Six Important Reasons Why You Need to Put Coaching First In Your Business & How Sustainability Fosters Healthier Growth with Andrew Winston
Dominic Monkhouse
Host of Top 2% Global Podcast 'Mind Your F**king Business' | Elite Business Coach and CEO Mentor | Specialising in Scaling Teams from 50 to 500 | Driving 10X Business Growth | Founder, CEO, Investor | Kolbe: 7-3-9-2
Learning, developing, growing – there’s a reason these three words go together. You can’t have one without the other. They depend on each other. I’ve worked in businesses that place a high value on coaching and ones that don’t. And the ones that don’t are the businesses that stagnate.?
An organisation’s capacity to grow is defined by its?openness to learning, which needs to be embedded from the top to the bottom. From the CEO to the most junior administrator, there needs to be a commitment to ongoing training and personal development.?
But why is coaching so crucial to business growth? What are its main advantages?
It’s not expensive.
Yes – really! A good peer coaching programme will cost nothing, but it can turn things around really quickly. It shouldn’t need specific rules or training. Some of the best we’ve seen are the simplest. Every staff member can pick someone as their coach or volunteer to be a coach, agreeing on how often to meet.?
When coaching clients through this process, we suggest they structure it so that the time commitment is no more than an hour every fortnight. Don’t make it onerous for any member of staff. Coaching relationships shouldn’t last more than six months, and it’s entirely up to the team member whether they want to participate. That’s the beauty of it. It’s not being imposed on you. Take it or leave it!?
If the programme isn’t working for either the coach or the coachee, then it needs to stop. Kill it and start again.
NextJump’s approach to staff development is a great example. Harvard Business Review identified them as a DDO (Deliberately Developmental Organisation), and they put a strong emphasis on candid feedback. Any perceived weaknesses that impact a member of staff’s ability to do their job are flagged up. They call it your ‘backhand’ – such a great name.?
Opportunities are then created for staff to work on their backhand outside their regular day job. For example, any team member who struggles with speaking in public is asked to lead culture tours around the company. By doing this, they deliberately practice their public speaking skills in a way that isn’t revenue-impacting. Fantastic idea!
Coaching enables forward planning.
In organisations that are scaling quickly, one factor that will restrain future growth is the?availability of more managers. You need to avoid the trap of promoting someone because they’re the least-worst candidate or they’ve been with you a long time. A person may be a first-rate developer but a lousy manager. Just because they were the first person through the door doesn’t mean they should step into management if they don’t have the right skills.??
When we work with clients on their strategic goals, we look at projected turnover, future org structure, number of employees needed and core capabilities. At that moment, the scale of the future problem reveals itself. And that moment when they realise they need to make coaching a priority. A peer coaching programme like the one I’ve mentioned above could be an excellent first step. Then I’d recommend a full-blown management development programme to fast-track employees who’ve shown potential.??
Coaching identifies true talent.
People who are naturally drawn to management do it instinctively. When I was MD at Rackspace, we hired Lucy, who sat next to two of our sales team. One of them, Clarissa, stayed later and came in early to coach her. We didn’t ask her to – she just did it. Clarissa had naturally displayed her management tendency. Needless to say, when the promotion came up, it was Clarissa who got it. She turned out to be a superb manager!??
It’s often the softer skills that are key to good management – and they’re the hard skills to measure. Creating opportunities for these qualities to shine through is essential – this will help you root out people with potential.??
A peer coaching programme will provide these opportunities. Staff can show their mettle around coaching because that’s the core skill you want. It will also give your leadership team priceless data on who has a growth mindset – whether they’re the coach who gets picked more than once or the person who wants to be coached. You’ll tap into all that crowd-sourcing information about who the organisation believes?has the skills to coach.?If you give participants a 1st, 2nd and 3rd choice of coach, you’ll get even more valuable data.
So when you do your?quarterly talent assessment?and analyse who meets or exceeds expectations and who lives by your?company values, you’ll judge based on recent, relevant data.
