization needs money in order to raise money;
5. There are no quick fixes in resource mobilization.

b) Communicating and prospecting

Once an organization has achieved a certain readiness for resource mobilization, it must then
take on another challenge: ensuring its long-term sustainability by acquiring new donors and
maintaining a sizeable constituency base.

The art of resource mobilization entails learning how to connect with prospective donors in a
manner and language they understand, and finding common ground through shared values and
interests. It also entails discerning the right prospect to approach, and matching the appropriate
resource mobilization strategy to the prospect.

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This concept is governed by two principles:
1) Resource mobilization is really friend rising. Financial support comes as a result of a
relationship and not as the goal in and of itself,
2) People don’t give money to causes; they give to people with causes. People give to
organizations to which they have personal affiliation, in some shape or form.
Dear learners, what do you understand from these principles?
_____________________________________________________________________________
_

c) Relationship Building

Dear students, once you identify your donors, the objective then is to get closer to them, get to
know them better, very much the same way as developing a casual acquaintance into a trusted
friend and confidante. As the relationship deepens, this increases the chance of donors giving
higher levels of support over time, intensifying commitment and enlarging investment.

As cultivation techniques become more targeted and personal, a donor may become more
involved in the organization. Initiating new relationships, nurturing existing ones, and building
an ever expanding network of committed partners is an ongoing activity, embedded as a core
function of the organization. This requires the dedication of board members, staff and volunteers,
and in order to build enduring relationships, the following principle should be remembered:
Donor cultivation means bringing the prospect to a closer relationship with the organization,
increasing interest and involvement. Dear students, the following figure can broaden your
understanding about these three concepts.

Diagram 1.1: The concept of resource mobilization

Organizational
Management and
Development
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 RESOURCE
MOBILIZATION Relationship
Communicating
Building
and prospecting

Dear learners;

1. On the basis of definition of Resource Mobilization, what has to be done to improve the
existing process of Resource Mobilization in your Organization? How should it be done?
2. Discuss with your friends about the three concepts of resource mobilization and spot
their importance for an organization?

1.5. Triangle and forms of resource mobilization

1.5.1. Triangle of resource mobilization

Resource mobilization involves three key elements, namely resources, resource providers and
resource mobilization mechanisms. Mechanisms for resource mobilization strategies are used by
organizations to obtain resources from resource providers.

Diagram 1.2: Triangle of resource mobilization

MECANISMS

 Submit funding demands

 Organize special events
 Sell services 78
 Request donation
RESOURCES RESOURCE PROVIDERS

 Monetary resources  Multilateral institutions

 non monetary resources  Bilateral institutions
 Human resources  International NGOs
 Free services  Governments
1.5.2. Classes
 Work and forms of resource mobilization
time  large public
 Logistics  Enterprises
1. Human resources: these are voluntary members and/or beneficiaries.
2. Logistic resources: these are equipment, real estate and premises.
3. Technical resources: these could be in the form of assistance for the direction of a study
or the implementation of a project.
4. Financial resources: these are funds, costs of membership, grants, and contributions from
friends and well-wishers.

It is important to note that having the sufficient financial resources is one of the key factors that
determine the organization effectiveness. The success of a resource mobilization (form or model)
adopted by an organization is among others determined by all or some of the following factors:
1. Strong relationships with local communities and organizations
2. Capacity to relate to business and government
3. A focus on mobilizing resources more broadly than for themselves
4. Access to an endowment or some other form of secure financing
5. Cogent mission and objectives that can be widely shared
6. Accounting systems to ensure that resources get to where they are intended

1.6. Purpose and Importance of Resource Mobilization

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The purpose: Identify and avail resources necessary to achieve long and short term strategic
goals.

The importance: Resource mobilization is essential for the existence of a healthy organization.
An organization cannot exist without resources. It is needed to provide continuity and stability to
the organization and its work.

Resource mobilization is critical to any organization for the following reasons:

1. Ensures the continuation of your organization’s service provision to beneficiaries
2. Supports organizational sustainability
3. Allows for improvement and scale up of services the organization currently provides
4. Organizations, both in the public and private sector, must be in the business of
generating new business to stay in business

What is meant by sustainability?

Although sustainability is often identified with having sufficient funds to cover an organization’s
activities, it is actually a broader concept. There are three fundamental streams of sustainability:
institutional, financial and programmatic. Each is vital to the survival of an organization.

 Programmatic sustainability: the organization delivers products and services that respond
to the beneficiaries needs and anticipates new areas of need. Its success enables expansion
of its operations scope.

 Institutional sustainability: the organization has a strong, yet flexible structure and
accountable, transparent governance practices. Its structure and good governance allows it to
respond to shifting supporters’ priorities and to new responsibilities toward its beneficiaries,
while creating a positive work climate for its staff.

 Financial sustainability: the organization draws on various sources of revenue, allowing it

to support its on-going efforts and to undertake new initiatives.

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2: The Basic Principles of Resource Mobilization

Dear students, can you list down the basic principles of resource mobilization?
_____________________________________________________________________________
_
_____________________________________________________________________________
_

These are the basic principles of resource mobilization (CSO, 2012):

1. Ability to ask: state what you want clearly and with emphasis. Be confident!
2. The personnel approach: from the donors view point: “institutions do not have needs,
peoples do”. Donors know what that by giving to an institution, people will benefit.
Remember, donors are not just organizations. Real living and breezing people make
decisions on whatever to give or not to give.
3. Creditability: people prefer to give to organizations and projects that they have heard of. This
means that an organization’s creditability and good public relations are extremely important.
4. Understanding the donor: you have to know your donors, what they fund, what they like or
dislike, their fears and their needs before approaching them.
5. Relative standards of giving: people give in relation to their means and in relation to what
others give.
6. Show peoples need: avoid lies. Your appeal must show the need that your working is
addressing, the ultimate beneficiaries and the difference the donation you are asking will
make in their life.
7. Understanding the six rights: the right person asking the right prospect for the right amount
for the right project at the right time on the right way.

Let’s see these six “rights” one by one:

 The right person: who is the right person in the organization to ask for the
contribution/donation
 The right prospect: who are the right prospects (donors that might respond
positively)?

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  What the right amount to ask for: know the amount you want before you ask.
 The right project: is always the one that a prospective donor has most interest in.
 Determine the “right time”: the best time to approach a prospective donor for a major
gift is when you have nurtured a positive relationship.
 Know the right way to ask: the language tone and presentation matters.
8. Set an example: those closest to an organization must set pace. This will encourage others to
give too. If those closest to an organization do not believe in the project enough to give
generously, how others not as close expected to make significant contribution?
9. The Pareto “80/20” principle: often 80% or more of the funds raised will come from not
more than 20% of the donors. Or 80% of the results will come from 20% of efforts.
10. Say thank you: saying thank you is extremely important. It recognized the value of the
donor’s generosity. Saying thank you encourages repeat giving.
11. Build long term relationship: what an organization needs are people who are willing to give
regularly and substantially. All the efforts to find a donor and persuade him to give will
really bear more fruits if they continue give in many years to come.
12. Accountability, transparency and reporting back: when you take money from somebody
you are responsible for seeing that: - the money is spent for the purpose for which it was
raised. Once the money is spent, you are obliged to report back on how it was spent and what
has been achieved.
13. Observe the highest ethical standards: this will be in relation to external agents (donor’s
clients and collaborators) and internally (in relation to staff and volunteers)
14. Have multiple donors supporting your organization: it is very dangerous to have only one
donor supporting an organization.

3: Resource Mobilization Approaches

There are two fundamental streams of resource mobilization approaches: internal approaches and
external approaches.

Internal approaches can be defined as a mixture of an organizations long-term and short term
internal and sustainable fundraising activities. Such approaches have the following benefits
among others

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 1. They determine an organizations degree of sustainability with or without donor support
2. They reduce an organizations degree of dependency on donors and well wishers
3. The organization has the right to determine when and how such resources can be used

External approaches can be defined as a mixture of organizations resource providers mostly in

the form of donations and grants. Such resources are provided as individual donation or from
donor agencies and well wishers. Such approaches have the following benefits among others
1. Help in meeting an organizations resource gaps
2. Provide a road map (support) for an organizations self-sustainability
External approaches have the following disadvantages among others
1. Are not sustainable, the donor may withdraw support.
2. Terms and conditions of such resources are decided by the donor or donor agency;
hence an organization may or may fail to meet required conditions.

In building an organization capacity to self-sustainability, a resource mobilization strategy must

seek to explore and establish internal resource mobilization approaches that eventually reduce
the organizations dependency on external resource providers.

Dear students, from the previous section, it is believed that you have got a clear idea about the
principles and approaches of resource mobilization and management. Now, what do you think
of the relationship of resource mobilization and development?
_____________________________________________________________________________
_
_____________________________________________________________________________
_

4: Resource Mobilization and Development Linkages

 How can an organization raise the income needed to carry out its mission?
 Where are the required resources?
 How do you sustain your organization and work?

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  How can we develop the status of our organization through resource mobilization?

These are the key questions confronting organizations when they consider how to maintain their
work and strengthen organizational sustainability.

 Developing a plan or strategy for resource mobilization can lead to creative efforts in using
your own local assets to gain support for your organization.
 Multiple sources of funding can increase your independence and flexibility to implement
programs and reduce reliance on external (or foreign) funding.
 With increased competition for scarce grant resources, thinking of, & creating options for
new, diverse, & multiple funding streams will help your organization manage its programs.
 Resource mobilization can help to analyze your organization’s status on how it can do
locally before soliciting external sources for funding.

Chater Summary

 Resource is a combination of financial and non-financial supplies that is essential for

attaining the objectives of an organization or individual. It includes money, the skills, time
contributions and services of humans, and equipment and materials. The possible sources of
resources can be from domestic (internal) or external sources.
 Resource mobilization is a process, which will identify the resources essential for the
development, implementation and continuation of works for achieving the organization's
mission. In real terms, resource mobilization means expansion of relations with the Resource
Providers, the skills, knowledge and capacity for proper use of resources.
 Resource mobilization does not only mean use of money but it extensiveness denotes the
process that achieves the mission of the Organization through the mobilization of knowledge
in human, use of skills, equipment, services etc. It also means seeking new sources of
resource mobilization and right and maximum use of the available resources.
 Resource mobilization is critical to any organization for the following some reasons: ensures
the continuation of the organization’s service provision to beneficiaries, supports
organizational sustainability, allows for improvement and scale up of services the

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 organization currently provides, organizations, both in the public and private sector, must be
in the business of generating new business to stay in business.
 The basic principles of resource mobilization include, ability to ask; the personnel approach;
creditability; understanding the donor; relative standards of giving; show peoples need;
understanding the six rights; set an example; the Pareto “80/20” principle; say thank you;
build long term relationship; accountability, transparency and reporting back; observe the
highest ethical standards and have multiple donors supporting your organization.
 In building an organization capacity to self-sustainability, a resource mobilization strategy
must seek to explore and establish internal resource mobilization approaches that eventually
reduce the organizations dependency on external resource providers.

Self – Test Exercise 1

1.1. Choose the best alternative for the following questions

1. A financial and non-financial supply that helps to fulfill organizational needs is?
A. Money B. Personnel C. Time D. Resource E. None
2. Which one of the following points is similar to the definition of Resource Mobilization?
A. a process, which will identify the resources essential for the development,
implementation and continuation of works for achieving the organization's mission.
B. right and maximum use of the available resources.
C. To receive maximum resource from a single resource provider
D. a and b
E. all of the above
3. One of the following is external sources of resource?
A. Households B. Governments C. Export earnings D. Firms
4. Which concept of resource mobilization involves identifying the organization’s vision,
mission, and goals, and putting in place internal systems and processes that enable the
resource mobilization efforts to be successful?

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 A. Communicating and prospecting
B. Organizational management & development
C. Relationship building
D. All of the above
E. None of the above
5. Which one of the following is not the importance of resource mobilization?
A. Diversifying and expanding resources
B. Enhancing the dignity of one's Organization
C. Disseminating the good practices of the Organization
D. Expanding relations with the stakeholder and community
E. A and C
F. None of the above

1.2. Review Questions

1. Define the terms resource and resource mobilization: How will you classify resource and
resource mobilization?
2. There are various mechanisms for Resource Mobilization. List any 3 mechanisms.
3. Resource providers are of various types. List any 5 types of resource providers.
4. Discuss some of the importance of resource mobilization.
5. Discus the basic principles of resource mobilization and management.
6. Discus the basic approaches of resource mobilization.

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 Chapter Two

Community Based Resource Mobilization and Management

Introduction

For any organization, building relationships with the community is at the core of resource
mobilization planning. As CIDRC (2010) definition Communities are systems composed of
individual members and sectors that have a variety of distinct characteristics and
interrelationships. “Community-based,” in using the community as agent, it helps an
organization to determine whether what they are doing is relevant or not, and helps to identify
possible support from the community. Now days, the non-governmental organizations,
community based organizations, faith based organizations and charitable organizations use
community based approach because it is the best way to respond to local problems, to improve
the quality of life of the local community by mobilizing people and resources, building long term
relationships with the community and to increase the sustainability of projects by raising
resources from the community.
Dear students, this chapter will introduce you the meaning of community based resource
mobilization and management, the role of organizations in social wellbeing, the concepts and
principles and factors affecting community-based resource mobilization.

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Chapter Objectives

After the completion of this chapter, you will be able to:

 Enumerate the role of NGOs, CBOs, FBO and CO in societal wellbeing
 Know the concepts and principles of community-based resource mobilization
 Explain the rationale for community–based approach in resource mobilization
 Know the guiding principles of community-based resource mobilization
 Identify factors affecting community–based resource mobilization

1: The Roles of Organizations in Societal Wellbeing

1.1. Non-Governmental Organizations (NGOs)

Dear learners, who are NGOs and what is their purpose?

______________________________________________________________________________
______________________________________________________________________________

A non-governmental organization (NGO) is any non-profit, voluntary citizens or groups who are
organized on a local, national or international level. They are task-oriented and driven by people
with common interests (FDRE, 2009).

Dear students, see the next definition carefully:

 The Economic and Social Council of the United Nations (ECOSOC) originally defined
NGOs as ‘any international body that is not founded by an international treaty’

 Also the United Nations now describe NGOs as “not-for-profit, voluntary citizen’s group,
which are organized on local, national, or international levels to address issues in
support of the public good. Task-oriented and made up of people with common interests,
NGOs perform a variety of services and humanitarian functions, bring citizens concerns

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 to governments, monitor policy and programme implementation, and encourage
participation of Civil Society stakeholders at the community level” .

1.2. Community Based Organizations (CBOs)

Dear students, can you define community based organizations?

_____________________________________________________________________________
_
_____________________________________________________________________________
_

CBOs are civil society non-profit organizations that operate within a single local community.
They are essentially a subset of the wider group of non-profit organizations. Like other nonprofit
organizations, they are often run on a voluntary basis and are self funded (Stephen A., 2001).
Typical community based organizations fall into the following categories:
— community-service and action;
— health;
— educational;
— personal growth and improvement;
— social welfare and self-help for the disadvantaged people.

 CBOs which operate within the given locality insure the community with sustainable
provision of different kind of services for the disadvantaged. Its sustainability becomes
healthier and possible because the community is directly involved in the action when
monetary and non- monetary support or contribution is needed.

 In developing countries (like Sub-Saharan Africa), CBOs often focus on community

strengthening, including HIV/AIDS awareness creation, human rights, health clinics, orphan
children support, water and sanitation provision, and economic issues.

1.3. Faith Based Organizations (FBO)

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Dear students, can you mention the main purpose of faith based organizations?
_____________________________________________________________________________
_
_____________________________________________________________________________
_

As citied by Institute for Reproductive Health (2011), FBOs are religion-based groups or
congregations, specialized religious institutions, and registered or unregistered non-profit
institutions that have a faith-based character or mission. This is to refer to a broad and diverse
range of organizations and individuals such as religious leaders, churches, faith-based networks
and NGOs, and religious governing bodies that have in common a commitment to their religious
faith. Their main purpose is to help the community on different areas especially the
disadvantaged people.

1.4. Charitable Organizations (COs)

Who are charitable organizations?

_____________________________________________________________________________
_
_____________________________________________________________________________
_

The legal definition of charitable organization (and of Charity) varies according to the country
and in some instances the region of the country in which the charitable organization operates.
According to the Federal Democratic Republic of Ethiopia (2009) charities and societies
legislation, charitable organizations are organizations, which are established exclusively for
charitable purposes and gives benefit to the public.

 Their purposes are:

— prevention and alleviation of poverty;

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 — the advancement of the economy and social development and environmental protection;
— the advancement of education;
— the advancement of health or saving of lives;
— the advancement of arts , culture, heritage or science and so on.

Dear students, check the type of organizations existed in your area? And discuss their
contribution for the well being of the society?

2: Concepts and Principles of Community-Based Resource Mobilization

Dear students, can you define the term “community” in your own words?
______________________________________________________________________________
______________________________________________________________________________

Let us see the definitions given by different authors;

 Communities are systems composed of individual members and sectors that have a variety of
distinct characteristics and interrelationships. They can be defined by the characteristics of
their people; geographic boundaries; shared values, interests, or history; or power dynamics
(IDRC, 2009).
 The term community-based often refers to community as the setting for interventions. As
setting, the community is primarily defined geographically and is the location in which
interventions are implemented. Community-based must be closely associated with immediate
needs at the community level. “Community-based,” in general is using the community as an
agent (Stephen A., 2001).
 For any organization, building relationships with the community is at the core of resource
mobilization planning. As CIDRC (2010) defining the “community”, also known as
constituents or stakeholders, helps an organization to determine whether what they are doing

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 is relevant or not, and helps to identify possible support from the community. It makes sense
then to begin by identifying the individuals or groups that are directly or indirectly influenced
by the organization’s mission, and whose needs shape the organization’s strategies.

3: The Rationale for Community–Based Approach in Resource Mobilization

and Management

Dear students, what do you think is the main reason for using community based approach in
resource mobilization?
_____________________________________________________________________________
_
_____________________________________________________________________________
_

 Benefits of Community Based Resource Mobilization (CBRM)

Below are some of the reasons for using community based approach in resource mobilization:

 Every community, even the poorest, has resources that can be used to implement
organization’s objectives that respond to local needs. The role of any organizations
should be creating awareness, facilitate and implement relevant activities while
generating local resources to support such efforts.
 Without certain human, material, financial and other resources, it is impossible for an
organization to achieve its goal. In many cases, these resources come from the local
communities. This shows that community contributions are valuable ways to strengthen
any activities in the organization.
 It is the best way to respond to local problems.
 As the community is the main target of an organization, community based resource
mobilization helps to improve the quality of life of the local community by mobilizing
people and resources.

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  Another need for community based resource mobilization is that if an organization is
able to inspire people that are close to give or give of themselves, then it may become
that much easier to get those remotely connected at least interested in knowing more
about the organization and contribute what they can.
 Also, community based resource mobilization helps in building long term relationships
with the community. By contributing their time, money, material and/or labor, the
community assumes greater ownership for achieving the organization’s objective.
 In addition, it increases the sustainability of projects by raising resources from the
community. This provides a greater independence and flexibility to implement activities
targeting needs of the community
 And the most important thing is, for a given organization, it reduces chances to be
dependent on foreign donors.

4: Guiding Principles of Community-Based Resource Mobilization and

Management

Dear students, these are some of the principles for effective community based resource
mobilization effort:

1. Be clear about the purposes or goals of the engagement effort and the populations and/or
communities that you want to engage.
2. Become knowledgeable about the community’s culture, economic conditions, social
networks, political and power structures, norms and values, demographic trends, history, and
experience. Learn about the community’s perceptions.
3. Go to the community, establish relationships, build trust, work with the formal and informal
leadership, and seek commitment from community organizations and leaders to create
processes for mobilizing the community and obtaining the needed support.
4. Remember and accept that collective self-determination is the responsibility and right of all
people in a community. No external entity should assume it can give on a community the
power to act in its own self-interest.

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5. Recognize and respect the diversity of the community. Awareness of the various cultures of a
community and other factors affecting diversity must be paramount in planning, designing,
and implementing resource mobilization and management plans.
6. Community based resource mobilization can only be sustained by identifying and mobilizing
community assets and strengths and by developing the community’s capacity and resources
to make decisions and take action.
7. Organizations that wish to get the community support needs to be flexible enough in
communicating.
8. Community collaboration requires long-term commitment by the engaging organization and
its partners.

5: Factors Affecting Community–Based Resource Mobilization and

Management

There are three factors that affect community based resource mobilization:

 Political factors: Political factors impacting on community based resource mobilization

might include legislative or regulatory changes that might affect the organization’s
environment or resource mobilization plan.

 Economic Factors: Economic trends are relevant primarily as predictors of future

organization’s activities. The community trends in wealth, employment, tax, consumption
and disposable income affects resource mobilization plan.

 Social factors: Social factors are the most important factors in determining the resource
mobilization plan. As an organization affect and affected by the surrounding community,
it should consider the tradition, custom, value, social interaction etc. of the society in the
process of making resource mobilization strategy.

