Future Outlook in Executive Coaching
Author: Nancy Zentis, Ph.D.
The Outlook for Executive Coaches for the future is bright!
Coaching is a growing industry. Worldwide, companies spend about $1 billion each year on executive coaches–people who work one-on-one with managers to help them better perform their jobs. The high demand for coaches is based on the fact that coaches can immensely increase the productivity of entire organizations
An executive coach helps managers, executives, and staff members to improve organizational effectiveness through inquiry and dialogue. When managers are more aware of their strengths and weaknesses, they are better able to communicate with and motivate staff members. The executive coach’s job is to assist new and seasoned managers alike as they learn to leverage their innate skillsets in more effective ways.
Executive Coaching can be lucrative earning $200 – $400 an hour on average and sometimes higher, according to a survey of 480 coaches.
Biggest Obstacles Facing Executive Coaching
Coaching Skills and Ethical Practices
When asked to identify the biggest obstacle for coaching over the next 12 months, both internal and external coaches indicated that professional coaches who lack sufficient coaching skills, training, and experience needed to support and challenge leaders could be a downfall for the profession. They indicated the need for both external and internal coaches to have a solid coaching background gained from a recognized coaching training certification program and demonstrated proven coaching ethics.
Coaches also felt that market place confusion about inconsistent coaching practices, over market saturation – too many unqualified people hanging out their coaching shingle, underpricing – coaches charging undercharging just to get the work, competing services – “I do it” all mentality, and over regulation of the field of coaching are some of their biggest concerns.
Level of Support
Some of the obstacles that concern coaches when working with clients is the level of support provided by Senior Leaders and the Individual’s Boss, while 77% of external coaches, 63% of internal coaches and 70% of organizations believe that reviewing action planning with a boss is part of the coaching process, only 34% of leaders feel this important. It appears that the most common type of senior leadership support is utilization of coaching and integration into the culture. Gaining senior leader involvement in the entire coaching process is to the success of the coaching program.
While coaching continues to gain traction at the most senior levels in the organization, there is still work to be done to show support for coaching, especially since C-level executives of the organization do not always work with a coach themselves.
Measuring Impact of Coaching and Link to Business Results
Some of the common methods used to measuring the impact of coaching are based on a satisfaction level rating, 1. the leader rates their own progress (55% – 79%), 2. The leader’s boss assesses their progress (27% – 54%) and 3. Measuring business impact -only 34% organizations indicated they measured the impact or effectiveness of coaching. While leaders seem to believe that executive coaching is being linked to business results more often than the other three rater groups, with 31% think it is done regularly.
The process of measuring the impact of the coaching needs to improve. Using quantitative data level 4 evaluation – impact on the business and organization, and individual’s job performance would greatly improve current measurement practices.
Greatest Opportunities for Executive Coaching
Executive coaching is expected to continue to grow according to responses to a question about expected trends in coaching. The majority of organizations (77%) agreed that the use of coaching will increase. Coaches were even more positive, with 91% of internal coaches and 92% of external coaches expecting an increase.
· When coaches were asked to identify the greatest opportunity for coaching over the next 12 months, they indicated that now organizations are realizing the increased benefits of coaching.
· In a recent survey, indicated a high likelihood that the use of executive coaching will increase (77% of organizations, 92% of internal coaches and 91% of external coaches).
Benefits of Coaching
Even executives are beginning to see the benefit of Executive coaching as a tool for career advancement. Human resources professionals and career counselors say that in the last several years, more high-level executives (those making more than $150,000) have turned to executive coaches and professional résumé writers. They see it as a way to gain an edge in self-marketing. An executive coach may administer self-inventory tests, conduct videotaped interviews, practice negotiating strategies and offer general career advice. Perhaps most important, they offer support and motivation during a job search that can easily last two to six months, or longer, for those seeking six-figure salaries.
