How to Build a Coaching Culture in 5 Steps

Summary

Building a coaching culture requires more than teaching managers how to coach. Yet DDI's data shows that only 25% of leaders say their manager coaches them effectively. Organizations can close this gap by securing senior leadership support, building coaching skills at every level, creating practice opportunities, establishing accountability, and measuring impact. Combining effective manager coaching with AI-enabled practice can also help extend development beyond formal conversations. Together, these five steps make coaching part of everyday work and help strengthen engagement, development, and performance.

Most organizations don’t have a performance problem. They have a development problem, and more specifically, a coaching gap.

DDI's Global Leadership Forecast 2027 reveals just how significant that gap is: Only 25% of leaders say their manager coaches them effectively. And with so few leaders receiving effective coaching, organizations can't afford to leave development to chance.

That gap matters. Because in a world where skills expire quickly and expectations keep rising, the ability to grow people—consistently and at scale—separates high-performing organizations from the rest. In other words, if your leaders can’t coach, your business can’t adapt. Organizations that prioritize coaching empower their leaders, strengthen team performance, and drive lasting results.

Building a coaching culture means making development part of everyday work, not something reserved for formal performance conversations. It requires leaders with strong coaching skills, employees who feel comfortable seeking feedback, and organizational practices that reinforce continuous growth.

What Is a Coaching Culture?

In workplaces with a coaching culture, coaching is embedded in everyday work, fostering continuous learning, development, and growth.

At its core, a coaching culture marks a shift from traditional hierarchical structures to a more empowering, cooperative approach. It involves open communication, active listening, and thoughtful questioning to unleash the potential of individuals and teams.

And importantly, it’s not hierarchical. One of the biggest false assumptions is that coaching is top-down, with a senior, more experienced employee supporting someone more junior. In a healthy, effective coaching culture, all team members, regardless of their level or role, help each other to be their best selves by creating a safe space for everyone to learn, practice new skills, and grow. 

While the coaching relationship between leader and direct report is critical, coaching can also happen:

• Between peers
• From employees to leaders
• Across project teams
• During everyday problem-solving discussions

The key is that everyone needs feedback to grow. They also need to be open to learning. After all, leaders aren’t experts in everything. They, too, need coaching and feedback from others, regardless of where they sit in the org chart.

What Does a Coaching Culture Look Like?

Let’s be clear: This isn’t about making work feel nicer. It’s about driving performance. For a coaching culture to work, leaders need the competence and confidence to coach, motivate, and develop others. They must learn to have better conversations that consider both the practical and personal needs of the person being coached.

In thriving coaching cultures, several behaviors are consistently present:

• Leaders ask questions instead of immediately providing answers.
• Employees feel comfortable asking for feedback.
• Teams regularly reflect on successes and failures.
• Managers focus on development, not just performance outcomes.
• Coaching conversations occur at all levels of the organization.

Organizations that get this right don’t treat coaching as an event—it shows up in everyday conversations, decisions, and priorities.

Ultimately, coaching cultures are built on trust, curiosity, and a shared commitment to growth. These behaviors make coaching a consistent part of how people work together, rather than an occasional development activity.

What Are the Benefits of Creating a Coaching Culture?

Creating a coaching culture isn’t just about making employees happier; it drives measurable business performance. DDI's research consistently links effective coaching to stronger development outcomes, talent retention, and organizational performance, and the Global Leadership Forecast 2027 also shows how coaching relates to trust and engagement.

Coaching Builds Trust and Engagement

The benefits of coaching go beyond helping leaders develop new skills. Quality coaching can strengthen the relationships and engagement that support performance.

DDI's research shows that leaders who believe their managers coach them effectively are 9X more likely to trust their managers than those who don't. Employees whose managers strongly support their development are also 4.8X more likely to strongly trust their manager.

Coaching also plays an important role in leader engagement. Only 9% of leaders are fully engaged, and effective manager coaching is closely associated with stronger engagement.

Effective coaching shouldn't depend on whether someone happens to have a naturally supportive manager. Organizations need to develop coaching capability consistently across leadership levels so more employees can benefit from the trust, engagement, and growth it supports.

