Yes, coaching works, on average. A meta-analysis of 37 randomised studies found a moderate positive effect of coaching on work-related outcomes. For business owners, the evidence that coaching also delivers more sales or profit is thinner, but there are strong experiments that show it.
What makes the difference is what the coaching does and who receives it. Coaching that changes behaviour in the business delivers more than a general course. And the most important condition lies with the business owner: the willingness to change.
In short
- Three meta-analyses find a positive effect of coaching on skills, well-being and reaching goals. The effect is moderate.
- For profit and sales the evidence is thinner. A year of advice to small firms in Mexico did lead to about 50% more employees five years later.
- Your own attitude counts most. An open attitude towards change turned out to be the most important success factor.
In this article
- Does coaching really work, or is it mostly a good feeling?
- What does coaching change, and what does it not?
- Does coaching also bring a business owner more sales or profit?
- Which form of coaching works best for business owners?
- When is coaching of little use?
- How do you know whether your own coaching programme is delivering anything?
Does coaching really work, or is it mostly a good feeling?
Coaching demonstrably works, even if you only look at the strictest research. Three meta-analyses, studies that combine the results of many separate studies, all arrive at a positive effect. They mainly concern coaching of people who work in an organisation.
The strongest study is the one by De Haan and Nilsson. They only looked at randomised studies, in which chance decides who receives coaching and who does not. That way you can truly attribute the difference to the coaching. In 37 such studies with 2,528 participants in total, they found an effect of g = 0.59 (De Haan & Nilsson, 2023). The researchers call that a moderate effect.
An earlier meta-analysis by Theeboom, Beersma and Van Vianen combined 18 studies on coaching in organisations. Coaching had a positive effect on all five types of outcome they examined: performance and skills, well-being, coping with stress, attitudes towards work and steering towards one's own goals. The effect ranged from g = 0.43 for coping with stress to g = 0.74 for steering towards one's own goals (Theeboom, Beersma & Van Vianen, 2014).
An effect size such as g or δ is a measure of how large the difference is between people with and without coaching, regardless of the scale on which it was measured. The higher the number, the larger the difference. At 0 there is no difference.
What does coaching change, and what does it not?
Coaching works most strongly on results and on attitude, and most weakly on learned skills. That is the finding of the meta-analysis by Jones, Woods and Guillaume, which combined 17 studies on workplace coaching.
Across all outcomes together they found an effect of δ = 0.36. For skills it was δ = 0.28, and for attitudes and feelings about work δ = 0.51. The largest effect was in results at individual level, such as the work performance of the person coached: δ = 1.24 (Jones, Woods & Guillaume, 2016).
How long the coaching lasted and in what format it took place made no measurable difference in these studies (Jones, Woods & Guillaume, 2016). De Haan and Nilsson also found that the effect depended little on the length of the programme (De Haan & Nilsson, 2023). So a longer programme is not automatically a better one.
Does coaching also bring a business owner more sales or profit?
Sometimes it does, but the evidence is thinner than for well-being and skills. The strongest studies of business owners are field experiments, often in countries outside Europe. They show that advice to small firms can increase productivity and growth.
The best-known example comes from Mexico. Researchers divided 432 small and medium-sized firms into two groups by lottery. Some of them received access to heavily subsidised advice from a consulting firm for a year, around four hours a week. The firms that could receive advice became more productive and achieved a higher return on their assets. Five years later they had about 50% more employees and also a higher wage bill (Bruhn, Karlan & Schoar, 2018).
What improved in those firms varied greatly from firm to firm. Most often it concerned marketing, financial accounting and long-term planning (Bruhn, Karlan & Schoar, 2018). So there was no fixed recipe. The adviser worked on the problem that existed in that particular firm.
For general training for business owners, the effects are smaller. A meta-analysis of randomised studies of business training in developing countries found on average 5 to 10% more profit and sales (McKenzie, 2021). That is a real effect, but too small to measure reliably in a single study. That is why many early studies found no effect, even though there was one.
Which form of coaching works best for business owners?
Coaching that changes behaviour works better than coaching that only transfers knowledge. That is the lesson from a large experiment in Togo. There, training focused on personal initiative delivered much more than a classic business management course.
