Do companies and executives really get value from their coaches?
Some companies are investing a significant amount to provide coaching and coach training to their employees. Because a direct return on investment from coaching is hard to measure, some people question the value.
While every company and person is unique we can learn from what some of the most successful companies do. According to one estimate, between 25-40% of Fortune 500 companies use executive coaching and I suspect that that number is much higher these days.
Google is one of the most famous companies that uses coaching. Former Google CEO Eric Schmidt was initially reluctant to use a coach but soon realized that
“Every famous athlete, every famous performer, has somebody who is a coach. Somebody who can watch what they’re doing and say ‘is that what you really meant and did you really do that thing’? [They] give them perspective. The one thing that people are never good at is seeing themselves as others see them. A coach really really helps.”
How Coaches can Help
The Harvard Business Review conducted a survey to see why companies hired executive coaches. The survey found that:
- 48% of coaches are hired to help develop high potential employees or facilitate a company transition.
- 26% of coaches were brought in to act as a sounding board on organizational dynamics or strategic matters.
- 12% of coaches were used to address a derailing behaviour
- Only 3% of coaches were hired to help executives who were struggling in their personal lives yet 76% of coaches had to address issues in their executives’ personal lives anyways to help a coachee develop and grow.
Bottom Line Results from Coaching
Although the average cost for top executive coaches is around $500, most companies will find it well worth it. Executives can trace savings or increased earnings to things like reduced turnover, increased productivity and more agile decision making.
Tangible Benefits of Coaching in Organizations
- In one study conducted by MetrixGlobal LLC “companies received an average return of $7.90 for every $1 invested in executive coaching”.
- A “529% return on investment and significant intangible benefits” was reported in one Fortune 500 company.
- Individuals who had training along with coaching were 88% more productive, while those who received training alone were 22% more productive. – Personnel Management Association
- The companies in a study in The Manchester Review “described an average return of more than $100,000 (about six times what coaching costs them).”
Our Own Results at Essential Impact
We have worked with hundreds of companies to implement coaching throughout their organizations. When you look at the benefits of coaching for a single executive, you can only begin to imagine how powerful coaching can be when implemented into the everyday interactions of everyone in the company.
- Rogers saw a reduction in customer complaints, significant improvements in their Net Promoter Scores (NPS) and reduced turnover
- The Joey group of Restaurants saw a reduction of turnover and significantly improved their internal leadership readiness
- The Surrey Food Bank decreased turnover and increased donations during a recession.
To learn more about our success stories, click here.
Try it For Yourself
When it comes to building your career, a coach can be a powerful resource to help you and your company develop, stand out, and take action to achieve the things that are truly important to you.
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