Increased use of business coaching has created a greater need for accountability and clearer contracts.
In this white paper, we explore the limited research available on contracting—the setting up, use and monitoring of the business coaching relationship. We do not try to develop a standard coaching contract as that would be too constraining for the majority of business coaches—each contract must be customized to the client’s requirements. Instead we provide a list of factors that should be considered in developing an effective contract.
Poor contracting creates issues for all parties—business coaching contracts are much more than who, what, when and where.
What is contracting?
The business coaching interaction uses all the elements we associate with wholesome and effective human relationships such as dialog, reflection, enquiry and exploration of meaning. But this interaction takes place within a specific and unusual context—a learning conversation where the agenda for the interaction is determined by only one of the partners in the conversation. This mix of familiar and unique can lead to misunderstandings and dilemmas for both parties unless the implicit psychological contract that is operating is made explicit. The initial exploration of the terms of reference for the relationship and its continual monitoring are at the core of contracting.
Other disciplines and helping therapies such as counseling have a wealth of experience in the management of these areas. Our research identified good practice that recognizes clarity of mutual expectations as vital for a good working relationship. We describe three types of contracts that invariably operate in any helping arrangement:
Contract early using all three contract types—seek transparency for all—review the existing contract often.
The elements under each of these contracts are varied, and we have reviewed what communities of practice and professional associations have identified as critical. These groups include the International Coach Federation (ICF), the European Mentoring and Coaching Council (EMCC) and the Worldwide Association of Business Coaches (WABC). The Executive Coaching Forum, for example, provides a valuable service with the Executive Coaching Handbook where they have a competency model that describes the requirements of a coach, including a specific section on contracting. The complexity of this section illustrates the dynamic nature of the contract. One area of particular interest is clear accountability. Negotiating the coaching contract can be an ideal opportunity to engage the sponsor fully with setting the coaching goals and designing the evaluation criteria. Real sensitivities are, however, involved in such three-way contracts, and we suggest the use of a no-fault exit clause for both sides if it becomes clear that things are not working. Some practitioners have identified issues with the three-cornered contract specifically and even the four-cornered contract, where the line manager is not the direct manager of coaching.
In general, the business coach can effectively steer through the maze of who the client is in this relationship by maintaining transparency and appropriate ethics. For example, a mismatch between the career aims of the individual and the requirements of the organization is not unusual. The business coach must negotiate goals based on the common ground between these two perspectives and use the business coaching intervention as a method of bringing them together.
The WABC Professional Standards for Business Coaches are explicit in the need to hold the potential tension between organizational and client agendas: “I will put the client first while at the same time respecting the objectives of the client’s organization.”
The issue of confidentiality is particularly marked in this regard as sponsors/line managers often assume they will receive reports of the progress of the coaching. Clearly this is not at the business coach’s discretion and a contracting conversation must take place with the sponsor and the executive to agree on the frequency and extent of reporting.
Proper business coaching contracting protects all parties (e.g., client, business coach, organization)—efforts are rewarded.
We suggest including the following key elements in the business coaching contract. Additional elements are identified in the full paper.
- The duration, number, frequency and venue of sessions
- Fees, cancellation policy and the availability of the business coach both in person and for email/telephone discussions
- The business coach’s area of practice and the mechanism for onward referral. This is critical when the coach is able to competently provide more than one type of service (e.g., consulting, training, mentoring). A contract should be limited to one type of service unless the client requires a “master” or “broad” contract, in which case each service must be explicitly covered.
- Indication that the coach may be in professional supervision and will be discussing the intervention under the appropriate confidentiality agreement there
- A limitation of liability clause, information about the business coach’s professional indemnity insurance and a no-fault exit clause and process
- The goals of the business coaching, identifying the specific outputs and behavior changes required in a manner that is measurable and clear, including time, cost, quality and milestones
- The model of practice to be used, including its limitations and strengths. Identify if real-time coaching is expected and if observation of the client is required. Identify with whom any assessments will be undertaken and who will see the results.
Full White Paper
The evidence shows that a business coaching contract should be negotiated early in the relationship and revisited often.
Coaching can help business executives to fine-tune skills that are crucial within today’s economic and market constraints. These include, for example, the ability to exert influence across organizational boundaries, to manage conflicts, and to create and articulate a vision. Coaching has also been shown to help leaders develop a clearer understanding of their roles and responsibilities. But perhaps most importantly, coaching can help new leaders deal with the aspects of transition, transformation, and change (Stout Rostron, 2009:61).
