Want to know what’s going on behind the scenes for federal grant recipients? I recently finished my third interview with Adam Roth, founder, and CEO of StreamLink Software, the maker of grant management software AmpliFund to discover some additional insights for grant recipients.
We had a wide-ranging conversation in this third interview about the recent ”2017 State of Grant Management Report.” The report revealed insights into how people are managing Grant Leader Spotlight grants today and how the increased emphasis on performance Grant Leader Spotlight and accountability will be transforming the world of grants in the future.
Click here to listen to Part III of the interview.
Stuck with Outdated Grant Management Tools
The ”2017 State of Grant Management Report” revealed that only about 23% of grant-funded organizations are using some form of grant software to standardize their grant processes.
When you think about all the increased requirements between the Uniform Guidance, the DATA Act compliance and the critical open data components that are going to require substantive change for reporting and information management, that is surprising.
While the percentage of organizations seeing benefits from updating their grant management tools has grown, the vast majority of grant-funded organizations are still using outdated or generic tools to manage their grants.
Struggling with Grant Compliance?
If you are like the 77% of survey respondents who are not on some grant software, you may be wondering about how you be affected by the open data initiatives on the federal level Grant Leader Spotlight.
It’s clear that reliance on outdated in-house solutions can directly contribute to why so many organizations are struggling to comply with all changes in legislation.
Here’s the thing…
The increased focus on performance, on accountability, on open data and transparency are not stagnant. The next layer will be on this layer.
Auditors are going to be demanding more and more standardized policies to be compliant with the Uniform Guidance. Federal agencies are going to demand more and more data reporting Grant Leader Spotlight in machine-readable formats.
And if you don’t have those things now, and are missing an easy way to implement new policies, test them and ensure they are working, you are looking at additional burden because there are not strong systems in place.
Ready to Pry Excel Out of Our Hands?
One of those tried and true tools for many grant offices is Excel.
And it seems like sometimes we hang onto things because we are comfortable with them, not because they are the best tool for the job.
Excel isn’t a bad tool. It has a purpose, and certainly, some things should be done with Excel.
But where you have to capture information as data, and manipulate it, and share it, and move it, Excel isn’t the best tool for the job when it comes to reporting for federal grants.
It just doesn’t give you the same power to move data and efficiently manage the information.
Think about it.
Even if you create a template in Excel and share it with everyone in the organization, you still have to combine all the cells, tabulate the information and report the various elements.
As the data structure becomes more complex, the data movement and reporting will become more and more painful using those old-school tools.
What Holding You Back?
Perhaps you are trading the discomfort you know for the discomfort of the unknown?
Or maybe you think it’s difficult to modernize tools in the grant management space because we have a lot of unique requirements?
And when we talk about nonprofits, there are often funding pressures that hold us back from creating value by utilizing technology.
And let’s face it, people are often unwilling to try something new and different in the way they do things.
We have to understand that what we do is unbelievably valuable and our missions are incredibly specific to our areas or the communities that we serve.
But the types of data that we capture and the information that we share are not unique.
With the right technology, we can take a step back and recognize that what we call the data may be unique, but the types of data are not.
It is a difficult concept to get comfortable with because you think, ”Well, we’re so unique there’s no way that a system can map to what we do. There’s no way a system could do this unless they build it from scratch, and that’s so expensive and time-consuming I don’t want to go down that path.”
But all is not lost-because…
Data Types Aren’t Unique, But Our Mission Is
We looked at every performance indicator on all federal grants for the last five years.
And even though there is an endless variety of work performed by grant recipients, there are only six different performance indicator data types are being collected.
- Narrative goals
- Percent change
- Percentage achieved
- Complete/not complete narrative
Every single goal-type-answer is going to be one of those.
And so, despite the thousands, and tens of thousands, and hundreds of thousands of requested compliance or requests for performance reporting, only six different goal types exist.
One of the things that we need to accept is that there are ways to standardize what we do and there are ways to systemize what we do.
What we do, the words we use and the descriptions we write are unique, but the types of data we collect and how we move those and monitor them doesn’t have to be unique.
Funding Is Still a Priority
The survey showed 45% of funders indicate that their number-one priority is lack of funding and economic conditions.
And that drives many other challenges.
For example, nonprofits often struggle with a lack of resources for the fund accounting and know-how for allocating funds for certain purposes such as programs versus administration.
And when we talk about modernizing tools, streamlining processes and accessing technology, that’s also a challenge driven by funding pressures.
3 Strategies for the Future
There is more and more focus on accountability—not just in the world of federal grants, but also with funders on the foundation side.
This shift means there are increased requirements for performance, accountability, and transparency.
Here are three strategies that organizations can use to focus their efforts and also be the most attractive solution to funders.
- Raise money for your mission and for programs that make sense for you. Create a menu of funding opportunities at the beginning of each year. That way you’ll seek money that fits your overall strategy and mission. A focus on the mission will help you stay in compliance with your objectives because they are front and center for the organization.
- Understand the performance measures you’re going to track and define them ahead of time when you are considering funding opportunities. Knowing these measurements from the start will help you create the systems you’ll need for collecting and managing the data and reporting the information.
- Implement a system that allows you to collect and manage data in a more responsive way. A better system will allow you to frame your organizational structure and policies within that system.
Don’t Leave Money on the Table
None of us want to leave money on the table, but it happens all the time.
The performance measurements and the ability to spend against grants is decentralized from the people who are monitoring the program objectives and doing specific grant reporting.
Here’s an example:
You’re billing out salaries every month for a grant, and then one of the employees goes on maternity leave for three months. The salary isn’t accounted for inside the grant anymore, while that person’s out on maternity leave.
HR knows about it. The program might know about it. But the analyst who’s submitting the reports doesn’t, and the funder doesn’t. The data is sent from finance every month.
The program gets to month ten, only to realize that they’ve underspent the grant by 25% of an individual salary and they have no way of making that up at the end of the grant.
The grant becomes under-spent.
Here’s another example:
You have sub-recipients, so you’re dependent on other organizations to spend the money.
If those sub-recipient organizations don’t spend the money, you won’t get the chance to draw those funds if you don’t have tools and systems in place to effectively monitor the sub-recipient spending.
And you need to not just measure against the total of the grant, but against where they should be at a point in time by benchmarking spending.
These are just a couple of examples that can happen when grant recipients don’t have tools that help them monitor spending throughout the life of the grant.
Conclusion: Choose the Right Tool for the Grant
Utilizing grant software designed for grant recipients can provide many benefits such as:
- Allowing you to make better decisions about how you’re allocating resources
- Drawing down fuller percentages of your grant revenue
- Streamlining compliance with the Uniform Guidance and the DATA Act requirements
- Ensuring your policies have a practice in place to support them.
That is how investing in grant specific technology now will make your grants more manageable in the future.
Want some additional resources about these topics?
Click here to receive the ”2017 State of Grant Management Report”
And check out the AmpliFund blog for additional resources.
Ready to Improve Your Grant Management?
How about you?
Would you like to be a better grant manager?
We have another grant management training seminar coming soon.
Click here to get all the details!
Hope to see you there!
Lucy Morgan CPA, MBA
CEO, Compliance Warrior
Author of “Decoding Grant Management-The Ultimate Success Guide to the Federal Grant Regulations in 2 CFR Part 200” The 2nd Edition is now available on Amazon in Paperback and Kindle versions.