Proving It Up: ROI and Coaching
- POSTED ON MAY 25, 2022
Coaching as a profession is often faced with this question: what is your value?
The full spectrum of potential clients, ranging from corporate buyers to individuals in life transition and more, frequently want to know how you can help them where it really matters in the bottom line.
Many coaches will assert that return on investment is not a good scale when measuring coaching success. And still, the person approving the spend or writing the check wants to understand how the coaching will help them change and grow, often expressed as some form of payoff.
There are several ways you can meet this client requirement to gain both new and repeat engagements and, most importantly, help clients understand and acknowledge the important changes and progress they have created, with the support of you as a powerful coach.
How to Measure Coaching ROI
Research shows that the ROI of coaching includes better productivity, higher levels of overall employee performance, decreased expenses, revenue and sales growth, increased staff retention, and increased employee engagement.
But it may not be easy for all executives to come to this realization. This is why it is advisable for coaches to be transparent from the onset. One of the ways to do this is to provide your clients with information that will help them with evaluating coaching effectiveness. Here are some tips on how to measure coaching ROI.
Stakeholders — corporate sponsors and individual clients — need behavioral change that results in specific outcomes and impact. Align coaching with desired results from the beginning, whether those are for business objectives or personal goals. Be sure also to make clear what coaching is and what is not — i.e., consulting or advising. This will also help manage their ROI and coaching expectations.
Use scaling, before and after the coaching occurs. For individuals, employ tools, such as CTI’s “Wheel of Life,” and for executives and organizations, use versions of the wheel for professional contexts. You can also interview stakeholders before and after, and roll up the results into an executive value summary. You might also be creative and develop measures like a “Happiness Index” which can be helpful for individual clients who rely on coaches to provide the reflection of transformational changes of which they may not realize in their day-to-day lives.
Write engagement summaries for corporate coaching. Report on the results in a direct and impactful way. Quality coaching that helps leaders achieve significant behavioral change can have a dramatic transformational impact across entire organizations. Report on these individual changes, and the broader impact, and you’ll have made a compelling case for your ROI and coaching argument.
Document It: Case Studies and Success Stories
This is particularly important for organizational work. For these narratives, interview the clients you have benefited. Ask them specific questions, such as: How did coaching change your leadership behaviors? How did coaching change the impact you make on others? What did you learn during coaching, and what kind of enduring changes were created? Provide these first-person testimonials to the sponsors of the coaching work to help them see the effect your work has had on an individual level. This can then be compared to initial discovery interviews as a way to help track change and impact and to assist with painting a clearer picture of the link between ROI and coaching.
The International Coach Federation (ICF) is an excellent resource that provides many tools to help its constituents demonstrate the value of coaching. In one study, the ICF reported an industry median return of seven times the initial investment in coaching. Find reports that describe the efficacy of coaching on organizations and individuals, and as a certified coach, you can use these statistics and models to help you describe your impact as well.
There is one important thing not to do: Don’t compare your coaching with gross revenue or net income. There is no way to tie coaching to specific bottom-line performance of an organization or of individuals. Smart coaches will never sign agreements that establish this type of expectation and guarantee. If the client insists, then back out of the engagement.