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Leadership Coaching for Business Results
Dr. Maynard Brusman
“As long as there are human beings doing the work, businesses
can profit by creating more fruitful relationships with them.” – Stratford
Sherman and Alyssa Freas, Harvard Business Review, Dec. 2004
Many attempts have been made over the past decade to quantify
return on investment of coaching programs for executives in organizations.
Some spectacular results have been recorded.
Yet even with the application of ROI standards commonly used for
measuring training and development programs, there remain too many
variables to establish reliable data. It is difficult to quantify
data of a qualitative nature.
In 2003 Anthony M. Grant of the University of Sydney surveyed
coaching research and found only 56 studies that met standards
of reliable methodology. There were only 131 peer-reviewed studies
since 1937. While the outcomes of coaching programs appear to be
positive, the quality of research on coaching is extremely poor.
There are new studies being conducted currently by academics, but
it may be years before there are authoritative guidelines and best
practices for coaching.
ROI may never become a measure of the
true success of coaching. One
must assess its value with qualitative data. Any time perceived
value is used as a measure, the measurements are subjective and
less reliable. It is difficult to implement and replicate a program
where the outcomes are perceived as “good” or “very
good.”
The marketplace is perhaps the most vocal proponent of the use
of coaching for executives for leadership development. Top corporations
such as GE, IBM, Hewlett-Packard, JP Morgan Chase, and Goldman
Sachs are among those that invest heavily in hiring coaches for
their executives. Overall, annual spending on coaching in the U.S.
is roughly estimated at $1 billion.
Other companies with smaller budgets
are wise to follow this trend. Successful
companies don’t throw money at programs that don’t
have a positive impact on their bottom line—or, at least,
they don’t for very long. Even so, there are some concerns
about how much coaching adds to the financial success of the organization.
Improving an executive’s well-being
can certainly contribute to improving his or her interpersonal
skills (and hence the productivity of the team). Unfortunately,
some coaching may get an executive to feel better without having
a noticeable impact on his or her behaviors. Obviously, this
would be a case of incomplete or ineffective coaching.
How to Get the Most out of Executive Coaching
Let’s look at three studies that
are widely accepted as being quality research.
1. Gerald Olivero,
Denise K. Bane, and Richard E. Kopelman, “Executive
Coaching as a Transfer of Training Tool: Effects on Productivity
in a Public Agency” appeared in Public Personnel Management,
vol. 26, no. 4 (1997), pp. 461-469.
Summary: Describes the advantages of one-on-one executive coaching
in positively influencing transfer of training. Examines the effects
of executive coaching in a local government agency. Thirty-one
managers took a management development program followed by eight
weeks of one-on-one executive coaching. The study finds that training
increased managerial productivity by 22.4 percent, while coaching
increased productivity by 88 percent.
2. Andres D. Ellinger, “Antecedents
and Consequences of Coaching Behavior,” Performance Improvement
Quarterly, vol. 12, no. 4 (1999), pp. 45-70.
Summary: Discusses the use of
coaching to facilitate the development of learning organizations.
Presents the results of a study to determine the outcomes of
coaching interventions. Finds that managers’ commitment
to coaching can impact employee, manager, and organizational performance.
Carol Patton, “Rating the Returns,” Human
Resource Executive, vol. 15, no. 5 (April 2001), pp. 40-43.
Summary: Outlines a nine-step ROI process that determines the
value of executive coaching. Claims that this process must be applied
consistently throughout the organization. Includes a list of measurement
tools and important ROI measurements.
(Source: Morgan, H., Harkins,
P., & Goldsmith, M. (Eds.).
(2005). The Art and Practice of Leadership Coaching. John Wiley & Sons,
Inc.)
There are many other studies that show spectacular results from
coaching programs. Most do not meet standard guidelines for rigorous
measurements. Many are based on anecdotal experiences. Also, the
measurement of the perceived value of a benefit is not the same
as the measurement of changed behaviors.
Here are a few examples of other studies on coaching:
Research by the Chartered Management
Institute and Campaign for Learning - "Coaching at Work".
