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The Business Case for leadership Coaching

Being high up in the hierarchy is wonderful, and what’s great about being human is that … you can still grow! 

Leadership Coaching is a vehicle that expands your capacity so you and your organization gains.

I’m not making this up. There’s plenty of independent research backing this up.

ROI on Executive Coaching

A study on the impact of Leadership Coaching determined the ROI was 689% (factoring in the fully loaded cost of the coaching including opportunity cost associated with the time leaders spent being coached). That means for every $1000 invested in coaching, the organization reaped $6,890 in benefits. Wow.

The main competencies that coaching helped leaders develop included:

  • Leadership behavior (82%)
  • Building teams (41%)
  • Developing staff (36%) 

The leaders were very satisfied with their coaching experiences:

  • 95% are doing things differently as a result of coaching
  • 95% would recommend coaching to other company staff.

Good right? And there’s more.

A study on the impact of coaching in a Fortune 500 firm found an ROI of five to seven times the initial investment in an executive coaching program every $1000 invested in coaching generated $5000-7000 in benefits. Another wow.

  • Coaching produced a 529% return on investment and significant intangible benefits to the business.
  • Including the financial benefits from employee retention boosted ROI to 788%.

A study of 100 executives coached for 6-12 months documented an ROI of 570% on the initial investment in the coaching program.

  • Tangible impacts on business included increases in productivity, quality, organizational strength, and customer service.
  • Executives and their organizations also obtained intangible benefits including improved relationships with direct reports, peers, and stakeholders, as well as improved teamwork, increased job satisfaction, and reduced conflict.

Coaching makes sense.

Coaching helps organizations get the most from other tools

A study on executive coaching as a tool for transferring training noted that training with managers increased manager productivity by 22%, and adding a one-to-one (8-week) coaching intervention after the training pushed productivity to 88%.

Did you see that?

Increased productivity from training went from 22% to 88% – coaching made the training FOUR TIMES more effective. One more wow.

Personal Benefits

Studies have found that coaching reduced executives’ stress an average of 18% after 8-10 coaching conversations, while some participants experienced a reduction in stress level as high as 47%.

The primary stress relieving competencies that coaching assisted leaders to develop included:

  • Tools and perspectives to better tackle stress (74%).
  • Better prioritizing of time (72%).
  • Improved ability to make decisions aligned with what is truly important to them (79%).
  • Deeper understanding of the thoughts and actions that stand in their way (81%).
  • 85% said that the coaching made a significant impact on them and has helped them make various necessary changes in their day-to-day lives (85%).

Several (as in 17) studies have found that the process of coaching benefits the individual and organization by increasing the individual’s confidence, developing strategies for coping with work demands, and enhancing personal performance.

Bottom Line

Coaching is popular for developing leaders because it work. It makes sense.

It’s a win-win-win.

  • The organization benefits with better performance.
  • The team benefits because of more effective leadership.
  • And the individual benefits because they get to draw on more of their strengths and bring their best more consistently.

What’s not to love?

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