The Hidden Drain:
Risks & Costs of Poor Change

When organisational transitions fail, the damage doesn’t show up overnight as a broken piece of equipment.

Instead, it acts as a quiet, invisible tax on your culture and productivity, eventually compounding into change fatigue, employee burnout, and potential legal exposure.

The "Push Through It" Model for change doesn't work

Often organisations take a 'push through it' and it will all work out in the end approach to change.

Maybe this approach worked in 2016 when we were only experiencing two changes per year1 but now with the Velocity Shift we are experiencing ten per year since 20221. Maybe this approach should be retired.

This is supported by the fact that willingness to adapt to change has plummeted from 79% down to 43%1.

Trust in an organisation's ability to make change is now at 21%2 of people in the workplace.

To recap, we have 5 times more change per year, less than half our workforce willing to make change and about one fifth who trust that change can happen.

To cap that all off 44% of HR managers cite change fatigue as a top 5 barrier to making change3.

One might say that the status quo has some room for improvement.

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Poor Change is Now a Regulated Psychosocial Hazard

As of December 2025, poor change management is officially recognised across Australia as an active workplace psychosocial safety hazard, placing it on the same level as a physical hazard. 

SafeWork Australia defines poor organisational change as potentially including:

  • Not consulting on changes (e.g. not talking to workers or genuinely considering their views)
  • Not thinking about how a change may impact WHS risks or workers’ performance (e.g. not allowing extra time to do things while workers learn a new process)
  • Poorly planned changes (e.g. changes are disorganised or do not have a clear goal)
  • Changes are poorly communicated (e.g. information about the changes isn’t provided or is unclear), or
  • Not enough support for the changes (e.g. not training workers on how to use new tools)4.


When you are managing change poorly you are adding mental load to your people which is wearing them out and increasing the likelihood of burn out.
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Calculating the Dollar Impact of poor change

What does this actually cost your balance sheet?

In my book Changing with Confidence I ran the numbers on a change that is managed poorly. It cost twice as much as if the change was well managed5.

Then I developed a case study based on a 150 person organisation. I assumed the 10 changes per person per year and that we expected each change to take each person 2 hours of their time. Assuming an average salary of $100,000 this is around $50 per hour or $1000 per person per year.

This put the productivity loss as below:

Expected productivity
cost of the change		 Extra productivity costs
of change being managed poorly		 Total
$150,000 $150,000 $300,000


If we assume all these changes are managed poorly then we can assume there will be increased change fatigue which leads to presenteeism and absenteeism. This costs employers between $3,200 & $5,600 depending on the level of fatigue6. I assumed 15% of people are fatigued or 22 people of 150. I then assumed 18 people on the lower end and 4 people on the upper end.

Considering that 54% of people experiencing change fatigue are considering leaving their place of work7, I assumed that at least one person has left the organisation as 54% of 22 is 12 and I assumed 10% actually left which is about one. This costs 1.5-2 times their salary to replace them8.

I also assumed that 1 person has gone off on mental health leave with workcover. Mental health claims have increased with workcover by 33% between 2018 (9% of claims)9 & 2024 (12% of claims)10.

Expected cost Total cost of change
18 low change fatigued people at $3,200 each $57,600
4 highly change fatigued people at $5,600 each $22,400
1 mental health claim Covered by work cover but
maybe an increase in premium
Cost of hiring & replacing resignation $150,000 (lower end assumed)
Extra productivity loss for poorly managed change $150,000
Total cost of poorly managed change $380,000


I think this is a very conservative estimate but even at that cost it is not insignificant. If two people resigned or instead 30% of people were change fatigued, those numbers can grow very quickly.

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Know-Learn-Grow approach: Routinising Change

To protect your bottom line and your people, you need an internal system.

The Know-Learn-Grow to Change approach replaces confusing, ad-hoc changes with a structured, repeatable workplace routine.

No matter the scale of the transition, we build your team's internal capability so they can manage change smoothly and safely.

Self-Paced Tools for Change Capability

Stop reading static slide decks. Explore our digital training spaces and interactive toolkits designed to transform change into a comfortable workplace routine.
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The Practice Ground

This course includes The Resource Library to give you both the tools to implement change the Know-Learn-Grow way and the space to apply your knowledge in a risk free environment.

The Resource Library

Just the knowledge, tools, and templates to apply straight to your work.

 

Free Mini-Course

Sample a branching scenario and get a template for each section of the Know-Learn-Grow approach.

 

Looking for the perfect starting point? Get the book.

Prefer a physical guide before diving into our digital platforms? Changing with Confidence maps out the entire Know-Learn-Grow to Change approach with real-world application examples.

References:

 1https://hbr.org/2023/05/employees-are-losing-patience-with-change-initiatives
2https://www.gartner.com/en/newsroom/press-releases/2025-07-08-gartner-hr-research-finds-just-32-percent-of-business-leaders-report-achieving-healthy-change-adoption-by- employees

3Gallagher (2025). 2025 State of the Sector: Global Internal Communication and Employee Experience Survey. Arthur J. Gallagher & Co
4https://www.safeworkaustralia.gov.au/safety-topic/managing-health-and-safety/mental-health/psychosocial-hazards/poor-organisational-change-management
5Lorains, A. (2026). Changing with confidence. Dean Publishing.
6KPMG & Mental Health Australia. (2018). Investing to Save: The Economic Case for Reforming Community Mental Health Care in Australia.
7https://www.capterra.com/resources/change-fatigue-in-the-workplace/
8https://www.gallup.com/workplace/247391/fixable-problem-costs-businesses-trillion.aspx
9https://www.safeworkaustralia.gov.au/sites/default/files/2021-01/Australian%20Workers%20%20Compensation%20Statistics%202018-19p%20FINAL_2.pdf
10https://data.safeworkaustralia.gov.au/sites/default/files/2025-10/Key_Work_Health_and_Safety_Statistics_Australia_2025.pdf
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