Maximising coaching ROI: Measurable impact for HR leaders

Talent, HR and learning and development teams in many organisations are embracing the benefits of executive coaching in 2025. And so they should. With the global spend on leadership development programmes reportedly in excess of $60 billion a year, this is big business, and the stakes are high in terms of the need to prove a return on investment. 

Coaching focusses on whole person growth, aligning the coachee's personal goals with key objectives in order to drive behavioural change. The chances of success are higher than more traditional leadership development programmes which are (by necessity) aimed at a wide range of personalities, skills and knowledge and are therefore less targeted and personalised. 

Sadly, this often results in misaligned objectives and outcomes; participants come away with a small percentage of what they have learnt, as traditional development programmes lack ‘stickability,”’with research showing that most participants forget 50% of the information within one hour, 70% within 24 hours and within a week 90% is forgotten. The result is that the participants are uncomfortable in, and unskilled at, delivering the core objectives of the programme.

Coaching helps to overcome this hurdle by creating time and space for the coachee to reflect on what they have learned and explore how they can adapt those learnings to work for them. But how can you measure whether coaching is having the desired effect?

What are effective ROI markers for coaching?

Often the success of a coaching programme is judged by a flattering testimonial – clearly a feel-good moment for the coach but hardly data driven. Effective return on investment (ROI) markers need to be more focussed and will vary depending upon a range of factors such as the cultural maturity of the organisation, the behaviours and skills of its leaders and role models, and the systems and infrastructure that provide the governance and rigour required. For coaching to make a real impact, both the coach and sponsors must agree on realistic metrics. 

Some organisations know that they want hard data metrics such as a drop in employee relations issues, employee retention, innovation acceleration, an uptick in employee engagement scores or revenue growth. These metrics are often simple but effective and measurable. 

However, often organisations will need to go further and use more complex, often subjective metrics, to measure human behavioural growth rather than performance or technical expertise. These less tangible metrics can explore manager relationships, direct report engagement, stakeholder collaboration, peer networking, client relationships, job satisfaction, team cohesion and conflict reduction. These metrics can be effective as long as organisations don’t rely solely on analysis such as 360 feedback. Additional data such as the frequency of one to ones, the quality of coaching conversations between a manager and a team member or analysis of the team’s KPI success might be good indicators of specific behavioural change and business impacts for each behaviour shift. 

More complex still is where an organisation wants to focus on less tangible but still critically important returns. One such client wanted to understand the rate at which lateral hires felt a sense of belonging within their organisation. We concluded that the impact measurement needed to be a mixture of objective and subjective data. The organisation looked at retention rates, progression data and recruitment and onboarding costs as well as qualitative data emerging from the coaching itself relating to the coachee’s sense of belonging. 

The coaching relationship

Once the metrics have been identified, it is imperative that the focus is moved onto the relationship between coach and coachee. For ROI metrics to be delivered the coaching programme must:

• Provide clarity of purpose and goal alignment between the coachee, coach and the sponsors of the organisation – everyone needs to understand the current status quo and the desired short and long-term objectives;
• Have chemistry, with the right “match” between coach and coachee; and
• Have strong contracting between all parties setting out boundaries and benchmarks and which are regularly monitored and embedded in the coaching, building trust, rapport and challenge.

Coaching case study – when impact is delivered

We recently worked with a CEO and founder of an e-commerce business with a massive growth trajectory. The CEO is a charismatic, visionary individual who is passionate about his business and has a thirst for growth. We were engaged as a coach to help him to develop his leadership strategy, to analyse the kind of leader he is and wants to be.  

The discovery process identified that the CEO was well liked, but he confused people. The team understood where he wanted the company to go but had no idea what they needed to do or how they might do it. For his part, the CEO was often frustrated by what he saw as a lack of passion and capability to deliver a client- centric service. The result was that the CEO founder kept rolling up his sleeves and doing the work himself, failing to delegate, being deep in the weeds, failing to focus on the strategic growth of the company and …. critically failing to coach and trust his team.

Our coaching programme was based on clear goals to support the overarching leadership vision. These included KPIs in terms of the reduction in his client- facing activity and an increase in his time allocation on strategic activity versus operational or client support. These changes were measured using time recording platforms as well as software to assist him to focus on urgent versus important work, and project management software to support execution.  

Given his status in the company we also felt he needed human accountability. Part of his leadership vision was to articulate and embed a culture of accountability based on true psychological safety. He was committed to the theory that a fearless organisation is one whereby failure is embraced and growth is cultivated so that innovation results. We identified someone whose opinion he trusted (but did not always agree with) to be his accountability partner – to hold him true to the process as well as the outcome. This was not so much about hard data but more about day-to-day behaviours. It required this individual to call him out and challenge him when necessary. The impact of this day-to-day speaking up meant that others too felt permitted to do so. After all, if the CEO was being called out and indeed encouraged it, then others felt empowered to do the same. 

The beauty of coaching is that whilst we had identified the impact metrics at the start of the programme, we could pause and analyse progress and introduce new metrics as we went along. Soon the rate of innovation began to be measured too – not in terms of new big ideas but by reporting on collaboration and improvement of ideas from evolution and “first draft” to actionable projects. The CEO was delighted when he saw metrics recording the failures in the innovation process, as this showed him the effectiveness of the coaching process in terms of his leadership style from visionary to his own supportive coaching style.

Key impact led success drivers

Ensuring that an executive coaching programme is successful and delivers ROI will depend on many moving parts:

• Invest time and effort on alignment of sponsors, coachee and coach. What are you trying to achieve? Why do you want it? Agree what the current position looks like.
• Identify clear, relevant and realistic ROI metrics. A mix of hard and human behavioural data is ideal.
• There’s no single answer as to the right metrics to use, but organisations must start by analysing the coaching objectives and build out a blend of metrics to measure ROI. Clear contracting and specific goal design which is linked to the metric. What will a great – and good – outcome look like? And by when?
• Regular review of the agreed goals in the coaching process, between coachee and coach and also through tripartite discussion with the sponsors.
• Regular review of the effectiveness and openness of the coaching relationship.
• A clear plan in terms of the interventions that will be put in place to measure the ROI. Pulse surveys? Listening groups?  Direct feedback through coaching? Performance and behavioural reviews?  Always remember when considering subjective data that some voices may be perceived “better” or "louder" than others. Is all the “evidence” credible and worthy?
• How often will you measure outputs and why? Are there cyclical, seasonal or transactional variances? Compare pre- and post- coaching metrics.
• Ask yourself, what will you do when you start to see results? Is there a budget to provide further support and resources? Are the sponsors truly invested in long term growth (through coaching) or are they looking for quick fixes? 

Victoria Lewis and Richard Thompson are co-founder and directors at executive coaching and leadership development Odyssey Consulting