Companies recognize the importance of excellent leadership and are investing in executive coaching to develop this within their employees. 2012 leadership development remained the #1 reason for hiring a coach demonstrating a clear purpose for executive coaching. Having an Executive Presence makes a surprising debut as the #2 reason for coaching. This is a new coaching specialty and is something to consider for the future.
A 2012 survey showed that 48 percent of organizations planned to invest in executive coaching over the next 12 months, and this investment is expected to increase over the next three years. Companies are increasingly aware of the need for a system that helps drive change and keeps their organization competitive and executive coaching is the best way to help a leadership team manage the human side of business during these transitions.
Difference Between Internal and External Coaches
Responses for internal and external coaches show some clear differences. External coaches have many more years of coaching experience than internal coaches. Internal coaches were more likely to have shorter assignments (3 months or less) and external coaches to have longer engagements (9 or 12 month assignments). There is also a difference in the engagement itself, with external coaches using more assessments and coaching activities (e.g., shadowing) than internal coaches.
Measuring the Impact
The number of organizations who are measuring the impact of coaching has increased dramatically in the past seven years. In the current study, about half of the organizations link executive coaching work to business results either regularly or occasionally, up from only 7% in 2005.
Linking Coaching to Leadership Development and Talent Management
As organizations continue to develop leadership development and talent management initiatives, coaching is becoming a more prevalent component of these programs. Leadership Development and Talent Management executives are often asked to demonstrate the value of coaching, and as a result look for ways to link the coaching efforts to their strategies.
The most common response was that coaching efforts are being integrated into leader development strategy/Individual Development Plans, as indicated by 80% of organizations, 75% of internal coaches and 82% of external coaches. In addition, coaching is used in succession planning, according to 57% of organizations, 39% of internal coaches and 42% of external coaches.
External coaches reported using these means of linking coaching efforts to leadership development and talent management with greater frequency than internal coaches and organizations.
Perception of Coaching
As coaching continues to grow and develop into a known industry, it is interesting to monitor the perceptions of coaching within organizations. The majority of organizations, leaders, and external coaches (60% for each rater group) said that coaching is either only or mostly seen as a positive investment in high potential leaders. Internal coaches rated these responses a little lower, with 52% selecting these responses.
There were a surprisingly high percentage of respondents who indicated that coaching is seen as both remedial for performance problems and a positive investment in high potential leaders. Organizations, internal and external coaches selected this over 40% of the time (44%, 46%, and 47% respectively), while Senior Leaders chose this answer only 26% of the time. Clearly there is a difference in perception in usage of executive coaching.
Executive coaching will continue to play an important role in growing and sustaining great organizations as the need to develop leaders to their full potential increases. Coaching provides an opportunity to help people develop to their full capacity and to think about situations in innovative and creative ways. It provides the means for moving leaders beyond the way they have always done things to a new way of approaching problems and finding solutions.
As demonstrated in the current study, the coaching industry is growing at a rapid rate. With this growth, the field of coaching and its effectiveness is viewed positively by organizations. However, several areas of concern need to be further studied as to the credentialing and experience of both internal and external coaches; linking coaching to business results and leadership development; and measuring the outcomes of the coaching relationship, coaching outcomes, and performance more objectively. Although, the field of Executive Coaching is gaining in popularity as a tool for onboarding new leaders, supporting high potentials, and developing executives, the need to create an Executive coaching strategy tied to Leadership development strategies and Human Resources strategies and supported by the C- Suite still provides opportunities for the future success of Executive Coaching.
· Executive Coaching for Results, Executive Coaching Industry Research, 2013 Final Report, Brian O Underhill, PhD., Kimcee McAnally, Ph.D., Colleen Bastian,M.A, Erica Desroslers, Ph.D., Leslie Golay, M.A., Michael Tuller, Ph.D.
· Executive Coaching,By Sadie F. Dingfelder gradPSYCH Staff, APA
- The Latest Trends in the Executive Coaching Industry, Mary Jo Asmus