Have you ever stumbled upon something that completely changed your perspective? Something that made you question your initial doubts and opened your mind to a world of possibilities? Well, our hosts, Jason and Steve, have a story that will do just that. Prepare to be captivated as they take you on a journey from skepticism to revelation, exploring the profound impact of coaching. But what they discovered goes far beyond the expected return on investment.
In this episode, Steve and Daryl discuss:
- Understanding the ROI of Coaching
- The Cost of Turnover
- The Tangible & Intangible Benefits of Coaching
- Measuring ROI in Coaching
- The Importance of Goal Setting
Key Takeaways:
- Discover the tangible and intangible benefits of coaching that can transform your personal and professional life
- Learn how coaching can significantly reduce turnover rates and boost employee well-being, leading to a happier and more productive workforce
- Unlock the financial impact and profitability of coaching, as it helps individuals and businesses achieve their goals and drive success
- Understand why having a growth mindset and setting goals are crucial for personal and professional development, and how coaching can support these endeavors
- Explore the importance of addressing the ROI of coaching and gain confidence in the value and potential return on investment it can bring to individuals and businesses
“Investing in coaching can give you over 100% return on your coaching dollars, with proven data showing the positive impact on actions, communication, and culture.”-
Steve Scanlon
Connect with Steve and Jason:
- LinkedIn: Jason or Steve
- Website Rewire, Inc.: Transformed Thinking
- Email: grow@rewireinc.com
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Listen to the podcast here:
Jason and Steve - The Return on Investing in People
Welcome to the -let's see, this is the LinkedIn Live edition of the podcast that we do, The Insight Interviews- Powered by REWIREI'm one of your hosts. Jason Abell. This is another one of your hosts, Steve Scanlon. Steve, welcome to the show.
Here we are. It's a mouthful to say the LinkedIn Live version of The Insight Interviews- Powered by REWIRE- Powered by REWIRE. We got to work on that, right?
Yeah, maybe we'll come up with something better, but that's exactly what it is, right?
That's exactly right. We've got a little LinkedIn Live series that we're doing through our podcast, The Insight Interviews- Powered by REWIRE. So, we'll live here on LinkedIn, I don't know, forever and always, maybe even after we're gone. Who knows? And then we'll be producing this as a podcast episode. This particular podcast episode is probably a little bit different, right? You and I interview really great guests. We find out about their leadership insights. And you and I are famous for saying we're really excited about our guest today. I don't know, it's just you and I.
I'm still excited about my guest today.
Oh, well, that's kind of you
But we've got a topic that we're going to hit, and we're going to hit it hard. I think it's a meaningful topic. So, Steve, we're 1 minute in, but, man, will you want to lay out our topic today?
Yeah, absolutely. We're going to today speak to the issue of return on investment ROI of coaching. We certainly hear this a ton. Like you mentioned, Jason, we've been doing this know, I know sometimes people take all of their coaches and add up all of their collective years in coaching. And so, it would be a lot of years. We've been doing this a long time. And throughout these years, often when people need to make a decision about, hey, should I hire a coach? That is just a common thing that we hear, is what is the ROI of coaching? Like, if I invest X amount of dollars, how can I ensure that I will get X amount of value for my X amount of dollars? And I think it's something in this industry that I know a lot of coaches here... Jason, you and I spoke a lot about this. I think a lot of times when we speak about the ROI of coaching, I have watched people walk away and maybe feel sort of wispy about it.
Hmmm…
Like as if sometimes when we're sharing the ROI and we're talking about the value of relationships and this and that and this and that, people might still walk away and go, I know, but they're longing for something more tangible, which, frankly, I respect.
I do, too.
I get that they would be doing that. And so today we wanted to dive in and address it, and we belong to the Institute of Coaching, which is a great board that's tied to the McClain School at Harvard. And there have been people over the years that have actually researched this and studied it. And so, I think what we wanted to bring to the table today is talking to people about both the quantitative and the qualitative value that you could put ROI to and go, this is this. And the last thing I'll say, and then you can dive back in here, Jason, is we get to live it. And so, what's really interesting for us is usually that ROI question is coming from someone that's not already invested in coaching, but for our clients and for the people that we've worked with. It's fascinating, is once you're in it, you get to experience what the ROI is, and you're not usually asking that question any longer, but that's just one of those things. We can't have everybody in it because some people want to be in it only if they get the ROI question answered, and so we're going to endeavor to do that.
