The elusive formula for winning and managing government grants.

Feb 17, 2023 | Innovation, Small business

There is considerable grant money being allocated to innovative solutions to technical and market challenges by all levels of government. Such a honey-pot attracts all sorts of characters with a whole range of motivations, along with the genuine applicants seeking help. In this environment, panels of disinterested departmental officials and sometimes so called ‘experts’ are called upon to make judgements. As has been demonstrated over the last few years, these judgements are not always followed closely when votes are in play.

Be prepared to acknowledge that there is a whole lot of ‘lottery’ involved. Judgements about your eligibility against a set of guidelines that can be ambiguous, convoluted, and occasionally contradictory, can be an enormously frustrating and time consuming exercise for applicants. In addition, despite what is said, innovation involves risk. No government wants risk, and bureaucrats are conditioned by their culture to be utterly risk averse. The most remote whiff of risk, an indication of potential failure which can be politically weaponised to end careers is abhorrent to project assessors, irrespective of the number of times the word ‘innovation’ appears in the literature and conversation.

Before you ever approach the process of committing the resources to apply for a grant, then managing it should you be successful, you need to understand 3 basic rules:

1. Any grant funds will come into your P&L at the top line, so will add to profit assuming you make some, or reduce future tax losses. Most programs require cash co-investment, so make sure you discount the potential value of grant funds appropriately before you start.
2. Notions of Commercial in Confidence, often a central driver of innovators is absolute poison to public authorities, whose whole mind-set is about levelling the playing field. Assertions of Commercial in Confidence, written or verbal are worthless, even when delivered in good faith, as the project proposal usually goes through multiple hands during assessment.
3. To quote a senior bureaucrat during a conversation with me about the above two considerations: ‘when you get into bed with the government, who do you think is on top?” Recognise that grants come with strings, and managing pro-actively those strings, even when they seem somewhere between irrelevant and absurd, is essential to your ongoing sanity.

Assuming you have come to terms with these three factors and want to continue, following is a check list of what you simply must do, and not do.

Do’s

• Ensure you have very clear objectives and project path before you set about filling in the forms. Adjusting your project plan, time frames, or objectives in order to meet program guidelines and make your application seem better, is a common and serious mistake. Ensure your project fits their guidelines perfectly, never adjust your project to fit. A bit of nipping and tucking may seem like it will enhance your chances, and it may, but most often it comes back to bite.
• Clearly understand the objectives of the program. This sounds pretty obvious, and it is usually reasonably clear. However, there are always implicit objectives such as inclusion, equality, job generation, and most importantly re-election prospects that play an often unstated role.
• Reflect back the words of the stated project objectives in your communications, and add in some that reflect positively on the implicit objectives.
• Most programs work in rounds driven by dates. While this is often very inconvenient commercially, it better suits the bureaucracies. A project that is rejected in one round might be successful in another less populated by applicants, as the tendency is to break up the program funding into equal parts. So, persist. Ask for and take the advice on why your application failed this round, (‘the money ran out for this round’ will never be one of them, although it will often be the case) and work that advice into your application in the next round.
• Be prepared to have some well academically qualified person without any relevant experience of your industry, and indeed life outside the bureaucratic bubble, believing they can and should give you strategic and operational advice. You will be well advised to politely acknowledge and follow this advice, at least superficially, if your application is to be favourably reviewed.
• Always be prepared to report as per the schedules, preferably a day or two before the deadline. Be explicit in your application about the importance you place on these milestones and the attached KPI’s. These milestone reviews will always be a part of the grant contract, embrace them. Set about making auditing your project progress easy for the granting body.
• When you are not successful with an application, try and find out why, so you can do better next time. This can be a hugely frustrating process, and rarely will you ever know for sure, as those trying to explain it will be paranoid about telling you anything that may be used against them. I once prepared a grant application for a regional manufacturing innovation program for a client, where the guidelines were an absolutely perfect fit. My client was located in a regional town, had two patents on parts of the process he proposed to use, so we appeared to ‘nail’ the innovation requirement, would have generated a number of jobs, and was value adding a waste agricultural product, but we missed out. I spent considerable time and energy trying to understand why, but failed. I ended up receiving a number of 4-page emails that were absolutely incomprehensible, and could not get through on the phone. The ‘official’ up to whom my questions and protestations had been pushed simply stonewalled me. Eventually, as I am sure was the desired departmental outcome, I and my client gave up to invest the time and energy in something useful.
• Document everything, they will, and you might need to refer back at some point.
• Ignore the preponderance of verbs and adjectives that will adorn the guidelines and accompanying material. They are simply a manifestation of the bureaucratic instinct to complicate everything, using 3 words when one would suffice.
• Offer cream biscuits at the very least with the coffee in the unlikely event that they drag themselves out of the Canberra bubble and come to your offices. Lunch is better still, call it relationship building.

