4 Common Benefits of Business Coaching & Why Hire a Business Coach?
A decade ago, outside of athletic circles, you might have been pressed to find someone you know working with a coach. Coach contact info was passed in private membership circles like YPO or other business peer groups. They existed but were often an insider secret or the domain of the super-elite business executives.
Alternatively, sometimes you would hear in hushed tones that someone was working with a coach and the implication was that their boss or board forced them.
But today, coaching is much more mainstream. Why? Because it worked. It led to great business success. Both the super-elite CEOs of major companies and small business owners and even the struggling executives all improved with the help of a coach.
The book Trillion Dollar Coach, published in 2019, surged in business circles. It gave us a peek behind the curtain with details of how Bill Campbell helped build some of Silicon Valley's giants — including Google, Apple, and Intuit — and create over a trillion dollars in market value.
Like the top performers in any sport work with a good coach, executives who want to grow and push themselves out of their comfort zone need a guiding hand to help them focus on where to make improvements. A superstar athlete like Serena Williams uses a coach to help her with conditioning and identify where to make physical improvements. But her coach can also help her see other outside forces impacting her game and help create strategies for working through or around those for big competitions.
While reading Trillion Dollar Coach gives you insights into the benefits of coaching at unicorns in Silicon Valley, it's sometimes hard to project what those benefits are if you are running an SMB. Unless you have worked on the leadership team of a company engaged with a business coach, you likely haven't had a chance to see how they work or the impact they can drive for a business.
A business coach does much of the same thing. A business coach works with clients to:
develop trusting relationships
foster personal growth
form strategy
emphasize operational excellence
identify ways to spot both roadblocks and opportunities in fast-moving environments
We asked several business coaches to share insights into the best practices they use with their clients and some of the metrics for success they have seen over time. These Scaling Up Coaches achieved success in the business world and worked with a coach themselves before becoming a coach.
They shared how their coaching journey started with experiencing the benefits of business coaching firsthand. Those lasting positive impacts helped them form the processes they use in their coaching programs with their clients today.
You can also listen to “What Are The Benefits Of Working With A Business Coach?” a conversation we hosted recently in The Scaling Up Coaches Club on Clubhouse.
Listen to Scaling Up Coaches Chris Young, Ronald Tompkins, Diana Southall, Maxim Mulyadi and Steve Ferman answer questions and share how they work with clients.Business coaching can help you find new ways to manage a cash flow crisis.
Scaling Up Coach Diana Southall shared her first encounter with coaching and how it taught her a lesson about when to seek out a business coach. "The first time I ever experienced coaching was working in my family business with my mother. Thirty years ago, she was an early adopter.
We were at a point in the company where our original business, while not drying up, was definitely on its sunset. We needed to look at new opportunities and pivot the business because everything was stressful. There was no money in the bank."
"With money we didn't have, my mother reached out and brought in somebody from the Canisius School of Business in Buffalo to work as a business coach. He was amazing and really taught us a lot. After the first year of working with our coach, we were able to transition the business. That experience set my early expectation around coaching.
When you're in any kind of crisis, whether it's cash flow or you realize that you do need to change your business model, that's certainly a great place to start thinking about working with a coach."
Scaling Up Coach Ronald Tompkins, who works with many organizations in the social sector, agreed that a top driver for people to seek out a coach is when they run out of cash.
He says, "Many leaders in the social sector were not chosen because of their business background. People often come to me because I also have an MBA in Management and am an accountant. They say, 'you know, Ron, I don't understand the financial reports I'm seeing.'
I can share one of my most popular tools, called Seven Numbers For The CEO, with them. I share how you can control the agency if you've got the seven numbers in a human services organization."
When Ron starts an engagement with a new organization experiencing a cash flow issue, he has a process and tools to help them quickly. "If people can't make payroll, then there is no strategic plan. So if somebody is down, they can first address the cash flow issue. That's how I started. I was in an impossible position. We made some decisions that seemed wise but weren't. And we had to get immediate cash to keep our staff together. And I think we started giving up paychecks by the week or by the day or something. I can't remember the exact strategy, but that's where we had to start."
Scaling Up Coach Steve Ferman agrees. "I've lived that, wondering where payroll would come from in a few of my companies. If you're in a scale mode, because, as we all know, growth sucks cash, it's just the reality. Downturns suck cash as well. When times are hard, and sales are lean. I think it depends on the company and what's happening with them.
