FEDgrant Solutions
Federal funding can unlock transformational potential—but only if your operating model is built to sustain it. Whether you're restructuring in response to new grants, scaling operations across programs, or addressing pain points exposed during an audit, now is the time to rethink your design—with intention.
McKinsey’s recent article, The New Rules for Getting Your Operating Model Redesign Right, outlines six essential principles for designing high-performing structures that align culture, leadership, and systems. While rooted in corporate strategy, these lessons translate directly to the nonprofit and public sector, especially for federally funded organizations navigating complex compliance demands.
Here’s how to adapt their guidance to build smarter, more resilient organizations in the grant space.
1. Put Culture at the Heart
McKinsey says: Culture isn’t the soft stuff—it’s the hard stuff. A redesign won’t stick unless behaviors, values, and shared mindsets are aligned.
In your world: Compliance isn’t just about documents—it’s about behavior. You can build out the perfect grant management process on paper, but if staff don’t understand why tracking time matters or how indirect cost rates work, those processes won’t be followed.
A successful redesign must reinforce a culture of transparency, shared responsibility, and internal accountability—starting with leadership and reflected in daily operations.
2. Design for the Future
McKinsey says: Build an operating model that anticipates what’s coming—not one that recreates the past.
In your world: Don’t structure your org chart around a temporary windfall like ARPA, CARES, or a single federal award. Instead, assess the core capabilities your organization needs to sustain funding across changing grantor priorities: indirect cost recovery, cost allocation planning, subrecipient oversight, performance monitoring, and more.
Your structure should be flexible enough to pivot as grant scopes evolve—and strong enough to deliver on expectations regardless of the funding source.
3. Let Structure Follow
McKinsey says: Don’t start with the org chart. Start with the work. What needs to be done, and what capabilities are required?
In your world: Before assigning grant management to finance or program staff by default, map out what the compliance function actually requires—tracking match, modifying budgets, issuing subawards, documenting in-kind, completing drawdowns, ensuring allowability.
Once those responsibilities are clearly defined, structure roles around those functions—not just titles. If you can’t justify who does what and why it’s tracked, you’ll struggle to defend your system during audit.
4. Align Your Leadership Model
McKinsey says: Clarify who makes decisions and who’s accountable—don’t let leadership ambiguity stall performance.
In your world: In too many nonprofits, leadership owns strategy but not systems. Who is truly accountable for:
Internal monitoring and CAP follow-up?
FFR accuracy?
Single audit readiness?
Indirect cost management?
A redesign is the perfect time to embed systems leadership—not just program oversight—into your leadership model.
5. Build a Talent-to-Value Strategy
McKinsey says: Match your best people to the most value-driving work. Invest where the impact is highest.
In your world: Many federally funded organizations staff up around programming or community engagement—while backend compliance is patched together. But grant performance lives or dies in the backend.
Rather than simply hiring more staff, consider where fractional or external expertise can fill gaps, reduce risk, and strengthen infrastructure without long-term overhead.
6. Hardwire the Model
McKinsey says: Systems, scorecards, and day-to-day behaviors need to reinforce your model—otherwise it falls apart.
In your world: A new org chart or shiny fiscal manual isn’t enough. If time and effort tracking is still inconsistent, procurement approvals happen via email, and subrecipient invoices sit unreviewed—your compliance posture is still exposed.
This is where standard operating procedures, monitoring tools, internal control checklists, and staff training turn redesign into reality.
What Comes Next? Rethinking Structure with Compliance in Mind
Operating model redesign doesn’t have to mean hiring a full team or launching a six-month change management project. But it does require clarity, structure, and accountability—especially when federal dollars are involved.
That’s where industry specialists like FEDgrant Solutions come in.
We provide a neutral, external lens to assess where risks, gaps, or redundancies are lurking in your current design.
We help define and document compliance-critical roles and workflows so your systems are audit-ready and staff-supported.
We offer interim, fractional, or project-based expertise to fill capacity gaps during growth, restructuring, or audit resolution.
We don’t stop at strategy—we help embed tools, SOPs, and monitoring practices into your daily operations so your model works when the consultant leaves.
Ready to future-proof your operations?
Redesign is an opportunity to elevate your structure, not just rearrange it. Before you shuffle titles or onboard new grants, let’s ensure your systems—and culture—can support the funding you’re working so hard to secure.
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