In the world of higher education, grant management efficiently is crucial. Grants provide significant financial support to academic and research projects, but the process of applying for, managing, and reporting on them can be complex and time-consuming.
In a recent Strada webinar, From Planning to Reporting: Mastering Grant Management in Higher Education, our Director of Strategy, John McGrath, discussed these challenges alongside other industry experts. This blog explores the challenges institutions and organizations face and outlines steps to streamline the grant management process.
Understanding the challenges of grant financial management
Grant management in higher education is fraught with challenges, often leading to delays, compliance issues, and budget mismanagement.
- Delayed communication of award requirements: Principal Investigators (PIs) often fail to promptly communicate the important terms and conditions outlined by funders to the finance office. This can result in misalignment between cost timelines and reporting requirements and increase the risk of non-compliance.
- Post-award budget adjustments: Once a grant is awarded, budget adjustments can be difficult, particularly for multi-year grants. Uncertainties often arise around costs like fringe benefits, indirect costs, and salary adjustments. Mismanagement in these areas can jeopardize the project´s long-term financial health.
- Inconsistent expense categorization: Inconsistencies, such as misallocated expenses, or improperly charged time can cause major problems later. Grant managers must ensure expenses align with both the project’s goals and the funder’s guidelines.
- Lack of integrated tracking tools: Many organizations struggle with the absence of a unified system for tracking grant progress. When different departments use separate software, it can lead to inconsistencies in tracking and reporting, impacting the project´s financial visibility.
- Managing sub-awards: Complex grants may involve multiple sub-awards, each with unique compliance and reporting requirements. Miscommunication or lack of coordination in these areas can result in unaccounted expenses and missed milestones.
- Long-term planning and sustainability: Grants spanning multiple fiscal years require meticulous long-term planning. Institutions must consider inflation, salary increases, and other future financial needs, making resource prioritization and support allocation challenging. Ensure long-term sustainability in grant-funded initiatives is crucial.
These challenges may seem daunting, but we will now look at strategies and approaches organizations can use to overcome them.
Streamlining the grant management process
While these strategies are diverse, they collectively emphasize the importance of a clear, structured process involving collaboration across multiple departments:
1. Pre-award planning and proposal development:
- Feasibility check: Before applying for a grant, it’s important to evaluate whether the project aligns with the institution’s mission and strategic goals. This involves monitoring grant databases and reviewing new opportunities from federal, state, or private sources.
- Collaborative proposal development: A common mistake in grant planning is faculty members submitting proposals without involving other departments like HR, legal, and finance. A collaborative approach ensures that the scope, budget, and indirect rates are clearly defined and aligned with institutional policies.
2. Tracking and managing grants:
- Integrated tracking tools: As mentioned, using separate tools for different aspects of grant management application creates inefficiencies. Integrated tracking systems enable real-time monitoring of grant status, expenses, and milestones, reducing the risk of miscommunication.
- Award status and tracking: Institutions should keep track of each grant’s status—whether in development, submitted, won, or closed—and monitor key metrics like funding duration, disbursement schedules, and award amounts. This helps identify funding gaps or any adjustments that need to be made.
3. Expense management and budgeting:
- Detailed budgeting: Managing grant expenses involves more than just tracking salaries and direct costs. It’s essential to account for fringe benefits, facilities, IT, and contingency costs. For example, fringe benefits may vary depending on the funder’s requirements, and indirect costs (like facilities) need accurate allocation based on usage.
- Contingency planning: Adding a contingency fund can provide a buffer for unforeseen expenses, such as inflation or unexpected operational costs, helping to mitigate risks and prevent budget overruns.
4. Monitoring and reporting:
- Dashboards and visual reports: Dashboards offering visual insights into the health of a grant—such as life-to-date expenses, award amounts, and current funding status—make it easier for stakeholders to understand the financial picture. These reports also help in making informed decisions about reapplying for grants or requesting additional funds.
- Automated reporting: Streamlining the reporting process is essential for timely and accurate submissions. Tools like Workday Adaptive Planning can automate the generation of internal and external reports, reducing administrative burden and ensuring compliance with funder requirements.
5. Post-award amendments and closeout:
- Amendments and revisions: Throughout the grant´s life, budget or timeline adjustments may be necessary. Documenting these changes and keeping all stakeholders informed is essential for maintaining compliance.
- Final reporting: Once the project is completed, closeout procedures must be followed to ensure all expenses are accounted for and final reports are submitted. Clear steps for closeout help avoid any compliance issues and ensure smooth transitions to future projects.
Grant Management software tools and technology to support process management.
To effectively manage the complexities of grant planning, tracking, and reporting, institutions need robust tools that integrate various processes and provide visibility into the financial health of grants. Tools like Workday Adaptive Planning offer comprehensive solutions for budgeting, forecasting, and reporting. Many of these tools can also integrate with other systems allowing for seamless collaboration between finance, HR, legal, and departmental managers, enabling timely and accurate decision-making.
This helps automate administrative processes, minimize errors, and helps organizations focus more on the strategic goals of their grants. With this improved visibility, it becomes easier to make data-driven decisions, ensure compliance, and ultimately maximize the impact of grant funding.
A collaborative approach to successful grant management process
Mastering grant management in higher education hinges on fostering cross-departmental collaboration and implementing streamlined processes.
Institutions must involve all stakeholders early in the process, from pre-award planning to post-award reporting, and ensure they have the right tools and technology to support these efforts. This approach not only enhances their chances of securing funding but also ensure that grants are managed efficiently, with clear accountability and a focus on long-term sustainability. With the right processes and tools in place, institutions can optimize their use of grant funds, support the success of research initiatives, and expand their funding opportunities.