I’m fascinated by Gallup’s work on self-perception in the workplace. They found that the top quartile of staff (for management ability) know that they’re better than some people in their company but don’t know how good they are relative to the rest of the universe. On the other hand, the bottom quartile thinks that they’re better than average. So, the A-Players don’t know they’re genuinely A-Players, and the C-Players have no idea they’re not As!
Keep this in mind when people put themselves forward for promotion. They might think they’re suitable, but often, they’re not!?
Coaching drives team member engagement.
The Gallup Q12?is an excellent metric for staff engagement, as?is Friday Pulse.?If you become a coaching-first organisation, it will turbo-charge your score in these tests! Increasing engagement can unlock up to 40% more discretionary effort from your staff. Think of that!?
Through a peer-coaching programme, you tell staff, ‘We value you. Here’s your opportunity to develop and grow.’ Hopefully, you’ve built a systemic culture?of praise and celebration?alongside this. The coaching programme supports this, providing opportunities for positive feedback and confidence-building. It’s a win-win.
Coaching makes staff accountable.
By putting the onus on the team member to volunteer to coach or be coached, you’re asking them to look at themselves. To think, what is that I do that I need to get better at, whether functionally or personally, and what are my objectives??Staff become accountable?for their development.
Back to NextJump. They give four people group accountability for specific areas of the business. Each group has a captain, two team members and a coach. It’s the captain’s job to train one of the others to become good enough to be captain, at which point the captain becomes coach. By passing on the baton, they’re responsible for replacing themselves. Every manager should see their job in this way. Their goal should be to make themselves redundant so they’re ready for the next challenge.
This builds respect and accountability, particularly in bigger companies. It always staggers me how people stop pulling their weight when a business goes over roughly 35 staff. The dirty cups stack up in the kitchen, and no one washes theirs up – so frustrating. These things may seem insignificant, but it indicates something else is going on. People lose their shared accountability, and it becomes ‘someone else’s job’.??
Coaching strengthens relationships.
I’m a great one for building the neural networks of businesses. I’ve made this a priority in the organisations where I’ve been MD. By introducing a peer coaching programme, you’ll see new pathways being forged and relationships being strengthened. It can be so powerful for social cohesion in your business. You can go as far as ensuring coaches come from other functional areas or teams to make this aim explicit.
As well as neural networks, coaching will ensure DNA transfer from old hands to new ones. This keeps your culture tight. When you’re growing, it’s easy to lose that founder mentality, but here you have a way to retain the essence of your company and ensure everyone understands and feels it.?
One of the questions in the Gallup Q12 is about having a best friend at work. It’s based on research showing a concrete link between a best friend in the workplace and high-performing teams. If you’re coaching someone as a peer, there’s no management hierarchy. It frees the relationship to focus entirely on the individual, without any company agenda or hidden motive.
Something that worked well with one of my clients was getting all the coaches together at the beginning of the programme so they knew who else was involved. This proved successful, allowing staff to ask questions and form a support network.
Final Thoughts
Coaching is all about mindset. To become a coaching-first business, everyone must understand the importance of learning and growing. It takes deliberate practice and effort before becoming ingrained.
It’s not surprising that I feel it’s so important – you wouldn’t expect anything less from a business coach! But occasionally, I’ll come across someone who refuses my help, saying they don’t want coaching. That’s their decision. But it’s like saying you’ve closed your mind. Ultimately, we never stop learning.?
The Melting Pot: Driving Healthier Growth Through Sustainability with Andrew Winston
Last week we learned from Andrew Winston, one of the most widely read writers on sustainable business, and a globally-recognised expert on megatrends and how to build companies that thrive by serving people and the planet.?
Andrew’s journey into the realm of sustainability was a winding one. His formal education in economics and his subsequent tenure as a consultant instilled in him the strategic approach he would later need. However, it was the dot-com crash that turned the tide and urged him to follow a new path. He yearned for something more meaningful, leading him to pursue a degree in environmental management. He didn’t anticipate that his first book, written like a consultant and not an environmentalist, would become a bestseller and lay the foundation for his work in helping companies understand the role of business in society.?