Results issued in a press release dated 16th May 2002:
- 80% of executives say they think they would benefit from coaching
at work and dismiss the suggestion that coaching is just another
fad.
- Virtually all managers (96%) think coaching should be available
to every employee, regardless of seniority.
- 85% of managers say the main value of coaching is in enhancing
team morale.
- 80% of managers value coaching for generating responsibility
on the part of the learner.
Research by The Lifecoaching Company
- "Coaching Today Survey".
Research took place at the HRD Show in London in April 2002, respondents
all HR professionals.
- 86% held very positive views on coaching.
- 86% of respondents' organizations have offered coaching at one
time or another and coaching is CURRENTLY taking place in over
one third (36%) of organizations.
- Respondents feel that coaching achieves the following desired
outcomes:
A positive impact on other aspects of participants' lives, both
at work and outside the workplace (96%)
A feeling among participants of ownership of the issues and the
outcomes (85%)
Evidence of learning being put into practice (71%)
Readily-quantifiable and positive results, often demonstrated on
the company's "bottom-line" over the long term (62%)
Michigan-based Triad Performance Technologies, Inc., studied and
evaluated the effects of a coaching intervention on a group of
regional and district sales managers within a large telecom organization.
The third party research study cites a 10:1 return on investment
in less than one year.
The study found that the following business outcomes were directly
attributable to the coaching intervention:
Top performing staff, who were considering leaving the organization,
were retained, resulting in reduced turnover, increased revenue,
and improved customer satisfaction.
A positive work environment was created, focusing on strategic
account development and higher sales volume.
Customer revenues and customer satisfaction were improved due
to fully staffed and fully functioning territories.
Revenues were increased due to managers improving their performance
and exceeding their goals.
Another study conducted by MetrixGlobal for an executive coaching
program was impressive. Over 70 executives were coached from a
multi-national telecommunications company that included participants
in the United States, Canada, Mexico, and Brazil. MetrixGlobal
performed an extensive survey of 43 coaching participants that
yielded the following results:
Coaching produced a 529% return on investment and significant
intangible benefits to the business. Including the financial benefits
from employee retention, coaching boosted the overall ROI to 788%.
The study provided powerful new insights into how to maximize the
business impact from executive coaching. (Merrill Anderson: merrilland@metrixglobal.net)
Selecting Good Coaches
Are there ways to enhance coaching effectiveness? As a profession,
it is still sorting out best practices and standards. Even the
professional organizations (of which there are too many) do not
agree on the core competencies of a coach. Coach certifications
can come from any one of several organizations, and the requirements
all vary.
This is particularly unfortunate for
the person charged with finding good coaches for his or her organization.
There are no standard criteria
for judging a coach’s value
or worth. Perhaps the most reliable indication would be past
performance with other clients and organizations.
The problem is confounded by the fact that coaching borrows methods
from a diverse background of academics and industries ranging from
psychology, business, organizational development, human resources,
and even sports. Some excellent Ph.D. level professionals trained
in psychology may be suitable for some clients. A retired CEO or
entrepreneur-turned-coach may be more suitable for others.
Choosing a coach should not be left
to intuition, but many times it is. The
interview process should center on previous experience and results.
No matter what the coach’s background, he or
she should have a high degree of self-awareness and an ability
to work well with different personality styles while keeping an
eye on behavioral changes and business results. The process of
designing an effective coaching program does not end with the selection
of a qualified coach who is a good fit with the corporate culture.
Three Key Elements in the Coaching Relationship
A survey of the current literature and of experienced executive
coaches reveals the importance of a three-level qualification process
to ensure effective coaching.
Coaching is a three-way partnership between:
1. The organization hiring the coach.
2. The executive to be coached.
3. The coach
All involved must agree on specific goals and parameters. The
organization needs to have clear goals and a purpose for the coaching
program. There must be top-level support and visible links to business
imperatives.
The executive has to be willing to accept the process of coaching,
including listening to feedback, examining assumptions and beliefs,
and making behavioral changes.
