...leveraging the strategic power of soft skills®
Subscribe to one of Pat Wiklund's Electronic Newsletters		Articles Info Center | Publications | Articles List    Print this article (printer friendly version)    The ROI of Executive Coaching In today's challenging business climate, every unnecessary perk is routinely trimmed from corporate budgets. However, thousands of business owners, managers, and professionals still retain their executive coaches because they correctly view them not as personal perks but as corporate benefits. Coaching's popularity has long been fueled by anecdotal evidence of effectiveness. Recent larger, and longer-term, studies have concluded executive coaching not only facilitates the skills development that aids the individual participants, but also makes a significant impact on the overall organization. Study participants reported numerous benefits derived from executive coaching, including better working relationships with direct reports, peers, and supervisors, higher job satisfaction, and less conflict within their scope of responsibility. Organizations noted increased productivity, quality, and organizational strength. And, most important, they reported a significant return on the dollars invested in the process. Focus of Executive Coaching Executive coaching is typically requested when an executive needs to: Change behaviors or skills to "fix it," (whatever "it" may be). Develop more effective ways of dealing with people or organizational responsibilities. Clear away "blind spots," (unnoticed or subtext personal issues or behaviors that dramatically impact effectiveness). Nurture the skills and perspective required for a new position or career change. When Executives Need Fixing Coaching is often the intervention of choice when a talented executive has either a behavioral or personal issue that negatively impacts their effectiveness. In the privacy of the coaching relationship, issues can be addressed, and resolutions explored and practiced, with the ongoing feedback and guidance of an experienced coach. Because the coaching transcends the line of command, many troubled execs feel freer to identify and resolve the real issues they're struggling with. As an outsider, the coach isn't as constrained when delivering feedback, challenging a client to grow, or frankly outlining the consequences of not changing. On the other hand, when the issues are personal, many executives seek coaching outside the organization, choosing to work with a professional uniquely qualified to resolve personal issues against the background of an organizational setting. Some of these coaches may be — or have been — therapists or other mental health professionals allowing them to use a client's personal history or dynamics to inform the process. However, the work stays centered on coaching with regard to the specific models, strategies, and approaches the executive can adopt to increase personal and organizational effectiveness. Two major studies have shown that it is more effective and less expensive for the organization to provide coaching to those executives who have either become derailed or need to increase their vision. Unfortunately not every struggling executive sees a need or believes in the efficacy of individual coaching. Even with these reluctant clients, a skilled coach can facilitate major growth. As the executive becomes more comfortable, he or she will usually embrace the coaching opportunity and attribute their heightened effectiveness to the coaching relationship. Properly done, coaching is seen by both client and coach as a collaborative relationship that is non-threatening to the executive's confidence or self-esteem. Self-efficacy seems to increase, not decrease, as the formerly reluctant executive becomes more engaged. The organization benefits because the cost of bringing a flawed, but otherwise valuable, employee up to speed is significantly lower rather than replacing him or her. Developmental Coaching Another focus for executive coaching — preparing for a new position or supporting career growth — can call for the development of both new competencies and a broader perspective. In a long-term study of coaching outcomes, a division of BP found participants consistently improved performance, increased potential-for-advancement ratings, and achieved 50 percent higher salary increases than colleagues who had not participated in the program. Another study of coaching outcomes with over 100 executives, primarily from Fortune 1000 companies, reported similar results. Executives who participated in coaching realized improvements in their working relationships, better teamwork with a conflict reduction in their own groups, greater job satisfaction, more personal job commitment, and better client relationships. Their companies benefited from increased productivity, quality, organizational strength, customer service, cost reductions, and retention of executives who received coaching. All of this led to higher bottom line profitability, while providing an ROI in real dollars that was many times greater than the cost of the coaching initiative. Typically, executive coaching starts with addressing tactical issues, analyzing the presenting complaint, and then often progresses to more strategic issues. When the researchers looked at the impact of the tactical versus strategic impact, their findings were startling. A little more than half [58 percent] of the executives reported significant impact on the business when the coaching focused on tactical issues, while 100 percent of the participants who also addressed strategic issues reported significant impact on the business. Of the monetary benefits to the organization, 70 percent were delivered by those executives who worked on the strategic issues. If that's the great news, here's the downside. Less than half [43 percent] of the executives progressed past the tactical to consider and work on strategic issues. Granted, there may be some issues about generalizing the findings of these studies to the coaching initiatives you are providing or engaging. However, there are clear and obvious indications that individual executive coaching can easily move past individual initiative to a strategic business initiative. When we set coaching expectations and outcomes that are in line with the expectations and strategic needs of the organization — including moving through tactical to strategic issues — the potency and benefits of the coaching initiative can be realized throughout the organization. Resources Birkeland, S., Davis, B., Goff, M., Campbell, J., & Duke, C. (1997). AMOCO individual coaching study. Unpublished research report, Personnel Decisions International. Minneapolis, MN. A Practical Guide to Evaluating Coaching: Translating State-of the-Art Techniques to the Real World David B. Peterson and Kurt Kraiger in The Human Resources Program Evaluation Handbook. Sage Publications, 2004 __________ Since 1986, Patricia Wiklund, Ph.D. has helped some of America's largest, and smallest, organizations resolve expensive and troublesome people problems and conflicts by leveraging the strategic power of soft skills®. A former mental health professional, she is as comfortable on the front line, as on the shop floor, or in the corporate executive suite, and also works effectively in government and educational settings. Call her today at 415 641-5997, or email her at pat@patwiklund.com to discuss how she can help you put your people and organizations back on track. An electronic version of this article is available for reprinting or reposting. Please contact Dr. Pat Wiklund for permission to reprint, and to see if there is a royalty required for reprint. If permission is granted, we request a hard copy of the publication in which the article appears. We request you include Pat's bio at the end of the piece, along with contact information, and preferably, a photo. Photo’s are available online at http://www.patwiklund.com/speaking/index.shtml#photos   Back to Articles List
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