When Britain trudged home from Atlanta in 1996 with just one gold medal, won by the rowers Steve Redgrave and Matthew Pinsent, sports chiefs sat down to some serious soul-searching.

How had a nation that invented many modern sports finished 36th in the world, behind such sporting luminaries as Kazakhstan, Greece, Poland and Algeria?

The National Lottery turned out to be the solution, as the idea of diverting big chunks of taxpayers’ money to the ministry of fun was still not one that policymakers were ready to seriously consider.

Since the humiliation in Atlanta, funding in UK Sport’s “podium programme”, which covers athletes with a realistic chance of a medal at the next Games, has increased by about £20 million per Games. After Beijing, that incremental leap will be £70 million, to £160 million.

This is part of a £400 million funding package to London 2012, including £200 million of Exchequer money, representing an unprecedented backing of sport in the quest to finish fourth in the medals table and to inspire a new generation of Olympians.

Britain’s success in Beijing has been a decade in the making. In cycling, the star sport of the British Olympic team, the success is down to a thoughtful strategy that Dave Brailsford, its performance director, calls the “aggregation of marginal gains”.

The 70-strong backroom team, including psychiatrists, scientists, engineers and coaches, gets the best out of its athletes by being less dictatorial than the old-fashioned coach with a clipboard and whistle.

The result is that the riders are hungry for the rewards. And the cycling team is beating the rest of the world with a little more than £5 million a year, proving that more money does not equal more medals.

“You can invest millions in a sport, but if you have the wrong people in charge it doesn’t work,” said Sir Clive Woodward, the coach of the 2003 rugby World Cup-winning team, now working for the British Olympic Association. “There is no magic wand. There has to be consistency of funding, the right people and patience.”

Similar approaches have been taken in sailing, which has so far delivered two gold medals, and rowing, which captured two gold, two silver and two bronze, in exchange for £22.3 million and £26 million respectively. Compared with other sports, they represent great value for money.