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The Coach is In

The use of coaching is growing in corporate settings -- and has been shown to be a strong performance enhancer -- but HR executives often have challenges to overcome in crafting a program that will achieve their particular companies' objectives..

Thursday, March 1, 2012
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In times when no corporate expenditure can escape scrutiny, the use of internal people as coaches for their own colleagues seems an attractive alternative to the expense of external coaches.

"Mid-size and smaller companies view it as too expensive to risk the investment," says Michael Slade, HR leader and an internal coach for the Syracuse, N.Y.-based advertising and public-relations firm Eric Mower and Associates. "For a coaching program, it might cost $5,000 to coach one individual over the course of three to four months."

But cost is not the only reason companies look internally. Sandra Thomas, who served as a coaching-program manager at the U.S. Department of Health and Human Services before joining Cincinnati-based Sherpa Coaching in 2011, says cost is sometimes just one factor that prompts employers to consider other advantages of the internal approach.

"I wanted to do a coaching program," Thomas says. "But, because of the expense, which could be anywhere from $10,000 to $15,000 per person for a limited engagement, I wanted to create an internal program -- but not just [because of] the expense. Also so we could customize it, because no one knew our internal environment better than our people."

Some business owners, particularly those in highly specialized industries, believe external coaches simply can't identify sufficiently with their employees' challenges.

Dan Odess, president of Miami-based insurance-adjusting firm East Coast Adjusters, says he has tried external coaches for his employees but has found the uniqueness of the industry renders employees' needs too specialized for anyone but an internal coach.

Odess says his top people -- highly experienced in the adjusting field -- work with up-and-coming employees in setting and defining career goals, whether they concern earnings, building a client base, expanding geographically or something else entirely. Although using internal coaching like this can be time-consuming, he says, using external coaches often consumes even more time, believe it or not.

"It's like 10 times the work to achieve the same objectives," Odess says. "There is [also] no intimate tie to what we're doing, so you lose that emotional aspect of dealing with the claim on a regular basis, or dealing with the client."

Not only do internal coaches know the company culture and the employees; they spend more time with them, too. Sherpa, which conducts an annual study of trends in the coaching profession, finds in its 2011 report that internal coaches typically meet more frequently with their clients and are more inclined to favor an open-ended commitment to the coaching process.

There are hurdles, though, which might explain why the AMA Enterprise (a division of the New York-based American Management Association) reports only a quarter of companies with coaching programs say they find them effective.

Even though it's natural for business leaders to enjoy working with employees, internal coaches are often challenged to keep up regular coaching schedules when other priorities -- especially those seemingly more urgent -- present themselves.

"It's very easy to get up from whatever your so-called primary job or day job is," says Luke Iorio, president of the Institute for Professional Excellence in Coaching in Shrewsbury, N.J. "But still, being able to clear your mind is challenging, just as for every other executive who has multiple responsibilities."

Stacia Garr, a senior analyst with Oakland, Calif.-based talent-management consultant Bersin & Associates, says her company's research indicates support for internal coaching rises when top executives stop viewing it as a side activity and recognize its true benefits to the company.

"The biggest struggle is getting traction and getting managers to understand that this is not something that's in addition to what they're doing, but will enable better performance from their employees in the long run," Garr says.

The AMA Enterprise study indicates that many companies and managers are concerned about open-ended time commitments to coaching.

Green Bay, Wis.-based Schneider National, a trucking company with operations nationwide, sets up 18-month-long coaching relationships between senior executives and employees who are selected for their advancement potential. But Schneider is not as formulaic when it comes to the goals of each coaching engagement.

"The relationship is really based on the needs of the participant," says Lori Fliss, director of talent management for Schneider National. "Depending on the participant's development needs, gaps and career interests, the relationship is really tailored to help best meet those needs."

While the use of coaching is growing in corporate settings -- and has been shown to be a strong performance enhancer -- HR executives often have challenges to overcome in crafting a program that will achieve their particular companies' objectives. Among the challenges is making sure those chosen to coach do so in a manner that's consistent with the company's vision for the program. Another is balancing the need for confidentiality with the coach's responsibility to the company. HR executives are charged with making the best decisions to promote the advancement of the company's people; but, ultimately, their responsibility is also to the company's bottom line.