The coach must be committed to being
candid while fostering a supportive environment. The
coach must have a sense of the executive’s
world from a personal, business, and social perspective and be
able to hold out a mirror to the executive to foster behavioral
changes. At the same time, the coach must be able to maintain trust
and navigate sensitive political issues with the organization.
As in any triangular relationship, the key is defining and clarifying
goals, roles, and accountability. For coaching to produce results,
the goals should be measurable. Many times this involves using
360-degree assessments before and after coaching.
Executive coaching may not be for everyone,
and organizations and clients should consider their purposes
and goals before engaging coaches. While
the results may not be directly measurable in dollars, there
is no company that can’t
benefit from more candor, better communications, and more conscious
awareness of how its leaders interact with people in order to
maximize talents and resources.
Are You Ready to Hire a Coach?
A recent Harvard Business Review article (December 2004) asks
this question: Is executive coaching at U.S. companies destined
to play the role occupied by psychoanalysis in some Neil Simon
version of Hollywood: A virtual prerequisite for anyone who aspires
to be anyone?
Companies should not jump on the coaching bandwagon expecting stellar
results simply because other fast track organizations are doing
it. Executive coaching is not an end unto itself.
In spite of its apparently robust potential, the very act of hiring
a coach will not get the results needed unless there is sufficient
preparation and planning. In other
words, don’t seek coaching just because other
fast movers in the firm seem to be benefiting from it.
Coaching is effective for executives who can say, “I want
to get over there, but I’m not sure how to do it.”
Here are some questions to ask in order to enhance the return on
the investment in a coaching program:
| • |
As
an organization, are you committed to coaching as a process
rather than just an event? |
| • |
Is
the coachee’s immediate supervisor committed to the coaching
process? |
| • |
What
are the types of changes that you hope will result? |
| • |
Have
you established internal measurements to identify when you
have achieved success? |
| • |
Do
you have benchmarks on those measures to identify the baseline? |
| • |
Do
you have a control group identified? |
| • |
Are
you using the right period of time (at least 18 to 24 months)
to properly achieve the results you are looking for? |
| • |
Have
you considered indirect measures such as employee satisfaction
or turnover? |
| • |
Are
you measuring the coach on the results that the coach achieves
or the time that the coach spends? |
| • |
Have
you ensured that one of the measurements is perceived improvement,
as viewed by those who work with the coachee on a frequent
basis? |
| • |
Based
on everything that you know about the coachee, is there a reasonable
probability that the coachee will change? |
Recommended Reading:
Morgan, H., Harkins, P., & Goldsmith,
M. (Eds.). (2005). The Art and Practice of
Leadership Coaching. John Wiley & Sons, Inc.
Sherman, S. & Freas, A. (November 2004) “The
Wild West of Executive
Coaching.” Harvard Business Review.
Michelman, P. (December 2004) “Do You Need an Executive
Coach?” Harvard
Business Review.
Working Resources is a Strategic Talent Management Consulting,
Leadership Consulting, Training and Executive Coaching Firm Helping
Companies Assess, Select, Coach and Retain Emotionally Intelligent
People; Performance-Based Interviewing and Selection; Succession
Planning; Competency Modeling; Multi-Rater 360-Degree Feedback;
Career Coaching; Change Management; Corporate Culture Surveys and
Executive/Leadership Coaching.
Working
Resources is a Leadership Consulting, Training and Executive Coaching
Firm Helping Companies Assess, Select, Coach and Retain Emotionally
Intelligent People; Emotional Intelligence-Based Interviewing and
Selection; Multi-Rater 360-Degree Feedback; Career Coaching; Change
Management; Corporate Culture Surveys and Executive Coaching.
Dr. Maynard Brusman
Consulting Psychologist and Executive Coach
Trusted Advisor to Senior Leadership Teams
Subscribe to Working Resources FREE E-mail Newsletter.
E-mail:mbrusman@workingresources.com . Type Subscribe Newsletter.
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