Return On Investment

Coaching’s Return On Investment

Transfer of Training

Executive coaching as a transfer of training tool: effects on productivity in a public agency.
( Public Personnel Management ) Olivero, Gerald; Bane, K. Denise; Kopelman, Richard E.; 12-22-1997.

Archival data were collected indicating that training alone increased productivity by 22.4 percent. Most importantly, training, when augmented with coaching, yielded productivity increases almost four times the level achieved by training alone (88.0 percent).

THE MANCHESTER REVIEW

2001 • VOLUME 6 • NUMBER 1

Tangible Business Impacts

(Frequency of impacts reported by executives)

Productivity 53%
Quality 48%
Organizational Strength 48%
Customer Service 39%
Reduced Complaints 34%
Own Retention 32%
Cost Reductions 23%
Bottom Line Profitability 22%
Top Line Revenue 14%
Reduced Turnover 12%
Other Business 7%

Intangible Business Impacts

(Frequency of impacts reported by executives)

Improved Relationship: Reports 77%
Improved Relationship: Stakeholder 71%
Improved Teamwork 67%
Improved Relationship: Peers 63%
Improved Job Satisfaction 61%
Reduced Conflict 52%
Increased Organizational Commitment 44%
Improved Relationship: Clients 37%
Other Intangibles 31%

Most exciting of all were the estimates of return on investment. As indicated earlier, when estimated in the most conservative manner, ROI averaged nearly $100,000 for the sample, or 5.7 times the initial estimate.

Booz Allen Sees Nearly 700% ROI

Industrial and Commercial Training. Guilsborough: 2006. Vol. 38, Iss. 3; pg. 122.
Vernita Parker-Wilkins, Executive Development Manager, Booz Allen Hamilton, McLean, Virginia, USA.

Booz Allen, a management consulting firm ranked 75th in Fortune magazine’s 2005 “100 best companies to work for” and 4th in Consulting Magazine’s overall best firm to work for in 2004; partnered with MetrixGlobal, LLC to conduct a business impact study on the Executive Coaching Program. MetrixGlobal is a professional services firm that specializes in providing performance measurement solutions that increase bottom-line results.

Monetary benefits were identified by 61 percent of the leaders in seven of the eight business impact areas.

Total monetary benefits=$3,268,325.Four impact areas were identified as having produced at least $500,000 of annualized benefit to the business:
- Improved teamwork ($981,980).
- Quality of consulting ($863,625).
- Retention {of team members} ($626,456).
- Team member satisfaction ($541,250).
Total cost of coaching=$414,310.
Cost number was fully loaded with costs associated with administering and managing coaching, fees to the coaches, opportunity costs, etc.

The ROI calculation formula is:

(($3,268,325 – $414,310) ÷ 414,310) × 100=689%.

Triad Performance Technologies, Inc.
Grand Rapids, MI
Coaching & Sales Professionals

Triad Performance Technologies, Inc. studied and evaluated the effects of a coaching intervention on a group of regional and district sales managers within a large telecom organization. The third party research study cites a 10:1 return on investment in less than one year.

The study found that the following business outcomes were directly attributable to the coaching intervention:

Top performing staff, who were considering leaving the organization, were retained, resulting in reduced turnover, increased revenue, and improved customer satisfaction.
A positive work environment was created, focusing on strategic account development and higher sales volume.
Customer revenues and customer satisfaction were improved due to fully staffed and fully functioning territories.
Revenues were increased, due to managers improving their performance and exceeding their goals.