Applying “Talent to Value” to Executive Coaching

“Talent to value,” a concept initially developed by Sandy Ogg, founder of CEO.works, and later codified by McKinsey, is a framework that focuses on putting the “best talent” into roles that drive the greatest financial return for an organization.¹The core principles suggest that:

• Roughly “5% of roles” in an organization deliver 95% of the value.¹
• The specific “role” is analyzed first, independent of the “person” sitting in the role.¹
• Critical positions are broken down into “value creators” (those directly generating revenue, “value enablers” (those supporting critical functions), and “value protectors” (those lessening legal or financial risks).²

As large-platform executive and leadership coaching platforms began being introduced to organizations around 2013 and further gained popularity in 2021 and beyond as a way of providing coaching services to a broad segment of leaders, is this coaching framework counterintuitive to the “talent to value” premise? ³

What if we dissected this notion further…

While large digital coaching platforms excel at scaling foundational leadership skills to a broad segment of an employee population, we believe platform coaching is often treated as an individual benefit rather than a direct organizational investment. In contrast, customized executive coaching has the capability to target the most critical roles that have the greatest impact on an organization’s bottom line. CEO.works has found that critical roles, often representing less than 1% of an organization, can deliver as much as 80% of its value.⁴

“Coaching Talent to Value Alignment”

This is not to suggest that both coaching options do not have a place within an organization, but if an organization is seeking to drive financial performance and strategic value, customized executive coaching is worth the investment.

Watch for the next blog in this series of “How to assess executive coaches against the 5% rule!”

Sources:

1. McKinsey & Company. 4 Strategies for Linking Talent to Value. April 12, 2018. https://www.mckinsey.com/capabilities/people-and-organizational-performance/our-insights/the-organization-blog/4-strategies-for-linking-talent-to-value

2. McKinsey & Company. McKinsey and CEO.works: A New Approach to Managing Talent. https://www.mckinsey.com/about-us/new-at-mckinsey-blog/mckinsey-and-ceo-works-a-new-approach-to-managing-talent

3. McKinsey & Company. Matching Talent to Value. https://www.mckinsey.com/~/media/McKinsey/Business%20Functions/Organization/Our%20Insights/Matching%20talent%20to%20value/Matching-talent-to-value.pdf

4. CEO.works. Talent Allocation. https://www.ceoworks.com/talent-allocation