I recently met three people who all consider themselves coaches. One person is a psychic turned life coach; the second, a bookkeeper turned business coach; and the third, an administrative assistant turned operations coach.

What do they all have in common?

They have zero coaching experience.

With more people entering the coaching space and no barriers to entry, it’s imperative that you find ways to differentiate yourself.

One way to differentiate is by measuring the return on investment (ROI) a client receives as a result of your coaching. After all, leadership and executive coaching is all about creating behavioral change, but most coaches don’t measure that change. Our belief is that a positive change in leadership behavior has a correlating positive impact on people, the business and ultimately ROI.

The Gaps

I started to get curious about measurement as a result of the work we were doing with clients. As we took on longer-term engagements, we noticed two key gaps in our own work. We also noticed a pattern: the same serious gaps existed in the work of many other world-class executive coaches.

Gap #1: The first gap emerged when our executive sponsors started asking, “How do you know if the coaching is successful?” We responded with grins because we had smiley sheets that reflected great results. Participants were happy with our coaches. But, deep down inside, we knew we were only measuring client satisfaction and not change.

Gap #2: The second major gap emerged from our coachees themselves. We noticed that when the action-planning process was paper based, 80% of the participants either didn’t create an action plan or their plan was so weak it wouldn’t support behavioral change. On top of that, there was zero transparency between the coachee and coach, and between the coachee and her manager—and we know the manager’s role is critical to creating behavioral change.

Behavioral Measurement

In an effort to close those gaps, we developed a three-step process to measure behavioral change.

Step 1: Create an Online Action Plan

The first step is for the coachee to create an action plan. AND, it needs to be online. Online action plans create the transparency and accountability needed to support change. Inside the action plan, the coachee should identify one behavior per goal. These behaviors will ultimately become survey items later in the process.

Step 2: Identify Supporters

Ask most world-class athletes why they’re successful and they’ll often point to the team that surrounds them—their coaches and support staff. We need to apply the same principle in leadership development.

The second step is to surround the coachee with supporters—people who are impacted by the coachee’s behaviors and willing to provide ongoing feedback through a series of pulse surveys.

Step 3: Conduct Pulse Feedback

Next is ongoing measurement—we call this pulse feedback. In many coaching engagements, there’s 360 feedback at the beginning. In some programs, there’s a “time two” 360 at the end. The intent is good, but it’s unfocused measurement and often times unrelated to the participant’s action plan. Instead, we advocate for 360 feedback at the beginning, a focused action plan, and then ongoing pulse feedback surveys based on the action plan so that the coachee knows if they are moving the needle of change.

Calculate ROI

After you’ve tracked behavioral change, you can assess the greater impact to the organization. We culminate our coaching programs by guiding each coachee through an ROI calculation.

Below are the steps we recommend to calculate ROI:

  1. Leadership Goals: What goals did the coachee focus on?
  2. Impact of Behavior Change: As a result, what was the impact to people, process and/or the business? Have coachees describe what changed.
  3. Financial and Business Impact: What were the financial and/or business results that came about? Perhaps there was an improvement in productivity or efficiency. Maybe there was an impact on revenue or cost. Better leadership may have led to improved retention or new innovations.
  4. Percentage Attributed to Coaching: What factors contributed to the improvements? It’s likely that the business impact in step 3 was due to several factors, not just coaching. This step prompts the coachee to determine the extent to which coaching contributed to the business outcome. It’s better to be conservative and to underestimate the percentage, since you’ll have to justify your assumptions to executive sponsors.
  5. Financial Impact Due to Coaching: Multiply the financial and business impact from step 3 to the percentage identified in step 4 to determine the outcome resulting from your coaching efforts.

What’s Next?

If you want to differentiate yourself, you have to go beyond anecdotal confirmation that your coaching works. You have to shift from “my clients love me” to actual measurement at the behavioral and organizational levels. Otherwise you’ll be lumped in with the psychic, bookkeeper and admin.

 


Sal Silvester is an executive coach and author, who draws on his years of experience as a veteran Army officer, Accenture executive and founder of 5.12 Solutions and Coachmetrix. As a top leadership thinker and blogger, Sal has authored three best-selling books: Ignite! The 4 Essential Rules of for Emerging Leaders, Unite! The 4 Mindset shifts for Senior Leaders and Stakeholder Centered Coaching: Maximizing Your Impact as a Coach, which he co-authored with Marshall Goldsmith.
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