How well the HR executive chooses the right coaches -- especially between internal and external resources -- and manages the program may be the greatest factor in determining the program's success.

Keys to Success

According to Karl Corbett, managing partner with Sherpa Coaching, the leading factor in determining the success of any internal coaching program is the effectiveness of the program manager.

"We go into Company X and we train 12 executive coaches, then have a program manager who selects people to be coaches and monitors the coaching relationships," Corbett says. "If that person isn't doing all that work, there is a breakdown in the program."

In her role as program manager at HHS, Thomas discovered that ongoing support is also essential.

"The key is that you create a sustainable support system, so you know everyone gets the same quality of coaching," Thomas says. "You develop some common language around some of the skills, so, regardless of what audience you walk in front of in that organization, there's going to be someone who has heard it, so you're no longer having to sell it in that way. It sells itself."

HR executives who take on the role of program manager for a company's coaching effort need to look at several key factors in structuring and managing the program, including:

* What is the best way to create good matches between coaches and clients?

* If using internal coaches, how can they ensure an atmosphere of candor with their clients?

* If using external coaches, do they really grasp the culture of the company?

* What should be the duration of a coaching relationship?

* How does the company want to measure the effectiveness of the program?

* How are coaches to handle real or perceived conflicts between the interests of the client and the interests of the company?

* What outside resources can help?

* What is the best resource for training coaches? Does the company want them to embrace a particular coaching methodology?

According a 2011 report from Sherpa Coaching, internal coaches are more likely to seek their training at universities, whereas external coaches rely on their trade associations, as well as their years of experience in the industry.

Susan Davidson, president of the Atlanta-based coaching firm Beyond Borders, says those who presume to coach may really be doing something else if they haven't had good training.

"I found in my research that internal coaches, more often than not, are not true coaches, always following the client's stated agenda and goals," Davidson says. "Internal coaches more frequently use coaching skills to address the organization's agenda, not the individual client's agenda, of professional and career development."

While many companies may not see some of their managers as coach material, experts say coaching is more teachable than many may think. Garr says Bersin's research shows many senior leaders don't participate in coaching because they don't perceive it to fit with their core skill set, even though training can usually equip them better than they realize.

"There are very clear frameworks around how to do it," Garr says. "There is clear information about what works and what doesn't work. It's just people believing it's important enough to do it and being able to see the results. We found, in organizations that were highly effective at teaching coaching, they were 26 percent more effective at holding costs below their competitors."

Schneider National does not use a single program manager, but has three people in its talent-management function share the responsibility -- each of the three devoting a portion of his or her time to the coaching program.

"It's a very small piece of what they do, but in a broader sense, they can spread the duties around to make sure there is always someone who can focus on that role," Fliss says.

Getting the buy-in of top people, and their willingness to participate on an ongoing basis, is also crucial.

Thomas says the HHS coaches "[do] this in addition to their jobs, because [HHS] wanted people who were successful within the organization, and were going to be in the organization for awhile."

"Coaching in itself," she says, "would not be enough to sustain the position, not the way the federal government works, so these were not just training officers. They were individuals who did other programs."

More than any other challenge internal coaches face, the issue of trust and confidentiality comes up when talking to experts in the field. Even though rules of confidentiality are established up front, often in written form, the internal coach still faces a greater challenge than external counterparts in getting the client to maintain confidence that what is said will not be repeated.

"It may be difficult for an executive to discuss his or her true concerns, shortcomings and failings with someone who is part of the organization," says Davidson. "There is much greater trust with an outside executive coach who has no agenda or vested interest in the organization, other than that of the client."

According to C.B. Bowman, founder of the New York-based Association of Corporate Executive Coaches, the nature of the corporate setting can put pressure on internal coaches, even if they are totally committed to the confidentiality of conversations with those they're designated to coach.

A common conflict, according to Bowman, comes when the coach realizes the client's career objectives conflict with the company's vision for that person. The coach -- who is supposed to support the client -- nevertheless realizes his or her paycheck comes from the company. The client may realize this as well.

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"I'm not saying the coach can't be trusted," Bowman said. "I'm saying, from the perspective of the employee, they're going to think about this."

David Lassiter, senior associate with Kensington, Md.-based Executive Coaching & Consulting Associates, says his clients instinctively find reasons to worry about trust -- no matter how rock-solid the assurances are that their words are safe.

