Grants are important to the growth plans of many organisations, as they help fund projects that align with their mission and support the development of communities. Despite organisations distributing grants with the best intentions, they can significantly drain resources when not managed properly.
Managing grants efficiently is critical to ensuring the appropriate use of money, resulting in a positive community impact. To use funding most effectively, they need to be managed closely.
Grantmakers no longer need to rely on using multiple spreadsheets, calendars, or tracking systems to manage their grant funds. There are now a number of grant management systems that facilitate the effective management and delivery of their programs.
What is Grant Management?
Grant management is the administrative process that fulfils the requirements of a grant. The grant management process typically includes two main groups:
- The grantor - usually the government department or independent organisations distributing the grant.
- The grantee - the receiver of the grant funding.
For grant-making organisations, grant management defines the processes that determine who will receive funds, and how they will be distributed and spent to best meet the needs of the community.
Grant management is a lengthy process that requires grantors to undertake numerous tasks. These include creating applications, announcing the grant, distributing the grant money, and collecting reports.
The grantees' duties include applying for the franchise, managing the grant received, and supplying adequate reports.
Challenges of Grant Management in Today’s Environment
Grant management is more complex than ever. Organisations are facing increasing pressure from stakeholders, funders, and regulators to report more quickly and demonstrate concrete outcomes as part of each program.
One of the biggest grant management challenges is keeping pace with compliance requirements. They may be financial controls, reporting standards, or audit requirements, that vary by funding agency.
Stakeholders also need to know where money is being allocated and its impact. Without structured workflows and thorough documentation, it can be difficult to deliver timely projects or maintain accountability.
Grant teams are also managing increasingly large volumes of data across multiple stages of the grant lifecycle. When relying on outdated manual processes, challenges include duplication, missed deadlines, and reporting inconsistencies.
Why is Grant Management Important?
The grant lifecycle consists of three stages with multiple steps.
- Pre-award
- Award
- Post-award
Grant managers have the most important role when it comes to successfully realising the grant process. As the leader of the charge, they manage grant logistics and coordination, including effective communication, reporting and administration.
The function of a grant manager is to collect relevant information on the progress and results of the grant, and report back to key stakeholders. Efficient grant management includes:
- Defining a Fluid Process. Create workflows that support the grant-seeking and grant-making process by monitoring communication and addressing blockers.
- Managing and Distributing Reports. A huge portion of the grant process relies on financial reporting, so it’s necessary to establish a cadence of reporting and confirm that information is received by those who need it.
- Ensuring Compliance. Grant managers are essentially responsible for meeting grant obligations. If a team member isn’t providing key information on its progress, they step in to keep the process moving forward.
Risks of Poor Grant Oversight
- Miss Obligatory Targets. All grant programs are contingent on the grant recipient and the grant maker meeting certain grant terms. Without proper management systems, these crucial targets are unlikely to be met.
- Lose Track of the Timeline. Without a clear process or system in place to keep track of the entire grant lifecycle, team members can focus too much on internal processes and miss crucial deadlines.
- Misuse of Grant Funds. Small mistakes in the grant management process can lead to a misuse of grant funding. Failure to appropriately track and document transactions such as personnel costs, contracts, indirect cost rates, matching funds, program income, or other sources of revenue can be considered a type of grant fraud.
- Forfeit Future Funding. If any of the aforementioned issues arise during the grant review process, you’ll likely lose access to current funds, and your chances of securing future funding drop dramatically.
Diligent grant management benefits both grantees and grantors throughout the lifecycle. It helps grantors avoid faulty accounting or lost records, and supports the smooth execution of their objectives and long-term goals.
Common Mistakes in Grant Management
Grantors should ensure they employ grant making best practices to avoid several mistakes from occurring, which could lead to failed grant programs or misspent funds.
- Absence of a clearly defined grant management plan with workflows from the outset.
- Designing complex and confusing grant applications.
- Relying on manual or outdated grant management methods and processes, such as spreadsheets, or manual data input.
- Minimal grant lifecycle tracking, including a failure to keep adequate records.
- Failure to conduct timely grant reporting.
How to Effectively Manage Grants?
Managing grants can be challenging without proper techniques and tools. There are many financial, customer relationship, and project management software solutions available on the market, however none are purpose-built for grant management purposes?
A grant management system (GMS) is software that assists organisations in managing grants. Advantages of a grant management software include the automation and standardisation of the grant-making process. A GMS will help reduce the administrative burden on staff, improve data accuracy, and ensure compliance with funding guidelines.
There are many different types of grant management systems (GMS). GMS features can vary, but some of the top features to look out for include:
- Application Design: simplifies the process of designing and creating grant applications.
- Proposal Submission: facilitates the seamless collection of grant applications submitted by grantees.
- Review and Approval Workflow: lets reviewers comment, request additional information from grantees, and approve applications electronically.
- Financial Management: records spending against the budget and quickly generates financial reports.
- Cloud-based: in addition to providing 24/7 accessibility, cloud-based GMS serves as a one-stop shop for all the vital grant information, files, and correspondence.
- Streamlines Communication: allows seamless collaboration with grantees and within the grant program team.
A purpose-built grant management system can prove to be a powerful solution, and it may be the only thing holding you back from efficiently managing your grant programs.
The Role of Technology in Modern Grant Management
Grant management with the absence of accurate tools leads to a lack of oversight that puts organisations at risk of error and inefficiency in their processes. Technology is essential in bringing shape, speed, and accuracy to the process from start to finish.
Technology reduces manual data entry, which takes up significant amounts of time and can lead to errors. Automated document generation saves staff time, delivering consistent contract generation, report templates, and grantee correspondence. Configurable dashboards enable teams to tailor workflows to their specific grant programs, ensuring transparency throughout each stage of the lifecycle.
OmniStar's grant management software allows organisations to automate manual processes, simplify application workflows, and create a centralised hub for all documentation and correspondence.
Introducing technology into grant management enables a more open and connected environment for managing funds and progress reporting.
Benefits of Effective Grantmaking:
Besides avoiding the risks of grant process mismanagement, streamlined oversight also brings hidden benefits. These include:
- Increased Transparency for Improved Decision-making. Grantmakers make countless operational and tactical decisions daily. Having an effective grant management process provides transparency across all levels of the organisation and ensures that mistakes from the past can be recognised. It also guides future grant-making actions to ensure a positive impact can be achieved.
- Improved Performance Management. Grantmakers need a solid understanding of grantee performance, not only to provide feedback to external stakeholders but to ensure that program goals are achieved. Through a well-managed grant program, grantees can self-report information relevant to determine delivery performance, which can then be used by grantors to report dynamically to their relevant stakeholders.
- Impact is the vision of change that grant makers are working towards through their investments. A well-managed grant program assists with improving coordination and communication within the grant team, and helps work to be tracked and reflected upon. Effective grant management allows grantors to quantify the impact of the money spent and keep track of their gains and losses. It can also go one step further and prove the societal impact of a grant program.
Despite being aware of the numerous grant management benefits, a lot of grant makers struggle to manage their programs and fall victim to easily avoidable mistakes.
Understanding the significance of effective grants management can help you avoid the negative impacts of a poorly managed grants program and support better decision-making moving forward.
Manage Your Grants Effectively with OmniStar:
At OmniStar, we understand the importance of saving time in every step of the grant management process. OmniStar ensures efficiency at every stage of the grant lifecycle by simplifying complex processes, automating repetitive tasks, and freeing you to concentrate on maximising the impact of your grant program.
Book a demo of OmniStar Grants today to discover how to transform your current processes and increase your grant-making impact.
