Significant organizational change has the potential to threaten even high-performance cultures. A case in point is CareSource, one of the nation’s top nonprofit health-care plan organizations. First, the organization experienced tremendous growth in its employee ranks, growing from 900 employees to more than 4,200 in just over a decade. Second, its CEO of more than 30 years announced plans to depart. To ensure the continued growth and health of the organization during such monumental change, leaders at CareSource took a hard look at these challenges and found creative solutions for adapting and thriving.
The Universal Challenge of Change Management
CareSource is not alone in facing what can be monumental organizational change. In a 2016 study by the Human Capital Institute (HCI), nearly 80 percent of HR practitioners and leaders reported that their organization is in a state of constant change. Additionally, 85 percent of respondents said their organization had experienced an unsuccessful change management initiative in the past two years. Resistance from employees, poor leadership, and ineffective communication are just some of the reasons initiatives such as new technology implementation and organizational adaptations to regulatory impacts can fail.
Fortunately, CareSource’s story has a much better conclusion. The nonprofit used one of the most effective methods to empower employees and increase change readiness: investing in an organization-wide coaching culture.
Coaching for Change
As CareSource leaders assessed its challenges, they identified employee engagement as a top value within the nonprofit. This led them to explore and implement a leadership transition coaching program that paired new leaders with a coach credentialed by the International Coach Federation (ICF). The program armed leaders with important skills, such as learning to delegate, managing difficult conversations, and effectively navigating change, while fostering a collaborative environment where open discussion about issues and problems was encouraged. Leaders also learned how to use a coaching approach with their team, including asking open-ended questions to spark critical thinking.
Research confirms it was the right move. “Building a Coaching Culture for Change Management,” a research study conducted by ICF and HCI, examined the relationship between coaching and change management and found that high-performing organizations uniformly were proactive in utilizing coaching in all stages of change management.
The joint research found a stark contrast between the effectiveness of using coaching activities for managing change and its prevalence within organizations. The most common activities used for change management initiatives were classroom training, e-learning, and meeting with senior leaders. Coaching-related activities, while not as common, ranked as some of the most helpful methods companies used to achieve their change management goals. These included one-on-one and group professional coaching, as well as encouraging and equipping managers and leaders to adopt a coaching approach to management.
Whereas traditional learning activities may offer one-size-fits-all solutions, coaching is tailored to the needs of individual employees and teams. In a professional coaching engagement, the coach provides tools, resources, and support that enable employees and teams to get a fresh perspective on their unique goals and challenges. Employees are in the driver’s seat instead of receiving answers, advice, or direction.
Managers and leaders who are trained to use coaching skills adapt the tools and resources favored by professional coaches and incorporate them into their day-to-day interactions with their teams. By applying a coaching approach to management, they promote greater creativity, autonomy ,and trust within their teams.
Building a Coaching Culture
For the last five years, ICF and HCI have examined how organizations develop strong coaching cultures while prioritizing employee development. ICF and HCI identified six characteristics that constitute a strong coaching culture, noting that qualifying organizations meet at least five of these criteria:
- Employees value coaching
- Senior leaders value coaching
- Managers, leaders and/or internal coaches have received accredited coach-specific training
- Internal coach practitioners, external coach practitioners, and managers/leaders using coaching skills are all present
- Professional coaching is a fixture in the organization with a dedicated line item in the budget
- All employees have an equal opportunity to partner with credentialed coaches
For organizations with strong coaching cultures, coaching activities have become “must-have” budget fixtures instead of “nice-to-have” novelties. The research shows that organizations with strong coaching cultures were more than twice as likely to also be classified as high-performing organizations. Past ICF/HCI research also has demonstrated that organizations with strong coaching cultures reported higher employee engagement and annual revenue in relation to their peers than organizations without such a culture.
Buying Into Coaching
Buy-in at all levels of the organization is vital for a coaching culture in the organization to be a success. Leaders who experience coaching can easily see its benefits in empowering employees for success. This can cause a trickle-down effect where managers can use a coaching approach with employees, freeing them to focus on other objectives.
It is important for managers and leaders to understand the difference between a coaching approach and micromanaging. A coaching approach involves asking powerful and thought-provoking questions that facilitate self-discovery among employees who can then identify their own solutions. Contrast that modality with managers who operate more like taskmasters and provide all the answers to their direct reports.
Managers interested in using a coaching approach with their teams should first work with a professional coach who has been properly trained and credentialed in this discipline. Professional coaches can help leaders implement the cornerstones of effective coaching, including active listening and asking powerful questions to help their teams realize how to identify the obstacles preventing them from success. A coaching-client relationship also provides a safe environment for managers to determine when and how often they should use this new skill set.
CareSource’s coaching program is viewed internally as a major benefit and differentiator. Overall, the organization credits its coaching culture investment for saving $3 million over the last decade, including the retention of more than 50 leaders and high-performing employees, along with a 409 percent return on investment.
For organizations to successfully navigate change, effective leadership and communication are two critical factors. Involving coaching at all levels of a change management initiative is a proven way for organizations to identify potential roadblocks and get everyone on the same page.
Magdalena Nowicka Mook is the executive director and CEO of the International Coach Federation (ICF). Previously, she held positions with the Council of State Governments and the U.S. Department of Agriculture’s Economic Research Service. She is a trained coach and a frequent speaker on subjects of coaching and leadership. She received a Master’s degree in economics and international trade from the Warsaw School of Economics, Poland. She also graduated from the Copenhagen Business School’s Advanced Program in International Management and Consulting.