Change Management Budget: How can you expect success on the projects when the investment on the human factor is quite low in comparison to the overall project cost?

25 January, 2022

In our Change Management practice we have very often seen a particular situation that limits a project’s success: one of our 10 Elements, Change Management Budget, is not defined with the necessary rigor and precision during the construction of the project’s business case. It is also surprising to observe that when a budget is considered to attend to the people side of a project, the proposed levels of investment are very far from what is to be invested overall on the project.

Few organizations consult us as to how they should budget for change management when they are putting the project’s business case together. Most of our change management consulting services are requested after the whole project budget, including change management, has been defined. There are then serious limitations in developing activities aimed at the people side of the projects resulting in serious consequences that impact their possible success.

The lack of knowledge concerning Change Management on the part of the persons in charge of formulating the business case is evident in most organizations. This leads to not adequately budgeting fundamental change management Elements, such as:

Communication and awareness
Knowledge transfer and training
Incentives and recognition
Activities for the project team
Possible risk mitigation costs originated by change management
Activities needed for attending to key stakeholders, and
Others

We have also perceived that Change Management Budgeting, when it is included, generally is defined up to the project’s go-live which in reality is when the investment in the human factor becomes more relevant as it is the definitive proof that the change vision that gave birth to the project has been achieved.

No matter how much a project generates in technological advancement… the human capacity is what ensures success. Isn’t it therefore worth the effort of making a really serious financial investment in a project’s human factor?

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