When it comes to a nonprofit's finances, grants are one of the most sought-after sources of funds. When you think about it, grants are pretty sweet: they’re a sum of money awarded to a nonprofit that it doesn’t need to pay back. That means more financial resources to accomplish goals, achieve the organization’s mission, meet the expectations of donors and recipients, and even keep the lights on.
But getting and using grants to their full potential can be pretty challenging. There are many steps, stages, and tasks involved in finding the right grants, winning them, and ensuring you use the funds effectively. That's why many nonprofits use grant management solutions to handle everything from start to finish.
That said, we'll go over everything you need to know about grant management solutions, how they can make a real difference in the impact of a grant, and how a solution like Hiline can help improve your nonprofit's finances.
Understanding What Grant Management Entails
Managing grants is a pretty complex process that comes with a lot of steps and tasks. Basically, it's all about overseeing the grant from the moment a nonprofit applies for it until it finishes reporting on how it used it.
Initially, they need to find grants that align with their nonprofit's goals and mission. This can involve some research, submitting proposals and applications, and negotiating with grantmakers to secure the funding needed.
Once they get the grant, they need to keep a close eye on it to make sure they’re using it effectively and efficiently. The nonprofit might need to create a budget and timeline for the grant, track its expenses, and ensure the grant is being used for the right things.
Finally, they need to measure and report on the impact of the grant. This can involve tracking metrics like the number of people helped or the amount of money raised and sharing this information with the grantmaker and other people who care about the organization’s work.
Overall, managing grants well and having a nonprofit financial plan is really important if you want your nonprofit to succeed. By managing grants effectively, you can make sure you're using them to their full potential and meeting your obligations to the people who gave you the money.
Importance of Efficient Grant Management
Grant management covers each stage of the grant process and ensures they’re used effectively and that a nonprofit meets its reporting and transparency obligations. It starts at the beginning when a nonprofit first tries to secure a grant. Winning grants can be challenging, and proper grant management techniques cover finding grants and applying to eligible ones (which can include submitting materials and completing applications).
Next, grant management oversees the award process, where grant money is received, earmarked for certain projects or initiatives, and utilized in its intended way. This is crucial because the money awarded is often considered “restricted,” meaning it needs to be used for a specific purpose.
Lastly, grant management plays a critical role in the reporting, monitoring, and transparency obligations that typically come with a grant. Some of these requirements might be legal or official obligations (for example, if there are IRS bookkeeping requirements or usage terms from the grantmaker). But, some of these obligations might simply be in the best interest of stakeholders.
For example, transparent reporting practices surrounding grant usage can instill confidence in donors and recipients and improve and maintain a nonprofit’s reputation. Grant management allows nonprofits to execute all of these steps and requirements organizationally and efficiently.
Advantages of Using Grant Management Solutions
As you can see, grant management can be complex and involves many steps, processes, and practices. And just as businesses turn to a small business CPA to effectively manage their finances, nonprofits leverage grant management solutions. These solutions simplify the grant process, help track the grant throughout its lifecycle, and allow nonprofits to easily “tick all of the boxes” regarding it.
Some of the main advantages of grant management solutions include the following.
1. Effortless Tracking of Grant Lifecycle
The grant lifecycle is multifaceted. But grant management solutions allow nonprofits to easily track the grant throughout its lifecycle, from the pre-grant phase through the implementation and closeout stages. This tracking allows a nonprofit to smoothly coast through the different stages, monitor the grant and its usage, and most accurately measure the ROI and impact.
2. Increased Efficiency in Data Management
Grants involve large sums of data, and grant management is important for nonprofits to effectively and accurately manage it. This includes effectively handling information on the grant and grantmaker, financial data (such as budgets and financial reporting), project data, compliance documentation (including records and reports), impact and evaluation data (outcomes, metrics, and assessments), and historical data. Grant management solutions offer an efficient and accurate way of managing and working with these large quantities of data and distilling key insights from them.
3. Ensuring Compliance With Grant Standards and Guidelines
While grants can be essential sources of funds, they usually come with fairly strict standards and guidelines. This might include reporting requirements, evaluation and performance metrics expectations, and compliance and legal requirements. Grant management solutions keep things organized and give nonprofits a comprehensive view into how the funding is utilized to best allow for accurate and targeted use of funds and comply with any requirements.
Role of Technology in Grant Management
While there are different types of grant management solutions, technology plays an increasingly large role in how grants are managed. One study found that the grant management software market is expected to grow to $2.9 billion by 2027, up from $1.3 billion in 202. Here are two main roles technology plays in nonprofit grant management solutions today.
Automating Grant Management Using Software Solutions
Many of the tasks involved in grant management can be repetitive and time-consuming when they’re handled manually. But today, grant management software automates many of the tasks that previously took a lot of time to get right. This frees team members to focus on human-only tasks while ensuring grants are managed as accurately and effectively as possible.
Role of AI in Streamlining Grant Management
Artificial intelligence, or AI, is transforming many industries and spaces, and the nonprofit grant space is no different. AI tools can efficiently identify grant opportunities, assist with writing proposals, extract and assess data, and monitor performance. AI can also be used to generate reports and insights, making it easier and more efficient for nonprofits to assess the impact of their grants.
How Hiline Helps
When it comes to tech-enabled grant management solutions, Hiline is like a nonprofit’s secret weapon. First, Hiline is a one-stop shop for finance as a service, which helps nonprofits handle their bookkeeping, finance, tax, HR, and payroll needs. This comprehensive and expert-led approach to accounting allows nonprofits to ensure their financial foundations are strong and well-equipped to support the entire grant lifecycle and processes.
Hiline also uses class tracking (by grant) to organize and monitor each grant your organization receives. That means you have full visibility into exactly how your grant funding is utilized, so you can rest assured that funds are being used to maximize their impact.
A Grant Management Solution Ensures Your Nonprofit Stays Organized and Efficient
Grants can be a powerful driver for change and impact in your nonprofit. But to ensure they’re secured, used effectively, and their impact is monitored and understood, nonprofits need a powerful grant management solution. These solutions allow your organization to reduce the workload involved with winning grants and manage and deploy them organizationally and effectively.
When you’re ready to transform how your organization approaches grants, Hiline is here to help. We’re a premium experience for all things accounting, finance, tax, HR, and payroll, and one of our specialties is grant management.
Allow us to help you with your grant management so you can continue doing what you do best: positively impacting the space you’re in. Contact us today to get started.
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