Grant management software is just now beginning to take hold in the nonprofit industry and with its emergence comes many misconceptions and myths. We believe that grant management software can vastly improve your grant management process, giving you the tools you need to track every grant your nonprofit applies for and their specific requirements of your organization. Take a look at the most common grant management software myths below and find out if grant management software could benefit your organization.
Myth 1: Grant management software should replace your organization’s accounting solution.
Grant management software is NOT designed to be a replacement for your nonprofit accounting solution. Grant management software does not have the capability to house your organization’s financial data; however, it does have the capability of importing data from your accounting system. Nonprofit employees often need to access financial data when creating reports and other important documents related to their grants. While grant management software cannot house the organization’s financial data, the right software can import selected financial data from the organization’s accounting system. To put it simply, grant management software is a separate system from a nonprofit’s accounting solution, but it can manipulate the financial data that is imported from the accounting system for its own use.
Myth 2: Your donor database is sufficient for managing your organization’s grants.
A lot of nonprofit organizations are trying to force their donor databases to perform two functions – manage both donors and grants. A donor database is designed to track gifts, send thank you notes, create fundraising strategies and offer insight into a campaign’s effectiveness – NOT to manage the grant process. In addition, donor databases are not transparent systems designed to be used throughout the organization. Donor databases have their specific purposes and are typically designated to only a few people in the organization.
Grants, however, require a different system because so many areas of the organization play a role in the grant management process. Grant management software offers a centralized database for all of the activities, information, and documents pertaining to the grant. For example, grant management software is able to pull information from multiple areas of the organization (such as HR, accounting, and programming), automatically consolidate the information, and report it back to the funder. This is crucial since funders often have specific requirements for organizations accepting their grants. Grant management software provides organizations with the ability to monitor, analyze, report on and manage each and every grant, as well as streamlines the entire grant management process by establishing open communication between the organization’s other systems and departments.
Grant management software is designed to help nonprofits effectively manage their grants at every stage of the process. Donor databases may be able to provide some information for the grant management process, but they will not be able to guide nonprofits through the entire process.
Myth 3: Spreadsheets are sufficient for managing your grant information.
Many nonprofit organizations will create spreadsheets to track the information that their current systems cannot generate automatically. Depending upon these spreadsheets is often a sign that the organization is creating a work-around, which can create many potential problems in the future. For instance, what if the creator of the spreadsheet leaves the organization and no one else in the organization has access to the information? Your organization could lose a substantial amount of mission-critical data. How will your organization transition from managing 2 grants to 15 grants using only spreadsheets? As the complexity of the grant management process increases, the risk of error becomes high. Spreadsheets – while they may work for organizations managing one or two grants – are not a viable method for those organizations managing numerous grants.
The right tool will make the grant management process easier and save your organization a substantial amount of time. Contact us today to learn more about how grant management software can improve your grant management process.