Don’ts

• Do not get annoyed by constant insistence that you nominate the electorate and postcode where your project will take place.  Just give them something that serves as press release fodder, irrespective of how accurate it might be. Usually this will be your ‘head office’ even if there is absolutely no relevant activity beyond governance being conducted from that address.
• Do not ever miss a deadline of any sort. When implementing a project, if it looks likely you might miss one, forewarn them, with the reasons, then, preferably, meet the deadline. The added effort to recover to the deadline will deliver brownie points. Any variation to the terms of a grant agreement are treated differently when they are a surprise, than when they are forewarned. This is really just common sense and courtesy, but I have seen tiny molehills blow up like Vesuvius in their absence. Such misses can motivate an audit. The right to audit will be written into the grant contract, but will probably never happen in the absence of some sort of catalyst that motivates action. When they do audit, they are usually ‘tick and flick’ exercises. However, noncompliance with the reporting schedule, or obvious inconsistencies that emerge from a cursory look can lead to deeper audits that are seeking to find the inevitable breaches of the guidelines and grant contract detail. Responding will be a time consuming, frustrating, and resource hungry exercise. You have things to do to move the project forward, and manage the rest of your business, while they have as an objective, finding out where you have cut a corner, adjusted priorities, or spent in a way that is even marginally inconsistent with the agreement.  Best to avoid that sort of scrutiny by overt compliance.
• Don’t expect them to be as responsive as you expect. The sense of urgency you feel will have no effect on the pace of progress of your application. Don’t let it frustrate you, too much.
• Do not counsel them on the challenges faced in filling in their demonic templated application forms. Somebody who may be commenting on your application designed it, thinks it is perfect, and might take such criticism personally. When they are difficult, as they normally are, ask for clarification, pointing out the deficiencies as inhibiting the quality of the information you are giving them, rather than pointing out their idiot template was generated by Satan.
• Don’t become annoyed at the constant communication required by different people who ask the same questions as the previous incumbent. This is nothing compared to the changes in personnel that will occur during the project implementation. It will often feel like you were put on earth to train a seemingly endless stream of apprentices.
• Never forget that most grant programs are competitive. Therefore, you are not only seeking to demonstrate to the assessors that your solution to challenges being addressed is worth supporting, but it is more worthwhile than any of the ‘competitive’ applications.
• Don’t forget that those doing the assessing are just people, trying to do a job in a culture that will be entirely different to yours. Generally they do not set out to frustrate your ambitions, that is just an unintended consequence of the culture they must operate in, so do not overreact.

The benefits of grant funding.

• Obviously, when appropriate, and well executed, the cash. Almost always this is the primary reason a grant is sought. However, it often becomes secondary to the following point.
• Recognition, networks and the next grant. Governments live and die by the communication they generate, and networks they can leverage. Generally they are pretty good at it, having brought in communication professionals who do know their jobs. (I exclude advertising from this comment. Public servants generally know absolutely nothing about advertising effectiveness, but insist on their right as the client to dictate the ads, which is why there is so many wallpaper ads thrown at us) Once recognised as a compliant, PR friendly grant recipient, the networking opportunities are significant, and often prove to be the best outcome of a grant. Being a recipient, and having that good record of co-operation, gives you a head start the next time, as you are a known quantity, which reduces risk.

I hope that all helps, good luck, you might need it.

Header cartoon credit: Tom Gauld