Research report 2007
By Sarah Chiumento, Chief Executive, Chiumento
Our research reveals that organisations in the UK are failing to get the most
from coaching, despite a willingness to invest significantly in this leading people
development tool. In particular, organisations’ reluctance to measure the bottom
line impact of coaching is a key cause for concern rendering them unable to prove
a clear return on their investment.
With Coaching Counts, conducted in conjunction with Personnel Today,
we set out to explore the use of coaching in UK organisations. It is clear
that organisations recognise coaching as a powerful tool to boost individual
performance and leadership effectiveness. A lack of industry regulation however,
has fostered some negative perceptions of coaching that must be challenged if the
industry is to flourish and organisations are to reap the benefits.
Undoubtedly, regulating such a diverse and dynamic industry is a tough call but
if organisations and practitioners work together to set standards and monitor
activity, they will both benefit. Furthermore, decision-makers who are buying
coaching have a responsibility to ensure coaching suppliers have the appropriate
experience and qualifications. Organisations that view measurement of their
investment in coaching and regulation of the industry as “just too difficult”, are
potentially squandering their talent development budget. Individuals who believe
that anecdotal measurement alone is sufficient may find their budget withdrawn,
impacting on the value that can be derived from coaching interventions.
Our research also reveals that many organisations expect managerial staff to
coach. While this approach can be cost-effective, managers need time set aside
to coach their teams, and the skills to coach successfully and confidently. Poor
coaching from inadequately trained managers can do more harm than good.
With an increasing focus on HR to provide evidence of value for money – HR
can ill-afford to neglect measurement as a way of demonstrating the impact of its
investments in development tools, especially coaching.
By Helen McCormick, Acting Features Editor, Personnel Today
Coaching has become a popular people development tool, with many
organisations upping their spending year on year. One of the more alarming
findings to emerge from the survey however, is that while they seem happy to
throw handsome amounts of money at coaching, worryingly few firms measure
the bottom line return on this investment. Measurement is widely felt to be
difficult, but greater efforts must be made if coaching is to be fully effective. With
HR increasingly expected to provide tangible evidence of the value for money of
all its decisions, the ROI in relation to coaching can no longer be ignored.
About the research
This research is based on responses from 497 companies with an average of 12,481 employees.
The fieldwork was conducted in the week commencing 23 April 2007 by Reed Business Insight
among Personnel Today’s readership.
The most popular reason for Many respondents however, question 70 per cent of respondents say their
organisations to invest in coaching is regulation of the industry with more organisation offers coaching.
to improve individual performance than two thirds believing there are Of these, however, just 26 per cent
Most organisations are spending too many ‘cowboy’ operators offer coaching to everyone, while
between £100,000 and £499,999 Worryingly, more than two thirds of 44 per cent only offer coaching
a year on external coaching. And organisations do not formally measure to the senior teams
this is increasing. More than half are the return on investment (ROI) 55 per cent of organisations admit
using more coaching than a year ago; of coaching, many because they that their approach to coaching
55 per cent also anticipate levels of feel it is hard to get more than is ad-hoc.
coaching to continue to increase over anecdotal evidence
the next 12 months
Exploring the findings
The state of play in the UK
The importance of coaching as a way of Developing a strategy for coaching would Does your organisation
improving performance is clearly gaining help organisations truly maximise and offer coaching?
recognition in British business. harness the impact of coaching. 44%
An overwhelming 93 per cent of Of the various models used in coaching, 30%
organisations believe that coaching is now three dominate the marketplace.
a leading development tool. And coaching The most common is the GROW model
is increasingly prevalent in business: (41 per cent), followed by solution
two-thirds of organisations (65 per cent) focused coaching at 38 per cent and NLP 26%
have used coaching for the past five at 19 per cent. This confirms that despite
years, while 12 per cent have offered it the ever increasing number of coaching No, my organisation does not offer coaching
to staff for more than 10 years. The vast models emerging from sports, psychology, Yes, only to certain job levels in the organisation
majority use coaching primarily as a tool to academia and other areas, there is a Yes, to everyone in the organisation
improve performance (77 per cent), continued focus on using the tried
while 67 per cent use it to develop skills If yes, only to certain job levels
and tested models that have been
and 63 per cent to train managers in in the organisation:
practiced now for some years and
coaching skills. which deliver results.
Board level 49%
Senior Management 75%
The responsibility for buying coaching The majority of organisations use both Other managerial 54%
tends to lie with the HR department internal and external coaches, although Other 19%
(56 per cent). Forty-four per cent say two out of 10 solely rely on line managers
that it is part of a strategic approach to coach teams and 16 per cent use only
to how they develop their people. external coaches.
