Grant application and tender processes share many similarities: they’re competitive, they rely on a high quality submission where claims must be backed by evidence, and they’re evaluated against weighted merit criteria.
The grants and funding space is experiencing unprecedented growth with applicant organisations struggling to keep up while juggling business as usual. Why did this step change occur and how it is shaping the future of organisations in the face of increased competition and scrutiny?
The response to long-term unemployment, family and domestic violence and the increase of chronic diseases are only a few of examples of where private enterprises have stepped in to help the government take positive action.
This has resulted in a change in the contracts landscape yet again, with the combining of disciplines. The traditional commercial tender design, focused on value for money, innovation and outcome-driven solutions, is moving into the program funding and grants space – for a good cause.
Government reform and ‘conscious capitalism’
All around the world governments are acknowledging that they can’t fix all the social problems of the world by themselves; and in order to really create an impact, they need to change the way they fund and evaluate social programs.
With funding challenges, government is divesting its involvement in direct service delivery and focusing its core business on contract administration and policy. The widespread “commissioning” of public services to non-profit and private sector organisations has necessitated the process of transparent procurement, monitoring and evaluation.
Building local capacity
This is especially apparent in the human services sector over primary healthcare, aged care, domestic and family violence, employment and training services, and disability services. The industry is now being tasked to help solve social problems and close service gaps by delivering client-focused, flexible, relevant and responsive front line services that traditionally were managed by government.
This new contestable market has resulted in a competitive network of community, government and commercial agencies competing for a share in an integrated inter-agency response that brings localised services closer to the people.
The move from output to outcomes
In its early stages, subcontracted service or program contracts were used to help drive down costs, and to reward productive and efficient private businesses with incentives or output-based payments. Major contracts for the running of facilities such as detention centres, correctional centres, hospitals and employment services were among these contracts.
In the health and human services sector, organisations are using research analysis, technology, sophisticated data and a range of assessment tools to measure not only outputs, but program outcomes to analyse impact (eg. reduction in hospital admissions; evidence of positive behaviour).
Effect on business development
New fiscal models are also emerging such as social impact investments which are funds set up by organisations (e.g. private equity and banks), intending to generate social and environmental impact as well as financial return. Local needs assessments and innovative service design feature strongly in the best funding and tender applications, and measures to evaluate the impact of the service model, practice and client/patient outcomes are helping government and industry make better, more appropriate policy and commercial decisions.
The downstream effect of these new types of contracts won’t limit business opportunities for others, but will alter the relationship landscape yet again. Personal contact and business development will become more important to learn of partnering, alliance and sub-contractor opportunities.
These new, developing trends have significantly matured the way in which tenders, funding and grant applications are created in terms of lead up time, the changing structure of the tender team, and many organisations in general.
At Bidhive, we’re supporting many not-for-profit and non-government organisations to successfully set up and manage their funding and grant applications. These organisations are facing the modern-day reality of competing for a finite pool of funds, with limited resources in a very competitive marketplace. Developing the mindset, skill set and knowledge assets might be at first daunting, but once established (and with guidance), it can make all the difference between sustaining an efficient, high performance organisation that makes an impact, or a floundering organisation that is destined for demise.