Chapter Summary

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There are a number of organizations who are participated on the development of the community.
This includes Non-Governmental Organizations (NGO), Community Based Organizations
(CBO), Faith Based Organizations (FBO) and Charitable Organizations (COs). Each has its own
goals and ways to achieve these goals. For example NGO’s are not-for-profit organizations
established to address the society’s problems and FBOs are religion-based groups who help the
public who need support in different areas. Communities are systems composed of individual
members which can be defined by the characteristics of their people; geographic boundaries;
shared values, interests, or history; or power dynamics. Community-based must be closely
associated with immediate needs at the community level it is using the community as an agent.
Community based resource mobilization and management helps an organization to determine
whether what they are doing is relevant or not, and helps to identify possible support from the
community. The main reason is that because the community has resources that can be used to
implement organization’s objectives that respond to local needs and without certain human,
material, financial and other resources it is impossible for an organization to achieve its goal. In
addition, it is the best way to respond to local problems. The three factors that affect community
based resource mobilization and management includes political, economic and social factors.

Self – Test Exercise 2

Choose the best alternative for the following questions

1. Which one of the following is not-for-profit organization?

A. Faith- based organizations
B. Community -based organizations
C. Non- governmental organizations
D. Charitable organizations
E. All of the above
F. None of the above
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2. FBO’S are:
A. Religion -based groups or congregations
B. Specialized religious institutions
C. Institutions that have a faith-based character
D. Are registered or unregistered non-profit organizations
E. A and C
F. All of the above
3. One of the following is not the purpose of charitable organizations?
A. Prevention and alleviation of poverty
B. The advancement of education
C. The advancement of health or saving of lives
D. The advancement of arts, culture, heritage or science
E. All of the above
F. None of the above
4. The main reason of community based resource mobilization is :
A. To help the society by focusing on their problem
B. Without certain resources it is impossible for an organization to achieve its goal
C. It is the best way to respond to local problems.
D. Helps in building long term relationships with the community
E. All of the above
5. Before we make community-based resource mobilization and management plan, we have to
be clear about the purposes or goals of the engagement effort and the populations and/or
communities that you want to engage.
A. True B. False
6. One of the following is not true about charitable organizations?
A. The definition of charitable organization (and of Charity) is the same country to the
country
B. One of the main purpose of charitable organizations is prevention and alleviation of
poverty;
C. According to the Federal Democratic Republic of Ethiopia, charitable organizations are
established exclusively for charitable purposes

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 D. It helps for the advancement of the economy and social development and environmental
protection
E. All of the above
F. None of the above
7. Identify the correct statement?
A. Communities are systems composed of individual members and sectors that have a
variety of distinct characteristics and interrelationships
B. The term community-based often refers to community as the setting for interventions
C. For any organization, building relationships with the community is at the core of resource
mobilization planning
D. Community-based must be closely associated with immediate needs at the community
level.
E. A and D
F. All of the above
8. Which one of the following is not the guiding principle of resource mobilization and
management?
A. Become knowledgeable about the community’s status
B. Go to the community, establish relationships and build trust
C. Recognize and respect the diversity of the community
D. Be flexible enough in communicating with the community
E. Long-term commitment by the engaging organization and its partners
F. All of the above
9. Which factors affect community–based resource mobilization and management?
A. Ecological factors E. A and C
B. Social factors F. B and D
C. Climate factors G. All of these
D. Political factors
10. Defining the “community”, also known as constituents or stakeholders, helps an organization
to determine whether what they are doing is relevant or not, and helps to identify possible
support from the community.
A. True B. False

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 Chapter Three

Resource Mobilization Strategy

Introduction
In every organization, to identify the activities that should be undertakes to achieve resource
mobilization objectives; resource mobilization strategy is a process that should be applied. It
helps an organization to map any resource mobilization activities. A resource mobilization plan
becomes effective when the organization analyzes the existing resources at its disposal and run
programs on the basis of a plan on the type and quantity of resources essential to achieve the
strategic objectives. As George M. (2008) cited before planning for resource mobilization,
organizations should make adequate preparations for resource mobilization to be effective and to
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ensure they are maximizing all opportunities; the resource mobilization plan should be tightly
integrated with their organizational strategic and communication plan and it should follow the
vision, mission and goals of the organization. Moreover, resource mobilization strategy is
important because it involves all key stakeholders and encourages ownership; it creates
consistency between organizational mission, programme needs & resource mobilization targets;
it increases readiness to achieve a new resource mobilization aspirations and it optimize
investment in resource mobilization activity.

Chapter Objectives

After the completion of this chapter, you will be able to:

 Explain the concept of resource mobilization strategy and priorities
 Know the funding targets by donor category
 Elaborate the resource mobilization strategic framework designed
 Know how to set strategic Resource mobilization goals and objectives
 Know how to define the target group
 Identify the responsibility of the stakeholders for the strategy

1: The concept of Resource Mobilization Strategy and plans

Dear student, from your knowledge about resource mobilization in the previous chapters,
define resource mobilization strategy and plan?
______________________________________________________________________________
______________________________________________________________________________

Resource mobilization strategy is a process which helps an organization to identify the activities
that should be undertaken to achieve resource mobilization objectives. It helps an organization to
map any resource mobilization activities for the next few years (George M., 2008).
A healthy resource mobilization strategy is one which is:

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  Diversified – with a variety of income sources, no one source providing more than 60%
of revenue
 Balanced – balance the different goals of recruitment, upgrading and building long-
term source of income
 Mixed (maturity level) – find right balance of different life cycles of fundraising
programs

Resource Mobilization strategy is not a minor work and it should be as per the mission of the
organization. Decisions should be taken what kind and how much resource is essential in order to
achieve the mission of the organization. Here, resource mobilization is a strategic work that
provides sustainability to the organization and program. For an organization that does not have a
strategic plan, resource mobilization is just imaginary because resource mobilization plan does
not only entail spending the grant assistance of the donor or use small resources through offer it
is more than that.

Resource mobilization strategy and plans provide a short term and long-term roadmap on an
organization internal and external resource mobilization activity. A strategy is broader and
covers duration of between two or three years whereas a plan is shorter covering duration of not
more than one organization financial year.

Resource mobilization plans are derived or developed from the broader resource mobilization
strategy. They are short term action plans developed to derive the realization of the broader
resource mobilization strategy.

Such resource mobilization strategies and plans have the following benefits (among others):

1. Provides a mixture of an organizations internal and external resource mobilization activities

2. Provides long term and short term resource mobilization goals, objectives and targets that
are in line with the organizations strategic plan resource needs
3. Provides a frame work within which the stakeholders can continuously monitor, evaluate
and improve on the strategy’s degree of efficiency and effectiveness

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 4. Communicates the organizations resource and resource mobilization needs and expectations
to both the internal and external stakeholders
5. Promotes participation in resource mobilization among the organizations internal and
external stakeholders
6. Acts as an accountability tool to the organizations resources providers, partners and
beneficiaries
7. Provides the basis within which an organization can evaluate, explore and understand its
capacity to self-sustainability and growth

2: Resource Mobilization Priorities

A resource mobilization strategy should be guided by the organization’s needs for resources, its
broader financial goal and its mission (Norton & Michael, 2009).

 The overall amount of resources being sought will determine the resource mobilization
strategy to a large extent and;

 The kind of resources and the purpose for which they will be used are also factors that
might influence where to go for support;

Resource mobilization prioritized:

 Understanding, defining and communicating all dimensions of the need;

 Informing, motivating, and facilitating giving;
 Engaging and involving donors as stakeholders and investors and;
 Maintaining donor relationships based on shared values;

Most importantly, resource mobilization is also the art of working with people to help them
achieve their most cherished hopes for a better life for humankind by making available to them
opportunities to invest in the excellent work we do.

Funding targets by donor category

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Fundraising can best be defined as the art of getting donors to give us what we want for an
identified charitable/development purpose. Fundraising in itself is not a charitable activity but
organizations invest time and resources to raise finances to expand their strength and their
activities. It is a management process of identifying those donors who share the same values as a
given organization and building strong, long-term relationships with them.

Dear students, let us see the five income sources for an organization.
The 5 Income Partners
The five possible sources of income for any not-for-profit organizations are:
1) Individuals and associations of individuals: Individual donors could include Trustees,
volunteers, staff visitors, vendors and suppliers, members of social clubs first time, repeat
and long term donors.
2) Some of the Companies: which include national and multinational companies, small and
medium businesses, shops and restaurants
3) Foundations and trusts: international grant making agencies and national trusts and
foundations.
4) Statutory or Government: national or local government, bilateral and multilateral funding.

5) Earned Income: through fee for trainings, consultancies, charge for services, sale of
products and earnings on investments.

What do they give?

Money  Voice especially in advocacy initiatives

Time and expertise  Influence
Goods or in kind donations  Information

Dear students, what motivates donors to give?

_____________________________________________________________________________
_
_____________________________________________________________________________

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_

 They give to provide others an opportunity to support the disadvantaged and to relieve
human misery thereby making the communities a better place to live in.
 They give to credible organizations that are known to be doing good work and the feeling
that they can contribute through the work of this organization to make the world a better
place.
 Organizations that work with causes or issues that the potential donor has been associated
with or has witnessed a close quarters.
 People donate for religious reasons, for availing tax benefits by giving to those
organizations and for the reason of giving back to the society by supporting and
encouraging excellence.
 Most importantly, people give because they are asked.

What does donors look for in an organization to give their donation?

______________________________________________________________________________
______________________________________________________________________________

The following are the most importance factors that donors look from organizations (CSO, 2012):

1. Legitimacy: only those who that have been established according to their countries civil laws
and traditions are considered to be legitimate. Such organizations are more likely to gain
donor support because they have achieved some level of compliance with government
standards and are less likely to be suspected of being fronts for underground political
movements.
2. Transparency: it is a creation that is highly regarded by prospective donors and partners as
transparency assures them of an organizations trustworthiness and commitment to its
constituents.
3. Accountability: this refers to an organizations ability to stand up for its mission and to be
guided by sound management and financial principles. An accountable organization is the
one that responsibly services its community, properly manages its resources and is able to

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 report back to the donors regarding the use of donated fund. Such organizations are likely to
gain public support, as quite a number of donors now expected to be up dated on how their
funds have been used by their beneficiary organizations.

3: Strategic Framework

The strategic planning process enables an organization to think through options, make informed
decisions on best approach, plans and steps, and carefully consider the resource implications.

Dear students, there are number of simple techniques that can be used in strategic planning:

1. Ansoff Matrix: This allows you to consider ways of developing new audiences and using
new techniques.
The possibilities are:
 Continuation – continue to use existing methods and audiences
 Market development – developing new audiences using existing techniques
 Product development – developing new methods and techniques for raising money from
existing audience
 Diversification – developing fundraising methods which involve new audiences and new
techniques. This is most risky and you will be using an untried technique to involve
people with no current involvement with your organization.

2. SWOT Analysis: It is a process of defining the Strengths, Weaknesses, Opportunities, and

Threats of an organization. By doing this you will be able to develop: Resource mobilization
approaches which build an organization’s strengths; avoid those areas of weakness or work
on compensating for them; seize the opportunities and develop ways of dealing with the
threats that appear on the horizon.
3. Stakeholder Analysis: This identifies those funders and agencies with an interest in your
organization’s work, and explores reasons why they might be interested in assisting with
funding or through supporting your fundraising activity.

It seeks to answer two questions:

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  Who do you think should be funding you?
 What is their interest in doing so?

4. PEST Analysis: This is used to explore the environment in which resource mobilization
takes place, in order to analyze external factors which may have an impact on the
organization. PEST examines Political, Economic, Social and Technological environment.

4: Strategic Resource Management Goals and Objectives

4.1. Goals and Objectives of the strategy

The Goals

They are general statements that described the hoped result of a strategy. Goals are long-term
and are achieved through a combined effort of multiple programs.

A goal can also be defined as general statements on the overall purpose of a project or program.
A program goal should point towards some long-term effect or change. It’s usually not written in
qualified terms.

The objectives
An objective is a specific and quantifiable statement of program achievement. It’s a statement
which can be used to determine program progress towards the program goal. Objectives are
developed from the goals and are used o derive the achievement of the goals. They can be short
term or long term. Driven from the goals, they are specific statements detailing the desired
accomplishment of the program.

A properly stated objective is action oriented, starts with the word ‘’to’’ and is followed by an
action verb. Objectives address questions of ‘‘what and when’’ but not ‘’why or how’’. They are
stated in terms of results to be achieved, not processes or activities to be performed. Objectives
must be SMART; which refers to specific, measurable, attainable, and realistic and time bound.

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The most important questions that should be asked during setting goals/objectives are:
 What are the resource mobilization goals for next 3 years?
 How much money/resource will you need to achieve your organization’s objectives?
 How to achieve the goal/objective?

We should also analyze the external environment such as:

 The Political, Economic, Social & Technological trends (PEST);

 The Competitors;
 And any other factors that can affect the activity of your organization;

Internal Analysis - Start with what an organization has and we should see:
 The existing fundraising performance
 Current supporters – recent/frequency/value
 Financial position of organization
 Organizational strengths and weaknesses (SWOT)

4.2. Defining the target group

The location, target community, problems and information and date of their real situation are
essential for developing a good resource mobilization strategy. As a result, before writing any
resource mobilization strategy, every organization should have decided its objective and
expected outcomes among others. Such decisions should be taken together with the target group
and the contribution and role etc. of the target community should be clearly outlined in such
resource mobilization strategies.

4.3. Responsibility of the stakeholders for the strategy

Dear students, resource mobilization strategy are often seen as the sole responsibility of the
organizations fundraiser.

 But a review of the tasks shows that everyone in the organization has a role to play.

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  Resource mobilization is a team effort. Everyone in the organization should be trained to
participate in the process.
 In order to make a resource mobilization strategy successful, it needs the leadership of the
executive director, the involvement of the resource mobilization director or officer and
stuff, the commitment of the board and the mobilization of the volunteers.

Dear learners
1. Discuss with your friend who should involve in developing resource mobilization
strategy?
2. What are the qualities of a good resource mobilization strategy?

Chapter Summary

Resource mobilization strategy is a process that helps an organization to identify the activities
that should be undertakes to achieve resource mobilization objectives and it is needed to map any
resource mobilization activities for the future. A good resource mobilization strategy has a
variety of income sources, and finds the right balances of different life cycles of fundraising
programs. Resource mobilization strategy should be as per the mission of the organization and it
should be tightly integrated with organizational strategic and communication plan. The resource
mobilization strategy is important because it involves all key stakeholders & encourages
ownership and generates support from all stakeholders. The first thing to be analyzed in making
resource mobilization strategy is to understand, define and communicate all the dimensions of

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the need. The donors focus on three most important dimensions of organizations these are:
legitimacy, transparency and accountability. Generally, in order to make a resource mobilization
strategy successful, it needs the involvement of all stakeholders.

Self – Test Exercise 3

3.1. Choose the best alternative for the following questions

1. A healthy resource mobilization strategy is one which is?

A. Diversified B. Balanced C. Mixed D. All of the above
2. Resource mobilization Strategy is?
A. is a process which helps to identify activities
B. Help to achieve an organization’s objective
C. It helps to map any resource mobilization activities
D. Helps to make a plan for the next few years
E. All of the above

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 A. None of the above
3. Resource Mobilization strategy is a minor work and it should not be as per the mission of the
organization.
A. True B. False
4. Which one of the following is false?
A. Decision should be taken what kind and how much resource is essential in order
B. to achieve the mission of the organization
C. Resource mobilization is a strategic work that provides sustainability to the organization
and program
D. Resource mobilization entail spending the grant assistance of the donor or use small
resources through offer
E. A resource mobilization plan becomes effective when the organization analyzes the
existing resources
F. All of the above
G. None of the above
5. Which one of the alternatives is not essential for resource mobilization plan?
A. State of resources B. Analysis of mechanisms C. Necessary skills
D. Strategic plan E. All of these F. None of these
6. Which of the following is the importance of resource mobilization strategy?
A. It Involves all key stakeholders & encourages ownership
B. Generates support from all stakeholders
C. Creates consistency between organizational mission
D. It makes all resource mobilization activities to go in harmony
E. B and D
F. All of the above
7. Resource mobilization prioritized
A. Informing, motivating, and facilitating giving
B. Understanding, defining and communicating all dimensions of the need
C. Engaging and involving donors as stakeholders and investors
D. Maintaining donor relationships based on shared values
E. None of the above

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8. All are responsibility of stakeholders for the resource mobilization strategy except:
A. Identifying the roles played by each participant
B. Making the team effort more effective
C. Taking a training to participate in the process
D. Participating resource mobilization director
E. Mobilizing of the volunteers
F. All of the above
G. None of the above
9. Which one of the following questions is relevant during setting goals/objectives of resource
mobilization strategy?
A. What are the Resource mobilization goals?
B. How much money/resource is needed?
C. How to achieve the goal/ objective?
D. How much time is needed to achieve?
E. All of the above
F. None of the above
10. The external environmental that should be analyzed during setting a resource mobilization
goal/ objective includes except:
A. Political trends B. The competitors C. Current supporters
D. The economic trends E. All of these F. None of these
3.2. Say True or False

1. Resource mobilization plan is collecting resources from one or more resource providers,
which will in turn bring down the financial risks and give sustainability to the organization.
2. During making a resource mobilization strategy, any other factors that can affect the activity
of an organization should be checked.
3. A resource mobilization strategy should be guided by an organization need for resources, its
broader finical goal and its mission.
4. The location, target community, problems and information and date of their real situation are
essential for developing a good resource mobilization strategy.

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5. It may not be necessary to clearly outline the target community in resource mobilization
strategies.
6. Technological trends are the internal factors that should be analyzed in making resource
mobilization strategies.
7. The Ansoff matrix allows you to consider ways of developing new audiences and using new
techniques.
8. Stake holder analysis helps to identify funders and agencies who are interested in assisting
your organization.
9. Identifying the strengths, weaknesses, opportunities, and threats of an organization is not that
much essential to prepare a strategy.
10. Transparency is one of the components that donors’ agencies look from organizations.

Chapter Four:
Fundraising Planning

Introduction

Every organization, no matter its size, needs a fundraising plan to guide and support its efforts.
Fundraising is a key source of income for many charities; for some, it is their sole source of
income so it is important for charities and their trustees to fundraise effectively, efficiently and
legally. The purpose of the fundraising plan is to have a planning document that clearly spells

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out the overall fundraising picture of the organization. In most plans, the agency takes a
historical look at the past and seeks to project probable funding sources into the future.

Dear Students, in this chapter an effort will be made to make you clear with the concept of
fundraising in general and related concepts in particular such as; the link between organizational
strategic plan and fund raising plan, fundraising planning, fundraising strategy, fund raising
planning cycle, and internal and external factors that affects fund raising.

Chapter Objectives
After the completion of this chapter, you will be able to:
 Explain the concept of fundraising
 Appreciate the link between organizational strategic plan and fundraising plan
 Formulate fundraising plan
 Prepare fundraising strategy
 Familiarize with the Implementation, monitoring and evaluation of fundraising strategy
 Recognize fundraising planning cycle
 Identify factors affecting fundraising

1: The Concept of Fundraising

Dear Students, can you define what does a fundraising mean?
_____________________________________________________________________________
_
_____________________________________________________________________________
_
Fundraising is can be defined as the art of getting people to give us what we want, when we want
it and for an identified charitable/development purpose. Fundraising in itself is not a charitable
activity but organizations invest time and resources to raise finances to expand and strengthen
their activities. Our ability to raise resources is a tangible manifestation of the strength of our

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relationship with our natural community of support (Neil Squire Foundation, 2003).
It is a management process of identifying those people who share the same values as your
organization and building strong, long-term relationships with them.

To unpack the above, fundraising is:

 Understanding, defining and communicating all dimensions of the need
 Informing, motivating, and facilitating giving
 Engaging and involving donors as stakeholders and investors
 Maintaining donor relationships based on shared values

Most importantly fund raising is also the art of working with people to help them achieve their
most cherished hopes for a better life for humankind by making available to them opportunities
to invest in the excellent work we do.

In other way, the term ‘fundraising’ can be used to describe the process of raising resources
(funds). These resources can be human, cash and/or any other material resource offered to
organizations as ‘in-kind’ support. Fundraising is a tool that will help organizations to create the
resources it needs in order to carry out their work and to meet the needs of community.

Dear students, can you tell the difference between ‘fundraising’ and ‘resource mobilization’?
_____________________________________________________________________________
_
_____________________________________________________________________________
_

Usually, the terms ‘fundraising’ and ‘resource mobilization’ are used interchangeably. However,
the term ‘resource mobilization’ encompasses more than raising funds, and includes gaining
support from the local communities including time, expertise, volunteers and gifts.

Table 4.1: The difference between fund raising and resource mobilization
Characteristics Fundraising Resource mobilization

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 Emphasis Money Resource in general (people, money,
goods and services)
Time frame Short term (1-3 years) Long term (3-10)
Frequency One- off Continuous process
Impact Limited to project As wide as the organization works
Sources External Internal and external
Nature of output Mainly tangible Both tangible and intangible

Dear Students, it is known that every organization has a goal towards which every organizational
member is expected to strive and fundraising is extremely important for organization’s success in
achieving their goal.

