Different Ways To Prove the Effectiveness of Executive Coaching

Leadership development is a rewarding undertaking, but the interpersonal nature of executive coaching makes it hard for companies to measure a tangible return on their investment. Trying to put a dollar amount on the benefits of coaching for employees may be difficult, but proof exists. For example:

• "Case Study on the Return on Investment of Executive Coaching" reveals that a Fortune 500 company's executive coaching initiative produced a 529 percent ROI and significant benefits such as overall productivity and employee satisfaction. When factoring in employee retention, the ROI jumps to 788 percent.
  
  
• According to "Maximizing the Impact of Executive Coaching," a survey of 100 executives mostly from Fortune 1000 companies, an investment in executive coaching realized an average ROI of almost six times the cost of the coaching.
  
  
• The What Is Coaching? report cites research indicating that the ROI of coaching can range between 221 percent and 788 percent.

Besides comparing financial gains compared to costs paid, you can measure success in other ways, both tangibly and intangibly. Tangible benefits of executive coaching include:

• Increased productivity
• Higher performance levels
• Reduced costs
• Growth in revenue and sales
• Higher employee retention
• Higher employee engagement

Intangible benefits include:

• Increased emotional intelligence
• Higher confidence
• Strengthening of executive presence
• Better communication
• Enhanced situational leadership skills
• Embracing accountability
• Stronger work relationships

The Challenge With Measuring Coaching

Despite all those positives that can result from executive coaching, it continues to be difficult to measure because of a multitude of factors, ranging from not having a controlled environment to different peoples' perceptions of what change means.

Take, for instance, a 360-degree review I completed for an executive coaching client for which I interviewed 15 stakeholders both prior to the coaching engagement and after its completion eight months later.

When I asked them whether they had perceived change or improvement in the coachee, everyone answered with a resounding yes—except for one person. That stakeholder said he didn't observe any change at all.

However, when I referred to my initial interview with the stakeholder and read back to him his observations, it was apparent the coachee had indeed changed—in fact, quite dramatically. Taken aback, the stakeholder commented, "His behavior changed so much, I completely forgot how he was before."

That example demonstrates how stakeholder subjectivity is an area that makes results hard to measure. Further, people can come into the situation already having perceived beliefs about change itself.

If someone believes that people don't change, that person is going to have a difficult time discerning change in anyone. Individuals tend to base their perspectives on opinions, not facts, and can also overindex on certain factors.

In assessing success from executive coaching engagements, a coach may speak with someone who interacts daily with the coachee as well as someone who only collaborates with them quarterly. The problem is that those measuring success often apply equal weight to those stakeholder perspectives.

With that consideration in mind, 360-degree assessments administered pre-and post-engagement are indeed the most accurate way to measure leadership competencies—ranging from decisiveness and delegation to active listening and effective feedback—that executive coaching can cultivate.

In addition to asking a coachee-leader to complete a self-assessment, give the assessment to eight to 20 stakeholders to get their opinions of the leader. The more assessments compiled, the greater the accuracy of the cumulative scores.

Measuring on Tactics vs. Change

One way to ensure you're measuring the effectiveness of executive coaching is to focus on the type of coach who is working with a particular leader. A tactical coach versus a transformational coach working on systemic change will likely elicit different results.

Consider a senior leader who doesn't reach out cross-functionally to build relationships. A tactical coach could structure an assignment for the coachee to measure (check off) every time they reach out cross-functionally to stakeholders. At the end of six months, the coach may see a long list of checkmarks that indicates that the executive addressed the issue a certain number of times.

Many executives would be happy with that result, but here's why it may be shortsighted: The leader could just be checking the box because it's required of them during coaching—it doesn't mean they have systemically learned the behavior.

And one year later, the executive will likely be back to their old behavior because no deep transformative change occurred. Or the coachee may have built the habit and is still applying it, but it's transactional in nature rather than a process of meaningfully building a relationship with the stakeholders.

A different coach may choose to pinpoint an underlying fear that addresses the root cause, such as discomfort with intimacy or lack of self-esteem. If a coach addresses the root of the problem, behavioral results will follow. A rubber band effect—in which the executive reverts to old behavior—will be less likely. Instead, there will be a domino effect where the learning translates to other domains, which results in a bigger ROI for the company.

For instance, I worked with a client, "Angelique," whose supervisor sought a coach for her to address what the supervisor called unprofessional behavior. The supervisor had observed Angelique saying flirtatious things to co-workers and acting inappropriately. After I met with Angelique, I realized that her supervisor was only seeing the symptom of the problem, but the real issue was Angelique's insecurity. Whenever she felt insecure, she turned toward flirtatious behavior. It's something she had been doing all her life that had become an automatic behavior. Therefore, simply telling Angelique to stop being a flirt certainly wasn't going to be effective.

