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Scoring Real Points With Exec Coaching - Investor’s Business Daily

11 July 2008 No Comment

Scoring Real Points With Exec Coaching

Gary M. Stern Fri Jul 11, 5:57 PM ET

Ten years ago, if a senior manager was assigned an executive coach, it was like being called into the principal’s office. At that time, most managers who needed coaching were typed as difficult or problematic.

Now organizations are finding that executive coaches can help boost a company’s revenue by developing new business strategies.

Executive coaches help people see their blind spots in order to improve their business verve. Just as golfers can’t see their own swing, then hire a pro to improve their game, corporate leaders and entrepreneurs turn to executive coaches to see the gaps in their business model. By changing a businessperson’s outlook and strategies, executive coaches can help drive revenue.

When Jodi Rolland was a regional director at Merrill Lynch’s (NYSE:MER - News) Global Wealth Management in 2006, she hired Ray Sclafani, the president of Tarrytown, N.Y.’s ClientWise, as an executive coach for leadership development. Now a managing director at Merrill Lynch based in Denver, she hired Sclafani to coach about 25 financial advisers with the goal of doubling their business in five years.

Studied Uniqueness

Sclafani focused on what made the financial advisers unique to their clients. He also looked at their business efficiency and how they lured new clients to generate growth.

Rolland noted Sclafani also helped each adviser “think like the CEO of a company.”

She added that hiring an executive coach for a financial adviser is like a medical doctor receiving coaching to run his practice more efficiently.

Sclafani conducted due diligence by reading the financial advisers’ talent reviews and studying their sales data.

“People’s behaviors are all about patterns. When they look to achieve something different or find themselves in a new role, it may require learning additional skills,” he said.

In researching the business, Sclafani realized that rich clients were making more demands on their financial advisers. Clients wanted their advisers to play a bigger role and coordinate with their estate and tax attorneys.

He concluded that the advisers needed to deepen their client relationships and establish a more targeted specialty. He also suggested ways to connect with “centers of influence like attorneys and CPAs who could help generate new business,” Rolland said.

The financial advisers who offered a strong niche were doing the most business. Hence, advisers who specialized in helping widows, small businesses and executives with stock options were the most profitable.

The specialist who worked with entrepreneurs knew which experts to hire to put a dollar figure on a business and who the leading business brokers were.

“If you’re hiring a surgeon, you hire a hand surgeon,” Sclafani said.

He also helped advisers hone their competitive edge or what Rolland calls their “unique value proposition.”

If a financial adviser calls a client the third Thursday of every month to review his portfolio, that could be considered a competitive edge, Rolland says.

Effort Pays Off

Sclafani helped advisers focus on the 20% of clients who generated 80% of their businesses and determine the right number of clients to expand their revenue.

After a year, Merrill Lynch’s financial advisers coached by Sclafani showed an increase of revenue from 20% to 40% each.

Sometimes a company turns to an executive coach when its revenue is running flat and the CEO doesn’t know what to do to jump-start its business.

Carolyn McDonald, the CEO of Navtech GPS, a Springfield, Va.- based reseller of specialized Global Positioning Systems, described Navtech as a family-owned business that was “stagnant, complacent and needed to break out of a rut.”

Navtech has 11 employees and generated $7.9 million in revenue in 2007. It offers a targeted product. But it did little marketing outside of its catalog and basic Web site. “We’ve always been a reactive company; customers found us,” she said.

To augment its revenue and reinvigorate its business strategy, McDonald in early 2007 turned to InterSource, a McLean, Va.-based executive coaching company led by Art Medici.

Medici interviewed all of Navtech’s employees, spoke to several of its customers and reviewed its financials.

Medici concluded that Navtech needed to do a better job of differentiating itself from its competitors by offering more customized products.

Also, Navtech needed to step up its marketing efforts by adding direct mail and e-mail campaigns, improve its sales training and strengthen its Web site by making it interactive.
Medici also recommended certain employees for promotion and that Navtech should hire people to help it expand into more revenue-generating areas.

Based on Medici’s advice, Navtech instituted a new financial accounting system, hired a full-time chief financial officer and promoted three people, including a director of marketing. Also, Navtech intensified its use of customer service databases.

Medici taught staffers, not just the CEO, to think more strategically. Each employee has a plan to increase business, and the script is reviewed periodically.

“We know where our market is and we’re starting to go after it,” McDonald said.

Medici meets with McDonald weekly to review whether its financial targets have been met and pinpoint any obstacles.

In small business, where every employee is critical, personnel issues predominate. Her executive coach showed McDonald ways to handle staffing issues differently, explained how to overcome staff resistance to change and encouraged her to stretch her staff’s talents.

“In our company, we’re selling knowledge, and every employee plays a major role,” she said.

By offering more customized products, Navtech has been adding customers and is expecting to see increased revenue from its direct mail and e-mail campaigns.

Based on insights from the executive coach, McDonald said, “we have a better understanding of why we’re doing well. We’re more intentional about going after new business. We’re going after niche users who have special applications.”

Why are executive coaches influential?

Rolland replied: “They serve as a neutral third-party and guide people along without telling them what to do. They help people manage their business better and increase revenue per client.”

Copyright © 2008 Investor’s Business Daily

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