Only 9% of leaders are fully engaged, and effective manager coaching is closely associated with stronger engagement.

Coaching Strengthens Leadership Development and Performance

Effective coaching helps leaders do more than develop new skills. It strengthens their ability to navigate difficult situations, support their teams, and apply what they learn on the job. Compared with leaders who receive no coaching, leaders whose managers are effective coaches are:

• 2.3X more likely to say they consistently bring out the best in their teams (43% vs. 19%).
• 3.2X more likely to feel very prepared to handle high-stakes conversations (41% vs. 13%).
• 5.6X more likely to rate their development programs as high quality (45% vs. 8%).

These leaders also report applying 15% more of what they learn back on the job.

For organizations, the value extends beyond individual development. When leaders receive effective coaching, they're better positioned to handle challenging conversations, support team performance, and translate learning into everyday leadership behaviors. That's what makes coaching essential to building stronger leadership capability across the organization.

How AI Coaching Supports a Coaching Culture

Building a coaching culture doesn't mean every coaching interaction has to happen between two people. AI coaching can give leaders additional opportunities to practice difficult conversations, reflect on challenges, and reinforce their skills between conversations with their managers.

DDI's research on AI coaching shows that leaders receiving both manager and AI coaching are 8X more likely to rate their development programs as high quality than leaders receiving no coaching (64% vs. 8%). That's also higher than the percentage receiving manager coaching alone (45%) or AI coaching alone (39%).

AI coaching offers benefits independently, too. Compared with leaders receiving no coaching, those receiving only AI coaching are 4.9X more likely to rate their development programs as high quality.

For organizations, the opportunity is to expand access to coaching while preserving the human relationships that support growth. AI coaching can provide a private space to practice and work through everyday challenges, while managers offer context, feedback, and opportunities to apply new skills on the job. Together, these approaches can make development more continuous and accessible.

Why Effective Manager Coaching Matters

A strong coaching culture starts with managers who know how to coach. They're uniquely positioned to support development because they understand their team members' work, see the challenges they face, and can provide feedback and guidance in the moment.

Yet access to effective manager coaching remains uneven. Among emerging leaders, only 17% strongly agree that their manager coaches them effectively, leaving many without strong coaching support as they build their leadership skills for the first time.

For organizations, this creates a challenge that goes beyond individual development. When coaching depends on whether employees happen to have an effective manager, opportunities for growth and support can vary significantly across teams.

Among emerging leaders, only 17% strongly agree that their manager coaches them effectively, leaving many without strong coaching support as they build their leadership skills.

Building a coaching culture helps close that gap by making coaching an organizational expectation. Leaders at every level learn to ask thoughtful questions, provide meaningful feedback, and create opportunities for employees to practice and grow. Over time, coaching becomes part of how teams work together, rather than something individual managers choose to do.

And as organizations introduce new coaching technologies, this foundation becomes even more important. AI can extend opportunities for practice and reinforcement, but managers remain central to connecting development with employees' goals, responsibilities, and everyday experiences.

How Do Leaders Develop Coaching Skills?

Building a coaching culture starts by equipping leaders with the skills they need to coach effectively. Many organizations assume coaching is an intuitive skill, but in reality, coaching requires practice, structure, and feedback.

At DDI, we often teach leaders a simple framework for coaching conversations known as the ACE model:

Ask

Leaders ask open-ended questions to better understand the employee’s goals, challenges, and perspectives.

Connect

Leaders build trust by demonstrating empathy and a genuine interest in the employee’s development.

Energize

Leaders help employees identify solutions, set goals, and take ownership of their growth.

This approach helps leaders shift from problem solvers to capability builders, empowering employees to think critically and develop their own solutions.

As leadership expectations continue to evolve, coaching skills are becoming increasingly important. In fact, 83% of HR organizations anticipate a significant increase in leadership skills needs over the next five years. Developing coaching capabilities is one of the most effective ways organizations can prepare leaders for these growing demands.

