Verification of Coaching Results (ROI)

transcript

Coaching: does it pay off or not?

Jitka Holt, Holt Communications Inc.International Coaches Meeting in Prague

February 3 – 4, 2011

“Not everything that can be counted counts, and not everything that counts can be counted.”

-- Albert Einstein

Agenda

• What kind of coaching brings results?• It’s all in the process• To measure or not to measure?• What results do we verify?• How do we verify results?• Designing your process

What kind of coaching?

Source: MetrixGlobal LLC

What am I made of?

What do I need to do?

Who do I want to be?

What do I want to create?

The bigger the agenda, the bigger the impact

But how do we measure it?

Or do we?

It’s all in the process

Same old, same old... It’s all in the process: set it right

Verify impact

Same old: ask the right questions

•Build alliances

•Decide: measure or not to measure

•Ask the right questions

Verify impact

To measure or not to measure?

Ask the right questions

For example:• What measurement will be possible? • Who are the measurement data for?• What sort and quality of data can be obtained? • What effects will attempting to measure have on

the coaching work?• What measurement will suffice given

organisational limitations and demands?

Source: Exceptional Executive Coaching, Dagley, 2009

Verification make senseHaving a quantifiable measure of the return on

investment (ROI) from coaching is:

Verification makes sense

12%24%

Important Not now Not

Source: Association for Coaching, 2004

What do you think?

In your experience, how important is it to verify the coaching results?

Same old: start with the end in mind

•Build alliances

•Engage a sponsor

•Find a good fit between coach and coachee

•Agree on measuring methods and metrics

Verify impact

Overview of quantifiable benefits* (example)

* According to purchasers

Confidence in quantitative measures (in %)

Percent confidence

Qualitative benefits (example)*

* According to purchasers

Same old? Make sure you’re on track: measure as you go

•Build alliances

•Conduct periodic check-ups

•Debrief

Verify impact

•Engage a sponsor

Challenge (individuals):

The impact is in the values, but it’s the behaviours that we measure: authenticity counts.

Challenge (organizations):

Mission

Vision

Values

Organizational goals

BehavioursThe impact is in

the values, but it’s the behaviours that we measure: authenticity counts.

Challenge: how do you know it’s working?What gets measured, gets done, so...

. . .watch out for the Hawthorne effect.

Same old? Measure a bit more

•Build alliances

•Debrief

•Interview•Conduct feedback

•Informal•Structured•360•…

Verify impact

•Engage a sponsor

Some verification methods

Percent

Source: Exceptional Executive Coaching, Dagley, 2009

Verifications methods overviewContext(Individual/or-ganizations)

Qualitative/ quantitative outcome

Reliabi-lity

Impact on coaching (Low/Medium/High)

Ease of admini-stration

Feedback Client Individuals/Organizations

Qualitative H H Easy

Peer-to-peer

Organizations Qualitative H HHH Medium

360 Organizations Qualitative/Quantitative

H H Complex

Interview Organizations Qualitative Medium M Easy

Survey Organizations Quantitative M/H L Complex

Formal debrief

Organizations Qualitative M/H May impede Medium

Performan-ce review

Organizations Qualitative/Quantitative

H May impede Medium

ESTIMATE

What do you think? What has been your

experience with using some of the verification methods? (+, Δ, comments)

Return on investment: what is it?

What it is• One way of showing

business value• Feedback about how to

increase value• Important for us to do as

business people

What it is not• A way of replacing intangible

value• A “final grade” about

performance• A defence of last resort to

justify our programs

Return on investment is a way to quantify that you are getting your value for money

ROI: where is it at for individuals?

ROI344%

on avrg

Initial investment

• Just over two thirds indicate they had at least made their money back

• On average: 344%

Source: ICF Global Coaching Client Study, 2009

Initial investment

ROI700%

on avrg

ROI: where is it at for companies?

• The vast majority* had at least made their investment back.

• On average: 700%

* Of those about to provide company ROI

ROI: where is it at for companies?• 19% indicated

an ROI of at least 50 (5000%) times the initial investment

• 28% saw an ROI of 10 to 49 times the investment

ROI is a versatile toolROI level When Data

Estimation Done before program is fully developed or deployed

Previous studies of similar programs

Forecast Done during the pilot phase of the program

Estimation by pilot participants

Post-program Done after the program has completed and learners had a chance to apply what they learned

Estimations, pre-/post metrics, control groups

Isolating the effects of coaching

• Personal interview with each respondent• Causal connection established:

Coaching -> behaviour change -> impact

• Effects of coaching were isolated– Estimate of change due to coaching– Estimate of confidence (error)

Example: personal productivityCaptured in terms of hours saved per week. Respondents noted

how coaching led to behaviour changes and then estimated the hours saved per week from these behaviour changes.

Respondent: “Focused on business priorities... Get more done in shorter time.... Leading more effective meetings.”

Estimated at 3 – 5 hours/week3hrs @ $75/hour x 48 weeks = $10,800$10,000 x 80% (coaching) x 75% (confidence)Net benefit = $6,480

Comic relief

Example: business impact and monetary benefits

Individual conversations revealed that 77% (23 of 30) cited coaching as having significant impact on at least one business area. Sixty percent (18) were able to quantify this impact in monetary terms.

Business impact area

% total citing significant impact

% total identifying $ benefits

$ benefits (discount-ed by estimators

Work output

30 20 $947, 208

Productivi-ty

60 50 277,526

Cost control

3 3 67,200

Employee retention

27 13 660,000

Sales volume

10 10 311,200

Total benefit

$2,263,134

Nortel Networks ROI calculation

The total cost for 43 participants was $255,000, which included all costs for administration, vendor, advisory council and time for clients to be coached.

ROI = [(Payback - Investment)/Investment)] x 100

$2,263K - $255K $255K

x 100% = 788%

Quite new: keep on going

•Build alliances

•Engage a sponsor

•Debrief

•Interview•Conduct feedback

•Informal•Structured•360•…

•Agree on ongoing feedback process with client

Verify impact

Ongoing feedback, a way to continue coaching• “... it’s not about the

coach, it’s about the people, a good leader is the least visible – for feedback/effectiveness, ask around!”

Source: Ask, Learn, Marshall Goldsmith, 1997

How to build your case: unsolicited advice

How to build your case: unsolicited advice• Before you start, agree on a verification process unique

to each engagement• In organizations,

• Engage the sponsoring leader• Set responsibilities for reporting• Offer clients the ability to select their coaches

• Manage the entire coaching process on an ongoing basis to ensure consistency and quality

• Trust is a two-way street: allow each coaching relationship to follow its own path

• Open up dialogue to learn from the coaching experience

What do you think? • How will you build

your case for your next engagement?

• What process will you propose to verify the results?

For more information contact Jitka Holt at:• E-mail: jitka@holtcommunicatons.ca

• Web: www.holtcommunications.ca• Skype: jitkainvancouver

• Tel: +1.604.724.4597