Dear learners; Why fundraising stands as important factor for organizations success? Please
go to a Non Government Organization (NGO) in your area and ask why fundraising is
important for their
success.----------------------------------------------------------------------------------------------------------
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Fundraising may have different importance for different organizations based on their goal,
purpose and type of their organization; generally here are some of the reasons why fundraising is
important for non-government organizations success:

i. Survival: Every organization needs enough money to survive. It has to meet its project
costs and develop its programmes for the future, pay the wages and salaries of its staff
plus all its administrative overheads, keep its buildings and vehicles in a good state of
repair, and pay for any new equipment that it needs.

The tool you will use to manage your fundraising is your annual budget. This will show the
amount of money that you plan to spend. It will also show the amount of money that has already
been raised or which has been promised, and what extra support needs to be raised during the
year so that you can meet all your planned outgoings.

ii. Expansion and Development: If your organization is to meet the challenges of the future,
you may need to expand the work, improve the quality of service, extend your activities

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 into other areas, carry out research, add campaigning and advocacy to basic service
delivery, and continue to innovate. All this requires more money – money that you will
need to raise.

iii. Reducing dependency: Many organizations have one or perhaps several major donors
who provide most of the funds they are spending. This situation can lead to a state of
dependency. If one of your large grants is withdrawn, this could create a financial crisis.
Not only this, but this dependency can make it difficult for your organization to
determine its own agenda since it will constantly have to adapt to the priorities of its
donor organizations. Broadening your fundraising base by bringing in other donors and
by generating other sources of income can reduce your dependency. But it is up to you to
decide whether your organization is too dependent on any one source, and if this is the
case, whether to negotiate some form of long-term funding partnership with your current
donors or to develop other sources of income.

iv. Building a constituency: Fundraising is not just about the amount of money you raise; it is
also about the numbers of supporters you can attract to your cause. Each supporter is
important to you. They can be persuaded to give again and to give even more generously.
They might like to volunteer or might be able to persuade friends and contacts to support
you. Their numbers are an indication of the level of support that your organization is
attracting, and this can add strength to your lobbying and campaigning work.

v. Creating a viable and sustainable organization: Fundraising is not simply about

generating the resources you need to survive from this year to the next, and paying for
any planned expansion and development. It is also about helping to create a viable and
strong organization which is able to sustain itself into the future. There are many ways
you can do this. One is to build a substantial and active donor base – getting people to
support you who feel involved and important to the organization, and who will continue
to give their support over a long period of time. Other ways include: organizing
successful fundraising events (which can be repeated and run even more successfully in
subsequent years); creating capital within your organization, such as buildings and
equipment (which reduce your need for running costs or can help you generate an

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 income) or an endowment or ‘corpus’ fund; and developing some sort of income-
generating activity within the organization itself.

2: The link between organizational strategic plan and fundraising plan

Fundraising is the process of soliciting and gathering contributions as money or other resources;
on the other hand, fundraising plan is a plan of how an organization will carry out its fundraising
activities.
Dear students, I hope you remember what a strategic plan means from your previous
education background or lessons. Please write what you understand about strategic plan.
_____________________________________________________________________________
_
_____________________________________________________________________________
_

Well, a strategic plan is a process that helps an organization to achieve its mission efficiently and
effectively. It helps an organization's management and board decides what is important and how
best to use its resources. Unlike an annual budget or operating plan, a strategic plan looks beyond
a one-year horizon, enabling the organization to set and reach long-term goals. Good strategic
planning is the process that determines your organization’s relevance, producing more than a
roadmap that ensures everyone is on the same wavelength and where change is stimulated.

Well so far you have understand the concepts of fund raising and remember the concepts of
strategic planning from your previous lessons, so how do you make a nexus between strategic
plan and fundraising plan?
_____________________________________________________________________________
_
_____________________________________________________________________________
_

Strategic planning is essential to effective major fundraising as it is seen as act of good

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governance. Major donors and foundations assume organizations both have and use a strategic
plan to govern and guide their station. In fact, most charitable foundations consider a strategic
plan a prerequisite for funding. This is because a strategic plan, and especially a plan that is
regularly used by the staff and board for making decisions and allocating resources, is an
indicator of good governance.

All donors want to be assured that the organizations they support are intentional and focused in
their use of resources— in brief, well-governed. Major donors, individuals and foundations, want
to know that their funding is supporting a project or an organization that has a strong likelihood
of success and that their support is adding to the overall strength and health of the organization.
If potential donors read strategic plan and know that their gift could be central to, or could
leverage, a range of activities they value, the case for support is strengthened.

Despite the use of strategic plan as signal for good governance and resource mobilization by
potential and actual donors, elements of strategic plan, such as mission, vision and values are
useful externally in case Statement, in funding proposals, in marketing and fundraising materials,
in on-air fundraising, etc. While it may seem that organizations are spending a lot of time
developing their strategic plan, it pays off in making it easier for them to craft fund development
materials that link to their organization's goals.

The strategic plan is the higher level, all encompassing articulation of organization's purpose,
goals and objectives. The strategic plan should answer the question essential to fundraising,
"How can the organization continue to be relevant, essential to the community and worthy of
their support?" In answering these questions, the organizations are doing the groundwork needed
to draft a case Statement as well as to write development, marketing and other department plans.

Dear Students, think about the link between organizations strategic plan and fund raising
plan, for some time and analyze it particularly from the perspective of non government
organizations. Now, let us see the link between organizations strategic plan and fund raising

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plan in the context of non government organizations.

Most established non government organizations possess an articulated Vision and Mission and
engage in a regular strategic planning exercise. Ideally, at the end of each Strategic Plan cycle,
the members of the organization engage in a review of its collective achievements, challenges
faced, and current realities vis-a-vis its Vision, Mission and goals, in order to plan for the next
cycle. A similar process is employed when developing a fund rising Plan, since your
organization’s Vision, Mission and Strategic Plan are the bases for its formulation.

The nature of non government organizations is to fill their funding gaps from sources other than
its beneficiaries. In an organization’s constant quest for resources, it can be tempting to develop
a project just to match a donor’s requirements and criteria. In some cases, an organization’s good
intentions can lead it to decide to serve this or that beneficiary, without taking into consideration
its financial limitations and available resources.

Many non government organizations are born out of the fiery goodwill and intentions of an
individual or a group of individuals who identify social needs that are unmet and seek to find
solutions to those needs. In the early years of the non government organizations, operations run
informally, almost intuitively, and the initiator or prime advocate sets the direction of the
organization. However, as your organization grows, more complex programs will require more
formal systems, and stakeholders would like to have greater influence in the running of your
organization, it is easy to lose sight of why the organization was formed in the first place. The
strategic plan particularly the vision and mission statements are what keep an organization on
track. Non-government organizations without a vision statement is like being on a boat with no
compass, flailing at the changing winds of a funder’s, or a founder’s, preferences.

Dear students, as you see from the above description, strategic plan is essential for NGO and the
fund raising plan derives from the strategic plan. On the other hand, the vision and mission as a
basic elements of a strategic plan a vital role in shaping the organization and its fundraising plan
and activities as well.
Dear students; What do you understand about the vision and mission of organizations?

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_____________________________________________________________________________
_
_____________________________________________________________________________
_

Well, we hope you properly define and elaborate the terms vision and mission ,now let’s see
what does vision and mission means and their role in strategic plan as linked to fund raising plan.
i. The Vision: There are as many definitions of a “Vision” as there are organizational
development consultants, but in the simplest of words, an organization’s vision is the
“shared hopes, dreams and images of the future.” Much more than a statement of identity,
your vision is a proactive, public declaration of how your organization sees the ideal future
in the area in which it works.
The forward motion of your organization depends on the clarity of your vision. Your vision
statement is your prescription for pointing you in the right direction. All other documents and
tools – your mission statement, strategic plan, marketing plan, business plan, and even your
fundraising campaigns- are the means to reach your destination. When your vision is internalized
by all the members of your organization, all of your work leads you towards accomplishing this.
Because you know your vision, you believe in it, and you all live it.

As you begin to plan for fund raising, it is time to put on a fund raising lens and analyze your
existing vision statement using the following criteria:

 Is your vision powerful?

 Does it capture the organization’s image of the future?
 Can members of the organization relate to it and be motivated to achieve it?
 Do they live the vision in their daily lives and passionately share this vision with others
with potential donors and with the community?

When clearly crafted, an organization’s vision is unchanging, and timeless. A well thought out
vision statement attracts donors that share common aspirations. It discourages your organization
from force-fitting program elements that have nothing to do with your vision, which may have

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only been created to meet the requirements of a particular donor. Staying focused on vision-
driven vs. donor-driven programs will address real and not perceived needs within beneficiary
communities. Conversely, it helps your organization determine the prospective donors to
approach and as a result, moves you forward to its achievement.

ii. The Mission: An organization’s mission statement is a brief expression of why it exists its
reason for being. It states your organization’s purpose, with and for whom your organization
works how your organization will go about fulfilling its vision, and the values that your
organization adheres to. A mission statement …
 Is clear, concise and understandable
 Expresses why the organization does its work or the organization’s ultimate purpose
 Is broad enough for flexibility but not too broad to lack focus
 States with and for whom the organization works
 States the organization’s distinctive competence or the difference the organization
will make for those it serves
 Serves as an energy source and a rallying point for the organization

When applied to fund raising planning, your organization’s mission becomes the anchor by
which you will communicate your cause to your potential donors, why you are deserving of
support, and how you will prioritize your limited resources. As a result, your mission statement
also gives you a sense of your organization’s resource gaps, which ultimately becomes a major
component of your fundraising plan.

Dear Students, as we have tried to emphasize in section two, there exists a link between
fundraising plan and strategic plan. Nowadays, strategic planning became a deliberate process in
which top executives periodically would formulate the organization’s strategy, and then
communicate it down the organization for implementation. And it is being adopted everywhere
or in every institution regardless of size, type and complexity of the institutions or organizations.

From the simplest business firm to the most complex giant corporation, nongovernment
organization, state settings such as ministries, commissions, authorities, the importance of

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strategic plan is immense. And the link between strategic plan and fundraising plan become more
vivid as driving fundraising plan from strategic plan become necessary and mandatory.

Especially the two most important components of strategic plan which are vision and mission
provide a direction for organization to base their formulation of fundraising plan.

Generally, all fundraising plan should:

 Be consistent with Objects and any Legal considerations (Governance and legal concerns)
 Link with Strategic Planning and Business Planning
 Make clear links between the track record, the evidence for what still needs to be done, and
the demand for additional resources
 Outline sources for funds
 Evolve from a realistic action plan - People/tasks/allocation
 Address risks
 Include a clear statement of outcomes, together with monitoring and evaluation activity
(with costing where appropriate)

Dear learners; please, go to NGO in your area and ask whether their strategic plan is linked to
their fundraising plan.

3: Formulate Fundraising Plan

After this subtopic students will be able to know what fundraising plan means and how to
formulate a fundraising plan.

Before proceeding to explaining about the fundraising plan, what do you think the purpose of
fundraising plan?
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______________________________________________________________________________

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Well, Fundraising does not simply involve going out and asking people for money. There is a
tremendous amount of planning that needs to take place. Specially, in the present situation where
the pie for international funds is getting smaller and the number of players wanting a piece of a
pie is increasing, competition for the resources increases, making the existing fundraising stream
more vulnerable. Fundraisers must know what they are raising funds for, how much money
needs to be raised, how they are going to go about raising it, which they will approach for
donations, etc. All of these factors are taken into consideration and planned for during the
development of the fundraising plan.

Raising money is often one of the most challenging issues nonprofit organizations face. Finding
the dollars to advance campaigns and grow organization requires strategy, planning and follow
through especially in today’s tough funding climate. A solid fundraising plan is the first step to
identifying your organization’s goals, tactics and timelines, and it will help you meet, and even
exceed, your financial targets.

Generally, the purpose of the fundraising plan is to have a planning document that clearly spells
out the overall fundraising picture of the organization. In most plans, the agency takes a
historical look at the past three years and seeks to project probable funding sources three years
into the future. Because there are a number of ways to raise money, fundraising plan is an
opportunity to flesh out which options are best for specific organization. It keeps organizations
focused on the most effective means of drawing in dollars.

Dear Students, a brief analysis of fund raising planning related concept listed above reveals that
currently the need and competition for fund is growing among nonprofit organization and this
leads to the need for formulating a well structured and efficient fund raising plan that will help
the organizations to achieve their goal. Fund raising plan can be seen as a general direction for
organizations to raise funds and it helps organizations to be focused.

Dear students, what components do you think fundraising plan should include?
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______________________________________________________________________________

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Fundraising plans are extremely variable, and should be adapted to each organization’s mission,
budget, financial goals and fundraising opportunities. At a minimum, your fundraising plan
should include the following components:

1. Introduction
In the introduction to the fundraising plan, the agency articulates the overall goals for the plan
(such as we want to diversify our funding strategy, want to increase our controllable income,
want to form strategic partnerships, want to broaden out from over reliance on government
funding) listing the key elements within this document. The agency should identify the need(s)
your fundraising plan hopes to satisfy. People will want to know what it is they are being asked
to support.
Generally, the introduction part of the fundraising plan should answer:
 Why the agencies want to raise the money?
 What the agency want the funds to accomplish in your non-profit (i.e., what
charitable programs and services do you want to support)?

2. Background: In this section the plan should cover the historical background and impact of
the organization. The key sections should include:
 History and historical impact (accomplishments) of the agency
 Mission statement and current programs with one sentence description of each program
3. Case Statement: The case statement is a clear, concise, compelling one page statement
spelling out the reasons a donor would want to make a contribution or grant to your
organization. Within the context of the plan, this statement should pull together some of the
above information and should reflect the passion of the organization.

A case statement is an overview of why organizations exist, what they do, who benefits from
what they do, how they benefit, why they need funds, why it’s important to become and remain a
donor to the organization. A case statement can be ‘communications spine’ of all organizations
fundraising work and it ensures continuity and consistency throughout program.

4. Demographic Information - External Analysis - This section should encompass the

external environment that is creating a need for the organization. These are:
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 o Economic and social indicators - for example poverty, educational, housing, health
care; cultural and digital divide issues, etc
o Political climate - What are the political factors that are working either for or against
the organization?

5. SWOT ANALYSIS - A SWOT (S strengths, W weaknesses, O opportunities T Threats)

assessment provides a quick overview of the organizational dynamics, identifies strengths
and opportunities from which to build, identifies weaknesses and potential threats, and helps
to determine if the threats identified are real and controllable or uncontrollable. If the threats
are uncontrollable, such as the general economy or the weather, understand them, but do not
spend much time acting on what is out of your control. The Strengths and Weaknesses are
INTERNAL to the organization and the Opportunities and Threats are EXTERNAL.

6. Organizational Development/Dynamics - In this section the agency wants to analyze the

strengths and weaknesses of the board of directors, especially as it pertains to its capabilities
to raise funds.

 Is the board an active or passive body of people?

 Are their people who are positioned to open up funding doors?
 Does the board have a history of raising funds?
 Is it motivated to raise funds?
 Is there strong leadership on the board?
 What about the president of the board, is she/he a strong leader?

In many cases with grassroots organizations, the board was not designed as a fundraising board.
Therefore, the development of a resource development committee that has strength, influence
and contacts should be organized to help implement the plan.

7. Funding History - Gives a historical sense of where the money has come from to support the
organization. Try to break down this analysis by funding sources and years? What % of
money historically has come from government funding, private foundations, corporations,

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 donors (individuals), earned income, religious, planned giving (if any), special events, United
Way, etc. Have these percentages been increasing or decreasing during the past three years.
You may want to break down the revenue by program areas since much of the pubic and
foundation funding will be restricted to specific programs.

8. Funding Opportunities - This is where the agency looks at funding opportunities initially
for the next 12 months and into the future. Most agencies break down their funding needs
into four areas:
 Programs and projects
 Administrative
 Equipment
 Capital (if you are raising money for building, expansion, or major renovations)
For each one of the areas it is important to establish funding goals (dollar amounts needed) for
each of the areas and to write a one-page summary sheet of each of the above funding goals that
include:
 Description of the funding need
 Goals and objectives of the funding need
 Impact to the community and to the organization
 Dollar amount needed

This section is one of the longest sections in the plan because most agencies have multiple
programs that need funding. In addition administrative, equipment needs and perhaps capital
campaign requirements are detailed.

9. The Funding Strategy - This is where the agency analyzes the primary funding sources
identified by our research and includes the strategic approaches to them. Be aware that
researching potential funding sources is an ongoing task that requires regular contact with the
people in the community; reading the newspapers daily, regular follow-up with the funders to
assure that confidence in the organization is strong and future funding opportunities are
known.

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Remember that much of fund raising is relationship driven so the more visible the organization is
in the community through board and staff contacts the greater the possibility of receiving money.
Also make sure you integrate marketing materials (brochures, newsletters, e-mail letters, etc)
with a consistent brand image that is woven together with effective public relations efforts such
as:
 Regular letters to the editor from board members and Executive Director
 Radio talk show interviews
 Public service announcements and press releases
 Periodic meetings with newspaper editorial boards
 Media coverage on all major news and special events
 Television interviews on public service shows

10. Calendar /Timeline Create timelines to guide you in key tasks and sets deadlines throughout
your first year of operation. This is an important tool that will ensure smooth implementation
and that priority areas receive the Board and staff time needed to be completed successfully.

 How long will each fundraising event/activity last?

 When will you conduct each element of your various fundraising events/activities?
 How long will it take to complete each strategy?

Include deadlines for all the key elements of each fundraising objective and strategy. Regular
monitoring of your deadlines will give you a quick update to see if you’re on schedule.

4: Prepare Fundraising Strategy

The term ‘fundraising’ is used to describe the process of raising resources (funds). These
resources can be human, cash and/or any other material resource offered to your organization as
‘in-kind’ support. Fundraising is a tool that will help organizations to create the resources it
needs in order to carry out its work and to meet the needs of community. This means that:
 The fundraising process should start from a clear idea of what resources are needed
and why

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  What are the needs of the community and
 What plans do you have to address these needs?
 Is your organization planning to continue an existing service, develop an existing
service or develop a new service?

There are many ways of raising funds, and the chosen method will depend on how much is
needed and for what purpose. This is where a fundraising strategy will help you to plan
effectively.

A fundraising strategy is a step by step plan of action that outlines where an organization is now
and where it wants to be in the next one, two or three years, and how it proposes to fund these
plans. Fundraising strategy should be based on an organization’s business plan.
As a general guide, fundraising strategy should explain:
 what your organization wants to do (aims and objectives) why your organization
wants to do it (the need)
 who will benefit
 what will happen if nothing is done (that is, the effect on the community)
 when your organization wants to do it (timeframe)
 how much it will cost (budget)
 how your organization plans to raise the money
 who is responsible for doing what (tasks)
 what funding is already secured

A fundraising strategy also identifies the financial and other expectations of your institution and
outlines the activities, time scales and resources that are needed to meet these expectations. It is a
working document that evolves as circumstances change, but it typically takes a forward view of
three to five years.
Dear students so far you have introduced to fund raising plan and fundraising strategy, then
discuss with your friends on the difference between fundraising plan and fundraising
strategy?

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Fundraising plan is a plan of how an organization will carry out its fundraising activities. On the
other hand, fundraising Strategy is a long term plan of action designed to achieve a particular
fundraising goal.

Dear students; why Do you think an institutions need a Fundraising Strategy?

_____________________________________________________________________________
_
_____________________________________________________________________________
_

Well, having a well thought out strategy will help you to prioritize your projects and target your
energy and resources effectively. It is also a useful tool for articulating your goals and activities
to colleagues and other stakeholders to win their support and cooperation. The process of
developing a strategy brings into focus the strengths, weaknesses, opportunities and threats that
are relevant to your fundraising ambitions.

Steps in Fundraising Strategy

 Knowing the fundraising goal
 Who can give?
 Broadly how can we reach them?
 Who will fundraise?
 What are the timelines?

Dear students do you know any kind of Fundraising Strategy that is applicable in your areas?
___________________________________________________________________________
___________________________________________________________________________

Generally, there are five fundamental strategies available to non-profit fundraising programs.
They are growth, involvement, visibility, efficiency, and stability. Each has it’s own costs and
benefits – and is appropriate to a stage in the life of your organization. Often a not-for-profit will
find itself in a position where it is unable to meet the demand for its program or service. In order

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to meet the demand it will have to expand its donor base and revenues. This is the time for a
growth strategy. In this situation the organization invests in attracting new donors who will
expand revenues in future years.

Other organizations may place an emphasis on delivering their program with volunteers instead
of cash. This is an involvement strategy. Amnesty International, with its volunteer letter writing
campaigns is a classic example of an involvement strategy at work – as is just about any church
parish or congregation.

New organizations and movements often choose a visibility strategy where their prime objective
is to be noticed. They try to achieve visibility in hopes of attracting future supporters and donors.
Greenpeace, the AIDS movement, and Mothers against Drunk Driving are all not-for-profits that
have employed visibility strategies successfully.
Once the organization has grown to the point where it can provide sufficient program to meet
demand, it usually switches over to an efficiency strategy. Stewardship and sound management
are the priorities here. The emphasis is usually on maximizing the ratio of revenues to costs.

These organizations often communicate messages to donors like “90 cents of your dollar will go
to saving the Amazon rainforest”. The Canadian Cystic Fibrosis Foundation of Canada is a good
example of a current efficiency strategy at work. After doubling their donor base in recent years
(growth) it has switched its emphasis to upgrading donors to monthly and planned giving – and
increasing the revenue to cost ratio as a result.