Forty one per cent however, admit that
it is left to line managers, which indicates Does your organisation employ internal and/or external coaches?
that a substantial number of organisations 1% 10%
are not taking a planned, strategic
approach to their investment in coaching. 19% Internal coaches only (coaching staff
employed by organisation)
So it is unsurprising that the majority Internal coaches only (line managers
act as coaches)
(55 per cent) of organisations say their
External coaches only
approach to coaching is ad-hoc – that is
Both internal and external coaches
to say bought reactively rather than as 16%
(1%) Don’t know
part of a planned development strategy. 53%
The benefits of coaching
Encouragingly, 96 per cent of organisations Why do organisations invest in coaching?
claim to have seen individual performance
To improve individual performance 83% 17%
improve since coaching was introduced.
To improve leadership/management effectiveness 81% 17%
Nearly as many (92 per cent) have also
To aid personal development 66% 32%
seen improvements to leadership
and management effectiveness. To improve productivity of the organisation 61% 34%
Of these, 45 per cent and 39 per cent To support individual career progression 45% 47%
respectively have seen significant or To improve employee engagement 40% 48%
major improvements. To improve staff retention 29% 52%
0 20 40 60 80 100
To improve emotional intelligence 22% 51%
When the public and private sectors are 0 20 40 60 80 100
0 20 40 60 80 100
compared however, there is a marked
Agree strongly Agree slightly
difference between the two. The public
sector trails behind the private sector on
all benefits since introducing coaching.
Regulation, regulation, regulation
This is despite spending more money
overall on coaching than the private Concerns about regulation and mentoring in Europe. These standards
sector, and despite 60 per cent of public accreditation have encouraged some are proving to be of practical value to
sector organisations now using more negative perceptions about the coaching organisations, training providers and
coaching than a year ago. The public industry. Worryingly, 69 per cent of practitioners in identifying what ‘good
sector also anticipates its use of coaching respondents believe that there are too coaching’ looks like”.
will rise over the next 12 months. many cowboys in the coaching industry.
With no one awarding body for coaching
An overwhelming 83 per cent believe qualifications however, standards can,
the industry would benefit from more
and do, vary considerably. There is also
regulation so it is encouraging to see that
no governing body for coaches, and
some coaching organisations such as the
none is planned in the foreseeable
European Mentoring & Coaching Council
future. Clearly, there are coaches in the
(EMCC) are making inroads here.
marketplace who may not have sufficient
The EMCC’s Chair of European Standards
experience and/or training, nor relevant
Committee, Marina Dieck explains,
“Through collaboration and research the knowledge. This is borne out by the
EMCC has developed a set of standards finding that three-quarters of
and competencies to work towards respondents believe it is difficult to
establishing excellence in coaching and find high-quality coaches.
What improvements have occurred in organisations
since coaching was introduced?
Improved individual performance 45% 51%
Improved personal development 39% 55%
Improved leadership/management effectiveness 36% 56%
Improved support for individual career progression 26% 59%
Improved productivity of the organisation 23% 62%
Improved employee engagement 18% 61%
Improved emotional intelligence 12% 55%
0 20 40 60 80 100
Improved staff retention 10% 52%
Agree strongly Agree slightly
Who’s coaching the coaches? The cost of coaching
The most common factor for choosing organisations when choosing a coach While 41 per cent of organisations spend
an individual coach is their coaching – and this could be one reason why less than £50,000 a year on coaching,
experience – nearly eight out of our results suggest that 69 per cent of 44 per cent spend between £100,000
10 respondents claim to take this into organisations question the quality to £499,999, rising to 51 per cent
consideration. Only 17 per cent believe of their coaching providers. of organisations in the public sector.
that supervision should be taken into The top factor when choosing a coaching The average spend on coaching by
account when making a decision, yet supplier rather than an individual coach organisations is £83,250. It is clear that
supervision is a crucial factor in ensuring is the quality of coaches, cited by 71 per coaching represents a significant amount of
good practice in coaching and to act cent as the reason behind a decision. an organisation’s budget. The majority of
as a release valve for coaches dealing This is followed by recommendation organisations’ coaching budgets are spent
with difficult yet confidential situations. (49 per cent) and price (48 per cent). on one-on-one executive coaching.
Supervision may also become a central Clearly, the power of word of mouth HR is most likely to control the coaching
method of regulating coaching. As the in the decision-making process should budget in an organisation, but two out
CIPD’s Coaching Supervision (2006) not be ignored, but in the absence of of 10 line managers have the final say -
report states, if you fail “to provide recommendation serious review of another indicator of the ad hoc nature of
supervision for internal coaches and supervision and qualifications is a must. coaching in many organisations.
manager coaches, the sustainability and
The consequence can be a variety of
return on investment of your coaching
coaches and inconsistent standards
initiative is in jeopardy.” So it is concerning
– which in turn limits the opportunity to
that this is overlooked by so many
measure the value of coaching.
