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What would you say is the most critical success factor for the business growth of your company? If you’re like 91% of those surveyed in a recent study of CEOs in North America, Europe, and Asia, you’d say “developing leaders.” In this article, we’ll explore why leadership development has become more vital than ever to business success, and why companies are now overwhelmingly choosing a previously untapped resource, executive coaching, as a key part of the solution.

Executive coaching on the rise

In a Fortune 500 survey, 43% of CEOs and 71% of senior executive team members said they had worked with a coach, 63% of companies said they plan to increase their use of coaching in the coming five years and 92% of leaders who have used a trainer in the past plan to do so again.

Because? The statistics indicate a clear answer: coaching works. In a study of 370 participants who had worked with executive coaches, the group went from the 50th percentile in performance to the 93rd percentile. Amoco Corp./BP evaluated the impact of executive coaching over a ten-year period and found that managers who received coaching they received 50% higher average salary increases because they performed so much better.

So what does this mean for you and your company? It means that coaching is a powerful option when you need to transform managers into leaders who can handle today’s ever-changing world. Executive coaching allows you to dramatically improve the strength of your leadership bench.

But why turn to an outside source for leader development? A brief history of business over the past three decades may shed some light.

Leadership Skills – Yesterday and Today

In the 1970s and 1980s, corporations used a pyramid structure with the CEO at the top. Most executives had three or four direct reports and were therefore able to spend quality time providing on-the-job training. If he had strong functional skills during that era (marketing, finance, and sales, for example), that was all he needed to win as a leader. Termed “hard” skills, they were seen as the most important, while “soft” skills, such as team management and communication, were seen as of lesser value, if not entirely dispensable.

Then came the 1990s. Wall Street got tougher on companies, demanding better and better results. Most of the markets had sold out domestically and started looking internationally. All of this sparked a wave of mergers and acquisitions that resulted in ever larger organizations. These huge conglomerates, too big to use pyramid structures, turned to flat-matrix organizations. The result? Suddenly, managers had 8-12 direct reports, less time to train each individual, and also found themselves with different bosses in different places for different functions. The complexity of doing business had increased dramatically.

Other critical changes took place at the same time, intensifying the pace and challenges associated with change:

  • More and more women entered the workforce, resulting in greater diversity in the workplace.
  • People were living longer, so for the first time in the history of modern capitalism, four generations were working under one roof.
  • The rapid changes taking place in technology meant that the “work week” had become 24/7 for many organizations.
  • Working across all hemispheres created the need to manage time zones and cultural diversity, which increased the importance of strong interpersonal skills.

Dramatic Changes in such a Short Period – The Results?

In this environment, functional skills have now become the price of entry. Skills previously considered “soft” are now the “hard” skills that are vital to becoming a successful leader. Universities and MBA programs rarely teach those skills, and today’s flat organizations allow little to no time for the busy leader to receive direct on-the-job training.

As a result, employee loyalty has dropped dramatically, bringing the average tenure in any job to three years. Employers are finding it increasingly difficult to retain their best employees. The pace of change and increased scrutiny, including new government regulations, is relentless. Last but not least, as baby boomers (the largest group of people in the workforce) begin to reach retirement age, companies are beginning to realize an even greater shortage of good leaders for the workforce. future.

The upshot of all this means that many companies and human resources departments are turning to outside executive coaching to develop and strengthen their leaders.

What is Executive Coaching anyway?

There is a myth about executive coaching that it is about “fixing” behavior problems. Could not be farther from the truth! Coaching is not consulting, advice or therapy. It is not about regretting a past that cannot be changed. It is about focusing on a future that can be changed.

An executive coach is a trained professional who develops an ongoing relationship with the leader-client and focuses on helping that individual take action to make stated goals a reality. A coach serves as a combination of mentor, manager, personal trainer, and sports coach. A good coach does not provide solutions to the client. Instead, the trainer extracts solutions of the client. This helps already successful leaders achieve lasting positive changes in behaviors that enable them to transform themselves and their teams, ultimately leading to better overall business results.

How can an executive coach help?

A recent survey revealed the top two reasons companies hire executive coaches:

  • 48% said they used a coach to develop high-potential employees or facilitate a successful transition to a new position.
  • 26% said leaders used a coach as a sounding board.

So what exactly can an executive coach help today’s leaders achieve? The list is long, but here are some examples:

  • Strengthen leadership skills/core competencies.
  • Managers on board in a new company or position.
  • Improve time management and work/life balance.
  • Reduce/better manage stress.
  • Develop more productive working relationships.
  • Improve conflict management skills.
  • Implement a new strategy, vision, or direction.
  • Build an existing business or launch a new one.

What to look for in an executive coach

It’s one thing to know that an executive coach can be an asset in developing leaders within your organization. Another thing is knowing how to choose a good coach. Make sure the trainers you consider are…

  • well trained Ask to see training certificates from an accredited training school.
  • Certified by the International Coach Federation (ICF).
  • Trained or certified in assessments such as MBTI, StrengthsFinder, FIRO-B, LPI, EQI, CPI.
  • Versed and experienced in both business operations. and human/organizational behavior.
  • No bias, no bias, 100% customer focused.
  • Able to maintain 100% confidentiality.
  • Open to letting you talk to past clients. At the very least, you should read testimonials from past clients.

How do you know if a coach is right for a specific leader?

Good chemistry is key to success with an executive coach. A trainer may have stellar credentials, but may not be the right fit for the leader in question.. So request a free trial session when you’ve narrowed down your list of potential trainers. So, don’t be afraid to ask some tough questions:

  • What kind of people and problems have you worked with and what were the results?
  • What is your coaching model and process?
  • Is there a client you would turn down?
  • How do you deal with resistance?
  • How would you define the difference between therapy and coaching?
  • What is your greatest strength as a coach?
  • What is your plan to keep key stakeholders informed?

Cost and payment?

How much does executive coaching cost? The range is wide depending on the level of experience and track record of the coach. Harvard Business Review has reported that rates range from $300 to $3,500 USD per hour. One thing you can do to keep costs down is to apply for a volume discount if your company has multiple managers who need training.

Make sure you get a good return on your investment (ROI) when it comes to Executive Coaching. Two recent large-scale independent studies among thousands of executive coaching clients around the world found their return on investment to be 600-700% of the cost of the initial investment. However, take the time to quantify the results of hiring an executive coach. The costs of having weak leaders in today’s marketplace are great, but the benefits of having strong leaders are priceless.

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