David Rock’s convinced internal coaching can change the culture—and the bottom line—of a company. And he’s got the research to prove it, with a new study of coaching’s impact on a New Zealand insurance company.
“During a time when this client’s industry was tanking, our coaching initiative helped turn a loss into a profit, halved staff turnover and increased engagement fifty percent,” said Rock, whose company, Results Coaching, led the effort.
In 2008, IAG (Insurance Australia Group) NZ, the largest insurer in New Zealand with more than 2,000 staff members across nearly 40 locations, decided to take action after “lower than expected business results and a decrease in overall engagement scores.”
The decision was made to build a coaching framework into the company’s senior leadership development program, and to create a “coaching culture” among IAG’s employees and managers.
Ruth Donde, who ran the initiative for Results Coaching, tracked the insurance company’s progress and reported the results: “coaching has significantly impacted engagement and retention across the business in two years.”
What’s more, Donde found, was that once planted, that “coaching culture” took root and took off, with coaching now integrated into other IAG programs and systems, with resulting performance boosts. The company’s managers describe coaching now as “what we do around here,” and report 94% of HR managers using coaching skills every week.
The initiative intended to make coaching “business as usual” from the start. “In order to maintain and grow coaching within IAG, coaching now forms part of all people manager job descriptions,” according to Donde’s report on the project.
“Coaching is promoted within the organization and is already an attractor for new staff. All new managers are informed of the coaching culture within IAG NZ and all go on a coaching skills program. Keeping coaching top of mind is done through visual aids and ongoing messaging around the benefits of coaching and being coached, status related to coaching, success stories and testimonials. Coaching clinics have been set up for refreshing and practicing coaching skills. Mentor groups and communities of practice are being set up as well as further development for coaches so that they can upskill to the next level of certification. Annual minimum requirements have been set for coaches as well as systems to ensure maintenance of coaching standards.”
The creation of a culture where coaching’s just “what we do” is a trend that Rock outlined earlier this year in an extensive study of internal coaching programs. “When senior leaders become coaches, it makes them more effective leaders themselves,” said Rock. “Getting leaders to build leadership skills in their people deeply transforms their own leadership skills.”
Rock suggests that even if an executive devotes only one hour a week to coaching, the results can be dramatic and widespread. “Attention changes the brain, and just as playing an instrument one hour a week will build your musical skills over time, the same happens with coaching. This can be explained through the concept of ‘attention density’, which is the quality and quantity of actual attention paid to a specific set of circuits in the brain. Through repetition and continuous activity, new skills are more readily embedded.”
Rock argues that a key to success in building internal coaching programs is focusing on that “coaching culture,” with a program that covers senior leadership development, talent management, transition performance management, skills development and “on-boarding,” the process of bringing new employees firmly into the company.
A study involving a department of the Australian government found “on-boarding” makes a big difference in employee retention. According to a report on the effort, “after training over 100 internal coaches across this whole organization, one of the bits of feedback was that the internal clients felt far more valued by the organization. They felt the business really cared about them. The organization spent tens of thousands of dollars finding them. Many people just don’t feel that they are cared about – all you have to do is give them someone to talk to them for twelve hours over six months, not a lot of time investment, and you can make a big impact.”
Dramatically improved performance numbers on retention, motivation, and employees’ sense of being valued, Rock said, show how coaching impacts a company’s bottom line. “Internal coaching definitely works. It is the initiative of choice in organizations undergoing change, and looking to embed a coaching culture.”
In the recent study involving IAG, staff turnover dropped from nearly 20 percent to 9.97 percent. Engagement figures rose, from 51% to 76%.
And that bottom line? According to Donde’s research, IAG moved from a 5% operating loss to a profit of 7.6%.
Have you had experience planting a “coaching culture” at a company?
Did it take root? And did it show up—critically—in the company’s bottom line?
This article was written by Mark Joyellais & reprinted with the permission of The Coaching Commons http://coachingcommons.org/
