INDUSTRY INSIGHT

5 fixes for grants management

• By Subhash Kari
• Mar 24, 2017

While it may not be common knowledge, grants are the lifeblood of government services across the country. Over each of the last three budget years, approximately 20 percent of federal spending went toward grant funding. In FY 2016, this totaled $665 billion, an amount larger than that spent on federal contracts. Sadly, while I can trace the math for the spend, I am unable to say with conviction if those dollars are delivering the best possible outcomes for citizens.

A recent nationwide survey on the current state of grants management conducted by George Washington University, the National Grants Management Association and REI Systems confirmed that the kind of visibility and evaluation necessary to connect the dollars to outcomes is not happening today.

Of the 250-plus grants management professionals surveyed, 54 percent were frustrated by the bureaucracy and the inefficient tools and IT systems associated with managing grants. Another 44 percent of respondents were not confident that they could determine grant-making best practices despite years of working in the field. And, perhaps most disturbing, 31 percent were not confident they could evaluate the program impact and outcome of their grant funds at all.

The status quo must change. Such a lack of transparency and inability to measure performance outcomes only perpetuates the trust deficit that exists between the Americans and their government institutions. What is more, the status quo is untenable in today's uncertain political and budgetary climate.

The grants management world needs a new set of guiding principles and best practices. Extrapolating from our latest survey results and based on my firm’s long track record in the grants domain, I suggest the following five practices for improving the current state:

1. Introduce agile concepts to grant managers

Grants management effectiveness could be improved significantly by applying some of the core principles and values of the agile methodology. For example, the concept of cross-functional teams jointly accomplishing work would fundamentally alter the grants domain. Today, grants are usually assigned to an individual, who is expected to monitor them holistically from cradle to grave. In contrast, forming a cross-functional grant team that includes staff with the competencies required to administer and oversee a grant and then assigning that team a portfolio of grants would deliver significant benefits. It will reduce cycle times by minimizing outside dependencies, allow team members to adjust to the seasonal workloads typical with grant phases (e.g., application cycles), improve grantee satisfaction and increase federal employee engagement.

Another agile concept that should be adopted is incremental value delivery. Grant-making agencies can increase the pace of innovation in research and demonstration projects by requiring grantees to show incremental results and incorporating regular opportunities to inspect and adjust. That way, grants can be structured in a manner that supports grantees and permits flexibility. Doing so would promote evidence-based techniques to measure progress and reduce the risk of grant funding being squandered on initiatives that fail to deliver acceptable impact.

2. Establish a single, comprehensive grantee risk and performance database

Nationwide, tens of thousands of organizations receive federal grant funding -- many from multiple agencies. A single grantee performance database would allow grant-making agencies to consider the comprehensive, aggregated risk profile of a grantee before making an award. This insight would be particularly valuable if a struggling grantee receives funding from several sources -- an agency that notices a performance problem can alert others before they make their own award to the applicant. The system could function in parallel to the Past Performance Information Retrieval System that is used across government before a contract award is made.

Additionally, such a database would make it easier for grant makers to identify their “top 10” best performing grantees. Grant makers could meet with them and analyze their success factors and then share those best practices with grantees whose performance needs improvement.  This would represent a marked change from current “best practice” gathering, which allows any grantee or agency to claim that its practices are “best” regardless of actual performance.

3. Build integrations between federal, state and local grant systems

State and local governments are by far the largest recipients of federal grant dollars. These vital funds are managed by a tangled web of systems, processes and data standards that blunt the positive impact of programs. Grant leaders have a tremendous opportunity to drive greater efficiency in the distribution and management of federal grant funds. Two interwoven initiatives can address this complex challenge head-on.

First, a federal/state/local grants data exchange must be created that standardizes grant-related documentation (i.e., application, award, post-award, etc.) into structured, machine-readable formats. While the DATA Act attempts this standardization with all federal funding, it is still being piloted and cannot be comprehensive given its scope.

Second, grant leaders must develop a common set of system-to-system connectors among the IT solutions agencies use to manage grants at different levels of government. This will simplify and automate the exchange of grants-related data per the standards created, reducing the burden of manual data sharing and reporting. Ultimately, this efficiency would increase the portion of spend that can go to grant purposes and reduce the part that goes to administration.

4. Establish a single payment platform across federal grant makers