AJO Blog

Primary tabs

Why Executive Coaching Needs to Be Part of Your Leadership Development Strategy


November 15th, 2016

- Updated on

November 16, 2016 - 10:06am
The need to identify and develop future leaders remains a top priority for organizations today, as noted in numerous 2016 human capital studies.  
  • Attracting, retaining and developing talent, including the next generation of leaders is one of six business challenges identified by CEOs in the 2016 CEO Challenges study from the Conference Board
  • The inability to produce leaders fast enough to keep pace with business needs and the pace of change was cited by 89% of respondents in Deloitte’s Global Human Capital Trends 2016 study
The challenge is even more pronounced for mid-market organizations (1001 – 5000 employees) where a lack of resources results in lower levels of talent management maturity, as compared with Global 2000 companies. According to Bersin’s recent report, High-Impact Talent Management: Talent Management Maturity in the Mid-Market, only 3% of mid-market organizations have a clear talent strategy.
executive coaching image

Executive Coaching Achieves Results

At AJO, we are strong proponents of Executive Coaching when it is part of a targeted, strategic talent management strategy for identifying and preparing leaders for current and future roles; and when it’s supported by senior organizational leaders. In our work with our clients, Executive Coaching has emerged as the most valued developmental activity in several high-potential leadership programs we’ve managed.
Among all activities (which range from  action-learning, leadership mentoring, out of the box assignments, skill-building workshops, journaling and assessments, including 360 interviews), Executive Coaching is consistently rated as the most valuable activity by program participants. In addition, promotion rates of 60% have been noted among high-potential participants, exceeding program goals.

How Is Coaching Evolving?

In the last five years in particular, we’ve seen Executive Coaching increasingly positioned as a powerful future-focused development approach for leaders at all levels. This is supported by recently released data from the Conference Board’s bi-annual Executive Coaching study, which noted the following trends:
  • Coaching is shifting from performance-related to developmental in terms of its purpose, focusing on preparing leaders for future roles. It’s also being implemented at lower levels in the organization to develop leaders early in their careers.
  • Coaching is more focused. The three top types of targeted coaching are:
    • Development focused to expand capabilities and prepare leaders for future roles
    • Assessment/360 focused to provide leaders with greater self-awareness
    • Performance-focused to reduce gaps and build capabilities in current roles
  • Evaluation remains a challenge, with only moderate confidence being expressed in current measurement methodologies
  • Internal coaching is increasing as organizations see the benefit of coaching cultures on retention, engagement and productivity and want to scale coaching cost-effectively

What Role Does Executive Coaching Play in Leadership Development?

Coaching benefits the leader and his/her organization in numerous ways, including:
  • Identifying gaps and blind spots
  • Building self-awareness
  • Increasing confidence and resilience
  • Strengthening critical leadership skills
  • Strengthening relationships
  • Retaining top talent
When it is part of a strategic initiative aimed at achieving clearly defined business goals and agreed objectives, Executive Coaching has the potential to overcome ROI measurement challenges and elevate organizational performance.
The Conference Board noted the following focus of coaching assignments among its 2016 study respondents (see Chart 21 from its report, shown below).
Conference Board executive Coaching Study 2016In AJO’s Coaching Practice, data gathered on the top coaching goals from 100 of our most recent client engagements closely parallels coaching goals identified in the 2016 Conference Board survey, as shown below.
AJO executive coaching program goals
High-performing companies spend more than four times on leadership development as much as average performers according to Deloitte. They are strategic, data-driven and embed leadership development throughout the organization with top executives involved.

What about your organization?

  • Does it have a clear talent development strategy?
  • Is it strategic and data driven?
  • Are your senior leaders actively involved?
  • What developmental activities are you leveraging to develop your leaders and high potentials?
  • Is executive coaching a key developmental component? If so, is it targeted and complementing other development approaches?  
  • How successful are your initiatives? What are the goals? What business metrics would be impacted by leadership development?
In our experience, these are important questions for all organizations who need to close leadership gaps, irrespective of organization size or industry. And while we’re biased, we would always advocate for on-going Executive Coaching as a foundational element of any leadership development initiative.
We’ve seen the results.