You said something that really resonates with me, is that when we do get that question early on, rewire has been around for ten years now, and I remember early on, when we would get that question, there would be a little bit of dancing around that, well, it'll make for better culture. You'll have higher retention, and your people will just be more emotionally intelligent. And those are all correct right answers. But for the founder or for, you know, the CFO, who needs to go, okay, look, if we're going to make this investment, what type of return do I get to be able to answer that question? As a business owner, I actually respect that question. And we've got answers around that now, which I'm excited about now. Not only the ones that we've seen, you're right, with our clients, but then there's data behind this. There's research papers from good people like Harvard and other respected consulting groups that have studied this and said, hey, there are actually some financial numbers that you can put to this as well. And so, we're going to tackle that a little bit today.
Yeah, not only it's when you start to really look at the research, and when you and I use the word research, and we're going to do that, you and I committed to that, when we quote some things today in the show notes, we're going to actually put the research, so if somebody listening actually wants to go, hey, I want to go read that abstract, understand the double blind studies, what was that academically sound research trying to do, we want to put that out there. So that, again, we're trying not to just walk out going, oh, it's this good thing. And trust us, there's research. No, there is research that you can actually go and read. And so, we're going to dive into some of that.
So, one of the things that we do, we have a head of research and development. His name is Steve Long. And if you've had any interaction with Rewire, you know about Steve Long. And he's just one of the most phenomenal coaches that I've ever run across. And when it comes to studies and research and getting the numbers right, man, there's nobody better than him. And you and I kind of sent him out, and we're like, okay, we know that we've answered this question a lot, we know that there's studies around this, but Steve, we need some numbers, like some data. We know what our clients say. We know what our clients experience, but we need some data. And he went back, and I don't know, what did he give us? 12? 15 studies?
All I remember is when he finally gave us that, Jason, I was like, that fell under the category of be careful what you ask.
Yeah, it was a lot.
Well, and also and I think there are people listening to this should understand this, people in academia that actually do research, it's heady, right? Like, when it's done well, you're talking about statistically valid and even some of the research- one of the things that he had sent us, there were 20 pages that were just talking about how they conducted the study before they even got to the conclusion, because that's what the scientific method says is you want to show how you came to this conclusion. And so, I just was laughing, going classic, that this research is deep and it's rich. We're not going to go through all of that, but just know it's there, and it's actually in abundance. And its people interviewing companies that have employed and engaged coaching organizations, and this is their result. So, it's not ethereal. It's, like, very specific. And one of the things, when he sent us all those links and all the data, and then he did a little summary at the top, and he said, the measurement of human behavior is indeed tough. And that's partly why we're doing this right now because it is tough to measure. Well, morale is up, culture is better. Yeah, turnover is low, but I'm not sure if I can measure it exactly, and this person communicates better, but the measurement of human behavior is tough. But when you start linking that improved human behavior to actual financial results, that can be done. And what he said is, look, got all this data. I've got all this research.
"He said it actually looks like the return on investment of coaching-I kind of average all this- is somewhere in the neighborhood of 224%. So, if you invest a dollar into coaching, you can make 224% on that dollar."
And so, I look at that and I'm like, okay, but how do I even- that just sounds weird…unattainable. Like when if you make any investment in stocks or real estate or anything else, and you get 224%, my gosh, that just seems crazy. So, I look at that and I'm like, okay, well, okay, what if we cut it in half? What if we cut it in half and we said, you get over 100% return on your coaching dollars. And here's why. Like, here's the data that shows when you invest in your C suite and coaching, here’s the different actions that these people are able to take part in because they've got a better tool set in the way that they engage meetings, engage one another, communicate with one another, communicate with your clients in the outside world, and you can start putting dollar amounts to that and measure it. Yeah, it's a lot.
Yeah. But what you just did was interesting because you gave us a number, and those statistics are out there, and we're going to put in the show notes where that I think that was that Booz Allen study, if I'm not mistaken, and I'm pretty sure they know what they're talking about.
Well, yeah, and so this was one that they had done that was this big longitudinal study. But then, Jason, it's interesting for me that you began to speak about communication and culture and stuff. And that's what's funny, is people that are only looking for ROI might go all that stuff is whatever, just tell me about results. That's which, like you and I said, fair.
Yeah.
We need to know that. And that's one of the things that Steve said to me, even as late as yesterday. He's like, when you're on this call, make sure people you know, Jason, when you think about our iceberg model, we have an iceberg model in case people don't know, and it's a pretty simple model. And anytime somebody shows you an iceberg, right, they're trying to infer the fact that what's below the surface is much bigger than what's above the surface, and whatever it is they're trying to show, right?