He passionately believes that profits and sustainability are not mutually exclusive and that the majority of a company’s value lies in its intangible aspects, such as brand value and customer loyalty.?
In this episode, Andrew emphasises the need to think beyond traditional business models and consider the broader societal and environmental impacts of operations. He also discusses the B Corp certification and Benefit Corporations, encouraging small to medium-sized enterprises to explore these avenues for demonstrating their commitment to environmental and social responsibility. Andrew also addresses the perception of sustainability practices in Asian companies and dispels myths surrounding China’s efforts in renewable energy.
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From Sustainability to Profitability
Andrew Winston is a globally-recognised expert on megatrends and how to build companies that thrive by serving people and the planet. He is one of the most widely read writers on sustainable business in the world, with regular columns in?Harvard Business Review?and?MIT Sloan Management Review.?
His latest book,?Net Positive: How Courageous Companies Thrive by Giving More than They Take?(co-authored with renowned CEO Paul Polman), is one of?Financial Times’?Best Business Books of the Year. It’s been called an “electrifying strategy for business success and unlike any other book you’ve read” by Merck Chairman Ken Frazier, a “wonderful rallying call” by Sir Richard Branson, and “pure heresy” by Arianna Huffington.
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His first book,?Green to Gold,?has reached more than 100,000 people in seven languages.?Inc.?Magazine included?Green to Gold?on its all-time list of 30 books that every manager should own.?His other book?The Big Pivot?was selected as one of the “Best Business Books” by?Strategy+Business?magazine.?Andrew is also the author of the?Harvard Business Review (HBR)?Magazine cover story, “The Net Positive Manifesto” and the HBR “Big Idea” cover story, “Leading a New Era of Climate Action.”?
His views on strategy have been sought after by many of the world’s leading companies, including 3M, DuPont, HP, J&J, Kimberly-Clark, Marriott, PepsiCo, PwC, Trane Technologies, and Unilever.
A shift towards meaningful work
Back in the 70s and 80s, sustainability in business wasn’t common, so it wasn’t on Andrew’s radar as a possible path to follow. He went to school and got a Degree in Economics. Then, he joined the Boston Consulting Group working on strategy and marketing. It was in the early 2000s that his life took a turn as the dot-com crash happened.??
“I had been at a startup, and we went under, and I was all of a sudden floating and realised I wanted to do something different with kind of more meaning.”
A couple of years before that, says Andrew, he hadn’t heard the word sustainability, or carbon, or even climate change. So looking back, he entered quite early into the business sustainability world.?
It was then, after the dot-com crash that Andrew went back to school and got a degree in Environmental Management. He started working with a professor, and they co-wrote?Green to Gold.?He admits that no one was paying him to do this work until he had spent a few years researching and writing this book.?
The book was a success and companies started to use it as a platform to talk about ‘green businesses’ Then, people started calling Andrew to give some talks.?
“And then bureaus called and offered me money to speak, which I didn’t know was a thing. I had never thought about that. I had a consulting background, so then it was easy to say, hey, I got this book out. I’ve been lucky. I mean, there’s been a lot of hard work behind it, but most of my business has been inbound. It’s really hard to go out and say, hey, hire me to speak. People know me, see my book, see me write something, see me on TV, and then say, hey, we should get this guy. I’ve been lucky to make that work for 17 years.”
The Two-by-Two Matrix
In his book Green to Gold, the core framework was defined by a two-by-two matrix. Andrew argues that it does frame the kind of questions you ask and the way you think about strategy.?
He tells the story of the time they sat down with Michael Porter at Harvard to talk about his framework for creating business value. There are a couple of big buckets, and they made a two-by-two that was basically that, but extended it over time.