In order to make this happen, it is important for coach and client to carefully set out the boundaries for how communication is to take place. Developing the habit of both formal and informal contracting is one of the first steps in beginning to understand the dynamics of forming a coaching relationship and setting boundaries. The coach and client agree to conditions of time, space, fees, confidentiality, and goals. In contracting, the business coach agrees to a specific set of conditions.
Contracting the Relationship
The purpose of the contract is to open up the potential for trust between coach and client that is essential if the client is to trust his or her own self-exploration. As the agreement lays the foundation for the relationship, it must be adhered to in action for trust to develop.
The contract between coach and client sets out which services have been agreed upon and delineates all fees as well as the outcomes and deliverables that can be expected. The contract sets out ground rules for the coaching relationship so that both parties are aware of their obligations. This helps prevent future misunderstandings and provides a firm basis to deal with disagreements. The contract describes the relationship between the coach and multiple parties, such as the individual client, the client organization, the HR unit, and line management.
Objectives for the individual executive and for the organization need to be clarified, with boundaries made explicit in terms of confidentiality, fees, cancellation, and termination of the contract. Often in coaching, the contracting process is linked to the generation and fulfillment of outcomes. Contracting usually deals with the management of the process, roles being played, evaluation of the process, learning and outcomes, and exit clauses.
Another important aspect of contracting is the review of the contract when necessary, including termination or renewal. In any business contracting process, it is important to draw up the “marriage” and the “divorce” papers at the beginning: a bit like a prenuptial contract. It is important to specify the boundaries and parameters of the entire coaching intervention, i.e., how the process will proceed from beginning to end and how to terminate the process, whether at the contracted termination point or sooner if required by either party.
For example, last year one of my clients terminated the contract prior to the agreed upon period for the coaching intervention suggested by her organization. She and I verbally re-contracted together how she could manage her exit from the coaching process, how she would defend this position to her line manager and sponsor, and how she could negotiate re-entering the coaching process in the future when she felt more ready. This was made very transparent to the sponsoring organization. It is important that your contracting allows for this type of flexibility, yet keeps you within the bounds of your agreement with the third party or sponsor.
Defining Coaching in Your Contract
It is useful to include a definition of coaching within your contract, specifying how coaching differs from other helping professions. For example, “the services to be provided by coach to client are designed jointly with the client. Coaching, which is not advice, therapy, or counselling, may address specific personal or professional projects, business issues, or general conditions in the client’s life or profession.”
In our organization we use the following clause in our coaching contracts:
Throughout the working relationship, the coach will engage with the client in direct conversation. The client can count on the coach to be honest and straightforward in asking questions, making interventions, and facilitating the setting of goals. The client understands that the power of coaching is in the relationship between client and coach. If the client or the coach believes the coaching is not working as desired, either client or coach will communicate this.
Your Model as a Contracting Structure
A model is a metaphor for the entire coaching journey, yet embodies a structured process. The Purpose, Perspectives, Process model developed by David Lane within the scientist-practitioner paradigm (Lane and Corrie, 2006) can help you in three ways: to contract with the client, to structure the entire coaching journey, and to guide your coaching conversation. Out of the specific conversation about process can emerge the client’s purpose; the way your perspectives fit together can help clients to achieve their purpose; and the process within which you will work helps you both to achieve the outcomes desired.
Essentially, to contract the overall journey, coach and client discuss the overall aim of coaching for the client (purpose) and what each brings to the relationship (perspectives). Coach and client then discuss and contract how the coaching will take place: timing, boundaries, fees, the tools and techniques to be used by the coach, and the way the client would prefer to work (process). They also discuss the overall results and outcomes the client hopes to achieve from the coaching intervention, results that need to be visible to the organization, including thinking, feeling, and behavior that the client would like to change (outcomes as a result of process).
As a rule, I start the coaching conversation with perspectives: “Where are you now?” “What’s happening with you?” “What’s informing your thinking?” “What are your reflections on your current (or specific) concrete experience?” We move on to identify purpose: what they want to talk about, what their needs are for today, and what key outcomes they want to achieve. Once we have identified what needs to be worked on, we agree on the process we will work with using whichever question frameworks, tools, or techniques are relevant to that process. At the end of the session we summarize actions, learning, and outcomes that have resulted from the coaching conversation.
Any model that you use for your regular coaching conversations can help you to define a structure and process and set boundaries for working with your client. However, the name of the game is flexibility and working to the client’s needs, so anything prescriptive will only be for your needs. Remember, the conversation is about them.
