Are Costs Affecting Your Change Initiative?

Cost of ChangeChange doesn’t come easily…or cheaply. Here’s a scenario: The Board or Executive Team, meet and hammer out their strategic plan and go back to work at their desks and begin putting the building blocks in place to reach the goals they’ve set. A few months, or a year into the plan, they suddenly discover that not only is change expensive, but it’s costly in ways and areas the strategic plan, well had no plan for. Every type of change comes with a price tag.

Employee Costs: Regardless of whether the change is small, drastic, incremental, sudden, planned, or unplanned, people will pay a price in terms of emotion and productivity. People handle change differently. Some will create havoc and slow the change process down through change resistance. Others experience stress as they may fear losing their jobs, or they may struggle learning a new process or technology, or they may express anger over the merge with a bitter business rival. These reactions cost your teams and business heavily in lost productivity.

Regulatory Concerns: A smaller company upon reaching incremental numbers of employees, must deal with an alphabet soup of regulations such as the FLSA, ACA, FMLA, AA, EEOC, and on and on. Hiring and payroll expenses go up as now there is a demand for employees who have the qualifications to deal with any number of government programs.

Regulations, particularly in the financial sectors, may come with a heavy price tag due to compliance issues that become more expensive to both implement and monitor as an organization grows. Enter the Compliance Officer, a position that until a few years ago had not even been created; and at a salary of $66K+, this addition will add heavily to costs.

Technology: Think dollars and chaos for this. If you have ever been an employee (or customer for that matter) at a bank that changed its core, you know whereof of I speak. Not only is cutting edge technology expensive in terms of money, implementing new technology takes its toll in downtime, lost productivity, and maybe even customers. The same can happen at hotels that change their booking software. Many organizations use the cloud and a vendor to handle technology elements and this can raise an increase in concerns over privacy breaches – an expense no company wants to face.

Certainly, as with life, there are no guarantees in business or in planning for change. However, planning can help to mitigate a lot of issues associated with BPR and change in general. There are tools such as Kotter’s eight-step model that can lend a hand in helping change succeed. Another tool appears in an HBR article by two members of The Boston Consulting Group.

The model the authors suggest is known as DICE. While I cannot speak to the success of this change tool, the process does offer some important questions that every organization needs to ask before going through change.

When contemplating your next change initiatives, begin with asking solid questions, lay down a comprehensive plan, identify implementation tools, and reduce expensive surprises by creating a budget for the costs that change can bring. Always expect the unexpected.

Thank you for reading this blog. If you have questions about your next change initiative call 404-320-7834 or email This email address is being protected from spambots. You need JavaScript enabled to view it., or visit

Graphic Credit: Copyright: VadimGuzhva

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