The Real ROI of Executive Coaching

user Andrew Blum

Looking at the stock market since 1930, an investor who missed the best 10 days each decade would have a total return of 28%. If, on the other hand, they held steady even during the few most extreme moments both up and down, total returns would be 17,715%.  

The point here is that, while success is created over time, outcomes are disproportionately impacted by a relatively low number of choices. The “quality” of those choices determines the quality of your results.  

This illustrates the importance of specific moments and how you handle them – and coaching is essential during those moments. While the value of coaching extends over long periods, it is most acutely valuable in critical moments of volatility and complexity. It’s in these moments that an outside objective and informed resource can help you see the full range of options, help you reconnect to your core values and fundamental strategy, and help you make choices that reflect the most accurate – and often least emotional – view of the situation.

That said, coaching isn’t something you can start in the middle of a crisis.  It’s an ongoing process with your coach that involves many conversations occurring over time so that your coach can become familiar with your “habits of mind.” It’s something that must be in place before the crisis or the problem arises.  As an executive coach, I’m often asked, “What is the ROI on this…”, “How do I justify this kind of investment?”. My response is simple:

You will make 5-7 decisions next year that will have a massive impact on the company you lead. If you make those decisions skillfully, thoughtfully, inclusively, with an awareness of your own biases and tendencies, with a sensitivity to the needs of the system, and with integrity around your own goals and purpose – those decisions have an extraordinary ROI. If those decisions are made without that kind of awareness or thoughtful consideration, there is a lot to lose.

In this regard, coaching is both an enabler of success and a thoughtful tool for risk management. Again and again, I find myself coaching CEOs at these critical moments in time, helping them to make slight adjustments in how they approach a situation or dialogue. These conversations lead to fundamentally different outcomes and that is where the value of coaching is realized.

The world is complex. These moments are complex. It’s difficult to navigate alone and can also be difficult to navigate with input from team members who have their own biases. A great executive coach understands the business, the strategy, and you as a leader – and brings those things together in a way that greatly improves, at a minimum, the depth of consideration and thoughtfulness in key decisions.

When I talk to executives about coaching and working together for a year, what I’m really saying is: We’ll work together to prepare ourselves for 5-7 critical moments in which we’ll need to optimize your performance and the quality of your decisions. 

That is where executive coaching is most valuable – and that is where the ROI is.     

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