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The business rationale for using coaching to benefit individuals and organisations.

Updated: Jan 6, 2023


Manager 1 - “What if I develop my people and they decide to leave?”

Manager 2 – “What if you don’t develop them and they decide to stay?”

- Anon

The benefits of great coaching are clearly evident when you look at your favourite sports team or marvel at the successful Olympians achieving near superhuman feats. What’s less obvious to many is how an organisation can really benefit from adopting a coaching culture throughout its ranks and the benefits that such a change can bring to its employees.

We now live in such a fast paced and complex world and our concept of work and career development has changed exponentially. Just a few generations ago it’s likely that an individual would be working in the same occupation as their father for the duration of their lifetime. Today’s working environment is slightly more complicated however and recent research suggests that Millennials will average 12.5 jobs in a full working career, spanning various industries. (https://www.recruitment-international.co.uk/blog/2017/11/millennials-likely-to-have-12-jobs-in-their-working-lives-research-finds)

One added complication that’s likely to create even more uncertainty in the future will be the rise of Artificial Intelligence (AI). The advancements made by technology will have a massive impact across every sector leading to what author and historian, Yuval Noah Harrari calls “the useless class” – a rather unfortunate title that the author coined to describe the millions of global employees that will be replaced by AI and automated technologies in the near future. (https://www.technocracy.news/useless-class-meaning-life-no-work-universal-basic-income/)

These two seismic drivers will have massive implications for organisations’ ability to recruit and retain good quality employees. If employees are more willing to move companies during their careers, then the organisations that have better managerial infrastructure in place, can relate to their teams members in a more personal and employee centred way and can provide their employees with challenging, yet supportive environments for growth will undoubtedly be in a strong position for success in the future.

We have seen many of the recent tech giants instilling a coaching philosophy into their work environments, most notably Microsoft and Google. When Microsoft CEO, Satya Nadella, took over the reigns of the tech giant from the bombastic Steve Ballmer in 2014, he knew there was a lot of work to do across the organisation to change the culture from the inflexible and rigid one he inherited, to the “customer-obsessed, diverse and inclusive” culture that he created. (https://www.livemint.com/news/business-of-life/how-satya-nadella-brought-a-growth-mindset-to-microsoft-11614874643362.html)

The fact that some of the world’s largest and most innovative companies have moved towards a coaching culture clearly highlights the strong commercial benefits for such a shift. As Peter Hill states in his book, Concepts of Coaching (ILM, Peter Hill page 3) a research survey into how HR professionals were using coaching techniques back in 1999 showed that around 90% of companies in the US at the time were using coaching programmes but these were primarily focused on Key executives and leaders and tended to focus on “leadership development, retention of top staff, management succession planning and ensuring success after promotion on new hires.”

Peter goes on to mention additional research conducted by Manchester Consulting Inc which looked at the ROI (return on Investment) that a coaching programme provides by examining 100 executives who had undergone coaching between 1996 and 2000 and it was found that the coaching had generated an ROI of 5.7 times the original investment. (Peter Hill, ILM 2014, Concepts for Coaching, page 3)

It appears that, as well as operational reasons for implementing a coaching philosophy in your business, we can also make a commercial case. As mentioned above, with such transience in the global workforce now, it makes sense for businesses to instil coaching practices to ensure that they get the most from their team, increase engagement and improve employee performance. Not only will this help with retaining high quality staff, it’s also likely to improve your chances of attracting high calibre talent.

So as we can see from the information above as well as the demonstrable return on investment for coaching you can also ensure that your organisation is best placed to capture and retain high calibre talent in the ever changing corporate world but what’s in it for the individual?

The Institute of Coaching (McLean affiliate, Harvard Medical School) website outlines some interesting benefits of coaching for individuals:

• Establish and take action towards achieving goals

• Become more self-reliant

• Gain more job satisfaction

• Contribute more effectively to the team and the organisation

• Take greater responsibility and accountability for actions and commitments

• Work more easily and productively with others (boss, direct reports, peers)

• Communicate more effectively.

Whilst the list is not completely exhaustive, it’s a comprehensive overview of some of the key reasons that an individual would avail of from a coaching culture.

In my opinion, two of the key benefits of a well structured coaching or mentoring programme will have the greatest impact are “helping individuals take action towards goals” and “helping them contribute more effectively to the team and the organisation.”

This is primarily because coaching really focuses attention onto achievable actions and proactive steps that individuals can take to make improvements in a work or private capacity. Regular coaching sessions also hold the coachee accountable and ensures that steady progress is made towards successful attainment of goals.

Additionally, regular coaching sessions can assist the coachee with self confidence and clarity around their contribution towards to the team/organisation and can allow the coachee to work through any potential barriers or issues that they may be facing and explore ways in which they can overcome these.

Conclusion

The exact financial benefit to coaching may to be hard to fully calculate but some studies have managed to ascertain an ROI in the region of 6x investment cost. Better still there are many studies now showing the major benefits for organisations in moving their corporate culture towards a Coaching led philosophy or to engage external coaching providers to evidence to their team members that they want to provide the right framework for success and support their employees in the workplace.

It’s quite revealing that many of the worlds leading corporations have either embraced the coaching culture or are working towards its implementation.

It’s a trend that I hope continues.

References and bibliography

“Concepts of Coaching - a guide for managers” – Peter Hill


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