UX delivers powerful results in Waterfall development: Robert Pressman (A Practitioner’s Approach) has my favorite numbers to remember, 1, 10, 100:

Every...

$1 spent to resolve a problem during product design equals
$10 spent on the same problem during development, and more than
$100 if the problem had to be solved after the product’s release.

First, there's an important distinction I should address. We are talking about how UX is supposed to integrate into Waterfall or how does it happen in the real world?

How it works (in theory)

The UX team completes the UX methodology and hands off actionable requirements, tested designs and the data to back all of them up. The Development team and begin right away and keep going. No more production stoppage meetings about whether the button should be green or read, a button or slider. The UX team has data to back up each decision, giving the Monday Morning Quarterback nothing much to do.

How it works (in reality)

In reality, the UX team is often brought in after coding has begun. While still tremendously valuable, there is a lot of catching up to do. Thankfully, the UX Methodology can be compressed in a time of need. Each UX stage is compressed, while the Development team re-focuses on back-end development which often (not always) isn't as dramatically impacted by UX findings.
Early UX work is the best way to reduce hidden costs!

Lederer and Parassad, ("Nine management guidelines for better cost estimating: Communications of the ACM") put lack of UX work into real numbers that should concern any Business Owner, Project Manager or Development team getting ready to undertake a development project without UX.

63% of software projects exceed their estimates because:

  • Frequent requests for changes by users
  • Overlooks tasks
  • User’s lack of understanding their own requirements
  • Insufficient user and/or analyst communication and understanding