Sometimes a mature organization will find itself in a period of crisis. In this case stability is the
right strategic choice. This is a defensive strategy where the emphasis is on keeping existing
donors rather than attracting new ones.

5: Implementation, Monitoring and Evaluation

In order to change the fund raising strategy into implementation, your fundraising strategy
should be written primarily to help your organization and it is important that everyone in your
organization easily understands it. It is good practice to repeat what your organization is there to

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do, why, when and how much it will cost.

After planning and devising the strategy to raise funds, the question is who should implement it?
Anybody in your organization, with the right skills, can do your organization’s fundraising
activities. For example, you might choose a member of staff, a volunteer or a committee of
volunteers. Who you choose depends on your organization’s resources, timescales, the activity to
be undertaken and the overall objectives of both your fundraising strategy and your
organization’s overall plan.

A strategy is only as good or worth having if it is implemented and then monitored to determine
its effectiveness. Implementation will of course differ depending on your particular plans. After
spending much time, effort and money in conceptualizing and implementing your fundraising
plan, now you need to know if it worked, or if you need to make adjustments midstream.
Monitoring the delivery of your strategy means that both successful and unsuccessful strategies
can be meaningfully reviewed and modifications or amendments made.

Monitoring your plan should consider the measurement of:

 The actual donations and grants received against the budget
 The costs actually incurred against those mentioned in the budget
 The fundraising ratio for each of the different fundraising methods or activities

People from all levels of the organization should be involved in the monitoring process. Clear
leadership will help to ensure that action plans reflect the measures of success outlined in the
plan.

Dear students, what do you think the benefits of the monitoring fund raising activities?
______________________________________________________________________________
______________________________________________________________________________

There are many benefits to monitoring fund raising activities; some of them are the following:

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  Current performance data obtained from monitoring efforts can alert you to problem
areas such as overspending, so you decide how to adjust or modify your strategies
 Demonstrates your organization’s commitment to accountability
 Continuous learning and flexibility contributes to improvement in results
An organization doesn’t only need to prepare an overall plan to guide their fundraising activity,
they also need to plan how to execute, to monitor and evaluate the planned activities. Monitoring
and evaluation also possess a serious of activities that need to be planned as to perform the
monitoring effective.

Dear students, so far you have seen that organization require to develop fund raising plan and
strategy as it helps them to direct their energy and focus in achieving their fundraising goal. As it
is always said, planning is not an end by itself it is a mean to an end. Therefore organizations
also require developing implementation plan and monitoring mechanisms. In the next part of this
section we try to see a monitoring and evaluation plan.

Dear students, do you think organizations need to develop a monitoring and evaluation plan?
If yes why?
_____________________________________________________________________________
_
_____________________________________________________________________________
_

Developing a Monitoring and Evaluation Plan

1. What to monitor
First you need to identify your indicators. Indicators are qualitative and quantitative measures
that show to what extent you are achieving your goals. There are short-term and long-term
indicators as well as process and results indicators. The indicators you choose should be relevant
to the goals set. If the goal is to get funding to do a Phase 2 of a current successful project,
monitor donor response to funding proposals, NOT publicity for your good results.

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2. Determine when you will monitor
The timing depends largely on the indicator you set, and the result or process you are checking
on. For example, when would it be realistic to expect responses to a direct mail pack? Factor in
the efficiency of your local postal system.

3. Determine how you will monitor and who will do it

 What will be your sources of information? Who will provide it?

 What tools or methods will you use to obtain the information?
 Consider interviews, visits, finance reports.
 Who will put together the monitoring report? What framework will be used?

4. Make sure monitoring is done

Communicate the benefits to users. Many people find it a challenge to both implement and
monitor. It does mean additional work but will be well worth it because what you learn from
monitoring information is invaluable for future projects. Do not always think you need to
reinvent the wheel; use staff meetings or other already existing processes to report on progress.

6: The Fundraising Cycle

The fundraising cycle is a tool used by most fundraisers to help plan, monitor, and follow up and
develop their fundraising activities. The cycle begins with the identification of the need- the case
for support. What is the organizations strategy in addressing that need? What would be the
resources required by the organization to implement the solution it has identified and what would
be its strategy to raise these resources, taking into account any internal and external factors that
could influence their success? Once the process of implementation of this strategy has begun
then monitoring and review of the successes and failures of the strategy should help us in the
final evaluation of the strategy we developed for ourselves. The fundraising cycle then begins
again; building on successes, minimizing failures, developing relationships with donors and
identifying new fundraising opportunities to follow up.

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Diagram 4.1: The Fundraising Cycle

I. Establishing the case for support: it is starting point of the fundraising cycle explaining
to the donors why they must give to your organization. The case should contain enough
information to the donors to make an informed decision to give to our cause. Developing
the case for support may seem easy; however it can be one of the most difficult things to
describe and must answer some basic questions for donors and supporters:

 What is the problem or the need?

 Who does it affect and where?
 How many are affected – how big is the problem?
 Why has it happened?
 What can be done about it?
 What will happen if nothing is done?

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 II. Research: it is second stage and an essential component of the cycle for the organization to
understand which donors - individuals, companies or trusts may respond to the appeal
outlined in the case for support and making sure that their needs are met by choosing the
most appropriate fund raising approach.

III. Planning and implementation: The fundraising activities to ensure they are adequately
resourced, cost effective and efficient and help reduce and manage risks.

IV. Monitoring and evaluation: To understand what lessons have been learnt and how to
incorporate the same into our future fundraising cycles to make the activity bigger and
better. Monitoring should be fairly straightforward. Targets and objectives can be
assessed against actual performance.

By periodically reviewing actual performance against planned performance, adjustments can be

made to the fundraising plan. Targets can be revised – up or down – and resources moved into
activities with the best performance, more investment into activities showing potential, and/or
rethinking activities showing poor performance. It is recommended practice that reviews are
undertaken a minimum of every three months.

At the end of the fundraising cycle, usually an annual process, the fundraising strategy should be
evaluated.
 Evaluation has two purposes: for accountability and for learning and improvement.

i. Evaluating for accountability

• Efficiency – the rate and cost at which fundraising activities result in income.
• Effectiveness – performance in relation to targets as set in the original plan.

ii. Evaluating for learning and improvement

• Developing staff – identifying training needs

• Learning from legitimate error – lessons from unexpected circumstances as a source
of knowledge for the future

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 • Reframing strategy – open learning through an exploration of different viewpoints,
including stakeholders (donors)

7: Factors Affecting Fundraising

Nonprofit organizations and nongovernmental organizations are increasingly being asked to bear
more of the burden of services to citizens previously provided by the government, with the
expectation that the private sector will support their operating expenses through philanthropy.

Dear students, what internal and external factors do you think affect fundraising activities?
______________________________________________________________________________
______________________________________________________________________________

Dear students, we can see how different internal and external factors affect the fundraising
activities from both the donor and receiver aspect.

Both the NGO community and the donor community are susceptible to any number of economic
and political pressures occurring everywhere from the organizational level all the way up to
macro variations in national and international economies. Donors are subject to funding
constraints of their own and are often beholden to boards, larger organizations, government
ministries, or even national legislatures that can limit their capacity to fund purely based on the
quality of a project or the good record of a grantee. Some donors can even fall victim to severely
limiting budget constraints that threaten their very existence. NGOs must be aware of these
possibilities and diversify their sources of funding accordingly.

There is a growing recognition that NGOs should be playing a more important role in partnership
with government and business as delivery agencies for poverty alleviation and development
programmes. Some of the internal factors that are preventing non government organization from
having the philanthropy are;

 Lack of development staff and the board’s not understanding fundraising (or being
involved in fundraising),

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  Lack of fundraising budget,
 Lack of fundraising knowledge and skills, as well as
 Lack of technology resources and infrastructure.

There are also external factors that affect fundraising, generally major worldwide trends stood
out above. For example, fundraising shifts in the philanthropic and fundraising practice
environments, social media and technology, and the economy.

The fundraising world is extremely competitive. More organizations than ever are thinking about
fundraising and beginning to develop independent sources of income for themselves.

Dear students think how competition affects fund raising activities?

______________________________________________________________________________
______________________________________________________________________________

Well, it is obvious that everyday new organizations come to the stage and add fuel to the
competition, and if you are already existed organization, you are required to compete with new
organizations, that are with full of energy and enthusiasm. These may be addressing similar
needs to those that your organization is tackling. Each of these ‘competitors’ will be striving to
show that they are ‘the best’. Your job then is to persuade donors that your organization is
successful, effective, cost-effective, and innovative and lively – in short, that you are the best
recipient for the donor’s funds.

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 Chapter Summary

Fundraising is one of the most important pieces of the organizational jigsaw. Quite clearly,
without funds, an organization will cease to exist or at least not be able to effectively serve the
communities that it has been set up to serve. Particularly, raising money is often one of the most
challenging issues nonprofits face. Finding the dollars to advance your campaigns and grow your
organization requires strategy, planning and follow-through— especially in today’s tough
funding climate. In the preceding text, the concept of fundraising has been discussed. The link
between organizational strategic plan and fund raising plan has been elaborated from the
perspective of good governance, resource mobilization and mission and vision of organizations.
The link between organizational strategic plan and fund raising plan has also been elaborated in a
non government organization context. In the context of variability, a different component of
fundraising plan has been assessed. Goals, objectives, strategies and timeline as the basic
components of the fundraising plan are assessed and the planning cycle is formulated. In the last
subtopic of the chapter internal and external factors were assessed on how they affect fundraising
activities.

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 Self – Test Exercise 4

IV.1. Choose the best alternative for the following questions

1. A plan which has strong link with fundraising plan is:

A. Annual Budget
B. Strategic Plan
C. Operating Plan
D. None of the above
2. Which of the following factors are considered during the development of the fundraising plan
A. The amount of the money needed
B. The way to raise the funds
C. The purpose of raising funds
D. Donors
E. All of the above
F. All Except D
3. Fundraising is about ;
A. Maintaining donor relationships based on common interest
B. Informing, motivating, and facilitating giving
C. soliciting and gathering contributions as money or other resources
D. raising resources as a form of human, cash and/or any other material resource
E. A and B
F. All of the above

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4. _________is a step by step plan of action that outlines where an organization is now and
where it wants to be in the future
A. fundraising plan
B. fundraising strategy
C. fundraising cycle
D. A and B
E. A and C

5. Which of the following statement is not correct about the importance of fundraising?
A. It helps organizations to meet the needs of their customers through innovation and quality
excellence
B. With or without the fund it helps organization to create chains of supporters
C. It reduces dependency by decreasing the number of donors to depend on
D. It helps in changing the number of donors from few to many donors to depend on
E. A and B

IV.2. Discussion Questions:

1. What is the purpose of the fundraiser that you are planning? Will proceeds benefit the
general fund, a capital campaign, a particular outreach, etc.?
2. If you are in a leadership position in the organization, how can you tap into the motivations
of other staff, volunteers and potential donors?
3. How can you ensure that your fundraising campaign stays on track?

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 Chapter Five

Analysis of the Donor Market and Process of Fundraising

Introduction

Nowadays, organizations are accustomed to thinking of actual and potential consumers of their
programs in terms of market segments. Donors are another whole area of essential constituents
for non government organizations. Applying basic concepts of marketing to donor audiences can
open up fresh perspectives and steps. Most NGOs have two key constituencies: clients or
consumers for whom the organization exists and to whom goods and services are provided, and
donors (and volunteers) who provide the majority of resources necessary for the organization’s
services to take place. Dual constituencies make marketing complex, as the needs and interests of
both must be addressed. Marketing is an external orientation. Most staff are internally focused,
concerned with quality of projects and programs. The external environment is increasingly
complex, competitive, and demanding about accountability and responsiveness. NGOs intended
supporters’ points of view, needs & interests are vital to their success. Since there are competing
other organizations that are more attentive and responsive who will successfully compete for
donors and their resources. So they must identify their specific donor audiences and then find out
what each wants, in what forms and ways of delivery.

Chapter Objectives

After completing this chapter you will be able to:

 Identify different types of donors

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  Know important sources of funding
 Examine the process of fund raising
 Develop funding proposal
 Communicating donors
1: Types of Donors

Donors are individuals, organizations and/or nations that make contribution through aid, which is
the transfer of capital, goods, or services for the benefit of the recipient.

Donors can be grouped under two large categories

i. International Donors (Organizations, UN & Governments): These are NGOs, which

have their head offices abroad and obtain support from those offices.
Again from within these NGOs another category could be established:

1. Secular NGOs
2. Religious NGOs
Sectoral classification of NGOs is also possible, i.e. NGOs focusing on various sectors such as
water, health, children, integrated rural/urban development, etc.

An international donor can only be considered as such under the Financial Regulation if the
following criteria are met: if it is international; a public sector organization; and set up by
intergovernmental agreements.
The specialized agencies set up by these organizations will also be considered international
organizations.

The following entities are assimilated to international organizations:

 The International Committee of the Red Cross;

 The International Federation of National Red Cross and Red Crescent Societies;
 The European Investment Bank and European Investment Fund.

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ii. Local Fundraising (Corporations and local governments, Individuals): These are
NGOs established in the country by either Ethiopians or non-Ethiopians.

Funding Targets by Donor Category

In the past years different kinds of donors with different funding category has been seen in the
world. The bilateral and multilateral aid is one of the biggest sources of funding that have been
seen over the past fifty and more years. These originate either from the foreign offices of the
developed countries or from the multilateral organizations set up by different countries such as
the United Nations (UN), the World Bank (WB), the Asian Development Bank (ADB). These
organizations have been created to extend international support for alleviating poverty and
reducing the socio-economic gap between the developed and the developing countries. But their
agendas are far more complex and they are not necessarily focused upon injecting funds into
NGOs, but definitely a small part of their massive programs does include funding support for
NGOs in developing countries.

The other category of donor’s with different funding target is the private
charities/foundations/international organizations which are more privately handled and have a
better focus on equipping local NGOs not just financially but also technically. In countries where
there is some economic growth recorded with a presence of a wealthy private sector, NGOs can
also look upon the corporate agencies as another major source of funding for them. There are
also international corporate groups that have Corporate Social Responsibility (CSR) agenda for
enhancing equity, social justice and development. Besides, in the present times, the corporate
agencies are also partnering with NGOs for joint profit-oriented projects. In some countries, the
local governments are also a major source of funding as they have different community welfare
and development schemes which NGOs can apply and raise resources and implement projects.

As can been seen from the above discussion, there exists different kind of donors category with
different funding target. Some of them targeted to alleviate poverty and reducing the
socioeconomic gap between the developed and the developing countries by extending their aid in

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different forms like aid, grant … others donor category make movement by targeting to equip
local NGOs financially as well as technically. Other donor categories even fulfill their funding
target up to partnering with NGOs for joint profit-oriented projects.

2: Important Sources of Funding

Dear students, can you identify some of the important sources of funding available for NGOs
in your community?
_____________________________________________________________________________
______________________________________________________________________________

Well, so far you have seen different types of donor category and their funding target, now it is
the time for you to be familiarize with different sources of funding. Although there are different
sources of funding available for fundraising organization, in this chapter you will see Corporate
donations, Long-term financial grants, Non-financial support, Mutual partnerships for addressing
social problems, Support from volunteers, Community contributions and Income from business-
oriented projects – selling publications, offering consultancy services, etc as the different sources
of funding available for organizations.

2.1. Corporate Donations

Dear students, write what you all know about corporate donation as a source of funding on
the space provided.
_____________________________________________________________________________
_
_____________________________________________________________________________
_

Well, the term corporate donation refers to any financial contribution made by a corporation to
another organization that furthers the contributor's own objectives. Two major kinds of such
donations (charitable as well as political donations) deserve specific consideration. However, for

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this module purpose we tend to focus on the charitable donation. Corporations give to charitable
causes, either because of the personal convictions of influential leaders within the corporation, or
more commonly to help establish the public perception that the corporation is a good corporate
citizen.

Types of Corporate Charitable Giving

Corporate charitable giving can be divided into direct cash and non-cash contributions. Direct
cash giving comes from corporate headquarters, regional offices, or company sponsored
foundations. Non-cash contributions are contributions of equipment, supplies or time, and do not
include cash contributions. Examples of non-cash contributions include:

 Donation of new or used equipment or supplies, such as computers and other electronic
equipment, office supplies, and
 Donation of targeted supplies such as clothing, canned goods, or paper products.
 Use of organizational services/facilities, such as financial and administrative support,
computer services, printing, mailing or copying, or targeted professional services and
support.
 Application of professional services, such as tax and financial advice, strategic planning
and organizational development, graphic arts and copy writing, and legal assistance.
 Non-cash contributions can also be interpreted through an organization's policy to
allow employees paid time off when performing volunteer work.

Dear learners; Make a group and discus and list examples of non-cash contributions made by
corporations that you know in your community?

2.2. Long-Term Financial Grants/Grant Funding

Define what grant means?

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_____________________________________________________________________________
_
_____________________________________________________________________________
_

Grant is a financial donation given to a person, organization, project or program. Grants are
usually given by the government, or by an entity that comes in many forms and names: funding,
donor, aid or development agency; benefactor, philanthropist, or grantor; grant giving or grant
making foundation or institution. The receiver of the fund, or grantee, is not expected to return
the money received, but is expected to use the resources in the manner which the donor had
intended. In that sense, these funds are restricted.

Dear students, in the following table a summary of different sources of grants with examples are
presented, please take a look closely and try to connect to the sources if grants that you used to
know under the table given below.

Table 5.1: Sources of grants

Source of Grants
Governments Bilateral official development assistance (ODA) agencies are government
agencies set up to channel assistance to other countries. Typically this
assistance goes directly to the government. The largest agencies come
from North America, Europe and Japan.

Examples:
United States Agency for International Development (USAID)
Canadian International Development Agency (CIDA)
Japan International Cooperation Agency (JICA)
Australian Agency for International Development (AusAID)
Norwegian Agency for Development Cooperation (NORAD)
Foundations Foundations are established with the principal purpose of making grants
to unrelated organizations or institutions or to individuals for scientific,
educational, cultural, religious, or other charitable purposes. Most of the

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 funds come from one source, whether an individual, a family, or a
corporation.

Examples:
The Ford Foundation
Aga Khan Foundation
Bill and Melinda Gates Foundation
Toyota Foundation
Nippon Foundation
Multilateral Multilateral ODA agencies are composed of member governments
agencies established by an international treaty or convention. These agencies have
a wide variety of objectives and interests of which development
assistance may or may not be one. Those that provide ODA include many
United Nations agencies such as the United Nations Development
Programme (UNDP), the United Nations Children’s Fund (UNICEF),
and the Food and Agriculture Organization (FAO). Other multilateral
agencies are the World Health Organization (WHO), the Asian
Development Bank (ADB), the European Union, and the Global
Environment Facility (GEF)

Dear students, since you have introduced to different sources of funding, now identify and list
the different sources of grants that you are familiarize with in your community.
_____________________________________________________________________________
_____________________________________________________________________________
_

Grants are provided to encourage development or growth in a particular area. This area may be a
geographical one or may be for particular areas of research and development, rural
reconstruction, social services, education, livelihood development, poverty eradication, etc.
Grant projects typically involve the implementation of specific components of a project designed
to tackle specific problems. Grants are indispensable resources for development researchers

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because their work does not always provide the capital return required to sustain their projects.
Recognizing that researchers, among others, provide services vital to the success of larger social,
economic and political objectives, grants of many kinds are made available to fund that work.

Grant making institutions support organizations whose mission and programs complement their
own? They look for signs of good governance of which legitimacy, transparency, and
accountability are key criteria. Many grantor-grantee relationships have evolved beyond the
grantee being mere project implementers to a manifestation of a working partnership, where
counterpart or matching funding is also expected from the grantee. Grant making institutions are
concerned about their partners’ efficiency as they themselves have to account to their principals
for the grants that they award.

Grants are typically made by the public sector or by charitable trusts and foundations. The
money does not have to be repaid and is usually exempt from tax. Many grant funders will only
fund organizations with charitable status. Some grant makers prefer not to fund organizations
that have built up significant reserves or generate cash surpluses. This can disadvantage those
with a business-like approach to running a sustainable social enterprise.

Grants almost always come with conditions, for example;

 Particular outputs or outcomes

 Achieving agreed milestones
 Unspent monies are returned to the funder
 Reporting requirements on the progress of the project or use of the money

Before pursuing grant funding the charity or nonprofit board should consider the following
questions:

 Is this an activity consistent with our aims and strategy – or is these grant
encouraging us to drift from our mission?
 Can we meet the grant conditions?

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  Will the cost of seeking grant monies outweigh the benefits?
 How will the activity be maintained or wound up after grant funding ends?

Dear students, do you think grants should be provided to the organizations with conditions?
Support your answers with justification.

Dear Students, the preceding discussion on grants shows that generally grants are a financial
donation given to a person, organization, project or program and they are provided by
governments, foundation or agencies. However the grants are provided based on the conditions
that are lays by the grantor and this may vary from setting milestone to be meet by grantee, or
returning unspent money to grantor. However, it doesn’t mean that there are no grants that are
provided without any conditions.

