How to go from "good enough" to AWESOME!!!
If there was ever a time to differentiate yourself and STAND OUT FROM THE CROWD, it is NOW!
In today’s world, where change happens faster than the click of a mouse, franchises want the leadership strategies that will empower them to tackle our crazy 24/7 world so they can: Increase sales. Be better leaders. Attract more customers. Manage change. Maximize productivity. Maintain Integrity. Communicate effectively. Stay healthy. Enjoy life more along the way. And….experience more success than they ever thought possible.
Today’s business environment is increasingly complex and rapidly evolving. Those who choose to lead or are thrown into management roles are often left to develop their own skills for harnessing the power and potential of their team to produce results. This is not surprising in this YouTube and “instant guru” world we are in.
But there is a better way!
Leadership coaching has been proven to be a highly effective method for impactful individual and team development. In fact, a recent global survey of coaching clients by PricewaterhouseCoopers and the Association Resource Center concluded that the mean ROI for companies investing in coaching was more than 6 times the initial investment, with over 25% of companies reporting an ROI of 10 to 49 times. The underlying theme is simple…spend money on the development of your people because…
People are the only reason organizations succeed or fail!!!
After all, what makes up an organization if not its people? And logic would dictate that an intelligent, strategic plan of investing in this “human capital” would lead to a greater return on the organization’s core assets. In a franchise organization, a lot of money, time and resources are spent on developing product and processes.
However, investing in people is not the same as investing in a piece of equipment or a new software program. For one thing, measuring the return on an investment in a person is a bit more difficult than, say, measuring the increase in the number of widgets per hour sold by the new widget machine that has just been installed on the franchise floor.
* For example, when coaching Franchise Sales People, the ROI is calculated based on how the sales people are able to close more franchises in their pipeline.
* Another example would be coaching a team on improving communications which often has a direct correlation on increasing employee retention rate.
Enough with the examples…Lets talk REAL RESULTS!!!
A Real Life Case Study of Leadership Coaching ROI from the “Expect Greatness ™ program
A company I worked with had 15 mid level managers in one department. The team executive had a reputation for micro-managing and was considered by peers and reports to be “intimidating” and “overwhelming”. One employee survey showed that 33% of the employees were not happy in their current roles and the department also had a 33% turnover (5 people) the year before. We talked and decided that the Expect Greatness Leadership Development program would be a good fit into their existing processes
A six-month coaching program led to tremendous breakthroughs in the team exec that transformed his reputation from “micro managing boss” to “engaged leader” . The coaching also helped the team to grow and flourish, while increasing specific, measured productivity by 8% in the 6 months. It also decreased turnover to less than 10% ( 1 person left) in 1+ years after the coaching engagement. The coaching program investment was $30,000 for the 15 people for 6 months…
One key benefit from this coaching case was the monetary value attached to replacing these employees . Here is the approximate ROI on the leadership coaching program, based on the fact we were able to retain 4 additional people in year 1 after completion of the coaching program
- $56,000 in search agency fees = 20% of annual compensation per employee is saved ($70,000 per employee/ $280,000 total compensation for 4 employees).
- $4,326 in internal recruiter costs = The internal recruiter estimated she spent 120 hours on the search (30 per employee), including reviewing candidates, scheduling interviews, preparing assessments, conducting reference checks, notifying unsuccessful candidates, etc., this cost can be estimated at approximately (120 hrs/2080 hrs annually X $75,000 recruiter annual salary).
- $70,000 in Lost Prooductivity = The search averaged approximately 3 months per employee, the cost of lost productivity resulting from the vacant positions can be estimated at 25% (one quarter of a year) of annual compensation per employee.
- $70,000 in Reduced Productivity = Assuming new people recruited from outside the company are contributing at a 75% productivity level for the first year on the job as the corporate culture, policies, practices, etc. are learned, the cost of this lost productivity can be estimated as 25% of annual compensation per employee.
If we stop here, we see we have already saved over $200,000 resulting in a 668% return on the coaching investment ($30,000). Of course, this calculation is incomplete as we have not included the savings related to orientation, training and other administrative expenses incurred with 4 new hires. We have also excluded other tangible and intangible benefits resulting from the behavioral improvements from the coaching, many of which were quite substantial. And we did not include the “8% productivity gains” as specifically noted by the client.
While challenging to calculate, it is imperative to understand that monetary values can be assigned to tangible (easier) and intangible (more difficult) results in order to measure this investment in a franchise’s most important asset – its people.
How do I get results like the above and get my people to “AWESOME????
Through a fantastic leadership development program that incorporates a simple 3 step process…
1) Be Aware: Clearly Identify the Coaching Objectives Upfront
After you hire top talent, you want to reduce turnover, maximize your hiring investment, and develop your future leaders from the moment they walk through your doors!!! As such, you can increase the chances of calculating a true bottom line impact of coaching if you carefully identify the highest priority objectives before the program – and take an “objective” measurement of these areas of interest before and after the coaching occurs.
The specific objectives that we focus on will vary by coaching case and will depend on many factors:
- Client’s department, position, level, function, etc.
- Corporate culture
- Corporate objectives/challenges/opportunities
- Client’s developmental needs, behavioral challenges, opportunity for advancement
- Changes in business strategy, required competencies, leadership or ownership
2) Be Intentional: Take specific steps towards Coaching Objectives
Again, while the specific areas identified for improvement will vary case-by-case, some examples of coaching objectives include:
- Communicating clearly and effectively with bosses, peers, reports, customers, investors, etc
- Consistently delivering business results that meet or exceed the competition, and/or forecast
- Managing the team in an efficient and effective manner
- Providing developmental opportunities and support for others
- Encouraging and rewarding innovation
- Demonstrating vigilance regarding costs, quality and customer service
- Performing in a manner consistent with the company’s mission and prevailing ethical standards.
3) Be Accountable: Measuring the Results of Coaching
Some results are more “tangible” than others and are, therefore, easier to translate into monetary value or bottom-line impact. This is not to say that the tangible outweigh the intangible in terms of importance. In fact, intangible changes in the client’s behavior can often have a wider-ranging impact than, or may actually lead to, the more tangible benefits of coaching.
Examples of tangible benefits from coaching:
- Increased sales in the franchises
- More new franchises opened
- Decreased employee turnover
- Decreased absenteeism
- Improved productivity
- Fewer customer/employee complaints
Examples of intangible benefits from coaching:
- Reduced conflict
- Better teamwork
- More productive meetings
- Improved employee morale – HAPPY employees generate more results!!!
- Better customer service
- Increased job satisfaction
- Better work/life balance
If you TRULY want to differentiate your franchise and STAND OUT FROM THE CROWD, it is NOW! Invest in your people! Give them leadership strategies that will empower them. Provide them tools and techniques that actually get them results. Be intentional about their growth and the growth of your franchise will follow!!!
Get your people in a quality Leadership Development program and watch them go from “good enough” to “AWESOME!!!”
NOTE: I won’t insult your intelligence… While we know leadership coaching and development can have a considerable influence on business results, other factors obviously have an impact. For example, sales volume is subject to many complex factors, only one of which is coaching. The level of sales is also impacted by: economic conditions, product developments, competition, pricing, customer demand, currency fluctuations, etc.
I do know from experience and from extensive research, that your ongoing investment in the development of your leaders is one of the BEST investments, with the HIGHEST ROI your Franchise organization can make!
What are your thoughts on what it will take to help your organization go from “good enough” to “FREAKIN’ AWESOME!!!”?