We try to diagnose what the problem is. You may say, 'my cash is horrible.' But the reality is that maybe your execution or strategy is what's broken, not your cash. The cash flow is just a result of the actual issue. We develop ways to look at what's going on and improve profitability. Evaluate your cash, maybe do some diagnostic tools like Cash Flow Story or the Cash Cycle. We use tools to try and improve cash flow, looking for a couple of minor changes that may help, but we have to understand what's going on with the company first.”
There is no one path to finding the answer or helping a company or business owner move to the next level. At Scaling Up Coaches, while every coach works from the same methodology, they have their own customized approach and process.
Scaling Up Coach Chris Young comes at it from a people-focused perspective. He believes the business isn't responsible for cash flow. People are. Even where there is a process, the process is run by people.
He believes in using diagnostics wherever you can on every facet of the business to see precisely where the problems are. When there is a cash flow issue, he uses a diagnostic approach to ensure that you have the right people doing the right things right.
Chris says, "There are essential processes for cash flow, but what drives the process is ultimately its people. And what's interesting is from the inside, looking out at your people, you might think that they're busy - especially in a remote kind of situation. But the reality is that people do what they're allowed to do. And if we don't have tight processes, that will impede their ability to produce, which will lead to cash flow problems."
Ron also pointed out that the cash flow issues stemming from COVID are still acute. And there are still many ripple effects yet to come. "A friend of mine who is an executive with the Small Business Administration (SBA) shared that they gave out so many of the EIDL loans that they hired an additional 20,000 to 40,000 people to administer the loans..
That period is closed. And she told me that in haste to distribute the funds quickly at the start of the COVID shutdown; many people did not understand that they were loans. And she said these things are non-negotiable. You can't go back. You can't declare bankruptcy on a federal loan."
Ron says, "I had no idea of that myself. If I had a magical wand, I would like to see us coaching some of these people who have, in good faith, done something to build their business and are in more danger than they realize at the moment."
Business Coaching can help an entrepreneur find a way out of frustration and burnout.
The frustrations from running and maintaining a successful business that entrepreneurs experience kicked off Chris's first coaching encounter. "I had a 20-year-old consulting company. We were doing really, really well. About six years ago, I was sick and tired of being sick and tired."
Chris says, "Sometimes you need to have somebody come in and point out your blind spots. They can help you identify that things aren't as good as you thought they might be. I brought in a coach who used the Scaling Up principles processes, and long story short, they helped me put my hand on the back of my head and help me look at my business in a very, very different way. It changed absolutely everything and gave me metrics, accountability, and a voice of reason."
Now, as a coach, Chris uses psychometric assessment tools to help identify if the wrong people are in the wrong seat. It helps him identify if people are not meant to be in a particular role.
Chris says, "Coaching won't fix that. So we look for those potential incongruencies between the person and the role and help organizations get very clear about who should be in what position and how to maximize their potential. Then we help develop better communication and conflict norms."
Diana also shared that now working as a coach, in addition to cash flow issues, she has found that another pivotal point for seeking coaching or advice is frustration. Whether it's frustration with the management team getting along or frustration with you wanting to grow faster, or when things are simply not clicking as you wish.
Business coaches can identify communication breakdowns that are the root cause of business problems.
Alongside cash flow and frustration, another familiar theme coaches see that leads to the need for a coach is a lack of communication.
Steve says, "I see many issues between silos and lack of communication between teams. And it's not always so easily uncovered. I find that in most struggling companies, cash is absolutely an issue. I've had it myself again, many times. But often, people just aren't communicating properly."
Steve shared an example from a recent client engagement that illustrates the underlying communication issues. "A client told me that their sales are down. And really, when I looked at their assessment, and we had conversations, the actual problem is they don't communicate with each other in the different departments. So they're really in silos. That's more of their issue. And that's more why their sales are down."
Once he identified these root cause communication issues, Steve was able to help that client with internal fixes for something they had previously thought was due to external forces.
Steve shares that it's also hard for CEOs, entrepreneurs, and business owners to see the forest from within the trees. He says, "We just can't see what someone from the outside can see. I personally have had a coach since 2005. So I believe in being coached. Why shouldn't we as business owners have coaches? Every great athlete has a coach."