2.3. Non-financial support

As the name indicates non-financial support will take other than financial support that can be
found from different sources. Basically, Non financial support might be either In-Kind donations
or Time and Talent.

i. In-Kind donations: Office space, land, equipment, stationary, food. In kind donation can
be purely donations of goods, for example if a community group or school is soliciting
donations to buy computers for its office, perhaps the donor can instead supply excess
computers from their company. A donation of two reams of paper a month to help with
mail outs or photocopying can also save the expanses of community group.

ii. Time and Talent: Volunteering (skilled/unskilled labor and professional/technical

expertise)

2.4. Mutual partnerships for addressing social problems

A partnership is an arrangement in which parties agree to cooperate to advance their mutual

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interests. Since humans are social beings, partnerships between individuals, businesses, interest
based organizations, schools, governments, and varied combinations thereof, have always been
and remain commonplace. In the most frequently associated instance of the term, a partnership is
formed between one or more businesses in which partners (owners) co-labor to achieve and share
profits and losses. Partnerships exist within, and across, sectors. Non-profit, religious, and
political organizations may partner together to increase the likelihood of each achieving their
mission and to amplify their reach in what is usually called an alliance.

For businesses, the “bottom line” includes more than just profits. Investors, customers and other
stakeholders want to see progress on a broader range of measures, including environmental and
social performance. To achieve such goals, companies and NGOs are joining forces. Companies
can help the environment and the communities where they operate in many ways, including
through philanthropic activities.

2.5. Support from volunteers

The act of volunteering is an expression of commitment by volunteers to community, and that

has value to the nation. Despite being the source of funds, Volunteers bring many benefits to the
nonprofit organizations. Volunteering is generally considered an altruistic activity and is
intended to promote goodness or improve human quality of life. In return, this activity can
produce a feeling of self-worth and respect. There is no financial gain involved for the
individual. Volunteering is also renowned for skill development, socialization, and fun. It is also
intended to make contacts for possible employment.

On the other hand, a volunteer is a person: ‘who voluntarily provides an unpaid direct service for
one or more other persons to whom the volunteer is not related. The volunteer can normally
provides his or her services through some kind of formal scheme rather than through an informal
neighboring arrangement.

The benefit of the services provided by a volunteer may differ in fundamental ways from
services offered by professional staff since the motivation to serve may be different. In some

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cases, a unique benefit is derived when the volunteer has more in common with the person being
served (age, race, economic background or experience) than does the professional staff.

Volunteers expand the base of community support for the nonprofit organization that sponsors
them by making the work of the nonprofit transparent to the community—by bringing the
community in, so to speak. In doing this, volunteers provide organizations with word-of-mouth
publicity and have the potential to cultivate a broader base of supporters for the agency and its
mission. And, of course, in addition to these benefits, volunteers expand organizations’ capacity
to deliver services to clients and communities in need.

Volunteers fill a key role in running organizations, handling day-to-day tasks, and raising funds.
Without them, some organizations might not exist. The more connected to a community people
feel, the more likely they are to take responsibility for the community and feel pride and a sense
of commitment. Mobilizing community resources and expanding capacity through volunteers
also enhance an organization’s general profile, which can attract more volunteers, program
participants, and funds.

Other potential benefits of using volunteers include the following:

 An increased ability to serve clients and respond to the needs of the community (e.g.,
increased services, expanded hours of operation, shorter wait times)
 Greater staff diversity (e.g., age, race, social background, income, education)
 Increased skill set, specialized skills and knowledge
 Expanded community support.
 Credibility – volunteers have fewer vested interests, making them a valuable public
relations asset
 Objectivity – especially in the delivery of services
 Refreshed energy
 Public opinion on important issues
 New ideas to enrich the existing program
 Flexibility to focus intently on a particular task or issue

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  Constructive criticism and feedback
 Fresh perspectives – "new blood" can keep an organization alive
 Ability to lessen the overall workload
 Immediate access to the community

Dear students, why do you think people become volunteers and participate in voluntary works
and discuss with your friends what benefits it brings for oneself?
_____________________________________________________________________________
_
_____________________________________________________________________________
_

Well, people become volunteers because of different reasons; generally the following reasons
can explain why people do volunteer works?

 to help others and contribute to the community

 to use skills in a new setting
 to find new friends and new relationships
 to develop a sense of accomplishment and self-worth
 to learn new skills
 to meet requirements of a course or program
 to challenge themselves
 to work for a cause
 to gain recognition for their abilities
 to help improve the quality of community life

2.6. Community Contributions

Community-based NGOs can improve the quality of life within their communities by responding

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to local needs, providing new solutions to problems which may be quite old. The surest indicator
that such organizations are truly meeting local needs is their ability to mobilize people and
resources in the community. Every community, even the poorest, has resources that can be used
to implement projects that respond to local needs. The role of NGOs is to address these needs by
building community awareness and implementing relevant activities while mobilizing local
resources to assist in the effort.

Dear Students, list some of the community contributions that are being undertaken in your
area.
______________________________________________________________________________
______________________________________________________________________________

Well students, I hope you have mentioned very important community contribution in your areas.
As you all know community participation serves as a strategy to identify and mobilize local
resources within a community. The state and NGOs should work with communities to identify
realistic contributions with regards to physical resources, time, and decision making/ governance
capacity. Additionally, local financing concentrates efforts on gaining financial support from the
local community and institutions. This includes:

 Fund-raising from the general public – e.g. through legacies and regular giving
programmes.
 Fund-raising from specific sectors – e.g. legal or medical profession.
 Businesses – sponsorship and donations, or provision of skills and facilities.

Local resources are any contribution from within the local community that assists the
implementation of an activity, project or program. They include a wide range of financial and
nonfinancial contributions from local community members, including individual citizens,
institutions, organizations, businesses, or government authorities.

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The following are examples of the types of resources that may be available locally to contribute
to the successful implementation of NGO activities:

i. Financial resources are probably the most sought after local contribution, as they provide
the ability to purchase a variety of goods and services that may not be otherwise
available.
Depending on the source, financial resources may be targeted to specific expenses or be used at
the NGO’s discretion. Financial resources can be raised from local citizens, businesses, local
authorities, or others in a variety of forms and through many means, including:

 donations of cash
 grants from local authorities or other community organizations
 user fees for participation in various activities
 membership dues paid by members
 fundraising events
 sponsorship of NGOs and/or their activities by local businesses

ii. In-kind material donations can help reduce the costs of implementing an activity
significantly. Examples of in-kind material donations include:
 Office supplies needed for the operation of an NGO
 building materials for the reconstruction of community buildings
 use of a car or other vehicle to transport or visit beneficiaries
 sports and recreational equipment for playgrounds or youth programs
 food and drink to offer to volunteers or beneficiaries
iii. In-kind intellectual services can be an extremely valuable contribution for projects that
require expensive expert and professional services such as legal, accounting, medical,
psychological, engineering or architectural advice or assistance.

iv. Space: such as the free use of a room, office, building, community center, school or
playground, for regular or special events.

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In addition to providing the skills and materials needed to conduct community improvement
projects, mobilizing local resources also helps an NGO to build long-term relationships with
important individuals and institutions in their community.

Dear Students, we have tried to slightly raise in a previous sub section that Community-based
NGO is not expected only to provide to the community, they can also use the community as
their sources of funds .and they can get resources in different forms from the community.
Therefore, can you list some NGO’s in your area that are using community contribution as a
source of funds?
2.7. Income from Business-Oriented Projects

Earned income is the monies received by a non-profit from the sale of products or services
rendered. This is also income received from interest generated by endowments and other
investments.

The concept of earned income poses a dilemma for some non-profits who equate it with a for
profit activity. The exchange of goods and services for cash is considered by some to be a
compromise of non-profit ethics and the organization’s mission, particularly when the mandate
and nature of a non-profit organization is to provide services to their communities and
beneficiaries for free. The idea of charging fees is unthinkable for some. In some countries this
may also cause legal problems if there is little understanding of the parameters of income tax
laws. For example in the Philippines, in order for the income earned to be tax-free, the income
generating activity itself must be directly related to the mission and programs of the non-profit as
stated in its legal papers of incorporation. But if the use of the profit stays within your country’s
laws that distinguish not-for-profit from for-profit enterprises, then the ethical problem is
minimized. More so if the organization remains focused on why it was founded in the first place
— mission first, survival second.

Earned income is also a donor acquisition strategy. It allows people not normally within your
organization’s universe of constituents to get to know your programs. Many donors shy away
from giving outright donations, regarding them as dole-outs. They like the idea of getting

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something for the money given, knowing that in the process they are contributing to the mission
of the organization. In response to your organization’s pressing need to raise funds, you will find
that a host of options are in fact open to you in this area. Not-for profits’ earned income may
originate from any or combination of the following options:

Table 5.2: sources of earned income for non-profit organizations

Income from Income from Professional Income from Endowments
Merchandise Services
Publications Clothing Interest income
Exchange or transfer of generated from investments:
information time deposits, stock dividends,
and sale of shares of stock
Ticket sales Consultancy
engagements
Stationery Technical assistance
Arts and crafts Legal assistance
Clothing Performances of art groups
Mugs, keychains, desk Hosting of conferences,
accessories forums, discussions
Food products Micro-credit and
learning programs
Training workshops/ programs

You will need to ask yourselves — what can we offer and make available for a fee? And to
whom shall we offer these? Earned income can provide a reliable stream of funds for the long
term.

The proceeds of funds raised from these projects meet financial requirements of programs to
fulfill the organization’s mission. However, managing earned income activities requires a certain
level of business expertise in order to be a truly viable income stream. Instead of plunging
headlong into uncharted territory, it is good to come up with a business plan. A business plan:

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  Helps you identify the amount of capital you need, when you will need it, and how
income will be generated.
 Allows you to assess the situation as a business manager would
 Enables you to commit to paper a well-organized strategy, which in turn improves
your ability to manage the business. This covers costs, marketing strategies, target
markets, identifying customers, pricing strategies, distribution systems, cash flows
and competitors.

Dear learners; please go to NGO in your area and ask whether they earn income and observe
how they earn it.

Many non profits organizations earn income by selling goods and services to members, service
users the general public or other organizations. Some organizations earn all their income this
way. They have flexibility about how to spend their earned income.

Examples of trading by non profits include:

 Selling tickets to events
 Selling publications or products
 Hiring out a venue
 Selling in-house expertise to interested parties e.g. publishing, training, consultancy
Charities can trade, however, if the trading activity is significant and is not related to primary
purpose of the charity there are charity and tax law implications and it needs a special attention.
It may extend to setting up a separate trading arm.

Trading is likely to pose particular challenges for charities. Questions to be considered include:

 Does your governing document allow you to create and invest in a trading subsidiary?
 Will the proposed trading involve significant risk to a charity’s assets?
 Would investment in a trading subsidiary be in line with the charity’s current
investment policy?

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 Dear students;
1. Try to remember and list some of the charity organizations which are actively engaged
in trading in your community.
2. Do you think nonprofit organizations should engage in trading? Support your
answers with justification

3: Process of Fundraising

3.1. Develop Funding Proposal

If a particular organization is thinking that writing a grant proposal is a quick way to solve its
organization’s funding problem, it should probably go into another line of work. Writing a grant
proposal should not be a one-shot experiment. Organizations don't write a grant proposal rather
they write many grant proposals. Grant proposal writing should be an ongoing process and an
integral part of organizations overall fundraising program. Here are the parts of that process:

1. It all starts with organization's funding priorities

Organizations should identify, on an annual basis, what their funding needs are for the near
future. They will have all the programs and activities that they currently operate plus ideas for
new programs or the expansion of existing ones. Each activity or program will have a funding
source or group of sources, such as your current grants, annual fund, product sales, admission
fees, etc. At this point they will identify those plans or projects that are likely to translate well
into grant proposals, and start the process of developing them.

2. Preparing a draft grant proposal

Before going much further, it is wise to put together a draft grant proposal for one of the projects
or programs that organizations identified as a candidate for funding. At this stage the
organization will assemble the detailed background information it will need, decide who will
write the proposal, and draft the key components of the grant proposal such as the executive

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summary, statement of need, project description, budget, and organizational information.

3. Finding potential funders for grant proposal

With a draft grant proposal in hand, it is time to look for appropriate funders. Develop a list of
criteria so that the organization can find funders that fit with proposal. You'll want to identify
funders that are interested in your particular location, the program area in which you work
(education, poverty, health, etc), and funders that are willing to provide the amount of funds your
project will need. Develop a broad list of potential funders and then winnow it down to those that
best fit with your needs.

4. Contacting and cultivating potential funders for grant proposal

It is not wise to just start dropping proposals in the mail or filling out online grant applications.
Organizations will save a lot of time and error if they make a call to, or email, the foundation and
speak to a program officer. Briefly explain the project and ask if it is the sort of thing the
foundation is currently interested in. This might lead to unexpected information and, at the worst,
will simply alert the organization that this particular foundation is not a good match for your
grant proposal. You might find out that the foundation's interests are worth thinking about for a
future project and proposal.

5. Packaging the grant proposal

Once the organization determined that the proposal is a match for a particular funder, it should
tailor basic proposal to that funder's priorities. The organization should understand the funder's
guidelines for grant proposals and follow them. It should also add a cover letter and any
accompanying documents the funder requests and make sure the proposal is accurate and easy
to- read.

6. Responding to acceptance or rejection of grant proposal

If grant proposal is accepted, the organization shall take responsibility for the follow up. This
will be crucial to organizations ongoing relationship with the funder. Take care of the letter of
agreement or contract as soon as possible. If grant proposal is rejected, the organization shall
respond graciously. Do contact the funder to ask if it is possible to submit again with appropriate

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changes or if they might still be interested later in a different project. Never complain. Never call
a board member. Don't become a pest. Don't burn this bridge.

3.1.1. Successful Proposal Writing

Preparing an application for a foundation or other fund provider is part of a process of planning
and of research on, outreach to, and cultivation of potential foundation and other donors. This
process is grounded in the conviction that a partnership should develop between the non-profit
and the donor.
A proposal must convince the prospective donor of two things:

 that the problem you wish to address is of significant magnitude and

 you have the means and the imagination to solve the problem or meet the need.

Dear students, so far you have seen that writing a funding proposal is not a one time job or task
rather it is a part of organization activities and it needs careful attention. Therefore, before
proceeding to reviewing how to write a successful proposal, it is better to see the different types
of proposal. Can you mention the different types of proposal?

Proposal Types

i. Unsolicited - You may submit an unsolicited proposal at any time, although there may be
target submission dates set to meet particular review panel meetings.
ii. A response to a specific program within a specific donor agency – these should be
written against the program guidelines issued by the agency. These programs have
recurring deadlines which you must meet to have your proposal considered.
iii. A response to a Request for Proposals (RFP) - To respond to an RFP, your proposed
project would have to fit the needs described in the specific work statement developed by
the funding agency. An RFP has a specific deadline; if the proposal arrives late, it
normally will not be considered.
iv. A response to tender – tender advertisement is placed in local newspapers and, again, the
instructions must be followed completely.

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After you have written a proposal, it could take awhile (even a year or longer) to obtain the funds
needed to carry out the proposed project. And even a perfectly written proposal submitted to the
right prospect may be rejected.

Raising funds is an investment in the future. Organizations should aim should be to build a
network of foundation and corporate funders, many of which give small gifts on a fairly steady
basis and a few of which give large, periodic grants. By doggedly pursuing the various steps of
the process, each year organizations can retain most of their regular supporters and strike a
balance with the comings and goings of larger donors.

Dear students, what kind of things do you think need to be considered in writing a Successful
proposal?
______________________________________________________________________________
______________________________________________________________________________

Rules for Proposal Writing

Be Concise
Though not all proposals are short, a good rule of thumb is to be brief (where appropriate) and
concise. For example, if an agency asks for a “concept paper” it should not be longer than 4 or 5
pages. Place yourself in the shoes of the people that you are approaching. They will not want to
plow through page after page of material that may be redundant or only interesting to you. A
concise proposal demonstrates your respect for the time that they have to commit to your
application and your ability to succinctly outline your request.

Be passionate and positive

Write persuasively and confidently - you're selling a concept that will have a very positive
impact.

Avoid using conditional language like:

 "We would like to . . ."
 "We may include . . ."

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  "Possible results might be . .

Instead, march boldly forward in your proposal with positive language such as:
 "We will . . . "
 "Programs will include . . ."
 "The results will be . . ."

Write for each funder

Though it is possible to have a funding “package” (policies, strategic plans, financial strategies,
etc…) each funding application should be contextualized.

Funders will help you. Call them and ask questions - but be sure you've done your homework
first and that you're not asking a question already answered in their literature. A proposal should
reflect planning, research and vision. The importance of research cannot be overemphasized,
both in terms of the funders solicited and the types of funds requested.

If the funder provides a format, follow it carefully. The most successful proposals are those
which clearly and concisely state the community's and organization's needs and are targeted to
donors which fund that field, a reflection of careful planning and research.

Don’t use jargon! Use simple, clear, concise sentences. Writing is about 20% of the issue in
grants acquisition.

There are factors all funders consider "highly important":

 Project purpose
 Feasibility
 Community need for the project
 Applicant accountability
 Competence – applicant’s ability to manage the project successfully

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Other factors also considered important include:
 Project language and logic: not too narrow, not rambling, well focused, detailed but not
redundant
 Probable impact
 Money required
 Community buy-in and support
 Innovative solutions
 Realistic - not too ambitious
 Well-documented
 Exciting
 Current & relevant

Dear learners; Discuss about highly important and important factors in successful proposal
writing that are listed above

3.1.2. Structure of Funding Proposal

Dear students; before going through this subtopic can you guess some components of a
funding proposal?
______________________________________________________________________________
______________________________________________________________________________

Well, proposals for international and local funding can differ from organization to organization,
and can vary based on the donor’s requirements. However, most successful proposals include the
topics listed below.

Unsolicited proposals or proposals that are called for by donors without the use of a particular
format should include the following.

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 i. Title/ Cover Page – the name of the organization, contact details, name of the programme
etc. In other words, the cover page should have the name of the project you wish to fund,
who the proposal is being submitted to, who it was prepared by and when.
ii. Letter of Intent: A letter of intent or a cover letter should be written on your letterhead,
and should:
 Have the funder's name, title, and address
 Be directed to the individual responsible for the funding program (not addressed "To
Whom It May Concern", "Dear Sirs", etc…)
 Provide a brief overview of the organization and its purpose
 Describe the need the project intends to meet (including target population, statistics,
example)
 Provide a brief description of the project
 Include the amount requested (if required by funder)
 Be one page in length
 Include the name and phone number of the contact at the organization
 Include a thank you and next step to be taken (we will phone you in the next week to
follow up)
 Should not exceed two pages
 Be signed by the person who can speak with authority on behalf of the organization

iii. Proposal summary (executive summary): Statement of your case and summary of the
entire proposal. This section must capture the attention of the funder and it must clearly
and concisely summarize the request. It should provide the reader with a framework that
will help him/her visualize the project. The remainder of the proposal will then serve to
deepen and amplify the vision presented in the summary section at the beginning. Write
the summary after you’ve written everything else.

A summary should meet the following criteria:

 Appears at the beginning of the proposal

 Identifies the grant applicant

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  Includes at least one sentence on credibility
 Includes a brief statement of the problem or the need your agency has recognized and is
prepared to address
 Includes at least one sentence on objectives
 Includes at least one sentence on methods
 Includes total cost, funds already obtained and amount requested in this proposal
 Is brief (in most cases it can be limited to a maximum of one page)
 Is clear and interesting

If the funder reads beyond the summary, you have successfully piqued their interest. Your next
task is to build on this initial interest in your project by enabling the funder to understand the
problem that the project will remedy.

iv. Problem Statement or Statement of Need (Why this project is necessary)

Present the context

Donors have many demands on their resources and have to decide where best touse them, in
terms of geographical area, region, problem or challenge. This means that you need to
contextualize your project in such a way that you show that the problem or opportunity being
addressed fit the donor concerns, particularly with international donors who may not understand
the local context.

The context includes:

 Country, region, area details (location in region, government, population etc);
 Poverty information, including information on the state of the economy,
employment/unemployment;
 Gender issues;
 Disability statistics
 Health and education statistics,
 Environmental concerns, etc…

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A problem statement or statement of need assessment should also meet the following criteria:
 Describes the target population or area to be served
 Defines the community problem to be addressed and the need in the geographical area
where the organization operates
 Is related to the purposes and goals of the applicant agency
 Is of reasonable dimensions - not trying to solve all the problems of the world Is
supported by relevant statistical evidence
 Is supported by relevant anecdotal evidence - like case studies (appendix)
 Is supported by statements from authorities or media articles (appendix)
 Is stated in terms of clients' needs and problems - not the applicant's
 Is developed with input from clients and beneficiaries
 Is as brief as possible Is interesting to read
 Is free of jargon
 Makes a compelling case
You want the need section to be succinct, yet persuasive. First, decide which facts or statistics
best support the project. Be sure the data you present are accurate. Second, give the reader hope
that your program can offer solutions. Third, let the reader know how your program addresses
the need better than other organizations without demeaning other organizations. Market your
“edge.” You’ll also need to describe how your work complements, but does not duplicate, the
work of others.

v. Program Description – describes your goals, objectives, your method, etc.