Sure.
So, above the surface in our iceberg model are results and actions. Or actions and results.
That's what you see.
Yes. That's what you see. Below the surface, we have as our model because we're in mindset coaching are thoughts and feeling, which is where the whole field of emotional intelligence stems from. Because as I think most of the people on this call can figure out, you're probably not going to just act differently over time unless you think or process differently.
Right on.
So we've had this tendency to work below the surface. But the ROI question actually are people going, okay, all that below stuff, whatever, help me understand the ROI on the results portion.
Yep, yep, yep.
And so, we've got there are I looked at another study yesterday that Flat looked at sales numbers, and we'll find that study and put it up there, Jason.
Yep.
But what I thought was interesting, and I got into this conversation with Steve, was not only could they show they literally did something so tangible as to say, hey, here was the sales quota for a quarter. And the people that were they had a control group, people that were in coaching, people that weren't in coaching. Not only did the people in coaching exceed this quarterly sales number, whatever, but the people that weren't in coaching actually didn't achieve it by a certain metric. And so when I looked at that, I was like, Steve, you know what's so interesting is that the ROI on coaching was a very specific number as it pertained to sale. More compelling for me was that I don't even know what to call it. What's the opposite of ROI? Because I was thinking return on investment. Well, cost.
Well, there's an opportunity cost.
What was the cost of not having an intervention?
That's exactly right.
But that's kind of negative. ROI ROI. I'm going to come up with some term of it's not ROI. Gosh. What was more compelling was cost of a lack of intervention.
Well, to take that further, if you take the metric of turnover, every organization has some sort of turnover metric. And I don't know that we've engaged in organizations, Steve, over the last ten years that we've been in business, where the company has higher turnover after they engage us, right? It's always the opposite. It's lower turnover. And that is a very specific measurable thing. When a team member goes from not on your team and not with your company to with your company, there's a cost there to onboard them. There's whatever technology you're going to give them, insurance, somebody to train them. But there's some sort of onboarding cost that is a dollar number. And most bigger companies measure, hey, the first year that somebody's with this company, they cost us X amount of dollars, and we know what that is. And when your turnover rate is high, you can start to measure those things. Okay, our turnover rate is this. It cost us this much money in the first year to have somebody on board, and the higher our turnover rate is, the higher the cost is. Well, we've just seen it over and over again, and you've got a cool story that you're going to tell. But when we get involved with an organization, the turnover number goes down, which means that they're onboarding less people. And by the way, it costs money to offboard somebody as well, right? Whether that's a pip process, human resources needs to be involved. It's typically a lengthy, timely, and expensive process. Also measurable when that turnover rate is lower, well, now you don't have that cost anymore. So that's a very specific cost. One of the things, just because I'll forget this point if I don't say it, is that's a specific dollar number, one that’s harder to measure, but we know that it's there. Why is the turnover lower? Because the people are happier. They're communicating better. They feel better about their jobs. They're more emotionally intelligent. Those are those intangible, maybe not as measurable human behaviors, but it turns into very measurable financial..png?width=340&height=260&name=Untitled%20design%20(6).png)
Well, look, you know this. It took every bit of energy I had to come in and do this particular podcast because I understand we want to get to ROI. And like you and I said, there's a great deal of respect for it. It's fascinating to me that the people that actually get this modality of intervention in coaching, go, ROI/ They stop like that's not a thing for them at all anymore because it became something so much bigger. But that's hard to tell someone that's not been in it. So we'll do this and go, hey, let us tell you one of those studies that I looked at, again, tangible measurements., this one crossed the line between tangible and intangible. But how about burnout? which is what you were just alluding to. Right? Now, that's a little how do you know exactly what that is? But burnout and then days mist of work is tangible.
Yep.
And so, if this modality helps people because they're communicating better, they become more fulfilled with their work and whatever, there's absolutely studies that show less burnout, which led to less even what we would call sick days, which is absolutely an HR measurement.
Sure.
And so, there are many HR people going, Well, I'll tell you the ROI of coaching, again, it's also based on a cost to us that's no longer happening at the level and rate that it was. That was another tangible measurement of the process.
