How to Plan Your 2025 Budget for Coaching: A Guide for HR Leaders

As organisations head into 2025, coaching remains a critical investment to enhance leadership, employee development, and team performance. Whether it’s 1:1 executive coaching, team coaching, or group coaching for managers, each type brings distinct value and requires thoughtful budget planning. To make a compelling business case, HR leaders need to align coaching initiatives with strategic business outcomes and demonstrate a clear return on investment (ROI).

Here’s a practical framework to plan your 2025 coaching budget, build the business case, and measure ROI effectively.

1️⃣ Assessing Coaching Needs Across Your Organisation

• 1:1 Coaching: Focus on high-level executives, senior leaders, or high-potential employees. This coaching helps with leadership development, decision-making, and personal growth aligned with organisational goals.
• Team Coaching: Used to improve collaboration, communication, and alignment within teams. Ideal for cross-functional teams or newly formed leadership groups.
• Group Coaching: Often used for mid-level managers or emerging leaders, where participants work on common challenges (e.g., managing change or improving leadership skills). This format fosters shared learning and peer support.

Tip: Conduct a needs assessment to determine which level of coaching is most appropriate for different employee segments. Use performance data and feedback to identify priority areas.

2️⃣ Building the Business Case for Coaching

To secure budget approval, position your coaching programs as a strategic initiative. Consider the following arguments:

• Boost Employee Engagement: Research from Gallup shows that engaged employees are 17% more productive and less likely to leave, which reduces turnover costs.
• Improve Leadership Capability: Leadership coaching increases managers' ability to handle complexity, resulting in better business outcomes.
• Retain High-Potential Talent: Offering coaching shows employees you’re committed to their development, leading to higher retention.
• Enhance Team Performance: Team coaching aligns group efforts with business goals, improving collaboration and innovation.

Use data from prior coaching engagements (if available) or case studies to showcase expected outcomes. For example, the ICF (International Coaching Federation) reports a ROI of 7x for companies investing in executive coaching.

3️⃣ Planning the Coaching Budget

When creating your budget, include:

• Coaching Fees: Rates vary depending on the coach’s expertise, the length of engagement, and whether sessions are 1:1 or group-based.
• Assessment Tools: Factor in the cost of personality assessments or psychometric tools (e.g., CliftonStrengths or DISC).
• Technology Platforms: If your company uses a coaching management platform, include subscription costs.
• Internal Administration: Allocate time for HR coordination, managing stakeholders, and tracking progress.

Consider pilot programs if this is your first year investing in a specific coaching model. This allows you to validate outcomes before scaling the initiative further.

4️⃣ Measuring ROI and Demonstrating Value

ROI in coaching can be challenging to quantify, but it’s essential to measure outcomes to justify future investments. Use a mix of quantitative and qualitative metrics:

• Pre- and Post-Coaching Assessments: Measure changes in leadership skills, employee engagement, or specific KPIs relevant to business goals.
• Business Metrics: Track outcomes such as increased productivity, reduced turnover, or improved revenue growth.
• Behavioural Changes: Use 360-degree feedback to capture shifts in leadership behaviours and team dynamics.
• Employee Feedback: Gather feedback from participants on the impact of coaching on job satisfaction and performance.

Many organisations also adopt coaching scorecards (Leedham, 2005) to track progress across four dimensions:

1. Foundation factors (e.g., coach attributes and processes)
2. Inner-personal benefits (e.g., motivation and confidence)
3. Outer-personal benefits (e.g., behaviour change and new skills)
4. Business outcomes (e.g., productivity improvements or revenue growth)

5️⃣ Involve Stakeholders for Accountability and Success

Ensure the success of coaching initiatives by:

• Engaging Managers: Involve line managers in setting coaching goals and tracking progress with their direct reports.
• Communicating with Leadership: Keep senior leaders informed about coaching outcomes and align programs with business strategy.
• Tracking Engagement: Use coaching platforms to monitor participation and progress in real-time, ensuring alignment with expectations.

Planning your 2025 coaching budget requires thoughtful alignment between business goals and employee development. By building a solid business case, allocating resources strategically, and tracking outcomes, you can position coaching as a critical investment in talent development and organisational performance. Use the opportunity to pilot new coaching models and demonstrate value through data and feedback, ensuring your organisation is well-prepared for the future.

Ready to bring coaching to your organisation? Click here to explore our coaching solutions and make 2025 your most impactful year yet.

About the Author:

Alexandra Lamb is an accomplished organisational development practitioner, with experience across APAC, North America, and MENA. With 20+ years in professional practice, conglomerates, and startups, she has collaborated with rapid-growth companies and industry innovators to develop leaders and high-performance teams. She is particularly experienced in talent strategy as a driver for business growth. Drawing from her experience in the fields of talent management, psychology, coaching, product development, and human-centred design, Alex prides herself on using commercial acumen to design talent solutions with true impact.