Often when things go wrong it is due to poor practice on the part of the coach, perhaps from not setting proper boundaries (Ting and Scisco, 2006:19). Contracting and relationship building are crucial to the outcomes of any coaching intervention. Contracting is complex as it determines in what areas, and how deeply, the coach can work with the individual client, the team, and the organization in a holistic, integrated, and systemic way.
This article first appeared in Business Coaching Worldwide (October Issue 2010, Volume 6, Issue 3).
Lane, D.A., and Corrie, S. 2006. The Modern Scientist-Practitioner: A Guide to Practice in Psychology. Hove: Routledge.
Stout Rostron, S. 2009. Business Coaching International: Transforming Individuals and Organizations. London: Karnac.
Ting, S., and Scisco, P. 2006. The CCL Handbook of Coaching: A Guide for the Leader Coach. San Francisco: Jossey-Bass.
Dr. Sunny Stout Rostron, DProf, MA
Dr. Sunny Stout Rostron, DProf, MA, is an executive coach and consultant with a wide range of experience in leadership and management development, business strategy and executive coaching. The author of six books, including Business Coaching Wisdom and Practice: Unlocking the Secrets of Business Coaching (2009), Sunny is Director of the Manthano Institute of Learning (Pty) Ltd and is President Emeritus of COMENSA (Coaches and Mentors of South Africa).
The Value of Business Coaching for Organizations
Organizations and businesses of all kinds have new challenges to face in our quickly changing global environments. Success today requires advancing on many fronts simultaneously, including facing new industry entrants and disruptors, adapting to customer demands, competing to attract and retain top talent, and establishing clarity of vision through tumultuous times. Leading organizations know business coaching is essential to support the alignment between organizational goals and the leaders, teams and individuals responsible for driving their success.
ALIGNMENT AND ACCOUNTABILITY
Achieve Success and Adapt to Complexity More Seamlessly
Organizations have new challenges to face in our quickly changing global environments. Success today requires advancing on many fronts simultaneously, including facing new industry entrants and disruptors, adapting to customer demands, competing to attract and retain top talent, and establishing clarity of vision through tumultuous times.
As these challenges grow increasingly intertwined, traditional siloed thinking lacks the relevance to operate effectively in this new context. It takes enduring commitment to continuously focus on the right business initiatives at the right time, find the precise balance of objectives, resources and timing, and build transparency and accountability at all levels of an organization to realize sustained success.
This shift requires new knowledge and skills. Developing a learning mindset, building resilience and adopting adaptability are key to driving growth, innovation and peak performance from leaders, teams and individuals alike. Achieving organizational goals requires alignment and accountability at every level of an organization.
As organizations rise to meet these demands and realize their strategic intents, business coaching can support the alignment between organizational goals and the leaders, teams and individuals responsible for driving their success.
Business Coaching Drives Enhanced Performance and Stronger Business Results
Business coaching impacts individuals, teams and the organizations they work within. A business coach will leverage their expertise to build on the current state of both the organization and the individuals within it, to enhance performance and leadership potential. It is a role that is, by nature, supportive, disruptive and progressive.
DUAL-FOCUSED FOR RESULTS
Business Coaching is Distinct
Business coaching is distinct in that it addresses the needs of both the individual and the organization they work within. This distinction makes business coaching a unique discipline within the world of coaching more broadly. Business coaches can go by many names—including executive coach, organizational coach, leadership coach, or corporate coach—yet each one focuses on the shared business goals and objectives of both the client and the organization. This dual focus separates business coaching as a distinct practice from all other kinds of coaching.
Business coaches support organizational goals and objectives, at an individual or team level, by identifying opportunities and supporting clients in their actions to achieve results. The business coach’s role can take on many forms—it can be supportive, disruptive and progressive to encourage insights, development, change and growth.
Business coaching is industry agnostic, meaning the competencies of an effective business coach can be applied to any sectors or industries. Some business coaches may choose to specialize and offer their services in a particular industry. This is especially true with WABC business coaches, as they are required to have business and organizational experience before earning their WABC credentials.
Business Coaches Can Help
All Organizations, Roles, Levels & Industries
BENEFITS OF BUSINESS COACHING
Enhance Your Organization’s Diverse Strengths
Business coaches are strategic partners who build your business and operational success. Among the broad array of service offerings, business coaches may help:
COMMON BUSINESS CHALLENGES
Business Coaches Create More
Effective Businesses and Organizations
Business coaching engagements can be initiated for many reasons—ultimately, the goal is to remove roadblocks or challenges or to stimulate new insights or pathways so a business, company or organization can achieve its full potential and sustain or grow its market position.