The program description should include the following:

Goals and Objectives

This section of the proposal describes the outcomes of the project in measurable terms. It is a
succinct description of what the organization hopes to accomplish and by when. Each goal
should be clearly stated and have an associated timeframe.

Program goals and objectives should meet the following criteria:

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  At least one objective for each problem or need committed to in the problem statement
 Objectives can be called outcomes
 Objectives are not methods
 Describe the population that will benefit from the program
 State the time by which objectives will be accomplished
 Objectives are measurable and quantifiable

Objectives are the measurable outcomes of the program. They define your methods. Your
objectives must be tangible, specific, concrete, measurable, and achievable in a specified time
period. Grant seekers often confuse objectives with goals, which are conceptual and more
abstract. Objectives should be SMART (specific, measurable outcomes that are realistic and
achievable over a specific period of time).

[S-Specific; M–Measurable; A-Action-oriented & achievable; R–Realistic; T-Time-bound]

Methodology: (A step-by-step outline of the development and implementation of the project)

This section describes the activities to be conducted to achieve the desired objectives. It also
includes the rationale for choosing a particular approach. Generally, a straightforward,
chronological description of the operations of the proposed project works most effectively. The
methodology section should meet the following criteria:
 Flows naturally from problems and objectives
 Clearly describes program activities
 States reasons for the selection of activities
 Describes sequence of activities
 Describes staffing of program
 Describes clients and client selection
 Presents a reasonable scope of activities that can be accomplished within the time and
resources of the program
 Provides a timeline of activities

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vi. Program Design: A Plan of Action

For each objective, a specific plan of action should be laid out. It should delineate a sequence of
justifiable activities, indicating the proposed staffing and timetable for each task. This section
should be carefully reviewed to make sure that what is being proposed is realistic in terms of the
applicant’s resources and timeframe.

It should outline the following:

1. The activities to occur along with the related resources and staff needed to operate the
project.
2. A flow chart, a table or a Gantt chart can be drawn up to describe the milestones,
deliverables and timeframes and staff/consultants allocated for activities.

vii. Monitoring and Evaluation

A monitoring and evaluation plan takes a broad view of a project's activities; in essence, it
answers these questions:
 How will you assess impact?
 How will you measure the project's success and effects?
 What do the "critical success factors" for gauging the project's impact tell you?
 What difference will the project make?

Evaluation procedures are increasingly important to potential funders. Designing a monitoring

and evaluation process for each project will enable your organization to measure project
objectives and determine a time-frame for expected results. The system should include
procedures for monitoring the progress of the project, reporting on the progress, and evaluating
the status of the activities.

Evaluation can be qualitative (positive changes in the attitudes of a community toward people
with disabilities) or quantitative (how many wheelchairs were delivered in a community). One
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 can also measure the product (how solidly built is the wheelchair) and the process (how are
recipients is involved in deciding which wheelchair is appropriate). Either or both might be
appropriate to your project. For all types of evaluation you will need to describe the manner in
which evaluation information will be collected and how the data will be analyzed.

The evaluation section should meet the following criteria:

 Explains how you will monitor the project's performance on an ongoing basis
 Describes the critical features of the project and how they will be measured
 Describes how data will be gathered and the process of data analysis
 Tells who will be doing the evaluation and how they were chosen
 Explains any test instruments or questionnaires to be used
 Shows how evaluation will be used for program improvements
 Describes any evaluation reports to be produced

The evaluation plan includes periodic project reviews intended to summarize the major lessons
learned during the course of a project's life-cycle, its activities, and impact on beneficiaries.

In order to monitor and evaluate the project successfully and share the findings, it is important to
develop a project reporting system. Project reporting includes periodic documentation of your
progress. Reports may include financial updates, implementation status reports, and periodic
evaluations. The report should be written for the project manager, executive director, and finance
department-as well as beneficiary groups, donors, other organizations, and the government that
has interest in the ongoing progress of the project.

viii. Qualifications of the Organization

This section describes the applicant agency and its qualifications for funding and establishes its
credibility. The programs and accomplishments of the organization will be examined in light of
how they address current demographics, social issues, specific constituencies, etc. In addition to
convincing the funder of the extent of the need for the proposed project, the agency must also
demonstrate that theirs is the appropriate agency to conduct the project. In this section, the

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organization should demonstrate that it has the means and the means to solve the particular
problem or meet the need, and it must explain why the organization should be chosen over other
organizations. Much of this information can be conveyed easily by attaching a brochure or other
prepared statement.

You can allude to the following in the summary but most of the information should appear in the
appendix. The qualifications should meet the following criteria:

 Clearly establishes who is applying for funds

 Briefly addresses the rationale for the founding of the organization
 Describes applicant agency's purposes and long-range goals
 Describes applicant's current programs and activities
 Describes applicant's clients or constituents
 Provides evidence of the applicant's accomplishments
 Offers statistical support of accomplishments (eg number of people reached through
your program)
 Offers quotes/endorsements in support of accomplishments (from the people you are
helping, professionals who can attest to the value of your work, respected business
leaders, etc..) Extract the best quotes onto a single page instead of copying a stack of
separate letters.
 Press clippings
 Describes qualifications of key staff members
 Leads logically to the problem statement
 Give the reader a feel for the makeup of the board (include the full board list in an
appendix.)
 If your agency is composed of volunteers or has an active volunteer group, describe
the function that the volunteers fill.

ix. Budget

When developing a budget, list every cent it will take to run the entire project. Don't forget
support staff, copying charges, postage, memberships, telephone charges, meeting costs, and all

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the "hidden" expenses. Then think, what part of this budget do you need to request from the
funder.
Put together an itemized list for the part of the overall budget you're requesting from the funder,
the request budget. Budgets should show income as well as expenses and are best drawn up in
spreadsheets (like excel). Sources of income should include other committed funders as well – if
they are co-funding the same project.
A budget should meet the following criteria:
 Tells the same story as the proposal narrative
 Is detailed - includes project costs that will be incurred at the time of the program's
implementation
 Includes all items asked of the funding source
 Includes all items paid for by other sources
 Includes all volunteers
 Includes all consultants
 Includes indirect costs where appropriate
 Is sufficient to perform the tasks described in the narrative

For a project with paid staff and external consultants, provide the rates for all levels of work to
be performed on the project.

x. Attachments - such as your constitution, CVs of staff and consultancy

3.2. Searching and Identifying Prospecting Donors

Dear students in the previous subtopic you have studied how to develop a funding proposal
which is an essential part of a fundraising process. After going through proposal development
lesson, you are required to study about searching identifying prospecting donors.

Dear students; before proceeding to the discussion, can you explain how organizations able to
search and identify prospecting donors for their funding needs?
_____________________________________________________________________________

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_
_____________________________________________________________________________
_

In order to search and identify prospecting donors, start with the connections you already have.
You may have a board of directors, you have people who are already giving to you annually, and
you have your viewers/listeners and members. These are the people who will give you more and
who will to others who will make gifts of their own.

Identify the people who might give to you, suspects. These people live in your community, have
a moderate amount of wealth, have an interest in public broadcasting, and know someone who
knows you. You will be able to generate a very long list of these people, so long that you will
soon need to prioritize it to make your work manageable.

Rank these people by a couple different criteria in order to spend your time and energy most
effectively. Essentially you need to ask people who are most ready to give to you first. Second,
you need to get to better know those who are not quite ready to give to you. And then last, you
need to invest the time in developing relationships with people who just don’t know you very
well.

How do you get those who are close to you to tell you who they know? By asking them; Ask
them individually; ask them in groups. “Prime” the list by starting with some obvious names,
names you can come up with yourself, prominent people in the community, business people,
people who have given to other stations or other non-profits organizations. People seem to have
an easier time naming potential donors when they look at a list of possibilities rather than at a
blank sheet of paper.

Prospect Attributes

In searching and identifying prospect donors, you are not looking for just anyone, at least not
really. You need to prepare a list that has the names of potential donors with their attributes.

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Dear students what attributes can you mention which can be used in searching and
identifying prospects?
______________________________________________________________________________
______________________________________________________________________________

Well. Prospect attributes may vary according to their background and situation; the following
however can be regarded as a prospect attribute which can help in identifying them.

a. Wealth: For someone to give you a major gift, they have to have some wealth. Your
prospects must be wealthy, but wealth can be hidden. And don’t limit yourself to the
“obvious” people in your community who everyone knows are rich. This is the only attribute
over which you really have no control. You can build interest and make connections, but you
cannot make someone wealthy.

b. Interest: You want people who have an interest in public broadcasting…or whose interest
can be developed. Your prospects must have an interest in what you do. But interest is not
always obvious, and may be evident in different ways. Also, someone with little interest can
become more interested in your station—this is a large part of the cultivation process.

c. Connection: Someone may be wealthy and have an interest in public broadcasting, but have
no relationship to you. Connections to your station can run through a couple different people.
As long as someone is willing to introduce you to some who will introduce you to a
prospective donor, you’ve got a connection. You can also forge a connection that does not
exist now. This too is what major gift fund raising is about.

How do you tell if you have a connection to someone? This is fairly straight-forward, but not
always obvious. You’re looking for people who have the following relationships with your
volunteers, board, staff, and others mentioned in section one above:
 Neighbors
 Family
 Employees/employers, or clients/service providers

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  Friends

d. Charitable intent. Evidence of an inertest in philanthropy is slightly less important. After

all, if you’ve got the other three characteristics, it’s likely that you’ll find this fourth. But not
always. Obviously, someone who makes charitable gifts in your community has chartable
intent. This is more a characteristic to be aware of later in the cultivation process. You may
identify someone in your community with interest, wealth, and a link to you. But as you get
to know them you realize, with your volunteers, that the person simply does not give…to
anyone. The absence of this characteristic needs to be noted, and might lead you to conclude
that you should not devote your time to this prospect.

Well students so far you have seen how to search and identify prospects by using different
attributes, now let’s see how it is also possible to search and identify prospect donors by using
a two step donor research process.

Funder or donor research is a two-step process. The first step aims to develop an initial 'prospect'
list of some ten to fifteen funders who have general interests in the subject area of your
organization or project. The second step involves further research and refines this list to the three
or four funders you may approach.

In developing an initial 'prospect' list, sources for funding can be found within your country as
well as abroad. As stated earlier, a choice for many small local contributors means that you are
growing local roots and a local constituency; in return for contributions these people would wish
for a voice in policy making. Funding from local organizations has a number of advantages. The
procedures are often easier to follow. And international donors want to know that local sources
have been tried first. When applying for funds from abroad, the national registration of your
NGO and formal approval of your project by your government is often necessary.

Locally, the main institutions to apply for funds are:

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  Local organizations – think of Rotary or Lions clubs, churches, temples, mosques,
hospitals, local business associations, the 'rich' in your community etc.

 Government or District institutions: Funds are often available, especially if working in

co-operation in the same field of interest. Think also of secondment of staff, use of their
logistics etc.

From abroad, possible sources include:

 Voluntary funding organizations: These include missions, aid agencies and other groups,
both religious and secular. Most of them are based in the North, in Europe, North America
and Australia. Such groups are often interested in supporting smaller-scale development
and health projects. A list of names can be obtained from national and voluntary
organizations and from embassies.

 Using your contacts: You previously contacted other NGOs working in the same field.
Where do they get their funding? Can you write to the same organization?

 Searching the web: Go to the websites of the big international organizations that cover the
groups you are trying to help. For example, you might be an NGO in Ethiopia. Now you
want to help girls who were forced into the sex trade and are now HIV positive. The
organizations that care for children might help (UNICEF) or the organizations that care for
women (ILO, UNIFEM). For example, with UNIFEM, if you type into the ‘search’ slot
“Ethiopia HIV women” the site tells you there are several projects like the one in your
proposal. If you then look for Contact Information you will find the address of the regional
office and an email address. Then you might want to Google again, writing “girls HIV
Ethiopia” into the search slot. There may be organization you have not previously dealt
with.

 International Aid organizations: These include the United Nations Agencies such as
WHO, UNICEF, UNDP, FAO, the European Commission (EC), the WB, and ADB.
However, they do not often support small-scale projects directly. Funds from these sources
are more likely to be available via national umbrella organizations. It is worth finding out

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 what their contributions to the government and to bigger NGOs in your country are. This
information will be available from your government (ministry) or from local UN and EC
delegations etc.

 Foreign Embassies: They often have funds available for small-scale projects. (For
example, Dutch Embassies have special funding sources for so called KAP projects. From
these sources they can give direct support to projects with sums up to $20,000. Special
procedures/criteria need to be followed).

After identifying prospecting donors and preparing the long list of prospecting donors, the next
step is prioritizing your prospects into manageable groups.

Dear students what do you think is the importance of prioritizing donors and refining the
previous list?
______________________________________________________________________________
______________________________________________________________________________

Well. As a second step of the donor search process prioritizing donors and refining the previous
list has its own importance. Simply talking, prioritizing your prospects is a critical step in
addressing the overwhelming feeling you frequently get when looking at a very long list of
prospects. However in more general sense prioritizing donors help you to;
(a) Reach out to the people, who are most ready to give first,

(b) Cultivate those who require more cultivation, and

(c) Safely delay activity with those who are further down the list.

3.2.1. Recording Facts about Individual Prospects

Dear students why do you think an organization need to record facts about individual
prospects?
______________________________________________________________________________

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______________________________________________________________________________

Well, recording facts about individual prospects have many benefits for those who have interest
on them. In recording facts about individual prospects, organizations become clear with the
individuals interest areas to fund, background willingness to fund, and other very important
questions which in turn helps the organization to decide whether to continue in cultivating them
as a potential donor or quit the process. In general, recording facts about individual prospects
help organizations;
 to make informed decision ,
 to save their resources and energy
 to prepare a strategy that best meet their prospective individual needs
 To uncover the true potential of donors

An important part of major fundraising is the identification of those who are capable of making
larger gifts to the station and who are either prepared to do so or can be made ready through
increased cultivation. And this can be achieved if the organizations able to record facts about
individual prospects. To uncover the true potential of donors, therefore, you must conduct formal
research. Organizations must either do this by their own or contract with outside services. For
Organization that chooses to do its own research, a variety of public sources are available, most
of them online, and many of them free.

Dear students what kinds of facts do you think should be recorded about individual prospects?
______________________________________________________________________________
______________________________________________________________________________

Well, the first step in prospect research is to gather all useful known information about the
prospect. It starts with basic biographical information — name, address and other contact
information, occupation, age, marital status, alma mater, name and other significant information
about spouse, names and ages of children. It continues to social and political information —
clubs, churches, political, even personal interests, when it can be obtained from a volunteer.

Then there is financial information — estimated annual income, securities, directorships, land

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ownership, and estimated net worth. Finally, there is other philanthropy — gifts to other
organizations, membership on boards, other volunteer service, membership on foundation boards
or family foundation. But data is not enough; the job of prospect research is "analysis, not just a
data dump." Research on any funder's stated programme interests is essential. Do not attempt a
scatter approach, sending requests to a wide group of organizations. It can damage your
organization’s credibility. You are trying to identify the few funders that have interests that are in
line with your organizational and project objectives. If you do not qualify, do not apply. Many
funding agencies now have web sites so look them up and see what they say.

Dear students; do you think recording facts about individual prospects help to get funds from
them? Support your answer with justification.
_____________________________________________________________________________
____________________________________________________________________

3.2.2. Develop Case Statement

As you remember students case statements have been mentioned in the previous section and
sub topics, by using your previous understanding can you say something about case
statement?
______________________________________________________________________________
______________________________________________________________________________

Well, The Association for Fundraising Professionals (AFP) defines the case as "the reasons why
an organization both needs and merits philanthropic support, usually by outlining the
organization's programs, current needs, and plans." A case statement, “is a presentation that sets
forth a case." The first is a concept, while the second is a physical document.

To draw a further distinction, case materials are resources the station collects to document its
history or work in the community. A case expression is any presentation you make to a particular
audience or for a specific purpose.

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A compelling and credible case for support is based on a current or recent strategic plan that
reflects the vision of the agency’s leadership: How will this agency best service the community
five years from now, and what resources are needed to achieve that vision?

The case is not a wish list; it is a credible articulation of a plan to address needs within a well
defined constituent group. The central question to be addressed in the case is: What is central to
our mission that we do not do now, or do not do as well as we should, that we could do with
additional private-sector resources. The case must define the problem, identify the solution,
provide a budget for that solution, and link private-sector philanthropy to that budget.

Dear students based on the above definition and description about the case, what elements do
you think are included in case statements?
______________________________________________________________________________
______________________________________________________________________________

Elements of the Case

The three most critical elements of the organization's case are its mission, vision, and values.

Mission: is why you exist. It is not what you do, but the greater purpose that the organization
serves. It concerns what the organization is today.
Vision: is what an organization can become in the future and, equally important, how the
organization will affect its community when it succeeds in realizing that vision.

Values: are the beliefs and practices that guide the organization's work in the community.
Generally, a sound case might include the following Elements:

• History of agency (track record of service)

• Summary of services or programs (what makes your organization unique)
• The need (the community’s need, not the organization’s need)
• The plan (solution)
• The campaign

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 • Anticipated project costs
• A vision of the agency once the campaign has reached its goal

Importance of the Case

"Why do we need a case?" the leader of one organization asked. "Every member of the staff
knows our story." The truth is that everyone within an organization knows his or her version of
the story, but each may be quite different from others.

If a conductor were to walk onstage, hum a tune, and ask the ensemble to repeat it, the result
would be a cacophony, no matter how hard the musicians tried. Just as sheet music makes certain
that everyone in the orchestra plays the same tune, the case for support guides your staff and
volunteers in communicating a cohesive story to the public.

In addition to serving as the guide for organizations and its employees to be focused on one
direction, the case statement serves different purpose.

The case for support serves as:

1. Resource document: It serves as a source document to shorter written communications

such as press releases, speeches, conversations, special presentations, foundation proposals,
fundraising brochures and the like
2. Engagement document: It is a major working tool in volunteer fundraising leadership
enlistment and training – and for prospect cultivation and solicitation where appropriate
3. Orientation document: The case is an effective internal document that builds confidence,
motivates and binds not just the staff but also the Board. It defines direction and gives
clarity to the organization thereby creating new opportunities.

To be effective, the case must

 Be realistic and inspiring
 Create enthusiasm
 Emphasis what the proposed fundraising will accomplish
 Prove the argument that the donor needs to give so that the programme can be achieved
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  Reflect the interests and concerns of potential supporters
 Answer the initial questions that any potential supporters might ask
Dear learners;
Go to any specific NGO in your area and ask whether they develop case statement if they have
case statement evaluate whether the case statement is;
i. realistic and inspiring and
ii. enthusiasm Creator

3.2.3 Conduct Effective External Communication

Dear students; why do you think organizations need to conduct external communication?
_____________________________________________________________________________
_
_____________________________________________________________________________
_

Well. Dear students as you know all NGOs will want to publicize themselves to different
audiences and in different ways as reputable organizations with high impact programmes. One of
the reasons, but by no means the only one, that publicity is important is to raise funds for the
organization. The links between publicity and fundraising are clear. But organizations also want
to publicize themselves for other reasons, such as increasing their membership base, informing
potential beneficiaries about the work that they do, and networking more effectively with other
organizations.

Dear Students, we have tried to slightly rise in a previous paragraph that organizations
especially NGOs need to effectively engage in external communication as it helps them to
create link, promote themselves and bring funds to their organization. Here the question is
how to conduct external communication? Therefore, can you list some publicity
(communication) tools that organizations can use in communicating externally?
_____________________________________________________________________________
_

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_____________________________________________________________________________
_

Well. Organizations can achieve publicity through written documents, branding, public events,
and use of the media, joining networks, and participating in conferences. They can also produce
a brochure and newsletters. All publicity tools can be very helpful when trying to promote the
organization externally.

Good external relations through the exchange of information and networking are important for
any organization. All organizations need publicity so that they are known by the public. When
starting to develop a publicity strategy, consider:

 Who does the organization want to reach?

 What does the organization want the public to know about it and its work?
Normally an organization wants to be known first and foremost by its beneficiaries, service users
or clients, and then by the government, other NGOs, funding agencies, local businesspeople and
people living in the locality. These audiences will need different types of information about the
organization.

For example, the members need to know what services the organization provides, such as
workshops and training. The government will want to know what an organization’s mission is,
who its beneficiaries are, and where the organization is working. Funding agencies will want to
know that the organization is credible, has a good track record and is worthy of their financial
support.

After the organizations identify its audiences and their need of information, it can prepare
external communication strategy and use different communication tools to reach its targeted
audiences. Many different tools can be used in a publicity strategy. Some of them are the
following;

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i. Written documents: These are good for visitors to the office and funding agencies who
are accustomed to reading reports and documents. Different documents can be developed
for different purposes. All of them should carry the organization’s full name, the name of
a contact person, and contact telephone or fax numbers. Be sure to distribute the
documents widely, not only from the office. Give some to international agencies,
umbrella groups, and other organizations that may distribute them on behalf of the
organization. Under written documents ,there are Some useful documents for distribution
and organization can use the following in communicating externally;

 The governing document provides useful information about how the organization is
governed, its aims, the powers of trustees and the way administrative arrangements (such as
membership and meetings) are handled.

 The strategic plan shows what the organization is trying to achieve over the next three years
and how it is doing this.