And just yesterday, I had a conversation. We've got a global manufacturing company that we work with, and HR weekly is sending us people. And the people that they're sending us are the people that they have identified as high potential people. So, these aren't people that are on Pips, and they want to just send them a coach, and let's see if that works. It's the exact opposite. These people are identified. They're high potential people. We want to invest in them even more so that they continue to rise through the ranks, be better leaders for the organization, but also have better lives themselves. And so, it's this thing where what's happened, I've watched this over time since we've been working with this company is the people when I end up talking to the person that has been identified, a coach, the guy literally yesterday said to me, man, when I heard I was going to be able to get a coach. I was like, yes, please. That was exactly his quote. And I'm like, oh, this is going to be so good, right? Coaching is going to work for him. It's going to be good for him personally, professionally, and very good for the organization. And I'm just going to the back of my head like, ROI. ROI.
Yeah. Well, we have our own measurement of ROI, and again, this is going to fall under the category, Jason, of something that we didn't talk about. But even here at Rewire, we have an ROI measurement- we have many. But one of our measurements is how long do people stay in coaching?
That's exactly right.
So, you and I did an interesting thing. Maybe not all coaching companies are like this. We actually measure how long people stay in coaching, on average, and some are for many, many years, and others where they need it for a short period of time or whatever. I haven't looked at that in a few weeks, but it's two years, a year and a half. How long?
Yeah, our average has gone up to 18 months. And there would be some people that might look at that and go, well, wait a minute. Why are people staying in coaching that long? We tell the organizations that we partner with we're only going to stay engaged with a particular client to the point where they've either reached the goals that they want to reach and at least they're good for now type of thing, or they don't have any other goals that we're trying to reach right now. So, in other words, typically what happens within, say, four to six months, they've reached the initial goals that they came in to reach. And what happens with that profile of a person, typically, as I'm generalizing here, is, okay, we reached that? Let's go higher, let's get better, let's close other gaps. And that person wants to continue to grow. And so, yeah, it's about 18 months right now.
So, this is appealing to the people that have strong, what we'll call left mode dominance, right? That left side of our brain when we're dominant, because we know it's not just left or right, but when we're dominant, it's sequential in pattern. I'm appealing to you guys right now. Ready? Jason, I would like you to speak to if it's roughly 18 months and we have that data, align that with what our contract asks our clients to stay in for.
That's the beautiful thing about at least the way that we run it is we're strictly a month to month organization. We don't want people staying in coaching because they're tied to a contract. We want people to stay into coaching because it is highly effective for them, and there is a very large ROI. And so, people can leave whenever they want to leave. They choose to stay. And some of our clients have been with us since the day we opened the door. These aren't dumb people. They wouldn't be spending the money that it costs to coach if they weren't getting if they weren't even getting results.
That's right. All that bottom stuff that, you know, that I'm passionate about thinking and emotional intelligence and the brain and stuff, it's still about actions and results. And if it weren't about that one, I don't think we'd keep clients for a lot. They might want to learn a little bit about how the brain works.
That's it. These people are staying in because they're getting results. Now, again, to me, that was just a little bit of a sequential pattern to kind of show. Like, if there wasn't an ROI for them, there's no way we would have that. There's just no way. I think and I'll try to do this as quickly as I can, I think I am actually a very good example of that. I mean, for the people that don't know, you were my coach. You were my introduction to coaching, and you coached me, for a little over ten years. And during those ten years, I went from an average producer in the industry that I was in to one of the top producers in the country. And a lot of that had to do with coaching, right? Like, we went step by step by step, and we worked on things. So, from a professional standpoint, it was huge. And oh yeah. When I first came to you, I was working twenty-four, seven, and frazzled, and by the end there, I was working less than 40 hours a week, had my evenings, had my weekends, and was producing at a multiplier higher than when we started coaching together.
The reason I love that story, again, we're trying to use deductive reasoning. By deductive reasoning, had that not had the effect and result, would you have quit your career and come and said, yeah, I got the impression you did that because you were like, if this had this effect on me, I want to have this effect on people. And now you've become our greatest coaches. You're better than me at this.
Ha, well, the only other thing I want to tell about that is, on the personal side, things were really working, also. I was a mess when I got into coaching personally. You coached me through the birth of three children. Very unfortunately, you coached me through the death of a child, which will take anybody, including us, completely sideways. And with the work life balance going through some heavy, heavy stuff, which everybody has their heavy stuff. It's not if, it's when. And I thought to myself, boy, from a professional standpoint, from a personal standpoint, high, high ROI, some of it measurable, some of it not as measurable, if you and I together could do that for a lot of different people, which we've been fortunate enough to be able to do over the years, not only for the clients being coached, now, we've got coaches all over the country that are coaching all kinds of people for us, but the organizations that are benefiting from those people and the ROI attached to it? Yeah, bring it. Yes, please.
