Key Takeaways
- More than two thirds of all change projects result in wasted resources, overblown budgets, and unrealized benefits.
- A strategic and well-planned change process guided by a change management professional can mitigate risks, minimize disruptions, and maximize the success of organizational transformations.
- Eide Bailly can help organizations mitigate costs and thrive amidst change with custom-built change management solutions.
Change is a constant and often challenging aspect of professional life, whether it involves reorganizing an organizational chart, embracing a new technology, or developing a new skill or process. However, it does not need to be a costly one.
What is Change Management?
Without proper planning, change initiatives can disrupt workflows, confuse employees, and waste time and resources.
69% of change projects result in wasted resources and budgets and unrealized benefits.
Change management is a systematic approach to planning, implementing, and managing large-scale change. It includes processes, tools, and techniques to ensure smooth implementation, reduce negative effects on employees’ work, mood, and results, and maximize the impact of change.
Change management can promote growth and improve employee satisfaction by providing clear communication, anticipating and mitigating resistance, and providing targeted support through change.
The Financial Implications of Change Management
Implemented properly, change management not only improves employee satisfaction and alignment; it also has financial advantages. Effective change management improves efficiency and can increase ROI, while ineffective change often increases costs, including budget overruns, staff turnover, and disengagement.
Businesses in the United States lose more than a trillion dollars every year due to voluntary turnover.
Increase Efficiency and Productivity
A well-defined change management plan includes training and resources to help employees understand the motivation behind change and the potential positive implications for their work.
Transparency and consideration of the employee experience of change encourages employees to adopt changes more readily and effectively, increasing productivity and potentially leading to greater output or faster delivery of products and services — providing a competitive advantage in the marketplace.
Reduce Risk
Change inherently introduces risk into an organization, whether it be the risk of project failure, operational disruptions, or negative impacts on customer and employee morale. Organizations must assess, plan, and implement changes carefully to mitigate these costly risks.
In one study, one in six IT change projects had a cost overrun of 200% on average — resulting in millions of dollars lost.
An effective change management process should engage key stakeholders, including employees and customers, from the very beginning. By soliciting input early on, you can gain valuable insights into potential risks and concerns. This not only reduces the likelihood of negative outcomes during times of flux but also builds trust and buy-in among stakeholders.
Manage the Cost of Change
When changes are implemented without proper planning or consideration, the results can be costly. Poorly managed change can result in:
- Decreased morale
- Loss of valued employees
- Project delays and missed milestones
- Budget overruns
- Reputation damage
- Extensive revisions
- Failure to deliver on objectives
Some of these costs — such as morale and reputation — are hard to measure, but others — like exceeding a project budget — have a clear financial impact.
How Eide Bailly Can Help
Change management is a strategic investment. By taking a structured and proactive approach to managing change, organizations can minimize disruptions, optimize performance, and achieve their strategic objectives more effectively.
Investing in a certified change management professional to guide your change processes can increase the rate of adoption, build trust amongst teams, and help cultivate an enduring culture of adaptability. Eide Bailly can help your organization reduce costs and thrive amidst change with custom-built strategies for increasing success rates and reducing resistance.
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