Executive Coaching – what is the real return on investment (ROI)

Coaching is probably one of the most—if not the most—individually tailored practices in talent development as it involves a close and confidential relationship between the coach and the person being coached. 

The coaching industry was worth $15 billion in 2019 and is expected to grow to $20 billion by 2022 and CEOs at startups and established businesses of all sizes engage in coaching in an effort to achieve better bottom-line business results.

Many of the world’s most successful entrepreneurs like Steve Jobs, Eric Schmidt, and Bill Gates have all used coaches, but, what is the real return on investment (ROI) of Executive Coaching?

The real ROI of Executive Coaching

• According to iPEC, 1.5 million searches are made every month by people and companies looking for coaches.
• While face-to-face coaching decreased sharply after COVID-19 (by 74%), online coaching has become wildly more popular, as it’s increased by 57%. (COVID-19 and the Coaching Industry) .
• 99% of individuals and companies who hire a coach are “satisfied or very satisfied” and 96% say they would repeat the process. (ICF Global Coaching Client Study).
• 68% of individuals who hired coaches were able to make back their investment. Those who make a financial gain on their coaching can on average expect 3.44 times the amount spent. (2009 ICF Global Coaching Study).
• 95% of clients rate their coaches as “good” or “excellent.” (2009 ICF Global Coaching Study).
• 86% of companies that could calculate their return on investment said that they at least made back their initial investment. 19% indicated an ROI of 50x the investment. 28% saw an ROI of 10-49x the investment. The median ROI is 7x the investment. (2009 ICF Global Coaching Study).
• According to a study, coaching has a 221% ROI. (International Society for Performance Improvement).
• 51% of companies with a strong coaching culture report higher revenue than their industry peer group. (Human Capital Institute).
• In one study, executive coaching had a 788% ROI thanks to increases in areas like productivity and employee satisfaction. 77% of respondents said that coaching had a significant impact on at least one of nine business measurements. (MetrixGlobal).
• A survey of 100 executives showed that the average ROI of executive coaching was almost 6x the cost of coaching. (International Coach Federation).
• 75% say that the value of executive and leadership coaching is “considerably greater” or “far greater” than the money and time invested. (International Journal of Evidence Based Coaching and Mentoring).
• According to Eric Schmidt, Google and Apple owe much of their trillion-dollar valuations to their business coach, Bill Campbell. (CNBC).
• 92% of small business owners agree mentors have a direct impact on their growth and the chances for their businesses to survive. (Kabbage).

There is in fact much more strong evidence that coaching works. These numbers certainly demonstrate significant ROI but even if we were to start with “Executive Coaching has a 200% ROI” it’s more significant than most other interventions one might embark on to help you improve business and personal results!

“The goal of coaching is the goal of good management: to make the most of an organization’s valuable resources.”,

HBR

If our people are what make an organisation successful why wouldn’t we want to make the most of our most valuable resources?