How Do You Build a Coaching Culture?

Creating a coaching culture requires intentional effort and sustained leadership commitment. Below are five key steps organizations can take:

1. Get senior-level support.

To be successful, culture change initiatives often need to start at the top. Senior leaders need to allocate time to coach in meetings, one-on-ones, and informal conversations. But most importantly, a senior leader must be seen to “walk the walk.”

Three key factors can help leaders increase their coaching effectiveness: 

• Managers and/or formal mentors set a positive example with coaching. 
• Leaders use objective assessments to gather feedback on their coaching skills and to guide their development. 
• Leaders see the impact of coaching on their overall effectiveness. 

When senior leaders champion coaching, not just in words but in action, it sets a powerful example for the entire organization.

2. Give all leaders coaching skills.

The second step is to give leaders at every level coaching skills. In addition, ensure that people in informal leadership roles (such as project managers and Agile leaders) have coaching skills. What’s the best way to do this? At a minimum, train every formal and informal leader in the core leadership skills.

The core skills combine emotional intelligence and coaching, enabling people to prepare for an assignment and learn and improve for the future. Ideally, leaders can also access additional resources that support their development.

As such, many companies have built robust learning journeys to train their leaders to become capable coaches. The result? You take a big step toward creating a coaching culture that delivers the benefits mentioned earlier.

3. Encourage employees to apply coaching skills on the job.

After training, the next step is to apply the skills on the job. The adage is simple but true: Practice makes perfect. But how can leaders build the coaching practice they need to succeed?

First, leaders need an action plan. While it is common to offer development activities for a group of learners, every leader needs a personalized follow-up plan that connects behavior to the organization’s business priorities. Some companies offer small group follow-up sessions for leaders to discuss coaching opportunities and share experiences and lessons learned.

Others leverage peer coaching, online simulations, or AI coaching tools that give leaders a private space to practice difficult conversations, receive feedback, and build confidence before applying their skills on the job. Above all, it's critical to create an environment and action plan that let everyone practice, apply what they learn, and get feedback on their progress.

AI coaching can also help leaders maintain momentum between formal development experiences. Rather than waiting for their next training session or one-on-one, they can practice a challenging conversation, reflect on a recent interaction, or prepare for an upcoming coaching opportunity.

But practice is most valuable when it's connected to a clear development goal. Among leaders receiving AI coaching, those with an up-to-date development plan report applying 76% of what they learn on the job, compared with 47% for those without one. That reinforces the importance of connecting coaching practice to ongoing development and manager support.

Consider how athletes and artists hone their talents. They practice regularly (daily!) and for extended periods. They ask for and expect feedback from others. A similar level of commitment and dedication is required to become a good coach. And when that commitment combines with opportunities to coach, you’re well on your way to creating a coaching culture.

Among leaders receiving AI coaching, those with an up-to-date development plan report applying 76% of what they learn on the job, reinforcing the importance of connecting coaching practice to ongoing development and manager support.

4. Create accountability.

Everyone needs to be held accountable for their role in creating a successful coaching culture. Often, leaders alone are held responsible for coaching and teaching their teams to coach one another. But in a true coaching culture, everyone is responsible for coaching and being coached, regardless of their level.

An outcome of effective coaching is that leaders develop teams that feel supported and empowered to make decisions. The resulting accountability system encourages employees to take ownership of their performance and encourages managers to take ownership of how they coach others.

How will you know if your organization has this level of accountability? When every employee, at every level, has regular coaching conversations.

5. Measure for effectiveness and ROI.

Finally, evaluate the effectiveness and ROI of your company’s coaching efforts. Who is coaching successfully? How often are coaching conversations occurring? What business outcomes are improving as a result? Tapping into this information will help you understand which elements of a coaching culture are working well and which areas need improvement.

The first step in measuring ROI is identifying metrics your coaching culture should influence. Common metrics include employee engagement and retention, productivity, and customer satisfaction.