Business coaching helps leaders, individuals and teams respond more effectively to change and accept greater accountability. It is often used to help high-performers reach even greater success as they engage with new opportunities for growth, at both a professional and organizational level.
Common Challenges That Business Coaches Can Address
An internal manager is taking over a new team and wants to understand how to integrate into an existing dynamic and build trust.
A business coach can help facilitate a smooth transition and provide the leader with clarity on how to build a vision and engage their team effectively.
An organization is going through a business transformation related to their goals, processes or technologies.
A business coach can help manage change effectively by implementing strategies to support the transition and adoption of the new priorities.
A president or CEO is ready to step down and is looking to build a succession plan to ready the organization for a significant leadership change.
A business coach can help the leader transition their expertise and knowledge effectively, and build clarity of vision while navigating a complex leadership handover.
If a team isn’t working well together, performance challenges and missed targets are common symptoms of underlying tension and lack of trust.
Business coaches can work with both individuals and teams to improve their dynamic, build trust with one another and find new ways to collaborate to increase productivity.
Supporting mental health is instrumental in retaining top performers and building an optimal, innovative work environment.
A business coach can improve employees’ understanding of how they contribute to an organization’s priorities, how to maintain an appropriate work/life balance, and how to be more authentic and open within the workplace.
Where Business Becomes Better
The Worldwide Association of Business Coaches (WABC) leads the business coaching industry in identifying the qualities, actions and skills you need to drive leading business outcomes and harness emerging opportunities.
As the industry leader since 1997, WABC has elevated business coaching practices worldwide and helped countless coaches, clients and companies successfully navigate complexity and achieve tangible business results.
Our global community spans more than 125 countries, and includes business coaches who work with entrepreneurs, managers, CEOs, presidents and professionals from all industries, all sectors, and all organizational sizes.
TARGETED BENEFITS OF BUSINESS COACHING
Accelerate Transformation Through
FOR FINANCIAL SERVICES
Amplify Client and Team Relationships
Enhance your customer service experience and build trust and loyalty with clients. Business coaching can help improve relationships and align individuals’ actions more closely with performance goals.
Drive performance with your team by strengthening internal engagement to drive greater innovation and more insightful decision-making. Improve the confidence, emotional intelligence and communication skills to motivate team members towards better performance.
FOR NFPS AND NGOS
Build Change for Good
Improve your organization’s ability to more effectively deliver on your mission to the communities you serve. Boost creativity, innovation and accountability for your programs, and more clearly articulate the need in ways that resonate with the public.
Increase the efficacy of your program delivery by thinking more strategically and spotting opportunities that drive greater results. Build support more effectively, both within your organization and with external partners and stakeholders.
For Professional Services
Guides Clients with Strategic Intent
Gather the right information from clients by asking more insightful questions and tailoring your approach more effectively. Guide your clients towards clarity by offering clear, strategic intent.
Build trusted partnerships founded on advice, authenticity and a sense of being in your client’s corner. Enhance your strategic deliverables with solutions that address clients’ challenges realistically and effectively.
Unlock Organizational Transformation
Strengthen the ability to identify client needs and get to the root cause of operational challenges more effectively. Gain a wider strategic view on how technology infrastructure supports business and operational strategy.
Build organizational roadmaps that take into account the diverse requirements across departments. Equip teams with the relationship-building skills and empathy needed to drive stakeholder satisfaction.
Foster a Safer, More Productive Culture
Increase employee focus by fostering a positive working environment through setting clear expectations of organizational priorities and safety. Align business objectives and team priorities more closely by equipping leaders with the skills to manage their teams more effectively.
Improve your customer service experience with increased loyalty and customer satisfaction. Build a supportive and respectful culture that takes into account the importance of a team member’s overall wellbeing, including their mental health.
Your Next Steps
Achievement with WABC
Business coaching offers many ways to achieve your business objectives and build a business coaching culture within your organization. Take the next step towards achieving sustainable performance improvement with WABC.
Hire a Qualified Business Coach
Search the WABC Business Coach Locator to find your qualified coaching partner in accelerating your professional or organizational achievement.
Recommend WABC to Your Employer
Are you a champion of business coaching within your organization and want to introduce WABC to your employer to see what’s possible?
Whether your organization has a business coaching program or is interested in building one, WABC accredits in-house programs to ensure that your employees are trained to coach using the latest research-informed best practice and global standards.
Consult with WABC to Build Operational Excellence
Many organizations see the value in using business coaching to unlock the potential within their organization, but don’t know where to start.
WABC offers a range of consulting and business services to identify opportunities and improve business coaching within organizations.