 The annual report covers the organization’s accomplishments over the previous year. It might
include photographs and case studies of work done; a summary of governing body members
and their background and experience; a copy of the annual accounts (audited or not); and
information about agencies that have donated funds.

 An organizational profile shows the structure of the organization, roles and responsibilities,
and lines of authority from the governing body to any project staff employed at community
level.

 A brochure provides basic information about the organization to encourage interest. It can be
distributed by staff attending workshops, at publicity events, etc.

 A fact sheet summarizes the organization and may include the mission statement, a list of
completed activities, the structure of the organization, its target group, etc.

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 Project brochures are more specialized. They describe an organization’s work in one area or
sector, such as women’s rights, and can be handed out at meetings to people with particular
interests in the area of work.

ii. Logos and branding: Anything that carries the organization’s logo or emblem will help
others remember and identify it. Some examples include calendars, stickers, pins, hats, T-
shirts, folders, or diaries. Signs or banners can also be used whenever appropriate to let
people know that the organization is working on a specific cause or issue. The emblem
increases publicity among those who cannot read, as they associate the picture with the
organization.

iii. Publicity events: Any event that an organization sponsors can be used for publicity.
Some examples are:

Open house: Open the office to the public and invite them to meet the staff, see the office, and
ask questions about the organization and its work. Display banners and brochures, and show
videos of programme activities while people network with each other.

Project launch or closing ceremony: At the start of a project or major programme activity,
invite people from that field to attend a small ceremony. For bigger projects, government
officials or funding agency representatives can be invited to make speeches to attract more
participants. Be sure to display banners, photographs and brochures, and to show videos of
programme activities if these are available.

Local events: When invited to attend local events related to the organization’s work, ask if
banners or displays can be taken. Wear the organization’s T-shirt, if it has one, and let people
know the name of the organization and what it stands for.

iv. Media: Media can cover special events that the organization holds, or they can run
general stories related to its work.

Television has a wide audience, which may include beneficiaries and funding agencies alike.

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However, the message should be well prepared in advance, as coverage is often brief.

Newspapers can give more attention than television to local events, although their target group
will be different. They can also carry photographs of the events. Articles can be posted in the
office and seen by many people.

Radio also covers both beneficiaries and donors, and can be useful to spread information about
recent activities.

A newsletter Produce a small newsletter that describes what the organization is doing, or that
reports on issues that its target group is concerned about.

v. Joining networks: Belonging to an umbrella or network organization or sectoral working

group of NGOs will allow the organization more opportunities to publicize its work. Such
bodies can also provide information about potential funding sources and upcoming
visitors, and they can advertise the work of other organizations. In this way organizations
benefit from the publicity an umbrella or network organization is engaged in. Being a
member of an umbrella group has another advantage: it can provide information about
development issues that may influence programme work.

Establishing formal partnerships with other organizations or signing memorandums of

understanding may have the same result.

vi. Conferences and workshops: Participation in conferences and workshops tells others
that the organization is active and interested in a particular topic. It can also help to
inform people about the organization’s areas of work, and facilitate information sharing.
Workshops are a good place to meet other people, including funding agency
representatives, who share common interests.

vii. Publicity through the office: An office can be used to publicize an organization. Make
display boards with information about the organization, including its mission and
organizational structure. In the project offices, display photographs of projects and keep

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 them up to date as they develop. Assign a small space to display publicity documents and
have some copies for visitors to take. Keep extra copies of the governing document,
strategic plan, and other organizational documents available so that these can be given to
people as and when requested.

viii. Brochure: A brochure is usually a single sheet of paper folded into three. It provides an
overview of the organization and is used to give people more information about it. It is
the easiest publicity document to develop, and is also very inexpensive. For those
reasons, most NGOs have a brochure.

ix. Newsletter: A newsletter is excellent for an NGO with a lot of information it wants to
share. Resource NGOs, networking groups, and umbrella organizations could all have
successful newsletters. Producing a newsletter may seem like a big task, but it does not
have to be produced every month. Once every three months may be sufficient, at least to
start with. Also, a newsletter does not have to be long: start with one side of paper. If a
member of staff is familiar with Microsoft Word, a good quality newsletter can be
designed using tables and columns. More advanced computer users can produce a
newsletter in Microsoft Publisher.

3.3.3. Develop Effective Ladder of Communication

Building a good, trusted relationship and ladder of communication with your donor is very
important. Often, co-operation and effective communication is not easy. A onetime
communication also doesn’t guarantee your success in communication rather you are required to
build a ladder of communication. The donor asks for long and complex reports, and transfers of
funds are often delayed. Communication problems are common due to misunderstandings on
both sides and because of postal delays. Don't forget that donors are dependent on their own
supporters, who in turn will expect reassurance that their money is being well spent.

Dear learners; as you know effective communication doesn’t only bring long term close
relationship it also facilitate works and bring co –operation among partners. Therefore, dear
students what methods do you think help organizations to build effective ladder of

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communication as well as bring co-operation between donor and receiver?
_____________________________________________________________________________
_
______________________________________________________________________________

Well, there are some ways to improve communication and bring co-operation, the following are
some of them;

 After receiving funds, write a letter of acknowledgement and thanks.

 Send regular reports as requested by the donor.
 Prepare accurate budgets, and keep costs as low as possible.
 If two or more donors are supporting your project, then the area of support should be
clearly defined and communicated.
 Encourage the donors to share a single global report and accept each others' tour reports
to reduce the amount of time you spend on their requirements.
 Always give feedback to the donor on how the money was spent.
 Always stick clearly to the objectives of your NGO.
 If there are any major changes of plan, inform your donor.
 Welcome visitors from your donor agencies.
 Try to reply promptly to letters from your donor.
 Build a relationship of trust

4: Communicating Donors

There is a rule of thumb in the fund raising business that you should have SEVEN other contacts
with your donor for every one time you ask for money. The reasoning behind this is that
effective fund raising is about good relationships, and all good relationships rely on two-way
communication and two-way benefit. Making seven non-asking contacts is a formidable task,
particularly if you are asking for funds more than one time each year. The task is virtually
impossible without a solid communications plan.

What possible communication methods and “excuses” can we find for contacting our donors this

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often – particularly without “bugging” them? Here are a few ideas, for starters – to jump start
your donor communications plan. Pick the ones that work for you and fit your organization’s and
donors’ “style,” and have fun with them!

4.1. Submitting Proposal to a Donor Agency

In submitting proposal to a donor agency organizations required to follow some procedures.

1. Make a list of possible funding sources. Try to get as much information as possible about the
ins and outs of each organization, its procedures for application and so on. If you can, find
out which person to approach within the organization, so you can address them personally.
This works best via mutual contacts.

2. Write a letter that can be posted or sent by email. Use your personal title. If you know them,
write to the person dealing with funds. Introduce yourselves in the letter and give a brief
explanation of your organization, its objectives, and your intentions with respect to funds.
Ask if their organization could consider a project proposal. Ask for details of any format they
use for project proposals and the procedures you need to follow. If the email is addressed to a
general target like “contact us” or info”, ask for an email address for the person who looks at
proposals.

Always make a copy of your letter to keep. If your source is local, give the person you addressed
a phone call about one week after you mailed the letter and ask if it was received. This is not
only to make sure that the post is working, but it is also an excuse for exchanging more
information. Personal relationships are very important in fundraising. By making a phone call,
you get a chance to find out the kind of person they are and to show your own involvement and
motivation. If you are approaching an international donor, follow your letter up with another e-
mail message if possible, just to make sure that your application has been received and again to
show your own motivation.

3. While waiting to find out the procedures to follow, you can prepare the information the donor
will likely want to know. Most will expect brief details of the following:

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  Aims and objectives of your organization.
 Details of the target population
 Number of people/villages you want to reach
 Social structure of the communities, including details of local employment, income
levels, high-risk groups etc.
 Details of the project area, its location, terrain and climate.
 Your relationship with other organizations e.g. other NGOs and the Government and
your intended cooperation with them.
 Names and qualifications of your staff members
 General plan of the implementations of your activities.
 Budget:
 Include a budget for the first year.
 Estimate expected funds from other sources.
 Be concrete about the funds you are asking for.
 Include in your budget items that are essential, but do not ask for expensive or
unnecessary equipment.

Donors are in general more interested in project costs (implementation of activities) than in
organizational costs (overhead costs – costs for telephone/fax, e-mail, postage, electricity bill,
etc.). For that reason, always include an item line for overhead costs when submitting a project
proposal. UNICEF admits to 14%, but 10% is more reasonable for a very small organization.
However some donors do not like paying much towards this line. In that case, find out the
donor’s policy on overheads and adjust the proposal accordingly.

You also need to discuss a contingency line with the donor. This means allowing some money
for the possibility of plans going wrong. A post-disaster project, for example, may face inflation,
fluctuating exchange rates, hikes in the prices of essential raw materials etc. The project can soon
be way over budget. An allowance of ‘unforeseen’ of 5 to 6% is normal in every proposal.

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4. If you follow all the guidelines and still your organization does not get the grant it needs,
remember that the funding agency has a hundred applications for every slice of money.
Citizens Associations are increasingly turning to the independent funding community to
assist their work and consequently the number and quality of projects – and their
accompanying grant proposals – are increasing. So do not take the rejection personally.
Around 90% of all proposals fail so do not be put off: you can learn from failure! Write a
brief letter or email to the funder asking the reasons for the rejection. The answer may
suggest how to improve the proposal, or even request an improved resubmission.

4.2. Organizing Fundraising Events and Invitation to Donors

Fundraising events are a popular form of fundraising. While they can be great money makers for
an organization, as well as they can also be used as a mechanism to communicate both potential
and actual donors for organizations at the same time they can also be time consuming and
expensive. As a communication tool, fundraising events needs to be planned carefully, because
the success of events depends on careful planning.

To help you ensure that your fundraising event is a winner and enable you meet the desired
communication goals, here are ten major components that you must incorporate into your event
plan:

1. Purpose: Before doing anything else, you must decide what the purpose of your event is. Is
this truly a fundraising event? Or does it have other goals? Perhaps your organization may be
hoping to raise money at the event, but the main function of the event is to gain publicity, or
reach out to a new network. Many charitable events have more than one goal. Figuring out
the details for your event will depend on knowing what goals you are trying to achieve.

2. Fundraising Goal: In conjunction with the event host committee, organization staff, and key
fundraisers, you must decide what amount of money you plan to raise at the event. If this is
truly a fundraising event, then everything in the event plan will be geared to raising this

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 specific amount of money. The amount you choose should be what you hope to net, that is,
the amount you plan to raise after expenses are deducted.

3. Budget: Every fundraising event plan should contain a complete budget listing all of the
expenses that will be required to hold the event. Your budget should include staff,
invitations, space rental, catering, entertainment, transportation, security, utilities, and
anything else that will be required to make the event a success. Your budget should take into
account your fundraising goal, ensuring that you raise that amount above and beyond all
expenses. Be sure to leave a little extra room in your budget for unforeseen costs.

4. Leadership: As part of your fundraising efforts, your event will most likely have a “host
committee” and one or more “host committee chairpersons.” These people are responsible
for contributing substantial amounts to the event and encouraging others to do the same. The
host committee is generally composed of wealthy donors, business leaders, or local
celebrities. The host committee and chairpersons are not responsible for actually running the
event, but are integral to ensuring that you reach your fundraising goals.

5. Target Audience: Who is the target audience for your event? Is this a general fundraiser
where everyone will be invited? Or is this event geared towards a specific group like
business people, parents, or young professionals? In short, you must decide whom you will
invite to your event.

6. Set – Up: Your event staff should plan the event set-up well in advance. The set-up includes
all of the particulars of the actual event: Where will it be? Will food be served? Will there be
entertainment? What kind of dress will be required? What is the itinerary for the event?

7. Marketing: Just like a new product, your event needs to be aggressively marketed to your
target audience. You need to convince your supporters that your organization and event are
worthy of their time and money. Draw up an entire marketing plan for the event. Possible
methods of “getting the word out” include: using your non-profit’s fundraising network,
mailed invitations, direct mail, phone banks, word of mouth and the event host committee.

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8. Sales: Once you market your event, there must be a procedure in place for making the actual
ticket sales, or accepting donations for the event. You must decide whether there will be
different contribution levels for the event (such as a flat ticket charge, an extra charge to be
invited to a V.I.P. reception in addition to the event, etc.). You must decide who will sell the
tickets, how they will be shipped or delivered, and who will be responsible for organizing the
incoming information.

9. Practice: While you probably won’t need a full run-through of your event, it is essential that
everyone who is working the event know, ahead of time, what their responsibilities are,
where they should be during the event, and how the event is going to “flow.” If you are
having a large or unusual event, the key event staff may want to have a practice run to make
sure that your operation is running smoothly.

10. Thank – You: One of the most oft heard complaints from contributors to charitable
fundraising events is, “They never even said ‘thank-you.’” Ditto for your event volunteers.
Make sure that the organization takes the time to send thank-you notes to everyone who is
involved in your event, including contributors, volunteers, staff and vendors. Keep your
donors happy… you’re probably going to be asking them for another donation sometime
down the road.

Nonprofit fundraising events are a great way to cultivate support and attract new donors. But
great events take a lot of planning, financial support and hard work. Before securing that banquet
hall or scheduling those tee times, ask yourself a few questions:

 Should we even have an event? As much fun as events can be, you want to have a clear
idea of what the end result should be.
 Who is our audience? Is this for existing supporters or are you trying to reach new ones?
Maybe your event is for clients. Determine your target audiences before you start
planning the event itself.
 What do we want them to do? Have a clear call to action for attendees.
 Is an event the best solution? Events can be time consuming and expensive so make sure
it is the best way to reach your goal. If your goal is only to raise awareness, you may

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 want to think twice.

Once you've determined a fundraising event is the best approach for your organization, create a
plan that will help you organize market and stage your event.

Chapter Summary

Now days completion for receiving support from donors become fierce and complex and
recognizing the existing situation provide the way to segmenting the donor market according to
different attributes. All classification of donors with their funding target we have looked in this
chapter are more or less are born as result of changing donor market .basically we can classify
donors as international and local ,however they can be also more classified according to their
funding target.

Being engaged in social works, identifying different sources of funding is vital sources of
funding which are available for organizations are however, different in their nature and the
benefits they provide, therefore it’s the organization responsibility to select the sources that best

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fit the organization’s goal, strategy and available resources. Corporate donations, Long-term
financial grants, Non-financial support, Mutual partnerships for addressing social problems,
Support from volunteers, Community contributions and Income from business-oriented projects–
selling publications, offering consultancy services, etc are some of the important sources of
funding available for organizations.

Fundraising is not a onetime task as it requires a sequence of interrelated actions to be performed

before securing the targeted fund .writing an effective funding proposal can be its core function
as to get the funds. In addition to writing funding proposal, searching and identifying prospecting
donors shall also been taken as a serious of task. In searching and identifying prospecting donors
is also a process which requires the organization to undertake a serious of research on actual and
potential donors. The search for prospecting donor might get settlement when organization found
a set of donors which meet the criteria of the searching organization.

The task of communicating donors may take different forms and may use different tools;
however organization can use it in searching, identifying, and retaining as well as building long
term relationship with donors.

Self -Test Exercise 5

5.1. Match from Group B to Group A

Group A Group B
1 Evaluation A. provide a framework to visualize the overall project
2 Methodology B. Describe Measurable outcomes of the project
3 Organizational information C. goals, objectives, and project methods
4 Title/ Cover Page D. One page information with the organization
letterhead
5 Budget E. types of donors
6 Goals and Objectives F. chronological description of the operations of the
proposed project works
7 Letter of Intent G. Presents a plan for determining the degree to which
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 objectives are met
8 Statement of need H. include history, structure, and board of trustees of
the organization
9 Proposal summary I. financial grant
10 Programme Description J. Include the name of the organization, name of the
programme
K. defines the community problem to be addressed
L. show income and expenses of the proposed projects
5.2. Choose the best alternative for the following questions

1. Which of the following is/are cannot be the reason for segmenting a donor market?
A. Increasing complexity of the external environment
B. To identify specific donor audiences and then find out what each wants
C. In order to win competition
D. All of the above
E. None of the above

2. All of the following statement is correct except?

A. individuals can be donors
B. multilateral organizations can be donors
C. both developing and developed nations can be donors
D. local governments can be donors
E. none of the above
3. Which of the following cannot be funding target by different donors?
A. alleviating poverty
B. reducing the socio-economic gap between the developed and the developing countries
C. injecting funds into NGOs and unbalancing the money supply of the nations
D. equipping local NGOs financially and technically
E. enhancing equity, social justice and development
4. Which of the following is not considered as an important source of funding?
A. volunteers support
B. generating income by itself

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 C. in kind donation
D. Community contributions
E. None of the above
5. Which of the following cannot be considered as a prerequisite condition by institutions to
provide grant?
A. the agreement of the receiver to meet agreed milestone
B. the ability grant receiver to produce Particular outputs or outcomes
C. the willingness of the grant receiver to return their money in a later days
D. the willingness of the grant receiver to report the progress of the project or use of the
money
6. Which of the following can be a reason for the state and NGOs to work with communities?
A. to identify to physical resources,
B. to identify realistic contributions with regards time,
C. to identify the potential of communities decision making capacity
D. to get the contribution of communities in the form of governance
E. all of the above
7. All of the following can be sources of earned income for non- profit organizations except;
A. professional fee by providing Legal assistance
B. Interest income generated from investments
C. income by selling Tickets
D. income by selling Stationery
E. none of the above
8. Nonprofit organization can earn income by selling goods and services to ;
A. other nonprofit organizations D. members
B. clients E. all of these
C. general public
9. Which of the following is/are components of a proposal?
A. Executive summary D. Evaluation
B. problem statement E. All of these
C. Budget

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10. Which components of the proposal describe the applicant agency and its qualifications for
funding and establishes its credibility.
A. problem statement
B. Organizational information
C. Evaluation
D. Methodology
E. Programme Description
11. Which components of the proposal describe why the proposed project is necessary?
A. problem statement
B. Executive summary
C. Budget
D. Evaluation
E. Programme Description
12. Which of the following attribute can be used in identifying prospects?
A. Prospects Wealth D. Connection
B. Interest E. All of these
C. Charitable Intent
13. Which of the following is true about case statement?
A. case statement starts with a concept, and end with concept
B. case statement is resources that organization collects to document its history or work in
the community
C. case statement strongly related to the organizations strategic plan
D. All of the above
E. B and C
14. Which of the following is /are external communication tools available for NGO’s
A. logos and branding
B. publicity events
C. media
D. conferences and workshops
E. all of the above
15. Which written communication tool is easiest publicity and inexpensive document to develop,

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 A. Brochure B. Newsletter C. Logos and branding D. Annual report E. Strategic plan
16. Which of the following is not correct about fundraising Events?
A. fundraising events can be a mechanism to communicate both potential and actual
donors for organizations
B. fundraising events can be time consuming
C. fundraising events can help organization produce money
D. fundraising events can be expensive
E. none of the above

Chapter Six

Roles of ICT and Social Media for Resource Mobilization

Introduction
Information and communication technology (ICT’s) are technologies that are used as means to
handle information and aid communication. ICT has an impact on community, business and
government on how agencies, organizations and groups interact with each other and with
citizens, clients and customers. Computer technology is becoming more efficient, productive,
and cheaper. Advances in technology are producing more powerful computing devices to create
a dynamic virtual network that allows people all over the world to communicate and share
information with each other.

On the other hand, globalization has had a deep impact on the social, economic, political and
cultural fabric in organizations all over the world. In this new socio-political context, for NGOs

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to be effective they need to keep pace with change. They need to move away from being
narrowly focused in their field of operation so as not to miss out on macro level causal and play a
role in influencing them in a proactive and effective manner. For NGOs to play this pivotal role
it is imperative to widen their constituencies of supporters.

Social media is a great tool that can be used to communicate with a wide set of audience about
the work NGOs have undertaken and mobilize support and resources. Social media offers a
world of opportunity for NGOs. Regardless of the type, scope of work, mission or objectives of
any given NGO, social media can be used by all.

Dear students in this chapter, first we try to see an overview of Information and communication
technology and social media, and then we investigate how it is possible to use social media for
resource mobilization in light of the current available popular social media. On related basis we
also see Online resource mobilization using ICT and finally the last two subtopics that deals
about Enhancing donor engagement using an ICT and The importance of ICT in managing
organizational resources will be dealt with .

Chapter Objectives

After the completion of this chapter, you will be able to:

 Know an overview of Information and communication technology and social media

 Know how to use social media for resource mobilization
 Familiarize yourself with online resource mobilization using ICT
 Understand enhancing donor engagement using ICT
 Appreciate the importance of ICT in managing organizational resources

1: Information and Communication Technology and Social Media: An

Overview

Dear students, please write what you know about information and communication technology

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and social media?
______________________________________________________________________________
______________________________________________________________________________

ICTs are broadly defined as technologies used to convey, manipulate and store data by electronic
means (Open University, 2013). This can include e-mail, SMS text messaging, video chat (e.g.,
Skype), and online social media (e.g., Face book). It also includes all the different computing
devices (e.g., laptop computers and smart phones) that carry out a wide range of communication
and information functions. ICTs are pervasive in developed countries and considered integral in
the efforts to build social, political and economic participation in developing countries. For
example, the United Nations (UN) (2006) recognizes that ICTs are necessary for helping the
world achieve eight time-specific goals for reducing poverty and other social and economic
problems. The WHO also sees ICTs as contributing to health improvement in developing
countries in three ways: 1) as a way for doctors in developing countries to be trained in advances
in practice; 2) as a delivery mechanism to poor and remote areas; and 3) to increase transparency
and efficiency of governance, which is critical for the delivery of publicly provided health
services.