Yeah. Well, I know I'm going to tell a really quick story, and we got to get there again. We just trigger each other on certain things. One of the challenges that I have with this entire conversation about the ROI of coaching is, in some ways, when we try to distill this ROI into only a numeric thing, it does sort of undervalue some of those things that you said. Because walking through some of that stuff with you and asking you questions and being with you where was the numeric value to that for you? Right?
It's like the Mastercard commercial, right? It's priceless. Some of those experience, some of the conversations that you and I had, bro, were, man, they were deep, and I needed you. And it wasn't therapy. It was coaching because it was Q and A types of things. But I will say this in the darkest of times, man, if I didn't have really good coaching, I don't know that I would have been able to perform my job at all. And so, yes, it helped personally, but it helped from a very measurable organizational ROI. .png?width=340&height=260&name=Untitled%20design%20(7).png)
It's funny. We got to clear some space right now. You're bringing me back to that. I recall that work that we did in that season. The other thing is, when we try to get to just ROI, ROI, ROI oftentimes I've seen organizations do this, the only way that they can show the ROI is by retrofitting effectively a pattern to coaching. And then coaching becomes prescriptive. And you and I both know when this is done really well, there's not a prescription. You're not going to come in and go, if we did it like that, ROI would be pretty easy to measure. But all of our clients of the fact that this is not a prescription process, we don't go ABC. I think that would make all those studies we saw even that much more vibrant, because we did to A to B, it doesn't quite work like that. But still they're out there, and people are reporting on some of the things that we spoke about. And so, yeah, dude, we only have a handful of minutes here. Just very quickly, and then you can comment on it- I had a client recently come into me, and we began to do work for his overarching company. This person was the leader, the CEO of an organization, and he chose to put some of his leaders into coaching. And he came to me in one of our coaching calls, and he was protecting confidentiality just as much as I was. And he said, I got to tell you something. One of my leaders who's been with me for ten years came into my office, we had an exchange, and then he asked me a question about the exchange itself. And the minute- he's like, I got goosebumps, and I thought, this is Rewire. There's no way this person, who's been in my employee for ten years, one of my biggest leaders, he is like, that's got your fingerprints all over it. Now, we don't try to give scripts and tell people what to say. That's not the methodology of coaching. But probably through a line of questioning, this person began to see things differently. And this leader came to me and said, just like you did, he's like, priceless. He's like, without coaching intervention, I can't imagine this leader would have even gone down that line. He was like, I've been waiting for that for ten years. And he didn't say that, he's like, I don't even know what the situation, because that's what confidentiality is. I didn't say who was it, or whatever. All I remember is him going whoa. He was like, without coaching intervention, I can't imagine that question would have even come into this person's mind. And I was like, well, right on.
Yeah, that's a great I mean, and you and I could go tit for tat, story for story over client stories. I will say this. We're going to start to wrap as we wrap our The Insight Interviews- Powered by REWIRE sessions. I'll ask you, what one insight did you have Steve? We'll go through this pretty quickly during this conversation.
I think the insight that I had is just hearing you talk about your experience was really longevity. This isn't stuff that we're working with people on to help them achieve just one goal and be done. While that can be super powerful, that like you said, I loved what you said there, and that's what stuck with me. Most of the time when people achieve a goal, it's not like, okay, I'm done doing goals. And so, even though I've worked with some people for years, it's so fun to come in and go, what's the next goal? What are we working towards? And people that have a growth mindset always are working towards something.
I know for me, it's the reminder how good- I mean, the profession that we're honored to be able to be in, how much it really works, not only on a personal level for people, but I do like helping companies be more profitable, be more productive and grow. And I'm just like, yeah, it does, and so there is an ROI, and it makes a difference. So, because this is an The Insight Interviews- Powered by REWIRE podcast, I'll say, hey, it doesn't much matter what our insights are, Steve. What really matters know if you're watching this or listening to this, what were your insights? And Steve, I'm going to put up here our screen, for those of you that are on video with us, there's a QR code up there. You can go ahead. And get on our schedule. If any of this sounds interesting to you, want to discuss it, talk about it, you'd like to get coaching for your organization? Here it is. And go to this website and do it for those that are just audio, www.Rewireinc.com, come find us there. But otherwise, Steve, we're in the books, my friend. We are done. Thanks for this was a great conversation. Enjoyed being with all of you that joined us today. And Steve, enjoyed being with you.
Peace.
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