Patricia Clason was our guest on the Caffeine Tuesday, and, after we found her, we had an amazing conversation about coaching the Corporate world! You can find Patricia on the web at The Center For Creative Learning, the company that she has founded.
Patricia was kind enough to give us the following information, and we wanted to give it the notice it deserves here on our Top Story, showing that Corporate Coaching DOES make a difference in the Corporate sector, and achieving quite a bit of notice (she has also brought us even more material, via her comments on David Hale’s premier Corporate Coaching blog post, click here for even more!):
As promised on today’s Coachville Caffeine show – here are some stats on corporate coaching ROI (return on investment)
From SHRM (Society of Human Resource Management) Website:
Executive Coaching as a Transfer to Training Tools: Effects on Productivity in a Public Agency.
G. Olivero, KD Bane, R E Kopelman
Study examined the effects of executive coaching in a public sector municipal agency. Training increased productivity by 22%. The executive coaching (including goal setting, collaborative problem solving, practice feedback, supervisory involvement, evaluation of end results and public presentation) increased productivity by 88%.
WASHINGTON, DC, NOV. 22, 1999 – More and more, corporations across the U.S. are hiring coaches as a perk for their top performers – the investment returns improved performance for the individual and higher profits and a competitive edge for the company. That’s what companies reported in a survey of 4000+ corporations this fall by the International Coach Federation and Linkage, Inc. who were asked about their interest and involvement in corporate coaching.
“We were happy to see that the respondents know intrinsically that coaching is a tremendous value to a corporate culture and produces results,” said Jane Creswell, Chair of the Benchmarking Subcommittee of the ICF’s Corporate Coaching Committee, which analyzed the survey results.
The survey revealed that the primary benefits of corporate coaching are improved individual performance, bottom line results (including profit), client service and competitiveness and development of people for the next level – confidence raising, skills and self empowerment, goal achievement, relationship improvements and retention. “Coaching helps retain the top performers by showing them how appreciated they are,” says Creswell. “It also sends the message that they have earned the privilege of special attention in developing to their highest potential.” Companies use both internal and external coaches as a perk for top performers. Those that prefer internal coaches see it as a way to leverage human resources and reach everyone in the company, since internal coaches know the company culture. Internal coaches, considered more practical and cost-effective by their employers, are prized for their ability to share in-house expertise and train managers in coaching skills.
The survey indicated that companies who hire external coaches tend to use them for executive ranks, who perceive the outside coaches as providing an extra level of confidentiality. Some companies held that their organizations were too busy to develop internal coaching or that internal coaches would just be devalued. Respondents’ said their greatest challenges to developing corporate coaching programs are getting enterprise-wide buy-in, executive buy-in and modeling. Impatience on the part of upper management for the time investment required for coaching to make an impact was another significant roadblock. Some respondents acknowledged that they don’t yet know how to deliver corporate coaching confidently or how to measure its effectiveness.
Coaching is most prevalent in the United States, but it is spreading globally. A 2002 survey of human resources professionals by the Hay Group, an HR consultancy, found that more than half the 150 organizations polled in Asia, Australia, Europe, and North America had increased their use of coaching in the previous 12 months; 16 percent were using coaches for the first time.
Executive coaches with the requisite skills (and some without them) charge anywhere from a few hundred dollars to $15,000 a day; a handful of telephone conversations can cost thousands of dollars. The current coaching market is largely unregulated. Inevitably, the scent of money has attracted charlatans and sharks to executive coaching. The International Coach Federation (ICF), established in 1995, is the closest thing to a professional body for coaches. It boasts 5,200 members — up from 1,500 in 1995 — and estimates that there are around 15,000 coaches in North America. It offers certification courses and recognition for coaches.
Step back from the hyperbole, and executive coaching may be seen as a combination of mentoring, professional development, and support offered through a one-on-one relationship between a coach and an executive. These relationships focus on behavioral changes to hone leadership skills, enhance personal effectiveness, and correct unhelpful behaviors to improve job performance.
Terry Pearce famously helped David Pottruck rewire himself as a leader, evolving the finance company chief’s leadership style from bruising to authentic and open. Their one-on-one coaching sessions included time at a sweat lodge in the wilds of northern Washington state, where a shaman led them in “spiritual cleansing.” Along the way, everything from Mr. Pottruck’s failed marriages to his personal values were pulled apart and examined. The duo later took their relationship a step further by writing a book, Clicks and Mortar: Passion Driven Growth in an Internet Driven World, which was published at the height of dot-com mania. The book focuses on Mr. Pottruck’s experience in leading Charles Schwab in the early days of its e-business development. Although Clicks and Mortar is somewhat dated now, in it Mr. Pottruck offers some timeless and useful leadership insights for CEO peers, including reflections on how leaders can inspire passion in employees. He also presents some candid revelations about his personal failings as a business leader and a husband and how he changed.
Booz Allen hired a consulting company this year to
study the return on its coaching program. The study
found that all the leaders applied what they learned
to improve their own development, while 53% went
beyond that to significantly improve their
relationships with teams and peer members. The
benefits were $3.3 million in the year 2003, while the
coaching for the last year’s 45 participants cost
$414,310. That means the return on investment was 689
percent, according to the study.
Detroit News, August 2004
7/14/2004 PHILADELPHIA – Executive coaching delivers a Return on Investment of nearly six times the initial cost of coaching, according to a survey of 100 senior executives who participated in coaching programs. The results of the survey were released today by Right Management Consultants. Seventy percent of the executives who participated in the survey valued the ROI on their coaching at $100,000 or more. Nearly 30 percent put the ROI between $500,000 and $1 million.
“Historically, the business value of providing senior executives with customized leadership coaching has been hard to measure,” said Joy McGovern, Senior Vice President and Managing Consultant of Right’s Organizational Consulting practice. “This is one of the first studies to attempt to measure ROI on coaching with hard data. “The survey results corroborate what coaching participants and first-hand observers have seen – that coaching can have a dramatic impact on change in executive behavior and organizational improvements.”
In addition to ROI, the survey also measured tangible and intangible business results of coaching. Executives said the biggest tangible business results their coaching yielded were: improved productivity (53 percent), better quality work product (48 percent) and greater organizational strength (48 percent).
From an intangible business standpoint, executives reported better relationships with their direct reports (77 percent); better relationships with their supervisors (71 percent); improved teamwork (67 percent); better relationships with peers (63 percent); and greater job satisfaction (61 percent).
Most of the 100 executives who participated in the survey were from Fortune 1000 companies. Half held positions of vice president or higher; one third earned $200,000 or more a year. Fifty-seven percent of the respondents were ages 40 to 49.
The survey was conducted by Manchester Consulting, which Right acquired in January.
MetrixGlobal LLC completed a study which was sponsored by a Fortune 500 company and a Coaching company. Coaching produced a 529% return on investment and significant intangible benefits to the business. When the financial benefit of employee retention was included, ROI jumped to 788%.