Organizations are facing a massive people crisis, but responding with process solutions. The remedy isn’t a trendier tech stack or more surveys; it’s managers with know-how. 

By Kimberly Lee 

Gallup’s most recent State of the Global Workplace report puts the cost of disengagement at $8.8 trillion annually, which is roughly 9% of global GDP, and is too big to ignore. Trust in managers has dropped from 46% to 29% in just two years. Performance metrics often mask the reality that employees are not merely resources to be managed, but individuals seeking to be truly seen. Most organizations are still responding to a people crisis with a process solution: more dashboards, more surveys, more performance improvement plans. 

Effective leadership is not a post-mortem of past achievements but a map of transferable grit. The problem isn’t measurement. It’s management. 

The PowerSchool HR team earned HRO Today’s TA Team of the Year Award in 2019, and that recognition serves as a case study for this philosophy. That outcome was not fueled by a trendy tech stack, but by the belief that a single coaching conversation creates an exponential wave of change. When a manager shifts from “directive” to “inquiry,” the entire cultural fabric begins to change. That experience, backed by a growing body of research, points to the same conclusion every time: The organizations that hold onto their best people aren’t doing anything magical. They just have managers who know how to coach. 

The Gap Between Training and Behavior Change 

HR leaders pour enormous resources into leadership development, and the returns are often underwhelming. Here’s why. Research shows that training alone produces about a 22% improvement in productivity. Add coaching to that training and the number jumps to 88%. That gap isn’t a rounding error. It’s the difference between teaching someone a concept and helping them actually change how they work. Most training programs are designed to inform, not to change behavior. Coaching is what bridges that gap because it meets people in the actual moment of application, when the stakes are real and the old habits are pushing back. 

Training transfers information. Coaching is what makes it stick. It provides the feedback loop, the accountability, and the real-time reinforcement that turns a workshop into a lasting behavior shift. Without it, even the best-designed programs tend to lose their impact not long after they end. 

This isn’t just a “people” argument; it’s a financial one. Research from PricewaterhouseCoopers found an average ROI of seven times the initial investment in coaching. The International Society for Performance Improvement documented a 221% increase in productivity when coaching was added to training. MetrixGlobal, after factoring in productivity and retention gains, landed at a staggering 788% return. At some point, the data stops being a conversation starter and starts being a mandate. The business case isn’t something to debate anymore. It’s something to act on. 

A Framework That Works: “GROW” in Practice 

One of the most practical tools for building a coaching culture is the “GROW” model: goal, reality, options, will. What makes it work isn’t that it’s sophisticated. It’s that it’s repeatable. It gives managers a structure for real coaching conversations without requiring a certification, a dedicated offsite, or a separate calendar system. It fits inside a 15-minute one-on-one. 

Each stage does specific work. Goal-setting creates clarity and direction, not just what someone is working toward, but why it matters to them personally. Reality grounds the conversation in honest assessment without turning into criticism. Options open up thinking, trading the urge to prescribe answers for the discipline to ask better questions. By trading that urge, a manager creates a safe fail-zone where professional confidence can be refined without being bruised. It closes the loop with a real commitment to a specific next step, not just a good conversation that fades by Friday. 

When managers apply this consistently, the results show up in the data. The International Coaching Federation reports a 70% increase in individual performance, a 50% increase in team performance, and a 48% increase in organizational performance in companies with active coaching cultures. Organizations with formal coaching programs also see 22% higher retention rates and a 28% reduction in voluntary turnover. 

Retention Is a Coaching Outcome 

There’s a persistent belief that retention is mostly a compensation problem. An example of that is when managers want to give increases or bonuses to retain an employee or counter an offer. However, the data doesn’t back that up. When employees leave, exit interviews point to lack of development, feeling invisible, and the absence of meaningful feedback far more often than pay. People don’t leave paychecks. They leave managers who don’t invest in them. 

Here’s what plays out in high-performing organizations repeatedly. Managers who coach regularly rarely get blindsided by resignations. Not because their teams are perfect, but because they know what’s brewing. Skill gaps get caught early enough to actually fix. 

Frustration surfaces before it hardens into a decision. And when employees feel like someone is genuinely invested in their growth and not just their output, they notice. That kind of attention is harder to walk away from than most people realize. 

The proof shows up across industries in ways that shouldn’t be ignored. Cleveland Clinic tied their internal coaching program to roughly $85 million in physician retention. Google’s “Project Oxygen,” which set out to identify what made managers effective, landed on one answer above everything else: being a good coach. Not technical expertise, not strategic thinking. Coaching. That finding changed how Google trains managers company-wide. 

What High-Performing Organizations Do Differently 

Building a coaching culture doesn’t require a multi-year transformation. It starts with a decision, followed by some very deliberate shifts at the manager level. 

Take a look at the succession plans. Managers with deep benches, the ones who consistently have “ready now” talent, are the ones coaching. The managers with empty benches year after year are doing something else entirely—managing tasks, not developing people. That difference shows up long before it ever becomes a crisis. 

The organizations getting this right aren’t replacing their training programs. They’re following through on them. Coaching is what closes the gap between a workshop and an actual behavior change, and the ROI difference is significant. Even moving from annual reviews to more frequent, shorter coaching conversations produces measurable gains in engagement and retention. 

The other piece is accountability. High-performing organizations hold managers responsible for how their people grow, not just how their numbers look. When development becomes an expectation rather than a nice-to-have, coaching stops being optional and starts becoming the culture. 

The $8.8 trillion in disengagement costs isn’t a workforce problem; it’s a leadership model problem. AI will change a great deal about how organizations operate, but it won’t the fact that people still need to feel seen, developed, and invested in. That’s not a technology gap. It’s a coaching gap. The organizations that outperform their peers over the next decade won’t necessarily have the most sophisticated HR technology. They’ll have managers who show up to one-on-ones ready to ask better questions instead of handing down more directives. 

 

Kimberly Lee, SPHR, is an HR executive, leadership coach, and founder of Lotic Systems and MyTalentAdvantage.