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RETURN ON INVESTMENT IN COACHING: PROPOSAL OF A METHOD

The subject of return on investment in coaching is a bit like the 64,000 Dollar Question, a popular American television quiz from the 1950s where the final question could be worth that amount (the equivalent of a half-million in today’s dollars) to the competitor who reached that level. Önceliği elden ödeme olan şirinevler escort bayanlara ulaşmak siz beyler için en önemlisidir. The show was however the subject of a great scandal when it was discovered that two of the winners, Charles Van Doren and Herb Stempel, had cheated with the complicity of the producers who wanted to give a dramatic tone to their show. A film (Quiz Show) and a book were also based on this story.

Similarly, to date, the answers that have been given in relation to the return on investment in coaching have been blown away by various inconclusive studies, but which have produced some dramatic effects, the most famous, still abundantly quoted, is that published in 2001 in The Manchester Review, which reported a 5.7x return on investment in leadership coaching. 1 However, the study’s methodology and small sample size have exposed it to harsh criticism, including that of Australian coaching expert Anthony Grant.

Several other studies were subsequently conducted with equally questionable results, the greatest difficulty being to isolate the impact of coaching from other variables that may influence the measured effectiveness factors.

It is in this spirit that Paul Lawrence and Ann Whyte undertook a research project on the subject, to find out how organizations evaluate their investments in coaching as well as their degree of satisfaction with the approaches used, and if it was possible to develop a model for calculating return on investment that they could use in the future. The results of their research were the subject of an article in the journal Coaching: An International Journal of Theory, Research, and Practice.

What do coaching buyers think?

The research authors decided to initially invite 50 buyers of coaching services to participate in a survey. Twenty-nine of them responded. Participants represented a wide range of organizations from a variety of sectors such as government agencies, financial and professional services, retail, energy, manufacturing, construction, and hospitality. Sixteen were based in Sidney, Australia, ten in Melbourne, one in Brisbane, and two in the United States.

The study also wanted to test whether it was true that few organizations take the time to assess their investment in coaching, find out how those who do are doing it, and understand the biggest obstacles in the way of executive coaching. ‘Evaluation.

However, it’s a question like “If your CEO asked you to justify your investments in coaching, what would you say?” which generated the most enlightening information to researchers.

An unusual coaching evaluation model

Lawrence and Whyte’s research resulted in an essentially linear model of coaching evaluation that takes the form of a ‘clock tower’, starting at its base with the goal or purpose of coaching and culminating at the very top with the financial aspects. This is more of an evaluation strategy used by coaching buyers than a uniformly applicable calculation formula.

between the goal of coaching or better still the “purpose” for which one decides to use coaching, establishing a clear difference with the objectives of a coaching mandate and this larger purpose related to the organization.

Indeed, they define the goal of coaching as having a predetermined intention aligned with the strategy of the organization. For example, an organization may want to use coaching to increase the number of potential successors for different key roles. On the other hand, each coach will have specific objectives.

. In this regard, it is crucial that the purchasing client ensures that coaching is the appropriate form of intervention for the person.

Coaching evaluation model

The coaching methodology. Which is at the third level, includes an explicit forward-looking evaluation of the coach’s coaching philosophy, profile, experience, approach. And methods used. The authors of the research do not give any leads to identify more appropriate methodologies than others. But the participants in the research clearly indicated that it was important to choose the right coach for the right person.

Behaviors, at the fourth level of the model.  In fact, 83% of interviewees stated that their evaluation strategy includes continuous observation of behavioral changes in the coach and for which they can obtain feedback, including the use of 360 o tools.

At the fifth level of the model. Results are any quantifiable element related to the results of the activities (business or otherwise) of the organization. Results such as greater engagement or behavior change are not sufficient indicators.

Finally, Return on Investment (ROI) is an explicit formula for calculating a monetary value for coaching results. However, only 28% of participants mentioned ROI as a component of a perfect coaching evaluation system. Buyers demonstrated more interest in the depth of understanding of coaching by senior executives.

The model proposed by the authors also includes a periodic evaluation process. That purchasing clients use to check the progress of coaching mandates, at least three times. For example, they make sure there is a coaching plan at the start. They then do another follow-up at the mid-term of the mandates as well as at the end. This kind of evaluation is easier to do in coaching than in training. Indeed, it is difficult to assess the results of a training program until it is completed, while research participants claim to be able to follow the evolution and progress of the career transition specialists as they go along. the course of the coaching program.

What about return on investment (ROI)?

The authors conclude that using financial parameters to calculate the ROI can be useful. Provided that the ROI complements other evidence of effectiveness. A simple financial measure is unlikely to be useful in assessing the impact of coaching in an organization. Indeed, it seems that leaders do not necessarily seek concrete proof that coaching has a direct impact on profit. They are more likely to seek evidence that coaching has an impact on key dimensions of organizational performance.

Implications of this research for coaches

Following this study, it would have been easier for all transition coaches to have access to a universal formula. For calculating the ROI of coaching. But this would reduce the value of coaching to a single figure by ignoring. The benefits that can be difficult to quantify in monetary terms.

Obviously, this presents a dilemma for evaluating the benefits of coaching. Indeed, how to assess the monetary value of improving leadership behaviors? The answer arguably begins with an informed look at the achievement of the organization’s strategy. Which includes a complex set of factors related to its success.

That’s why Lawrence and Whyte’s model offers a tool too. Work with clients to help them develop a coaching evaluation system that considers more than just money.

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