Results Created Through Coaching

RETURN ON INVESTMENT

Studies have shown that coaching for top executives at large companies yields 5-7x the company’s initial investment.

• Companies that have used professional coaching for business reasons have seen a median return on their investment of 7 times their initial investment, according to a study commissioned by ICF, and conducted by PricewaterhouseCoopers and Association Resource Centre Inc. (ICF Global Coaching Client Study, 2009)
• Three stock portfolios comprised only of companies that spend aggressively on employee development each outperformed the S&P 500 by 17-35% during 2003. (How’s Your Return on People? Harvard Business Review, Laurie Bassi and Daniel McMurrer, 2004)
• According to a study of senior level executives at Fortune 1000 companies who received developmental coaching, the average return from the programs was nearly 5.7 times the initial investment. (Maximizing the Impact of Executive Coaching, The Manchester Review, Volume 6, Number 1, Joy McGovern, et.al., 2001)

CASE STUDIES

While I have not done quantitative analysis of the ROI of my own work, below are examples showcasing the value created through my coaching. I changed names and details to protect confidentiality.

RECOVERY FROM A MAJOR SETBACK

Bottom line: As the result of this coaching engagement, the client received a major promotion, and decided against leaving the company. We did not formally estimate ROI here, but given the costs of replacing a senior executive, it’s safe to assume that substantial value was created through coaching.

When we began our work together, Robert S. was ready to quit his job. Under his watch the company suffered a major loss. His best friend and peer was fired as the result. Robert was devastated, stressed and confused. His self-confidence was shaken, and he was certain that his career at the company was over. He gained weight, and his family relationships were strained.

We talked, he wrote in his journal, and we talked more. We brain-stormed, we role-played a dreaded conversation with his boss, and we sent emails back and forth. We kept on peeling the onion: layer after layer of fear and pain until there was nothing but truth. And the truth was that he loved his job, he loved his company, he was passionate about the industry, and one day he would love to become one of the top executives in the firm. About six months after we began our work together, Robert got a substantial promotion – something that he could not even imagine when he first started coaching. His relationships at home and at work improved, and he engaged in a steady regimen towards losing weight and improving his health.

As Robert got better at hearing his own voice, he Robert-ised his new job. Through coaching he became clear about his strengths, weaknesses, and the contribution he would like to make to his company and his community. He put on his list only the tasks where he was the best person to do the job. The rest went on his Delegate or Stop Doing list. He put together a well functioning team with the right mix of skills and experience. He has expanded his involvement with local community organizations, and in a couple of years he will run for office.

Despite his increased responsibilities, Robert has been able to take enough time for himself, his family members, and other loved ones.

Now Robert feels joyful, confident, and energized.

HIGH POTENTIAL EXECUTIVE COACHING: WHAT’S NEXT?

Bottom line: As the result of our work together, the client became clear about what she wanted to do next, and landed a bigger, more satisfying job with her company.

Jane R. is an executive in a global Fortune 500 company. I was assigned to work with her as part of her accelerated leadership development program. Prior to the time of our work together, Jane had always been clear about the next step in her career development. When we began coaching, the landscape looked mostly flat and confusing. She did not know where she wanted to go next. This was a new place for her, since never before she had to actively design her future work. Also, she was privy to the plans of serious reorganization in the company, and she felt anxious about where she would land.

As the result of our work together Jane developed her personal mission statement, and discovered that the role she enjoyed the most and that was the best fit for her, was the role of the General Manager (GM). She also discovered that there was a good alignment between the culture of the company and her values, and drivers, and that she found deep meaning and satisfaction in her work.

After the initial stage of foundation building and discovery, she concluded that she wants to play the same role with the same company, and she wants to do it on a larger scale. Jane identified what she needed to work on to become “the best GM in the world.” With this clarity, she mapped out steps towards a new challenging, meaningful and enjoyable assignment. After the reorganization she was offered a job with a much larger portfolio and scope of responsibility.

CLOSING A MAJOR DEAL: EXECUTIVE COACHING AND CONSULTING

Bottom line: As the result of my involvement as a coach and a consultant, the company closed a $1.8MM round of financing with a Russian investor. Without the coaching they would have only asked for $600K. Without the consulting, chances are that they would have received nothing. I believe that the value created for the company through coaching was at least $1.2MM

The setup
A US start-up company, ABC, Inc. was in a difficult financial situation, and the leadership was deeply dissatisfied with the CEO’s (we’ll call her Diane) ability to attract investment. There was a high probability opportunity to receive bridge financing from a Russian investor. Diane was planning on asking for $600K.

I was brought in as an executive coach for the CEO to help her improve her performance and as a consultant to help close the deal with the Russian investor. Nobody on the team had any experience in working internationally.

Phase 1: Coaching the CEO
As we began our coaching relationship, it became clear that for a number of reasons Diane was ambivalent about receiving money from this particular investor, and that her ambivalence sabotaged the company’s success. She faced the fact that $600K was not enough to make a difference for ABC, and that they needed at least $2-3MM. As we worked through her resistance, she reconnected with her commitment to the company’s mission, worked through her ego, insecurities, and fears, and became excited about a prospect of generating enough cash for ABC to move forward.

When I set up my coaching relationship, I let my clients know that I might be making requests, or giving them challenges. The can respond with “yes,” “no,” or counteroffer.

I challenged Diane to ask for $3MM, she gave me a counteroffer and decided to ask for $1.8MM instead of $600K, as she originally planned.

Phase 2: Coaching the Team
In preparation for a meeting with the Russian investor, I coached the leadership team to clarify the key messages they wanted delivered to the Russian investor. They developed a vision for a successful outcome of the meeting and came to a conclusion that success meant that they would walk away with the signed Subscription Agreement. From this point I switched out of the coaching role into the consulting role to help get the agreement signed.

Phase 3: International Negotiation Consulting
I drafted the meeting agenda, and communicated with the Russian investor to get his agreement; produced a one-page Subscription Agreement in English and Russian, advised and educated the team on the ins and outs of negotiating with the Russians. I helped direct the discussion during the negotiation, and advised on follow-up steps and communication strategy with the Russian investor after the agreement was signed.