The path to growing your grant funding as a grant-dependent organisation is paved with good intentions. However, grant recipients often navigate a labyrinth that spans from meeting project milestones to managing finances by proxy through various stakeholders. It’s tough out there.
Your grant management approach needs to adapt to both the complexity of the team and also the maturity of their processes — and while no two organisations are the same, we’ve noticed a few common denominators after speaking with so many local council and nonprofit folks.
We’ll delve into where and how effective grant management make the difference between a well-oiled machine and you tearing your hair out.
The Challenges of Grant Project Delivery and How to Get Ahead of Them
Grant recipients frequently need help in meeting project milestones and delivering outcomes as planned. These challenges can stem from various sources:
- Unexpected delays in project implementation
- Changes in project scope or external factors
- Resource constraints or skill gaps within the organisation
The consequences include waning trust from grantmakers in your ability to meet milestones. That loss of trust risks future funding not being awarded or, at worst, clawbacks due to missing milestones.
When the first milestone report or variation gets missed during project delivery, you need to act swiftly and decisively. Here are the steps you should take:
- Conduct a root cause analysis: As soon as you notice delays or difficulties, investigate the underlying causes. Is it a resource issue? A skills gap? External factors beyond your control?
- Develop mitigation strategies: Once you’ve identified the causes, home in on solutions to prevent this from happening in the future. Can you reallocate resources? Provide additional training? Do you need to implement a grant management system to support your team?
- Communicate early and often: Don’t wait until the situation becomes critical. Reach out to your grantmaker as soon as you identify potential issues. Be prepared to explain:
- What challenges you’re facing
- The steps you’ve taken to address them
- Any variations you need to raise early
Remember, grantmakers are invested in your success. They would much rather work with you to overcome challenges than be surprised by the project failing down the line.
Aligning Financial Management with Project Progress
One of the most critical aspects of grant management is ensuring that financial outlays align with project progress. This alignment is essential for several reasons:
- It helps prevent cost overruns
- It ensures you have sufficient funds throughout the project lifecycle
- It demonstrates responsible financial management to grantmakers
To achieve this alignment:
- Integrate your finance team: Make sure your finance team is part of your core grant project oversight or steering committee. This enables real-time financial monitoring and alignment with project milestones.
- Regularly review financial projections: Compare actual spending against your budget and project timeline. Are you spending too quickly in the early stages? Or are you at risk of underspending, which could jeopardise future funding?
- Identify gaps in data, reporting, and systems: Often managing finances and managing grants require two sets of data that do not naturally sync up. One of the best ways to automate this is to use a grant management system that can either integrate with or import data from your finance software to provide one source of truth and make reporting time much easier.
The Importance of Centralising Grant Project Data
The most effective way to overcome these challenges is by centralising all grant-related information. This means moving beyond the traditional reliance on disconnected spreadsheets, emails, and finance systems.
Benefits of centralisation include:
- Improved visibility: Getting a holistic view of all your grant programs, their statuses, and their financial positions.
- Enhanced reporting: Generate accurate, timely reports with less manual effort.
- Better decision-making: With all information in one place, you can make more informed decisions about resource allocation and project management.
Benefits of Using Software for Centralising Grant Management
While centralisation can be achieved through various means, purpose-built grant management software like SurePact offers significant advantages:
- Real-time tracking: Monitor project progress, financials, and milestones in real-time, as your contractors, team and stakeholders update their tasks.
- Automated reporting: Reduce the administrative burden of grant reporting. According to KPMG, on the grantmaker’s side administrative costs can run between 3%-10% of a program’s budget. Given the lifetime of many multi-year grants and the lift required post-award, we suspect this number is even higher for recipients.
- Compliance management: Ensure you’re meeting all grant requirements and reduce the risk of non-compliance which can lead to clawbacks and loss of future rounds in funding.
- Document management: Keep all grant-related documents organised and easily accessible, which keeps important funding agreement requirements and budget data available for your program delivery teams.
Navigating Different Reporting Requirements
Grant reporting requirements vary significantly across different funding programs. While some general-purpose grants have minimal reporting needs, specific-purpose grants often come with more detailed requirements.
Some of the ways to stay on top of reporting include:
- Assess Requirements Early: Review all reporting obligations during the grant acceptance phase when you get the funding agreement. Make notes, set reminders, and assess your team’s capacity to deliver these.
- Schedule Regular Reviews: Institute monthly or quarterly reviews internally to ensure you’re on track with reporting obligations. This is even more critical if you are managing your grant funding using spreadsheets, as you won’t have grant software providing reminders and checkpoints for milestones and acquittals.
- Document Everything: Governance is where many teams get into trouble. Make sure to keep clear records of all grant-related decisions and changes, so that in the event of a disagreement you can refer back.
These are three ways to ensure your grant reporting does not slip. By centralising your grant-related data and processes, it becomes much easier to assess, review and document reporting requirements as your portfolio grows in complexity.
Managing Risk in Grant-funded Projects
Proactive risk management is always more effective than reactive problem-solving, so keep risk management front-of-mind when it comes to not only managing the grants you’ve already won but also your pre-award governance.
A few things to consider when it comes to risks:
- Having a governance process before applying
- Regular internal audits and gap analyses of the grant management lifecycle
- Regular budget reviews and forecasting against future funding rounds
- Clear documentation of review outcomes and communicating them
- Having a process for the project delivery team to flag potential delays
- Setting internal SLAs for raising variations for grants won
- Contingency planning when delays occur to ensure milestones are met
- Regular stakeholder communication protocols
All of the above risk management steps become easier to manage when your organisation has centralised its grant data and has a single source of truth that all teams operate out of.
Next Steps: The Journey to Improving Your Grant Management
If you’re looking to improve your grant management processes:
- Assess your current processes: Identify pain points and inefficiencies in your current approach.
- Set clear goals: What do you want to achieve? Better financial management? Improved reporting? Enhanced project delivery?
- Explore solutions: Look into grant management software options that fit your organisation’s needs and budget. Read our article about how to choose the right grant management software.
- Plan for change management: Implementing new systems requires buy-in from your team. Plan for training and support to ensure smooth adoption.
Effective grant management is not just about meeting compliance requirements — it’s about maximising the impact of every dollar received. By centralising information, aligning financial management with project progress, and leveraging appropriate tools, grant recipients can overcome common challenges and focus on what matters: delivering valuable outcomes for their communities.