He says coaches have a set of tools to help figure out the dysfunction of teams. "Many of the tools we have in our toolbox enable us to help clients communicate what's going on."
Steve shared, "It is pretty amazing how even though business partners talk all the time, they are not necessarily on the same wavelength or in sync. Working together as family members or close-knit people doesn't necessarily mean that you've got it all figured out.”
Ron Tompkins agrees. He shared a story of one client with relationships within the management team that was so deep that it was too tricky for them internally to uncover the problems that needed to be fixed. He shared that the people on their team were so committed to the relationships that they couldn't see the issues.
As a coach, Ron came in with the lens of a fresh pair of eyes. He told them, "Of course, you're good friends professionally, but this is a business process."
Ron shared that he sees this happen organically over time as businesses grow. "When you first get something started, you need relationships before making your first million or two. You can'tjust hire everybody or even the people you think would be wonderful people. You reach out to the people who are most loyal to you. When I first started my first nonprofit, I put my parents on the board. Now, at least I had the good sense to say that it was a six-month resigner position. The coach comes in and points out that to continue growth, you've got to switch from a relationship-based approach to management to a systems-based approach.”
Diana echos that. "I'm sure we've all worked with family businesses and multiple partners. There's that added layer of this interpersonal dynamics that we all need to navigate, and they need to navigate."
All of the business coaches agreed that their preference is to work with the leadership team, look at the four pillars or the four decisions in the business, and look at them all holistically. By working with a business coach vs an executive coach, the benefits flow through the entire organization not just with one individual.
Where an executive coach works with a single leader on their leadership style and how they're coaching their team, they teach them about time management and holding their team accountable, and more of the management side of their role. They perhaps also help them with the interpersonal relationships with others on the leadership team. But they are an advocate and a trainer for that one particular person.
Diana says, "A business coach can help a whole team navigate the personal and the business side." She says that these situations illustrate why it is important to have a business coach and not just an executive coach. Your coach must be helping the entire leadership team, not just leading one person.
Customized business coaching helps with unique business problems and scaling or growth pains, not just crises.
The problems that lead entrepreneurs to hire a coach are where they will usually start to see benefits in their business first. Whether the issue is around the bottom line, business growth, or setting the right business goals, Coaches who are not working with prescriptive plans will focus their coaching on each business's unique circumstances and problems.
Scaling Up Coach Maxim Mulyadi shares, "All entrepreneurs have a problem. They either don't have a system in place or don't have a strategy yet, or they may have a cash issue or want to grow. So they have those problems, and they need a guide. Or maybe they have assembled a new team. What's next? They may need to establish accountability. They may know a bit of Scaling Up, but don't really know how to run it."
While each coach has a different approach, a good business coach makes sure that a prospective client can benefit from their services.
Chris uses a very data-driven approach to know if clients are the right fit and will benefit from his coaching style. "We use psychometric tools. When we're going to work with somebody, we want to work with like-minded people who are, in some ways, hungry and humble. We use psychometric assessments, the TTI, tri-metrics, and HD tools, and they're fantastic. We can see blind spots with those tools. We can see how a person does what they do, why they do what they do, and where their competencies are, which gives us tremendous clarity."
While the data is essential, the relationship is at the heart of his coaching. He says, "I've learned to work with candidates where it is a mutual coaching situation. You're coaching me as much as I'm coaching you. I think that's probably one of my favorite relationships where you're learning as much from them as they are from you. There's humility about what you do or don't know."
Maxim has a more spiritual approach and shared analogies from favorite films to explain. The way I see it, we are looking for the hero journey of our client. Whether they are looking to defeat the Empire or they want to bring the ring to Mordor, we look for that hero's journey. And then we position ourselves as a Yoda or as a Gandalf. We always look for our Frodo or our Luke Skywalker to fulfill their potential and be there with them throughout the journey so they can be the best version of themselves. They can live their best possible life and have the best possible business.
A good business coach will have a measurable action plan that covers the growth strategies for a successful business while also improving the work-life balance for the business owner.
Diana shared, "That's what drives each and every one of us. Everybody I talked to who became a business coach is about helping entrepreneurs, and their teams live their best lives. My great-grandpa was an entrepreneur, and he used to say, 'You want to whistle on your way to work and whistle on your way home.' And he did."
