Effective Grant-Making Strategies for Successful Granting Programs
Starting a new grant-making program is both exciting and daunting. There are numerous social problems to be addressed and many possible ways of addressing them. Designing a grant program is undeniably complex, requiring time and thought to build a foundation for success.
Many funders think a lot about the issues they want to tackle. However, they often spend too little time assessing the impact of their grants. Although there is no single best practice to develop a strong program, considering the grant-making strategy and allocation of resources beforehand will inevitably increase the likelihood of an effective program being developed.
A grant-making strategy is a purpose-driven framework that enables grantors to design, implement, and evaluate their granting programs. The plan consists of information around the issues you want to address through your grant, your long-term goal, and the steps required to achieve them.
Why Are Grant-Making Strategies Important?
Bringing about change in the community through grant-making is a complex process. To ensure impact, it requires a well-designed strategy and consideration of several best practices for grant management.
A well-designed grants strategy keeps stakeholders informed of the mission’s focus, goals, and executional tools. It also provides a clear communication pathway between internal and external stakeholders, enabling continuous refinement of your grant-making efforts.
Organisations will already have some ideas on which issues, organisations, and locations they want to support through their grant-making efforts. To make a larger impact through the distribution of these funds, grant-makers need to design and adopt a strategy to help keep track of ongoing and future progress.
Common Challenges in Grant-Making
Grant-makers deal with numerous challenges that can reduce the positive impact of their strategies. Administrative tasks consume valuable time, especially when paper-based resources are used and tracking is still completed manually. Together, these impediments create bottlenecks in the grant lifecycle, making it difficult to assess the overall impact of the strategy. Many grant-makers cannot access the most suitable tools with which to collect meaningful data, or assess progress toward key outcomes.
Communication is another challenge faced by grant-makers, applicants, and other stakeholders. When these key collaborators are not aligned on the objectives of a grant, it can lead to confusion, missed opportunities, or unmet expectations. Maintaining consistency can also be difficult without standardised systems for reviewers that ensure fair and reliable assessments.
Government agencies and large foundations can also find compliance a complex process. Demanding thorough documentation and detailed reports, it creates a considerable additional workload.
Collectively, these challenges highlight the importance of a grant management system supported by a strategic approach and purpose-built technology.
What Are Grant-Making Strategies?
A grant-making strategy is essentially a method of directing funds to worthy organisations.
It explains how organisations plan to accomplish their objectives— their areas of focus in terms of a specific cause, the kind of organisations they want to promote, and their commitment as donors. Working with a clearly defined set of objectives and goals provides grant-giving organisations with a sense of focus and direction, indicating priority and generating greater outcomes. As each organisation’s giving practices differ from one another, there is no single grant-making strategy that fits all.
There are 2 major approaches to grant-making: responsive grant-making and strategic grant-making.
Responsive Grant-Making Strategy
Responsive grant-making is a flexible approach where funders remain broader in their approach. Requests generally come from organisations directly, rather than being sought by a funder. However, that doesn’t mean the organisation lacks focus areas; rather, they are guided by what they need most within their core set of priorities.
Grantors often use a responsive grants strategy to stay connected with their community's changing needs and ideas.. It can also be a practical way of supporting a community if there is little interest in funding a grant, or for gathering resources for a more strategic approach. Organisations with a broad, yet highly local focus, find that responsive grant-making best aligns with their mission.
Strategic Grant-Making Strategy
In contrast, strategic grant-making follows specific and clear goals. Incorporating pre-designed strategies, this style of grant-making is favoured by governments and large research organisations. This approach benefits any foundation that has well-defined objectives and a desire to focus on targeted missions.
Strategic grant-making relies on the funder to set the agenda, as opposed to the grantee. Strategic funders see themselves as accountable for the way the work is carried out, and its subsequent outcomes. For instance, a funder aiming to reduce the stigma around substance abuse may reinforce their mission with a coordinated campaign, funding for support groups, such as Alcoholics Anonymous, and policy advocacy to health insurance providers.
Both responsive and strategic grant-making approaches have their own pros and cons, but both have wide-ranging applications in strategy development. Below is a list of important steps to consider when designing your grant-making strategy.
Steps to Developing an Effective Grant-Making Strategy
1. Identify and specify your focus
Funders should begin by determining the issue or opportunity they are attempting to capitalise on or solve entirely. In many instances, these issues are chosen based on internal criteria, and focus on addressing organisational goals, community needs, government mandates, or shared values. Once focus is established, an organisation can determine the best practices for grant-making in its circumstances.
2. Analyse and determine knowledge gaps
This step helps funders understand where gaps exist within the identified focus area. Conducting research using both primary and secondary sources helps analyse where funds are needed most. The research process should answer why the need exists, how many people will be affected, and whether or not there are any actions that have already been taken by lobby groups or government bodies.
3. Interact with the community
Community interaction provides valuable information on the grant-making process. Receiving feedback from stakeholders within the community, grantees, and unsuccessful applicants can reveal blind spots. It can also help improve processes and shape future grant-making.
4. Consider the limitations of the grant
Before developing a grant-making strategy, it is worth considering the grant itself, including whether it is large or small and if it is to be delivered over the short-term or long-term. Some organisations may choose consistent guidelines for each grant, while others base them on individual circumstances or use capital grants, scholarships, or program-related investments.
Once these steps have been considered, it should begin to become clear which grant-making strategy best aligns with the outcomes of the project.
The Role of Software in Modern Grant-Making
Managing grants today is more complicated than ever, with technology playing a critical role in handling and administering large projects. Grants management software, such as OmniStar, is instrumental in simplifying and improving each stage in the grant lifecycle.
OmniStar enables grant-makers to build tailored workflows using powerful automation tools with simple drag-and-drop interfaces. Administrators can choose from more than 160 pre-loaded business logic rules that help automate reviews, approvals, and notifications.
The platform also supports data-driven assessments, offering customisable scoring systems and inbuilt evaluation frameworks that ensure consistency across applications. Reviewers can access supporting documents and complete their evaluations alongside the application, saving time while prioritising accuracy.
Reporting tools are another advantage of grant management software. Custom dashboards allow funders to track performance, monitor trends, and make data-driven decisions. Together, these capabilities accelerate the review process while ensuring thorough completion.
Government agencies may find OmniStar’s compliance management features particularly valuable. The system maintains tamper-proof audit logs that support version control, creating a complete historical record of changes.
OmniStar is a fully configurable and scalable solution for your organisation, adapting to both strategic and responsive grant-making strategies. Its flexibility enables organisations to implement unique strategies tailored to the requirements of their grant, while benefitting from a consistent, data-driven approach.
Grant-making software uses technology to automate tasks and improve assessments. It also enhances communication and tracks outcomes, helping organisations do more with fewer resources. As a result, they can create better strategies that make the most of their external funding.
Implement a New Grant-Making Strategy with OmniStar
An effective grant management system like OmniStar ensures you can concentrate on your grant-making efforts by simplifying the complex processes, automating repetitive tasks, and providing access to the platform from anywhere at any time.
Contact an OmniStar expert today or book a demo with us today!