Then collect quantitative and qualitative data over time on the metrics you’ve identified, and analyze it to spot improvements and trends. If you can link coaching to improvements in business results, you’ll showcase the value of a coaching culture. By measuring the ROI of a coaching culture, organizations make data-driven decisions, optimize their coaching programs, and continuously improve employee development and performance. This benefits individual employees and contributes to the organization’s overall success and growth.

As AI coaching becomes part of leadership development, organizations should also evaluate how it supports practice, skill application, and the quality of development. The goal isn't simply to measure adoption, but to understand whether different coaching approaches are helping leaders improve their effectiveness.

What Role Do Leaders Play in a Coaching Culture?

Leaders are key to building and nurturing a thriving coaching culture that boosts employee development and drives organizational success.

By acting as coaching role models, they inspire and motivate their teams and demonstrate a commitment to coaching that others want to adopt. When leaders engage in coaching conversations, they show that coaching is a valued part of growth.

Eighty-three percent of HR organizations anticipate a significant increase in leadership skills needs over the next five years. 

Leaders also play an important role in making coaching accessible. By providing training, resources, and time for practice and feedback, they help employees build and strengthen their coaching skills.

But coaching shouldn't be limited to formal development opportunities. Integrating coaching into performance discussions encourages regular feedback, goal setting, and development planning, making it a natural part of everyday work and reinforcing a coaching mindset across the organization.

What Challenges Can Prevent a Coaching Culture?

Changing organizational culture is hard work—it requires behavior change. Corporate culture has countless layers that accumulate over time. Organizational culture includes rituals, symbols, workspace layout and decor, expressed values, unconscious assumptions, and much more. Basically, everything someone experiences when they interact with the organization is "bits and pieces" of the company’s culture.

So, how can you build an effective coaching culture within the existing culture? Here are five things you can do:

1. Encourage stakeholder support.

Internal communications are an important step in getting everyone on the same page about why a coaching culture matters. And C-suite support is crucial. Your C-suite should communicate across the organization about why coaching is valuable and how leaders can do it.

2. Highlight and reward the good.

The goal is to make effective coaching so effortless and normalized that it becomes an unconscious cultural habit. But how can this be done? Leaders must do more than convey the message that coaching is important. They need to model good coaching so others can see it in action. Highlighting and rewarding positive coaching examples and outcomes is a great way to reinforce the message.

3. Clearly explain the benefits.

One of the biggest barriers to coaching is the belief that there isn’t time for it. To overcome this resistance, leaders need to understand how coaching benefits both their teams and the business. Those benefits may look different across organizations and teams, but making them clear is essential to gaining support and encouraging coaching as an everyday practice.

4. Don’t make coaching an evaluation tool.

Employees aren’t always excited about coaching. Many perceive coaching as a form of negative feedback that sounds like: "You are not doing something right, so let me tell you how to improve.”

The objective of coaching is to achieve better results; it is not meant to be an evaluation tool. Furthermore, building a coaching culture means being coached, and it requires all employees to become coaches for their peers.

The objections to coaching from individual contributors are the same as those from leaders:

• I don’t have time.
• I don’t have the opportunity.
• I don’t know how.

It is important to show people they will not need to take on additional work. Rather, they need to adjust their routines to incorporate coaching.

5. Promote coaching as a mindset.

After everyone understands the concept of creating a coaching culture, they may expect a detailed plan for what they should do.

Unfortunately, it’s not that straightforward. Building a coaching culture is about promoting a coaching mindset. It’s also about developing leaders who can handle situations in the moment, rather than holding intervention-like meetings with some coaching, just to check a box.

A Healthy Coaching Culture and Organizational Culture

Building a healthy coaching culture requires more than providing opportunities to learn. Leaders need ongoing support, meaningful feedback, and regular chances to practice their skills. That support can come from managers, peers, formal development experiences, and increasingly, AI coaching tools that help reinforce learning between conversations.

If your organization is already investing in workplace coaching, don't stop at isolated efforts. Build a culture where coaching happens at every level and becomes part of everyday work. By developing effective manager coaches and giving leaders additional ways to practice and grow, organizations can strengthen engagement, improve performance, and make continuous development part of their culture.