What Coaching Accomplishes

If a company invests $100,000 in new equipment, they expect a reasonable return on their investment (ROI) and  yet just 10% of 2,000 coaches surveyed, measure the impact of coaching using the ROI method! How do you calculate ROI and what is considered ​reasonable?
Source: International Coach Federation (ICF)
We have adopted the ROI Methodology™ (see graphic below)which is the ideal method for measuring the success of coaching. Dr. Jack J. Phillips and the ROI Institute developed and refined the methodology over the last two decades. While some coaches may assume that any behavior change and subsequent impact is directly attributed to coaching, it may be possible (and probable) that other influences are driving the same measure. According to the ROI Institute, as a change in business measure is documented, it is important to take the extra step to isolate the effect of the coaching on that measure.
 

ROI PROCESS METHODOLOGY

Isolating the impact of coaching from other variables starts with asking the person being coached to estimate the percent of improvement linked to the coaching after other factors have been itemized (i.e., all the factors that have or could have contributed to the improvement in the measure). Recognizing that this is an estimate, two other steps were taken to increase the acuracy of the impact: (a) assembled a group of subject matter experts (stakeholders) to discuss and agree on a similar estimate; (b) adjust for the error of the estimate. Here, all the participants are asked to indicate the confidence of the estimate that’s been provided on a scale of 0-100% where 0% is no confidence and 100% is a certainty. In this case, it was determined that the impact of coaching on the business outcome was 30% so the results were adjusted accordingly. 
In a real case study of the ROI of Coaching, a senior leader went through the Core Energy Coaching program after 13 years with the firm. He was a candidate for Partner, however he had received negative feedback from team surveys for the last two years. His advancement would be limited if he did not change his leadership style. He could even be terminated if the situation became worse. After six months, his anabolic energy was up considerably, productivity was up 67% and the "return on expectations" for coaching was off the charts. For a more detailed analysis of this actual case, click on the "Case Study" button to the right.