While doing some research on an entirely unrelated topic, I happened upon this article from 1998: New Federal Grants System to Eliminate Confusion, Bureaucracy For State and Locals. It profiles the U.S. Electronic Grants System (EGS), a forerunner to the Federal Commons and, later, Grants.gov that was spearheaded by Ann Fisher of DOT and involved DOT, EPA, ONR, Energy, Education, Interior, and Labor. The idea was to use the web to enable state and local governments and academic institutions to submit applications through one web interface, using a Java applet. The most interesting part of it, in my view, is this quote: 

Art Chantker, director of strategic programs at Federal Data Corp., said the system can be most successful if federal agencies first re-design their grants award procedures. “The key is to re-engineer the process and then apply the automated tools,” he said. 

It’s ten years later and that reengineering work has still to be done. What Chantker said then holds true today: the automated tools are easy but the business process is not, and until that fact is addressed we’ll continue to experience the kinds of problems which plague grants management today.