In that experiment, owners of small firms were assigned by lottery to a classic training, a training in personal initiative or nothing. Personal initiative here means: seeking out opportunities yourself, planning ahead and persevering after setbacks. That training increased profit by an average of 30% compared with the group without training. The classic training gave 11%, and that difference was not statistically certain (Campos et al., 2017).
Who does the coaching also makes a difference. In the study by De Haan and Nilsson, the effects were larger with qualified coaches (De Haan & Nilsson, 2023). In organisations, internal coaches worked better than external ones (Jones, Woods & Guillaume, 2016). One possible explanation is that an internal coach already knows the company. For a business owner this means: a coach who understands your sector and your figures has a head start.
When is coaching of little use?
Coaching is of little use if the business owner does not really want to change. Research into coaching programmes for young business owners found that an open attitude towards change is the most important condition for success (Audet & Couteret, 2012). A good coach cannot supply that attitude for you.
That research compared six coaching programmes and is therefore small. It does fit what the large experiments show. In Mexico, about half of the firms that received the offer ultimately did not take it up, even though the advice was heavily subsidised (Bruhn, Karlan & Schoar, 2018). Advice only works if you make time for it and act on it.
Coaching is also not the right solution for every problem. If the question has a fixed answer, such as a tax choice or a contract, a specialist will help you more. Coaching mainly helps with behaviour: making choices, setting priorities, reaching goals and keeping going. That is also where the largest effects lie in the meta-analyses (Theeboom, Beersma & Van Vianen, 2014).
How do you know whether your own coaching programme is delivering anything?
Measure the result in your business, not only how you feel. In the research, the effects were larger when participants rated their own progress than when others measured it (De Haan & Nilsson, 2023). So a good feeling after a session is not yet proof that it works.
De Haan and Nilsson also found signs of publication bias: studies with a positive outcome are published more often than studies without an effect (De Haan & Nilsson, 2023). The true average effect may therefore be somewhat lower than the published figures. That is a reason to measure carefully yourself.
Three questions help you test a programme beforehand and afterwards:
What concrete goal should this programme deliver?
Choose something you can see in your business, such as a better margin, a schedule you stick to or a decision you have been putting off for months.
How do I measure that, apart from my own feeling?
Decide beforehand which figures or facts you will compare afterwards, and who besides you will look at them.
What will I do differently myself?
Research shows that your own willingness to change is the biggest factor. Without that willingness, even the best coach delivers little.
Most research is about employees in organisations and about business owners outside Europe. For Dutch SME owners there is little randomised research. The direction of the findings is consistent, however: coaching that focuses on your own business and your own behaviour delivers more than general knowledge.
Sources
- De Haan, E. & Nilsson, V.O. (2023). What can we know about the effectiveness of coaching? A meta-analysis based only on randomized controlled trials. Academy of Management Learning & Education, 22(4). doi.org/10.5465/amle.2022.0107
- Theeboom, T., Beersma, B. & Van Vianen, A.E.M. (2014). Does coaching work? A meta-analysis on the effects of coaching on individual level outcomes in an organizational context. The Journal of Positive Psychology, 9(1), 1-18. doi.org/10.1080/17439760.2013.837499
- Jones, R.J., Woods, S.A. & Guillaume, Y.R.F. (2016). The effectiveness of workplace coaching: a meta-analysis of learning and performance outcomes from coaching. Journal of Occupational and Organizational Psychology, 89(2), 249-277. doi.org/10.1111/joop.12119
- Bruhn, M., Karlan, D. & Schoar, A. (2018). The impact of consulting services on small and medium enterprises: evidence from a randomized trial in Mexico. Journal of Political Economy, 126(2), 635-687. doi.org/10.1086/696154
- McKenzie, D. (2021). Small business training to improve management practices in developing countries: re-assessing the evidence for 'training doesn't work'. Oxford Review of Economic Policy, 37(2), 276-301. doi.org/10.1093/oxrep/grab002
- Campos, F., Frese, M., Goldstein, M., Iacovone, L., Johnson, H.C., McKenzie, D. & Mensmann, M. (2017). Teaching personal initiative beats traditional training in boosting small business in West Africa. Science, 357(6357), 1287-1290. doi.org/10.1126/science.aan5329
- Audet, J. & Couteret, P. (2012). Coaching the entrepreneur: features and success factors. Journal of Small Business and Enterprise Development, 19(3), 515-531. doi.org/10.1108/14626001211250207