The ROI of coaching
Just under half (44 per cent) believe it ROI is participant feedback (80 per Is ROI of coaching formally
is impossible to measure the ROI of cent), a qualitative way of tracking measured in your organisation?
coaching. This partly explains why a investment. This suggests that even those
significant 67 per cent of organisations do organisations that do measure ROI of
not formally measure the return on their coaching are not necessarily doing this
investment in coaching. This decreases effectively. Achievement of a participant’s
slightly for public sector organisations (64 objectives, arguably a more rigorous way
per cent). Yet, if coaching is not managed of measuring ROI, is cited by only 59 per
properly, it has the potential to be a waste cent. Surprisingly, slightly more than half of
of money. Coupled with the fact that over respondents believe that it is impossible 67% said return on investment of
two-thirds of businesses believe there are to get anything more than anecdotal coaching is not formally measured
too many cowboys in coaching, due to a evidence about the effectiveness of within their organisations.
lack of industry regulation and confusion coaching, which is perhaps why they
over accreditation, these findings pose neglect to measure its ROI altogether. Yes
some concerning questions about how Don’t know
buyers can know what their organisation
gets for its investment.
Only 13 per cent of respondents claim How is ROI of coaching measured?
they take the time to calculate what they Participant feedback 80%
are actually getting for their money when Appraisal 73%
they buy coaching services. The most Feedback forms from coaches 70%
popular method cited for measuring Employee engagement surveys 66%
Employee feedback 61%
Achievement of objectives 59%
Improvement in work quality 50%
360 feedback 48%
Employee retention 45%
Anecdotal evidence 41%
Use of coaching goals 39%
Impact on bottom line 34%
External indicators 32%
Customer feedback 25%
Money saved on recruitment costs 25%
It’s not all bad news. Chiumento advises taking a few simple steps
to demonstrate the value of coaching in your organisation.
Ensure that you discuss and agree the Try to develop some measures so Create a coaching budget and track
outcomes you want from coaching at that you know it when you see it! the costs and hours of coaching against
the outset with the coach, coachee For example if the outcome for the it and the arrangements you have with
and their manager or sponsor - the coachee is ‘more confidence in the each coach. Manage the coaches in
person who has oversight for the board room’ you might want to see your organisation and be clear about
coaching assignment. This could be them speaking up more frequently, those that deliver quality and those
someone from the HR department or voicing their opinions more often, that don’t
a line manager more conviction in what they say and Make coaching part of an integrated
Make sure the outcomes are fighting his or her corner approach to developing your
realistic and specific enough to avoid While protecting confidentiality people – link it to other initiatives
misunderstanding and they are get feedback at regular intervals on such as succession planning and
genuinely relevant to the individual’s progress. This can be gathered as part performance management
professional development and of the coaching assignment from a Involve business leaders in evaluating
the business range of colleagues and other staff the business impact of coaching.
Record these outcomes as part of a A mid way review with the coach and Measures such as reduced staff
‘coaching contract’ so that you have a coachee can be a very useful way of turnover and better retention are a
basis for determining what has been focusing attention on what is different good start but may well understate
achieved. Review them at an end of and it also allows for adjustment if the real benefits to the business. For
assignment review meeting with the things are off track example tangible outcomes might be
coach, coachee and sponsor better time to market or improved
forecasting. Both would have significant
measurable business impact.
Set a strategy for coaching and get When selecting coaches, ask about the Price will undoubtedly influence the
buy-in from the senior team. Don’t results the coach has achieved in the decision-making process, but other
just invest in coaching as a knee-jerk past and the extent of their training. factors such as quality are equally
reaction when needed. It should be a Get references and talk to people important. Remember the saying –
long-term people development tool they have worked with. Consider if you pay peanuts, you get monkeys.
related to business needs working with an organisation that has a Regrettably there are cowboys out
Position coaching as a positive coordinated approach to coaching, there who give the coaching industry
intervention that is an investment is clear about its measure of quality and a bad name
in development. Don’t allow it to supervision provision and can help you Involve the business leaders in
become a remedial intervention only identify the most appropriate measures determining the measurement
offered to those in the company of the ROI for your particular needs of coaching’s ROI, not just the
whose performance is below par and business HR department.
Establish if the coach is accredited. If you expect line managers to deliver
Are they a member of a body such as coaching, give them proper training
the International Coaching Federation and the time and skills to do this.
or the EMCC? Such memberships Careful evaluation of the cost/benefit
provide reassurance around the quality of internal delivery helps identify if this
and ethics of coaching is the best approach. Managers need to
realise that delivering coaching can help
them get the best out of their teams
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