“And we said, in the short run, you’re creating value by reducing cost or driving revenue, innovating, selling more stuff. But in the longer run, you’re also reducing risk, and you’re driving brand value. So it’s a two-by-two of reducing the downsides, increasing the upsides, and then short and long term and I find it still really useful.”
Whenever you see people write a business case for sustainability, it’s usually using those buckets, adds Andrew. The intangible one is the big one, which includes employee attraction and retention, customer loyalty, and brand value. For Andrew, the vast majority of companies’ value now is intangible. It’s like the market cap of the biggest companies. It reflects like five, six times more than their book value, their assets.?
“So much of the world is now your brand and what you bring to the world, what you promise the world. So I think that stuff has always gotten short shrift in business because we don’t know how to measure it. But it’s the majority of the value now, and often that’s where sustainability does sit. You’re building long-term connections and resilience and all these other things that aren’t as easy to measure.”
Multinational companies and sustainability
In the last few years, there’s been a dramatic change in what’s expected of business and their role in society. They now have to chime in on climate, inequality, LGBTQ rights, guns and democracy. They’re drawn into so many things in society, and every multinational is at the table on sustainability in general.
But, what percentage of them truly gets the importance of sustainability? Andrew says, a small percentage.?
“We’re about 50 years into this kind of neoliberal experiment of the only point of a business is profit. So that means everybody in business basically was raised in this, even the 65-year-old CEO, and it’s so dominant that they just believe anything else that isn’t focused only on profits is somehow a drag on profits and sustainability especially.”
On the other hand, Andrew thinks that the percentage that believes sustainability is probably the right thing to do is high, but we’ve all been taught that the right thing to do is somehow never profitable or is anti-business. So then we’re implying that a business only profits by not doing the right thing. That doesn’t seem very functional, that’s quite literally not sustainable. We can’t continue like that indefinitely, he adds.
“When I said I didn’t think it would take this long, I probably thought 20 years ago I should have worked myself out of a job by now, and sustainability officers shouldn’t be needed in companies, but we’re still a long way from getting there. We’re making progress. Things are moving, but it’s a big ship.”
How to make leaders care
Andrew admits that the challenge lies in replicating the mindset of leaders like Paul Polman, Chief Executive Officer at Unilever –?with whom Andrew co-wrote his book?Net Positive. Paul was a unique leader that prioritised the broader societal impact of the business.?
“He believes in money and profit and growth. That’s his job. He ran a public company, but he had this deep understanding. The way he puts it on [when] people talk about purpose in business, he goes, if you have no purpose, what’s your purpose? What’s your point? And this is the question that I think just very few can really ask about their business.”
Andrew has wondered for a long time how you can make more leaders think like Paul. Andrew’s research interviewing 20 CEOs who embraced sustainability revealed that personal motivations, such as experiences in nature or conversations with their children, played a significant role in their mindset shift. The challenge is that they made those decisions from a gut feeling. It’s personal, and that is something that you can’t replicate.
“How do you change leaders? Especially since part of the way things change normally is just generational change. You just get new leaders. But with things like climate change, we don’t have time for that. We can’t wait for Gen Z to be the CEOs of the world. That’s way too late. So we have to do something that’s much harder, change people within their roles, not wait for the next generation.”
The role of B Corp Certification in promoting sustainability
The B Corp certification plays a fundamental role in advancing business sustainability by setting and enforcing high standards of environmental and social performance. This innovative certification process acknowledges that a company is balancing profit and purpose, focusing on the overall positive impact they make on their employees, communities, and the environment.?
“I think for small to medium business it’s a great process because it’s a set of questions about your environmental and social impacts on the world that make you go through and say do we know? Do we have the data? And at a certain level of performance, you can get the branding.”
It’s not just about a company’s product or service, but about how it conducts its business, how it treats its workers, and how conscious and considerate it is of the planet. In Andrew’s view, it’s clear that B Corp certification sees sustainability as more of an embodied business practice rather than a one-off accomplishment. Implementing sustainability into the fabric of a company leads to a number of benefits. He uses the example of Ikea to illustrate this. A company that has been innovative in its approach to sustainability. By producing more renewable energy than it consumes and selling excess solar energy to its customers, Ikea exemplifies being net positive on carbon emissions.?
