The Organizational Benefits of Coaching: A Case Study

By Bob Schwieterman

PHH Arval is the second-largest provider of commercial fleet management services in North America. In 2006, the Canadian division targeted leadership practices and development as critical business issues to differentiate themselves from their customers.

Jim Halliday, president of PHH Arval’s Canadian business, championed this move. “We had a gap between where our leadership practices were and where we wanted them to be. We provide a service. Achieving employee satisfaction, retention, engagement and professional growth is a key part of our business model.”

“The 2006 employee survey results showed us we needed to substantially upgrade the people-management skills of our managers,” Rita Ennis, PHH Arval’s North American senior vice-president of human resources. “We’d be far better positioned to motivate employees to embrace change, to implement market-differentiating products and service and to stay with PHH while working to develop their talents if our managers were exceptional in their people management skills.”

To get a better understanding of how employees viewed the company’s 32 people managers and leaders, PHH called in Tracom Group, a performance consulting group, who used a custom leadership 360o assessment tool to find out.

The results of the 360o assessment showed that employees saw managerial performance to be lowest in three dimensions: coaching/development, creativity and innovation, and strategic thinking. In response, PHH chose to focus initially on developing coaching skills to equip PHH leaders to conduct performance-based coaching discussions through a four-stage process: learning, demonstration, feedback from direct reports and practice using real on-the-job situations. An important component of the process was to conduct checkpoint assessments during the latter stages to show proof of coaching effectiveness.

During the 15 months between the first and third 360 assessments, the leaders improved significantly on each of the five dimensions, gaining on average 14 per cent. Interestingly, scores on most of the 360 dimensions remained flat between the first and second administrations, which were five months apart. This is often the case when behavioural change is measured in the near term, and highlights the importance of reinforcing program content and regularly measuring progress over a longer period of time.

Further evidence of the impact to the business was the results of the recent employee survey.
The chart below provides a comparison of selected questions asked in the 2009 and 2006 employee opinion surveys.

How would you rate your immediate manager on each of the following?

These results attracted the attention of George Kilroy, the CEO of PHH. “In my visits to Canada, employees were talking enthusiastically about the positive changes they were seeing in the company leaders. Then I saw the improvements stated so dramatically in our employee survey data. I’m now confident that there’s a strong link between the employee work experience and the service quality those employees provide to clients.”

Bob Schwieterman is vice-president of Tracom’s performance consulting services.