"There's a part of our brain that's geared to searching and looking for perceived threats and risks in order to maintain our survival," Lassiter says. "And in coaching, when people need to become truly open and honest in what their experiences are -- what their feelings, wants and desires are -- that can be risky. I think the risk in dealing with an internal coach, even [with] a confidentiality agreement that is usually quite good, there is a certain degree of skepticism as to whether you can be honest with the coach."

Schneider deals with the trust issue by setting very clear guidelines for how the coach interacts with the client, establishing that issues such as performance reviews and pay adjustments are outside the coach's purview.

"We've been clear about the mentor role," says Karin Green, human resource manager at Schneider. "It's a supplemental developmental resource, and it doesn't really play in those spaces."

Coaching "At All Levels"

How would the trust question be affected if the coach were the CEO? That's how it works at Seattle-based hospitality company One Eighty Twist, where owner and CEO Dan Madsen -- having empowered other top executives to manage operations on a day-to-day basis -- does all the coaching personally.

While Madsen recognizes that there's no escaping his role as owner of the company, he says his long-standing approach of being close and accessible to employees helps put them at ease and ultimately makes it work. And that's a must at One Eighty Twist, he says, because he's already discovered that the company's culture requires coaching from one of its own.

"Coaching is needed at all levels," Madsen says. "I really believe in spending time with people and helping them out. Years ago, we had some people come in and do interviews and coaching, but it just wasn't flying in this culture. Our group wasn't very accepting of outsiders coming in and identifying what we needed to do."

Thomas became familiar with Sherpa's training regimen for coaches while still with HHS, and implemented it with her coaches there at HHS.

"Most people," she says, "are doing more with less. Coaching helps them to empower their employees to be more comfortable with decision-making, [know] how to handle conflict and things of that nature. So as a program manager, I was looking for the thing that would take that manager to the next level."

(Another approach is to let employees on a peer level coach each other. The Seattle-based Institute for Corporate Productivity reports that 27 percent of U.S. companies use a form of internal coaching known as peer coaching -- one in which two employees of equal status coach each other -- and 42 percent say they've had a high or very high degree of positive results.)

The skill of a prospective coach is one part of the equation. Another is how well a coach fits with a client. While Schneider considers its entire executive team to be part of its potential coaching pool, it chooses coaches on the basis of how well they match up with program participants.

"Someone who hasn't had an experience in a certain part of the business may be matched with someone who leads in that area," says Green. "They learn about more parts of the organization than they would with someone external, and that knowledge helps to accelerate the process more than partnering with someone on the outside."

Perhaps the greatest advantage of an internal coach is his or her understanding of the company's culture.

"They have a solid understanding of the goals [and] strategies ... of the organization," Beyond Borders' Davidson says. "They are familiar with the executives and, hopefully, how they interact with others in the organization."

Reasons for Going Outside

But even in this area of strength, not every conversation is easy for an internal coach to have with employees. Sometimes, it's easier for workers to receive correction from someone looking in from the outside.

"Suppose someone is coming from a Google culture, and they're going into what we used to know as an IBM culture," Bowman says. "How does the internal coach say, 'You can't dress in jeans, you can't play your instruments, we don't feed you 24/7, we want you to dress in a suit'? That's kind of a difficult discussion to have."

Internal coaches may also have a limited view of the professional world, whereas an external coach works with many different companies and spends more time in different settings.

"You get so involved in the day-to-day activities of your company that you don't have a chance to get out there and see what's going on in the world and read all the journals you need to be reading," Bowman says. "You're not being challenged by your peers in the field."

While Odess is convinced internal coaches are a better fit overall at East Coast Adjusters, he acknowledges they can lack some of the broader perspectives that an outside person brings.

"You kind of lose where there might be new developments on how to properly, let's say, estimate construction loss or something," Odess says. "They may be doing something they've been doing for 15 or 20 years, so it may be teaching a new dog old tricks."

As Thomas attests, a coaching program using internal people needs to be designed and managed just right. And coaches, clients and program managers need to put serious work into trust. But, she says, the work is doable and worth it -- and, in the end, there is no reason it should not work.

"People are afraid to establish internal programs because they're afraid it's not going to be successful," Thomas said. "There's nothing to be afraid of. People have a need for coaching."

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