What is the typical budget for a change management project?

According to a study released in 2009 by Prosci, about 15% of the budget for a change management project should be spent on the change management effort , excluding the training.

The study surveyed 575 team leaders, project leaders and consultants in change management from 65 countries around the world, including 44% from the United States and 11% from Canada.

Founded in 1994, Prosci is an independent research firm specialized in change management, business process reengineering and call centre management. Prosci's change management methodology is among the most widely used by public and private organizations all over the world.

Another study, this one released in 2010 by Gartner, shows that training usually uses up between 10% and 20% of the costs of implementing enterprise resource planning (ERP) software. Furthermore, organizations that allocate more than 17% of their overall budget to training significantly increase their chances of being successful.

Founded in 1979, Gartner is the world's leading information technology research and advisory company.

Other studies (Kotter in 1996 and McKinsey & Company in 2008) have shown that between 65% and 70% of projects that include major organizational changes do not achieve their objectives. The human component is most often cited as the main obstacle.

If you are looking for convincing arguments to help you get budget approval, note that according to Prosci organizations that use proven change management practices stated that they were on budget 1.6 times more than those using poor change management practices. These organizations also indicated that they were on schedule 4 times more and met their objectives 6 times more than those using poor change management practices.

Source : Prosci (2009)