During our coaching engagements, the real work entailed breaking down the behavior and creating mindfulness. By practicing self-awareness and working through the discomfort, Angelique was able to break the cycle so that when she started to feel insecure, she was aware of it and was eventually able to not allow the next step to occur. As a result, Angelique was able to change her mindset and reaction so that she no longer made her co-workers uncomfortable. Now, her inappropriate flirting is a distant memory.

In the example of the cross-functional relationships above, the approaches the tactical coach and the transformation coach each took factor into whether the long-term change will result from coaching engagements. The key is to identify—before coaching begins—the exact behavioral change the company wants to see from the coachee-leader.

Then when selecting a coach, consider someone who is well trained in developing emotional intelligence and psychology to competently handle more complex issues. In addition, seek individuals who have measurement protocols built into their coaching and who will conduct the pre-and post-interviews with stakeholders.

Those factors help to control the variable of the coach to some degree. The coach can then compare the stakeholders' opinions and more easily see when the leader's change is authentic.

As mentioned before, sometimes the coachee has changed so much that the stakeholders don't even remember the before person because they've been interacting with the after person to great success.

Making An Impact

Leaders should start off a coaching engagement by being consistent in what factors will be measured and how those factors will be measured from engagement to engagement. To set up a coaching engagement to be measured for success:

• Establish the business results you want the leader to achieve.
  
  
• Outline the leadership behaviors they need to exhibit and sustain.
  
  
• Identify the corresponding results you want to show up within the leader's team.

Ultimately, leaders should integrate those three factors into the daily choices they make. With an executive coach's help, repeated refinements and clear goals will help companies track the progress of the coaching investment.

A Team Effort

Stronger leadership results in the ROI extending far beyond the individual level. The benefits of executive coaching will trickle down the organization to other employees and ultimately have a positive impact on the company's bottom line.

Think of a leader as an orchestra conductor. At the most basic level, the conductor keeps the orchestra in time and together. But a conductor also translates the composer's message. With the conductor's lead, the musicians can then create a unified vision of the music to play to the audience's delight.

Like a conductor, an executive is responsible for driving focused alignment and keeping their team in tune with each other to get the desired results.

For example, a coach can work with a leader to be more effective at delegation or to better cultivate cross-functional relationships to develop and deliver operational excellence. But the impact doesn't stop at the leader's level. Now that the leader can improve performance and achieve sustainable results, they are in a better position to be able to pass along their knowledge to their direct reports.

Let's look at "Samir," a leader who has an issue with delegation. In working with a coach, he learns to avoid holding onto too many tasks and becoming a bottleneck in the chain of command. Once Samir learns to let go, other team members will develop and level up in their leadership because they receive stretch assignments for the first time.

Perhaps they start attending higher-level meetings that they were not invited to before. Or maybe they become involved in cross-functional projects that only Samir previously handled. As he gives his team members more responsibility, they begin to grow, learn and become more accountable under his direction.

When a team leader is working to drive more effective results, companies will start to see greater ownership and accountability by every person on the team. There will be more clarity in what the expectations are, because everyone will understand their roles and responsibilities as well as the level of performance that is expected of them. Rather than having directive dumping of assignments on them, the direct reports will have development and coaching conversations with their leader.

That's a perfect example of how employers will see behavior change from the leader as well as every team member. And when companies have high-performing teams, they are more profitable.

Proof and Rewards

Through coaching, an executive can become more of an orchestra conductor who is responsible for team-driven results rather than just their own personal results. Their new role becomes building and nurturing that high-performing team. Such a transition has a huge impact for the leader, team members, and the organization. It illustrates how executive coaching builds leadership capacity that translates into an ROI in myriad ways.

When you can provide proof of development efforts, employers will be able to attract, grow and retain employees. And regardless of whether a company has an effective leader at the helm of a 10- or 1,000-person team, the benefits will be clear.

How to Hire an Executive Coach

In addition to the standards of an executive coach already discussed, other factors separate quality coaches from the rest.

Qualifications. Unfortunately, the coaching industry is not regulated, which means anyone can call themselves a coach. Vet coaches' experience carefully by inquiring about what types of coaching experience they have (corporate is a must), training, credentials (the International Coaching Federation is respected worldwide), level of credentials (an indication of hours of experience), and psychology background.

Methodology. Look for a coach who has developed their own methodology over time. Be wary of individuals who sell a one-size-fits-all approach to coaching.

Coaching engagement. In addition to asking about the length of the coaching engagement, find out how often the sessions will occur. Some coaches only meet with clients monthly, even ad hoc. I have found that meeting weekly yields the greatest returns in terms of deep transformative change.

Personality fit. It's a good idea to meet with prospective coaches before engaging in an agreement. That way, you can ensure someone is a good personality fit for the employee.

This post originally appeared on ATD and has been posted with permission from the author. You can view the original here.