More and more, people are choosing to support businesses that align with their values, often favouring companies committed to making a positive impact on the world. The B Corp certification is a way for companies to tangibly demonstrate their commitment to sustainability, ethical business practices, and societal impact. It is not merely a badge but a commitment to a different way of doing business in a world increasingly aware of the importance and urgency of sustainability.
“These rating systems like B Corp they’re looking at a number of dimensions. And none of those say you’re perfect. And if you’re doing a lot right on some dimensions like social, that gets you more points, and it’s not a perfection meter, right? It’s an indication of again that you’re committed to something broader and that you’re making progress on both environmental and social issues.”
The politicisation of sustainability
While some countries see sustainable practices as imposed by the US and Europe, the political divide in the US hampers progress. Companies face challenges in standing up for sustainability, but Andrew argues that those that do often thrive economically.
“There are places that really feel like this ESG thing is kind of put upon them by the US and Europe in particular. So, Asian companies will say, I see the US is debating this. Does this mean we don’t have to do this? They just want out of having to worry about these things. It’s additional work; it’s additional thinking.”
And it doesn’t only happen with sustainability. In the US, there are some examples of companies publicly pulling back from a commitment to LGBTQ rights or diversity because they’re getting yelled at by conservatives, says Andrew. For example, Target pulled some merchandise from their shelves for Pride Week because there were angry customers threatening their employees because of the ‘gay merchandise’.
“It’s ridiculous. Someone threatening your employees is not a reason to back down. That’s criminal. You prosecute them, right? You don’t just change your merchandise because someone’s angry. So I think companies are in the crosshairs. They don’t always know how to do it. But I will tell you that for the most part, companies that stand up and say, no, we’re going to believe what we believe, make that effort, they actually do better economically.”
The managed narrative against China
When Andrew mentions that Asian companies feel the European standards of sustainability are a burden, it doesn’t mean they don’t believe in doing ESG. They simply want to do it their own way. Andrew explains that are plenty of companies, especially in Asia, that have a long-term view and really aggressive goals. They’re often leaders in efficiency, particularly in Japan.?
“There are a lot of big myths that somehow the West is doing all this sustainability stuff, and China isn’t, and they’re dragging us down when really China is doing more than anyone. They’ve spent more money than anyone. They built the entire solar and wind industry. They produced most of it while the rest of us watched. And that’s part of what brought the cost down so dramatically.”
A recent statistic by Bloomberg shows that, in the first four months of the year, China built three times as much solar as it did in the first four months of last year. And it’s on track to build more solar this year than the US has in total.?
So, Andrew says that whenever we hear that China is not doing anything, it’s a managed narrative.?
“It appears on Fox and the Murdoch properties. I get the question, almost every talk, ‘Why should we do this if China’s not?’ And every word in that question is not true. They are doing it. And the why we should do it is because it’s better for our business, it’s more profitable, it’s healthier.”?
The attempted takeover of Unilever
Andrew’s co-author, Paul, had been the CEO at Unilever for several years and in 2017, the head of the PE, Kraft, came to the office saying they were bidding for the whole company. It was a hostile takeover attempt, says Andrew.?
“It was going to be the biggest merger in history. And all of a sudden, there was this pushback from a bunch of unusual places. All these stakeholders of Unilever that really wanted it to continue its stakeholder model and looking at its role in the world.”
Kraft was a cost-cutting machine, so it was going to be a completely different approach to business, and one in which Unilever didn’t believe.?
“It was just a cultural misfit. But you had people from Greenpeace speak out and say, we want Unilever to stay at unions. And some of the investors were like, we might make money initially on the purchase, but we think Unilever will create more value on its own. So it kind of went bust fairly quickly.”
Andrew explains that Unilever had built a base of trust and stakeholder relationships and a general belief in the company that gave it that unusual support.?
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