Executive coaching is popular, lucrative – and unregulated.
In 2002, executive coach and clinical psychologist Dr Steven Berglas wrote an article for Harvard Business Review titled, “The very real dangers of executive coaching”. In it, he describes the botched jobs he’s had to fix after someone has been in the hands of an underqualified executive coach.
“To this day, not a month goes by when I don’t have a call about that article,” says Berglas from his Los Angeles home. “If anything, the situation has become worse in the last 14 years. The field is being flooded due to the lucrative nature of the work. There are so many degree-less professionals out there. It’s a horrific landscape for people to navigate.”
Berglas is not alone in his concern. The UK’s Professor David Clutterbuck, who some refer to as the “grandfather” of mentoring and coaching, was a keynote speaker at the International Coach Federation (ICF) Australasia Conference in October 2016 in Queensland. He has assessed hundreds of accredited coaches in centres designed for this purpose and says: “Seventy per cent of these coaches fail to meet even the basic standards of competence. That’s worrying.”
With low barriers to entry, no regulation and market confusion about what coaching actually is – definitions vary considerably – the ground is fertile for rogue players. Some of these may be hard to spot, as they include the well-dressed, former senior executive with many years of corporate experience, who deems specific training in coaching unnecessary.
In Australia, the coaching landscape is less likely to be “horrific”, as it has some of the most sophisticated buyers of workplace coaching in the world, according to Tony Mathers, CEO of the Institute of Executive Coaching and Leadership (IECL), which operates in the Asia-Pacific region. The coaching market in the UK is similar to in Australia in its level of maturity, says Mathers, with locations such as Singapore and Hong Kong a few years behind.
“Government and corporate purchasers [in Australia] know what they are doing in terms of the criteria they set, the qualifications they demand and evaluation required of the coaches they engage,” says Mathers.
However, not all purchasers are so experienced. So how can they know if the thousands of dollars they are spending on coaching senior staff is money well spent? And is price, which can range from about A$400 to A$1200 or more per hour, a reasonable indicator of quality?
“We cannot find any significant correlation between fee levels and competence or between fees and hours of coaching experience,” says Clutterbuck. “The difference appears to be mostly one of marketing expertise.”
As co-founder of the European Mentoring and Coaching Council, Clutterbuck was instrumental in putting organisational coaching on the map in the UK in the 1990s. He says an obvious trap that many workplaces fall into these days is automatically believing that all executive coaches are of high quality. “Few [providers] apply rigorous vetting to the coaches they offer,” says Clutterbuck.
Untrained coaches are a major concern of coaching practitioners worldwide, according to the 2016 ICF Global Coaching Study, conducted by PwC. The survey was completed by 15,380 respondents, 62 per cent of whom identified as business coaches, from 137 countries.
“[Coaching] fills a cultural gap for those in senior roles ... where else can they have a safe and trusted conversation?” Dr Julie-Anne Tooth
Australia is leading the way in trying to tackle the problem, with Standards Australia publishing Guidelines for Coaching in Organisations in 2011. For all countries, part of the challenge has been trying to keep up with the rapid growth of the coaching industry.
Over the past couple of decades, executive coaching has grown from a relatively novel concept to a mainstream learning and development intervention in many organisations throughout the world. It is often used in combination with mentoring and training or to help embed the learnings from leadership development programs.
Dr Hilary Armstrong is an executive coach and coach supervisor with Sydney coaching practice WhyteCo. She wrote the curriculum for, and led the delivery of, IECL’s accredited coaching program for 10 years and has witnessed the industry’s escalation.
“In the late 1990s, when coaching was just starting, it tended to be used for remedial purposes,” she says. “Then around 2010, when uptake by organisations really increased, it was commonly used to increase performance and productivity. Today, there is more of a focus on developing potential.”
Why is executive coaching so popular?
This is one of the questions that puzzled Dr Julie-Anne Tooth when she was working in a senior HR role 10 years ago. “I looked at this unregulated activity that wasn’t a profession yet was proving so popular in organisations, and I really wanted to discover what all the hype was about,” she says.
So, Tooth trained as a coach, and then practised as one. Still not satisfied, she devoted an entire PhD to the topic.
Tooth concluded in her thesis that at the heart of coaching lies a self-reflective practice that takes place within a trusted, confidential relationship.
“The opportunity to step away, reflect on your experience and learn from it is very absent from MBAs and the business world today, so it [coaching] is filling an important learning gap,” she says. “It also fills a cultural gap for those in senior roles who are ‘lonely at the top’ – where else can senior managers and CEOs have a safe and trusted conversation?”
When conducted well, does coaching actually work?
The University of Sydney is one of the few centres conducting academic research into the coaching industry. Its research and literature reviews suggest that coaching improves goal attainment, performance, mental health and resilience, as well as the ability to cope with organisational change. Through her PhD, Tooth also discovered that the coaching process leaves people more able to coach themselves.
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Does it deliver a measurable ROI?
Clutterbuck says a number of studies on the efficacy of coaching show high returns of around 600 per cent. “Most of these studies don’t have control groups; however, it’s probably a reasonably accurate estimate,” he adds.
Some of the biggest benefits of coaching, he says, tend to emerge well after the coaching assignment and are more difficult to measure. “How do you put a value on someone growing in maturity, or moving from a mindset applicable to one level of leadership to a mindset suited to a higher level?” he asks.
The future of executive coaching
All indicators are that executive coaching is well positioned for continued growth.
First, it satisfies self-interest. Who wouldn’t love having a conversation with someone for an hour or more, where the focus is completely on you, your goals and your potential?
Second, it meets a broader need. “The speed of change is so great today that loss of reflection in organisations has increased to critical levels,” explains Armstrong. “Reflection is an important part of our ability to learn and make wise, ethical decisions. It’s hard to put words to the value that many people derive from having that space ... to stop, reflect and think about what has been happening and to learn about it.”
Meanwhile, the broader coaching community is divided on whether they think coaching should be regulated. According to the 2016 ICF Global Coaching Study, 52 per cent of coaches agree that it should.
Berglas will be frustrated to know that coaches in North America were the least likely to agree – just 37 per cent there said yes to regulation.
What is coaching?
Standards Australia defines coaching as “a collaborative endeavour between a coach and a client (an individual or group) for the purpose of enhancing the life experience, skills, performance, capacities or wellbeing of the client”. Executive coaching is defined as “a service provided to executives and line managers for the purpose of improving skills, performance or work-related professional and personal development”.
When screening a coach, here are some of the key points to check:
- Coaching-specific qualifications.
- Supervision and ongoing development.
- Theoretical framework and evidence base underpinning their approach.
- Methods and assessment tools used.
- General coaching experience – years in practice and depth of experience.
- Industry-specific coaching experience: does the coach understand your context?
- Business experience.
- Commercial acumen, including reporting practices and stakeholder management.
- Professional membership and ethics.
Trends in coaching
Professor David Clutterbuck predicts a shift towards using internal coaches, where someone with a normal organisational role is trained to be an accredited coach. The Institute of Executive Coaching and Leadership confirms this trend with its clients in Australia, Singapore, Hong Kong and South-East Asia.
“The results of line manager coaching have been disappointing,” says Clutterbuck, explaining that it’s difficult to be totally honest with someone who will also be doing your performance review. “New approaches, such as creating coaching cultures within intact work teams, are producing much better results.”
This is an approach that has been embraced by EY, where coaching comes in two forms:
“Big C” coaching, which represents formal coaching engagements, and “Little C” coaching, which cultivates a coaching culture through the informal, day-to-day conversations that help professionals to develop.
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