Coaching always works at the interface between the individual personality and the professional role of the client. Whilst there is a lot being said and written on what is required from the individual psychological perspective, there is too little dialogue to me on the “business savvy” a coach needs to have. Thus, in my blog article I have listed what I believe to be some of the key business-related competencies a coach should possess.
The word coaching is not a protected term. Therefore, anything can be called coaching and anyone can call themselves a coach. In the organizational context, fortunately, there has been a gradual professionalization in recent years through professional associations that task themselves with ensuring the quality in coaching based on clear criteria and boundaries. According to the German Coaching Association (DBVC), “coaching […] is the professional advice, guidance and support of people with leadership functions and experts in companies and organizations as well as freelancers”. Coaching therefore always works at the interface between the individual personality and the professional role of the client.
Most of the coaching literature clearly refers to the first part of this definition, namely the personality of the client. Here, coaches are rightly required to have sound diagnostic and psychological knowledge. On the other hand, the requirements for coaches’ competencies in terms of their organizational and management knowledge are discussed far less. Coaching is clearly not expert advice and that coaches do not have to be better managers. However, coaching in the sense of the above definition loses much of its effectiveness if the coach lacks field competence, i.e. “business savvy”. I would like to contribute to this discussion by presenting four areas of competence that are essential for advising clients. At this point, it should already be said that there can of course be different rankings in terms of the importance of the competencies depending on the coaching issue or the hierarchical level of the client.
Competence area 1: Strategy development
Not only at the level of the company, but also for departments and teams it is often not clear which direction to take and which goals to pursue. In addition to classic strategic elements such as vision, mission and purpose, a basic understanding of tools for analyzing the current situation (e.g. SWOT, stakeholder analysis) and knowledge of strategy processes and management systems such as Objectives & Key Results (OKRs) also help.
Competence area 2: Organization & change
The way in which companies are organized has a massive influence on the behavior of the people who work there. Topics such as classic and agile organizational structures and management systems should therefore be familiar to coaches. Change management and facilitation knowledge offer important points of reference for locating clients in their field and for helping them to orientate.
Competence area 3: People management
In addition to strategy and organization, fulfilling the requirements of a management role requires people who organize themselves in a certain way and achieve goals. However, many managers find themselves caught between the formal focus of their role on strategic responsibilities and the reality of having to focus heavily on operational performance in day-to-day business because their own team is not yet senior enough. This is where knowledge of recruiting, personnel development, talent management, team development and employment law may be extremely helpful.
Competence area 4: Culture & power dynamics
Although often identified as the culprit (“we have the wrong culture”), culture cannot be influenced directly. It must always be changed through the first three areas of strategy, organization, and people. Nevertheless, culture is a powerful driver of behavior and prevents rational, seemingly logical solutions. Understanding or jointly analyzing a culture – also in the sense of forming hypotheses – helps clients to better understand paradoxes associated with their situation, informal structures and power and reward systems and thus to be able to act within them.
Once again, it is NOT coaches’ job to be able to accompany managers as experts in all these topics. However, without a corresponding map, coaches will have problems untangling their clients’ concerns and supporting them on their way from numbness and reactivity back to a sense of self-efficacy and proactivity. Depending on the issue addressed by the coaching or the hierarchical level at which the client is working, the competencies described are more or less relevant. However, they are never truly reliable.