The grant lifecycle is a marathon. Different problems crop up at different stages, and state, local, and Tribal government agencies need to cover a significant breadth of expertise areas to address them all: grants management, compliance monitoring, fraud detection, grant accounting, financial modeling, cybersecurity. Talent gaps and bandwidth issues can lead to compliance risks and missed funding opportunities.

Smaller jurisdictions face tighter constraints: Staff often wear multiple hats, and the addition of one or more grant programs can stretch teams dangerously thin. But even large jurisdictions with all the right in-house expertise may find that key personnel are overcommitted across multiple programs. It’s too easy for overworked staff to experience burnout, decreased productivity, and reduced program management quality, and the repercussions can be disastrous, from delays and mistakes all the way up to clawbacks.

Outsourcing offers a strategic solution to these challenges. Whether supplementing internal staff or filling specialized roles, outsourcing can help agencies of all sizes maintain program integrity while avoiding burnout. Read how.

Which tasks should governments consider outsourcing?

Use these criteria to decide which activities may be best outsourced to consultants:

• Cost: Is hiring cost-prohibitive, due to a short program length or high competition for specialized skills? Would outsourcing reduce operational costs over the program’s lifespan, including expenses related to hiring, training, and developing in-house staff and equipment?
• Expertise and quality: Would an external provider have specialized skills with experience on similar programs, or access to superior technologies?
• Timing: Would outsourcing accelerate your schedule, by reducing or eliminating lengthy hiring processes?
• Risk management: Are the risks associated with outsourcing manageable within your governance framework?
• Scalability and flexibility: Can outsourcing help you quickly scale resources up or down, and/or adapt to changing program requirements? (Consider not only the need to hire, but also to train.)

Best practices for outsourcing success

Once the decision to outsource is made, focus on these components and considerations for achieving optimal outcomes.

• Clear objectives and scope of work: Establish specific responsibilities, deliverables, and performance metrics for both consultants and in-house teams. This will help you integrate the two groups, an activity critical for collaboration and knowledge-sharing and for maintaining continuity once the outsourced engagement ends. Involve those who will be working with the consultants in helping to define the scope.
• Rigorous vetting and selection: 
  • Seek providers with the right expertise for your specific federal awards – across  people, process, and technology – plus a proven track record.
  • Consider how effectively the consultant’s technical approach and team fit with in-house teams and program methodologies.
  • Obtain a commitment that the people being proposed to you will actually work on your job.
  • Ask for references who can speak to the vendor’s service philosophy. Will they honor their quotes, or do they tend to go in with the lowest possible price and then find lots of reasons to increase that price? Do they generally try to stick to their budgets and quotes?
  • Engage relevant stakeholders in decision-making, but use a scoring methodology to evaluate candidates consistently. Provide bidders with enough context and detail for them to provide you with a complete and accurate technical approach, so that you can make an apples-to-apples comparison.
• Strong contracts: Build clear, detailed service level agreements and contracts outlining expectations, deliverables, and performance criteria.
• Performance monitoring: Implement systems to monitor consultant performance against agreed-upon metrics and mitigate any financial and operational risks.
• Effective onboarding: Develop a strong plan for transitioning responsibilities, and integrate consultants into communications and project management tools for transparency and oversight.
• Watch for overreliance: Make sure your team has the capacity and skills to manage the consultants, not the other way around.

In conclusion: Outsource for strategic, short-term support

Outsourcing is not a panacea, and it’s not a substitute for longer-term resourcing solutions like building pathways to strengthen talent acquisition and workforce development. But when approached strategically, it can be a powerful tool for state and local governments to fill immediate resource needs and support successful program execution.

Reach out to learn more and start building your best outsourcing plan.