Set your change management budget. Now multiply it by seven.

Most businesses underestimate the cost of change. At a recent HR Tech event, Nico Orie said that change management usually accounts for one percent of a project budget, but suggested that it should be seven times that amount.

Set your change management budget. Now multiply it by seven.

In my experience, these figures sound about right. Many organisations rush headlong into a new software implementation, sold on the benefits without appraising the cost of the change. The impact on a business can be substantial. The impact on employee motivation alone can be crippling.  Faced with a new performance management application, it’s easy to see how employees could see this as stick rather than carrot and resist a system that could actually bring about a better fit between their skills and ambitions than the position they’re in.

A good change management team would have this covered. They’d be ensuring that employees understood the ‘why’ of a project as well as the how. They’d be addressing cultural issues and behaviour as well as the software itself. Of course, all this costs money. But if you’re going to benefit from a business transformation project, you’ve got to make sure it’s a success.