With the growth of the Internet, a wide range of ICTs have transformed social relationships,
education, and the dissemination of information. Computer technology is becoming more
efficient, productive, and cheaper. Advances in technology are producing more powerful
computing devices to create a dynamic virtual network that allows people all over the world to
communicate and share information with each other.

Social media platforms or social media are the most common terms for (“Hi-Tech”) ICT based
communication platforms such as Twitter and Face book (Spier, 2011). Those platforms are most
commonly accessed through the Internet. Due to the variety of tools offered and the rapid pace of
development of new features, policies and applications, it is challenging to identify the unique
qualities of social media based on its features alone (ibid). It could generally be said that social
media integrates different forms of computer-mediated communication (CMC).

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Unlike many other ICTs, the access to some social media platforms doesn’t depend on one
designated end-device (e.g. a computer with Internet access), but rather can be achieved by the
growing number of Internet-connected devices. Furthermore, some functions can be accessed
without Internet access, for example publishing on Twitter via SMS.

Social media also affords two-way interaction with an audience, beyond any specific recipient.
This form of communication falls under the term many-to-many, in which messages are
broadcast to a wider audience that can then engage in an exchange. Many-to-many
communication is an aspect of great importance in social media’s impact on collective action.

2: How to Use Social Media for Resource Mobilization?

Dear students how do you think social media can be used for resource mobilization?
______________________________________________________________________________
______________________________________________________________________________

Well. An effective fundraising strategy demands outreach using a number of media. Though the
Internet has opened up a world of new possibilities for connecting with donors and collecting
funds, the effectiveness of traditional methods is undeniable. While using email, social media,
and other online resources is effective, a well-rounded campaign will get you the best results.

Internet and social networking sites bring fundraising strategies to a new high. There are more
ways than ever now to reach prospective donors quickly and cost efficiently through online tools
such as websites, blogs, email, videos, and networking sites such as Face book, Google Plus,
LinkedIn, and Twitter. Providing well-timed, meaningful events, announcements, and status
updates will bring awareness and support to your cause.

There is a strong business case for nonprofit organization to apply ICT, particularly the internet.
They can use it to enhance their effectiveness through improved delivery of services and
interactive engagement with civil society, the community sector, government agencies and the
business community. ICT can also enhance internal organizational efficiency and increase their

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visibility and capacity to raise funds.

There is the potential for nonprofit organizations—typically called community and non
government organizations to increase their effectiveness dramatically by using social media tools
to collaborate, build community, acquire resources, and deliver services.

Increasingly, applications of ICTs now encompass social media. Key features of social media are
the ability to collaborate, users creating rather than just receiving content, and dynamic rather
than static content. The participatory nature of these technologies may complement aspirations
and values of NGOs.

Nonprofit organizations worldwide are finding social media useful for a variety of purposes. For
example, Addison (2006) found that blogs are becoming a popular, low cost means through
which community organizations share news and opinions. Face book has been used to enhance
fundraising efforts (Miller, 2009). Blogs, wikis and discussion boards facilitated response efforts
of a citizen-driven network that emerged in response to the tsunami affecting South and East
Asia in 2004 (Di Giammarino and Trudeau, 2008).

Dear students can you list some of the most common social Medias that can be used to
mobilize funds?
______________________________________________________________________________
______________________________________________________________________________

Well. As far as social media goes, among your best friends are; Face book Twitter, Google Plus,
and LinkedIn.

Twitter lets you write and read messages of up to 140 characters, or the very length of this
sentence, including all punctuation and spaces. The messages are public and you decide what
sort of messages you want to receive—Twitter being a recipient driven information network. In
addition, you can send and receive Twitter messages, or tweets, equally well from your desktop
or your mobile phone.

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When you combine messages that are quick to write, easy to read, public, controlled by the
recipient and exchangeable anywhere, you‘ve got a powerful, real-time way to communicate.
And real-time communication is turning out to be ground-breaking for users and businesses
alike.

While most organizations are exploring Facebook, SMS technology and even blogs as a way to
communicate with their beneficiaries, volunteers and donors, several expressed their inability to
understand how Twitter could help.

Setting up an account for any of these media is very simple, but there are a few general rules to
follow when using them. With Twitter, rule number one is: don’t overdo the tweets! If you’re
tweeting more than once a day, it’s too much. Once a day is a nice reminder, but any more than
that can easily become an annoyance.

With Face book, Google Plus, and LinkedIn, you can be a little more liberal with status updates.
That said, doing only status updates isn’t the most effective approach. Setting up events in a Face
book page is extremely helpful for keeping all of your friends up to date. Of the social network
sites Facebook seemed to be the portal of choice. Easier to use than other social media tools
because of the following reasons:

 Easier to upload pictures; Face book can be linked to YouTube – this allows videos to be
uploaded on the organization page
 Less complicated compared to MySpace
 Creates communities and helps in networking
 No need to recruit too many people as the medium has a wide reach
 Face book is seen to help reach out to wider audiences during events

The social media undoubtedly present a growing opportunity for fund mobilization from the
general public. Giving through social media is integrated with other approaches to reach the
potential giver, including approaches through the social media and by telephone alerts,

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advertising, etc.

Social media on the other hand, offers methods for organizing large groups of people for
collective action without resorting to the hierarchical structure. It facilitates many-to-many
communication without creating the chaos which otherwise have been created, when a large
quantity of individuals tries to communicate with each other without a regulating structure. It
also offers new ways of managing social movement or collective action related information,
which lift the need for hierarchy to communicate this information and inform participant of task
assignments. Thus supporting the coordination of people’s actions without having them
performing predefined tasks.

Social media’s social affordance means people use social media in order to interact, share
information, communicate, and perceive their social environment. They deliberately contribute
to a collective action, also if sometimes unaware of its ends. That is to say, social media offers
new and ‘ridiculously easy’ ways for group forming. Those ‘ridiculously easy’ ways help people
overcome difficulties of coordination, organization, and communication in large groups. These
difficulties are often the obstacles that prevent people from fulfilling basic human desires and
talents for collective action.

The different social media platforms with their various functionalities also offer improved
efficiency in pursuing social movement’s goals. They encourage innovative use; allow
integration and (sometimes overlapping) association of various sources and materials (e.g. text,
picture, video and sound); allow the creation of flexible information-environments, in which
individuals can tailor their encounter with the content in a way that suits best to their learning
styles; and offer on-demand access to current information, allowing individuals to access
relevant information quickly and easily.

3: Online Resource Mobilization using ICT

Over the past decade of its years Online fundraising, has evolved from a slow and shaky genesis
to become a permanent fixture in the nonprofit development director’s tool kit for raising money.

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While online fundraising was adopted relatively slowly before September 11, 2001, the public’s
urge to respond to the events of that terrible day appears to have been a turning point in its more
widespread use. President Bush, in fact, became the impromptu pitchman for online fundraising
and volunteering, when he urged Americans to donate via the Internet. This instantly
demonstrated the convenience and speed of the venue; more than $215 million was raised online
in the aftermath of 9-11.1 This, of course, occurred in the context of ordinary people’s growing
acceptance of the Internet as a comfortable place to transact business.

But the development of online fundraising dates back 10 years, when a handful of nonprofits
began building their first Web pages. Among these, Rainforest Action Network, League of
Conservation Voters, and World Wildlife Fund, who were entrepreneurial enough to devise and
install printable donation forms along with credit card processing pages,. Some of their bravest
donors responded by making credit card gifts long before e-commerce became commonplace,
and online fundraising was born.

Since then, thousands of nonprofits and their donors have joined these first pioneers, integrating
online fundraising into their development programs.

During 2004, more than $2 billion was donated online. While this is only one percent of the total
of charitable gifts in the United States during the year, for some sectors and organizations online
fundraising accounts for as much as a quarter of all donations received.

In the United States of America online fundraising for all philanthropic purposes was reported to
have grown by 35 percent in 2010.35 Of the nearly 2000 nonprofits studied, online giving
averaged 7.6 percent of total fundraising, while for nonprofits in the international affairs and
health care sectors the average was over ten percent.

Many nonprofits (large and small) that experience consistent success with online giving have
some combination of the following attributes:

 Senior level buy-in, so that the organization’s leadership is supporting the effort.

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  Appropriate budgeting, so that online efforts can be properly staffed and technology
resources can be acquired.
 Commitment to internal cooperation, particularly between departments.
 A clear and disciplined fundraising plan that has a track record with annual fund–level
giving and organizational supporters who give small gifts year after year.
 A clear and focused brand, along with being a marketing-centered organization that is
committed to using all available communication channels to build the mission.
 Being a membership organization with a regional or national audience.

Today, millions of people are members of several online communities and they have extensive
online social networks that they communicate with. How can these networks be utilized in a time
of need? People with more experience using ICTs have helped the community around them.

If you want to accept donations online, that’s great. You’ll be providing your donors with a
convenient way to support you that they can access 24 hours a day. You provide a way for
people moved by information you provide on your site to donate right then and there without
having to call up anybody to make a pledge. But you have to set yourself up to promote your
online giving.

Make your donation form easy to fill out, navigate, and submit. Also, make the donation form
you post online printable, for those who start to give online and then change their mind and
decide to print the form and mail a check instead.
Note that you accept online donations on your home page. Make sure that everybody who visits
the site is alerted to the feature, and knows how to use it.

Essentially, setting up online payments involves designing an interactive form that users can
easily fill out, and setting up a form of payment. If you already accept credit card donations, you
are pretty much set up to accept credit card payments submitted online in a manual fashion. You
can receive the electronic form in your office and process the payment along with any others.

You may think that soliciting donations online means setting up your own Web site with a

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shopping cart feature to collect the money complete with the ability to process credit cards and
send out e-mail confirmations. That can sound like a lot of work (and possibly expense) to a
small group with no full-time staff. But there are alternatives to this do-it-all-yourself method of
accepting online donations.

Charity portals and charity malls are gathering places for fundraising organizations that let
somebody else promote you and process payments. Some of these sites provide 100 percent of
any donations they collect to your group others keep a percentage to run their sites.

One of the major changes the Web has made is that transactions are happening faster than ever.
In the for-profit world, you can apply for financing for a new couch and have approval in 45
seconds. In the philanthropic community, donors want to make decisions, be presented with
giving options, make their donation, and be recognized for their gifts, all within a very quick
timeframe. Providing them with an efficient way to give online can really help your cause.

4: Enhancing Donor Engagement using ICT

ICT are continually evolving and new uses are being created for their services. Social media has
grown exponentially in the last decade and it has become easier than ever before for anyone with
an Internet connection to publish information on the web. Media is no longer a one-way street.
Mainstream media networks are allowing for input from average citizens and anyone has the
ability to post content and share information with the web community. Mobile ICT has allowed
people with mobile devices to access and create information on the web from any location and at
any time. People are using technology to communicate with each other to organize social
movements and to respond to crises.

ICT’s have been used very effectively to engage communities in solving a disaster, and to
organize political actions. Support from donors can come in many ways, and information
communication technologies are allowing for more methods of spreading vital information and
lead to donors to provide their support easily. Moreover, ICT is also helping organizations to
motivate the engagement of donor’s. However it requires its own strategy and efforts as to use

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ICT to enhance donor engagement.

Dear students can you say something on how it is possible to deploy ICT in enhancing the
engagement of donors to different activities and support?
______________________________________________________________________________
______________________________________________________________________________

Generally, in recent years, and advances in information and communication technologies (ICT)
have brought about even greater engagement of donors, including increased donation, creation of
web-based professional, social, and political networks, advocacy initiatives, and the like. As a
result, NGO”S today have an even greater capability of enhancing donor’s engagement by using
ICT that can become strategically important for their success. NGOs, shall further mobilize
themselves with donors in order to gain more support. Thus, it is a mandatory to enhance the
engagement of donors as a way to build upon on the existing resources. Ultimately, a mechanism
is needed by which communication and information about the other can exist and flow freely,
and one of the best mechanisms is to establish a formal dialogue group between donors and the
organization, whereby each has the opportunity to better realize their mutually beneficial goals.

As social media’s most common attribute, and the one distinguishing it from other ICT
functionalities, many-to-many communication has the potential for a profound effect on NGO’s
action. Prior to the Internet, one could tell apart two sorts of media. One-Way Media or
Broadcast Media, such as radio, television, newspapers, and books, is media supporting one
directional transfer of information, usually from a central place to a broad audience. In one-way
media, for audiences to provide feedback there is a need to use another medium (e.g. audience
voting via SMS in programs such as American Idol or letters to the editor of a newspaper). On
the other hand, Two-Way Media or Communications Media are interactive and facilitate
communication between two individuals or a small group. Examples are telephone and
telegrams. The communication patterns in those media types are one-to-many and one-to-one
respectively.

In contrast, the many-to-many communication pattern combines the broad audience attribute of

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the former with the communication attribute of the latter, enabling a group conversation.
Although in some cases it can facilitate also one-to-one communication, email as the first tool
offering many-to-many communication (e.g. a correspondence of many recipients, as in mailing
lists). Platforms that were subsequently developed facilitate this function more effectively and in
some cases as their central functionality.

5: The Importance of ICT in Managing Organizational Resources

ICTs have transformed the social, political and economic spheres at an unprecedented pace for
the past two decades. Since ICTs provide new opportunities and at the same time poses
challenges for national development, any social segment, which falls behind this adaptation to
new technologies, will lose competitiveness. ICTs can be viewed as an important tool to enhance
efficiency and effectiveness in managing organizational operations, resources and the service
delivery process.

On the other hand, as the roles and functions of NGOs have significantly expanded in recent
years, there is a growing concern over the need to transform the operation and structure of
NGOs. At the center is the issue of improving managerial and service delivery efficiency as well
as governance of NGOs. In so doing, many public policy analysts and practitioners have recently
regarded ICTs as an important tool to reengineer NGOs. ICTs can reengineer the NGO sector.
The ultimate goal of the NGOs is to provide adequate service to the societal segments or
communities in need. Successful achievement of this goal provides a fundamental base for the
NGOs to secure their organizational legitimacy. When NGOs attain legitimacy in an efficient
manner, they are also able to promote their governance. In this respect, ICTs can be a crucial
alternative to increase efficiency by embedding new information processing and management
technologies into the operation processes, and to reshape the institutional base by electronically
connecting NGOs with funding agencies, service recipients, and the general public.

First, the most direct effect of using ICTs is that NGOs can increase the efficiency of internal
management and service delivery. For example, NGOs can replace hard copies of standard
letters and publications with e-mails and electronic versions, respectively, and to facilitate

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internal and external communication at less cost and higher speed. Second, NGOs can increase
the transparency and the accountability of their operations not only to the oversight government
agencies and donors, but to the public as well. Those who are care about the nonprofit activities
can conveniently access necessary information if NGOs upload information, data and other
resources regarding their organizational missions, financial reports, and ongoing projects and
agendas onto a website. Third, ICTs can help NGOs facilitate direct communication with
stakeholders and proactively reach out to new potential recipients. NGOs can use this to mobilize
the stakeholders for a better coordination medium, for a new fundraising source, for an effective
discussion forum, and for a legitimacy-garnering mechanism. In particular, when ICTs work as
an open channel for service recipients to participate in the decision-making process of NGOs, it
empowers the recipients to influence decisions that affect their economic and social. Generally,
ICT can help NGO’s to manage their human, material, financial and other resources.

Dear students, so far you have seen how important ICT is in transforming NGO’s to new level in
their activities. We have also seen that ICT can be applied as to increase efficiency and
effectiveness, communication purpose and facilitate service delivery activities .however As a
means to maximize the benefits of ICTs in managing organizational resources, both
governmental and individual NGOs should strive to broaden the use of ICT applications for more
than managerial and communicative purposes, bridge the digital divide to empower the service
recipients, engage in active publicity campaigns, and devise measurements to assess the actual
impacts of ICTs on the intended goal achievement.

The deployment and development of ICTs by Ethiopian NGOs are still underway rather than
completed. Therefore, what do you think should be done from NGOs, government and other
stakeholder’s perspective to increase the deployment and development of ICTs by Ethiopian
NGOs in managing organizational resources?
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_

Well, in the above paragraphs we have discussed about how to use ICT beyond the usual way of
deployment rather we stated that it can be used to bring efficiency and effectiveness to
organizations as well as it can be used to mange organization’s resources.

Dear students can NGO’s benefit more than managing resources from the application of
ICT?
_____________________________________________________________________________
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_____________________________________________________________________________
_
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_

Well. As is the case with business and government, NGOs can benefit greatly from the
appropriate use of ICTs. Even more than these other groups, NGOs are often drastically under
resourced in the face of ambitious goals; it is in these circumstances that the multiplying power
of technology is particularly useful. Technologies provide organizations with the ability to
maximize resources, reach out to new audiences, and achieve results that were previously
impossible.

The ability of technology to professionalize the work of an NGO often provides a number of
spin-off benefits. More professional looking reports and presentations can lead to increased
respect for the organization. In addition to providing information, a web-site may lead people to
take the organization more seriously. Development of technical skills as one component of
professional development may help to retain quality staff. In many circumstances, relatively
simple applications of technology can introduce models of transparency, openness and
responsiveness that serve as positive examples for the government actors and community leaders
with which the organization interacts.

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Common uses of technology in NGOs include databases to track member contact information
and participation, e-mail and text messaging for internal communication, and websites to
disseminate information to members, donors, the media, and the public. More advanced uses of
technology include tracking systems to assist in budget and election monitoring exercises,
targeting databases for “Get out the Vote” (GOTV) activities, and e-mail alerts and web-sites
that provide citizens with timely information on legislative issues and mechanisms for contacting
the relevant policymakers.

 Go to any specific NGO in your area and ask the following questions and write your own
report by including your conclusion and recommendation.
1. What types of technology does the organization use?
2. Do members, employees, and volunteers have access to the organization’s
computers and internet, if it has them?
3. Does the organization utilize technology for keeping records, managing
information, accounting, and publishing information?
4. Does the organization maintain databases?

Chapter Summary

Now days, the impact of ICT on the activities of various kinds of institution ranging from
business oriented to nonprofit organization and public institution cannot be ignored. ICT has also
come with a bundle of social media platforms which can be used in communicating,
collaborating and motivating peoples to be engaged and provide their services. Information and
communication technologies (ICTs) are broadly defined as technologies used to convey,
manipulate and store data by electronic means. This can include e-mail, SMS text messaging,
video chat (e.g., Skype), and online social media (e.g., Facebook).

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Like other organizations who actively apply ICT in their daily activity, nonprofit organization
can also apply ICT, particularly the internet. They can use it to enhance their effectiveness
through improved delivery of services and interactive engagement with civil society, the
community sector, government agencies and donors. ICT can also enhance internal
organizational efficiency and increase their visibility and capacity to raise funds. Their ICT
engagement may also extend up to online fundraising.

ICT and its related mechanisms doesn’t only provide NGO’s a chance to raise funds, it also play
a major role in transforming the operation and structure of NGOs. It makes easy their internal
and external communication, improve their managerial and service delivery efficiency as well as
their governance.

Self - Test Exercise 6

6.1. Say true or false

1. All ICT based social media communication platforms are accessed through the internet.
2. Social media affords two-way interaction with an audience, whenever there is any specific
recipient.
3. Nowadays, for NGO’s to be effective for connecting with donors and collecting funds using
Internet is enough.

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4. SMS technology can also be used by NGO’s communicate with beneficiaries, volunteers and
donors.
5. ICTs are more important to enhance efficiency and effectiveness in managing organizational
operations, resources and the service delivery process for specific organizations like business
oriented organizations.

6.2. Choose the best alternative for the following questions

1. Which of the following is/are not correct about social media?

A. It is a name for Hi –tech ICT based communication platforms
B. It integrates different forms of computer-mediated communication
C. It is hardly possible to identify its unique qualities
D. It can be accessed other than the designated end-device
E. None of the above
2. Which online tools can be used to reach prospective donors quickly and cost efficiently
except;
A. Face book B. Twitter C. Google Plus D. blogs E. None
3. Which of the following is not correct about the usage of social media tools by NGO’s
A. social media serve only to acquire financial funds from donors
B. social media tools can be used to deliver services
C. social media tools can be used build community
D. social media tools can be used to initiate the collaboration of community
E. none of the above
4. Social media can serve the following purposes for NGO’s
A. serve as a low cost means to share news and opinions to large public
B. help in enhancing fundraising efforts
C. they can facilitated response efforts of a citizens on harsh conditions
D. A and B
E. All of the above
5. Which social media tools lets the user to write and read messages of up to 140 characters,
A. Face book B. Twitter C. Google Plus D. LinkedIn E. None

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6. Which of the following is/are not the importance of ICTs in NGOs?
A. ICT can increase the efficiency of internal management and service delivery for NGO’s
B. ICT can facilitate internal and external communication at less cost and higher speed
C. ICT can help NGOs to increase their transparency and accountability of their operations
only to their donors,
D. ICT can be used in spotting new fundraising source
E. None of the above

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