The Cost and Benefits Executive Coaching

By Dr. Earl R. Smith IIDrSmith@Dr-Smith.comwww.Dr-Smith.comLately I have been feeling like a cutting-edge piece of technology. That’s a new feeling as I have beencoaching executives for a couple of decades. But nowthere seems to be a new attitude towards coachingand the kinds of wisdom and experience that I bringto engagements. For many rising executives, anexecutive coach now seems to rank alongsideBlackBerrys on the list of must-have accessories list.Why? Simply put as an Executive Coach’s my goal isto help my client get to where they want to go withinthe corporate world much quicker! And, these days, speed is allimportant - the competition is fiercer than its ever been.For me, Executive Coaching is neither a training workshop noroccasional and random words of wisdom. It is a mutual and ongoingrelationship between my client - generally a business executive thataims to foster personal growth as much as leadership developmentand me as their executive success coach. Whether our work is focusedon time management, leadership styles, career transition or how tomaintain a balance between work and life, we set goals and agree onactions with the objective of making the executive better, faster andsmarter. The work that we do impacts the entire career of my clients.Only emerging about a decade ago as a new management initiative,executive coaching has become one of the fastest growing industriesworldwide. The US-based International Coach Federation reports that of its more than 5,000 members worldwide, around 400 work in Asia.Moreover, the number is growing. Coach training company CoachHouse Asia, with its head office in Singapore and branches in HongKong and Shanghai, has certified around 150 coaches in its two yearsof operation.My executive coaching occurs one-to-one in a private setting and overthe phone. It involves very high levels of trust between coach andclient. Because of this, the learning is much deeper than in mosttraining situations. Personal issues can be addressed. Executivecoaching allows the client to deal with challenges and issues thatwould be difficult in a more ‘public’ setting.I have a two tiered fee structure for my coaching engagements. Therates depend on the nature of the engagement and the client. Most of

my leadership coaching is directly with a client who is paying the cost.Companies that are investing in their rising stars pay for much of myexecutive and organizational coaching. In these situations, there aretwo clients - the executive and the company.For the first type of engagement and depending on the depth andbreath of the engagement, I normally charge between $180 and $250an hour. My rates depend on the client’s actual needs and the amountof effort and time involved. These engagements are completelyconfidential. There are no third-parties who have access to the work wedo or the issues we discuss. As a result, the relationship which evolvesduring the engagement tends to be close and based on mutual trust. The focus of the engagement is to help the client improve their skillsand open the door to a brighter future. The second type of engagement involves a client - the executive - anda sponsor - the company. Although this fee can be significantly higher,the company has recruited me either for its entire staff or to coach oneof its rising stars. The implied obligation for me is that I need to focusefforts on improving the value of the executive to the sponsoringcompany. That means that I need to work within the context of thecompany and with its senior team or board of directors. My experienceis that it generally takes about four or five times the effort to workeffectively within this more complex environment.A recent survey by an international human resources consultancy, TheHay Group, showed that between 25 and 40 per cent of Fortune 500companies’ recruited executive coaches for their executives. Big namecompanies such as Motorola and IBM offer executive leadershipcoaching as part of their executive development programs, sometimeseven paying as much as $750 an hour.Every company has stars amongst their top performers. It is my job astheir coach to make them superstars! A US-based career managementconsulting company, Manchester Inc., conducted a study into theeffectiveness of coaching for executives and its value to companies. The results showed that companies that invested in executive coachingreceived an average return on investment of more than 500%. My ownexperience validates that finding.Unlike some ‘volume’ coaches, I do not work cheap. I do not have aone-size-fits-all formula for my clients. I customize every coachingengagement to meet the client’s needs and stretch their capabilities.In addition, I do not engage in ‘quick fix’ coaching. Change is difficultfor most people and developing new habits to overcome old ones takes