Coaching is coming of age. We are approaching the end of an era when it was seen as a fluffy perk for top managers, who might talk about having a coach in much the same way as they might brag about getting a top-of-the-range company car.

More and more organisations are seeing coaching as an essential HR tool and they are becoming increasingly discerning about how they choose and use external coaches. Many are now building their own capability to keep skills in-house, as well as to cut costs.

Tricia Bey, managing director of the School of Coaching, says: "Using external coaches is very expensive, so this is feeding a trend for building internal coaching cohorts as firms see too much valuable knowledge walking out of the door with the coach."

According to Graham Lee, director of coaching at business psychology consultancy OCG and author of the CIPD book Leadership Coaching: From Personal Insight to Organisational Performance, HR professionals are also scrutinising coaching more closely. "They are taking more responsibility for setting guidelines," he says. "People are starting to ask what it is we are trying to achieve."

Another factor behind the maturation of coaching is the growing number of academic institutions that are introducing or enhancing courses on the subject. Recent months have also seen bodies such as the CIPD developing coaching standards.

Coaching, along with e-learning, represents the largest growth area identified by the CIPD's Training and Development 2005 survey. Coaching by line managers is used by almost 90 per cent of respondents, with 74 per cent expecting to increase coaching activity. Sixty-four per cent of respondents report using external practitioners.

But it is not all plain sailing. Nearly all respondents describe finding high-quality coaches as "a difficult task", the lack of regulation in the market as "worrying" and the terminology as confusing and off-putting. With all the horror stories of cowboy coaches causing more harm than good, the HR community, along with bona fide practitioners and trainers, has become wary.

"We are seeing a big drive for greater professionalism in coaching from HR professionals wanting to make sure they are getting a high-quality service, as well as from suppliers and coaches who don't want to be tarred with the same brush as the cowboys," says Jessica Jarvis, CIPD adviser, learning and development.

Jarvis will be speaking at the CIPD's annual Coaching at Work conference this month and is the co-author, with Annette Filery-Travis and David Lane, of Making the Case for Coaching: Does it Work?, which will be published by the institute this year.

"HR needs to play a key role in the selection of coaches and the design and management of coaching programmes," she says. "It must exert pressure to ensure that only people from professional bodies with the right qualifications are used."

The CIPD has drawn up professional HR coaching standards at foundation and postgraduate (professional development) level, and is developing standards for executive coaches. It plans to consult members on the latter this year and has just launched the CIPD certificate in coaching and mentoring, based on the new standards.

"So many people have come forward in the past few years wanting coach training or support," says Judy Whittaker, the institute's director, membership and education. "Soon we will be able to offer employers guidelines on what to look for in coaches and individuals at all levels of qualifications based on our standards."

Meanwhile, the European Mentoring and Coaching Council is developing an international coaching competency framework, which it has put out to consultation. In a further development, the national training standards development body Ento is co-ordinating a national occupational standards project, which will lead to national vocational qualifications.

Lancaster University Management School has launched an eight-month accredited postgraduate certificate in coaching. This will eventually lead to a diploma or master's degree in coaching, currently under development. Oxford Brookes University, which already offers a master's programme in coaching and mentoring, also has plans to expand in this area. In January next year, subject to accreditation, it will launch a taught doctorate.

The Institute of Leadership and Management has developed a coaching qualification for managers, while Henley Management College has launched its first certificate in coaching, including a module exploring the beliefs and values that surround coaching.

Unilever, BP and Norwich Union are among the larger employers that have introduced strict processes for screening external coaches. These typically include written questionnaires asking which professional body individuals belong to, which models they use and so on.

Others have decided to develop internal coaches. These include Prudential, which launched a coaching programme two years ago after realising it was losing talented people who felt they weren't being given the chance to achieve their full potential. The company set up a "corporate university", allowing alumni to become "certified professional co-active coaches". Participants follow the UK Coaches Training Institute (CTI) coaching model, an import from the US that's accredited by the International Coaching Federation.

Prudential now has a pool of 200 internal accredited coaches at middle to senior management level and more than 400 further down the organisation. Matthew Starks, head of learning and development at the company, says: "We don't employ external coaches to coach our top talent – we use our people developed with the CTI, so we are pretty self-sufficient. And we are finding that people are having much more honest conversations."

Portman Building Society spent around eight months talking to 20 potential coaching providers before finally settling on Full Potential Group.

"We found that many providers did not listen enough and were peddling their own model. Finding a partner who really grasped what we were trying to do and who could genuinely come with us on our journey was harder than you might think," says Ann Elliot, director of HR at Portman.

The building society's Coaching Champions programme aims to place senior managers as "role-model coaching leaders" across the organisation. Forty people have already been on it and there are plans to involve another 20. In April Portman also rolled out a Coaching for Performance scheme to managers with more than five people reporting to them. The six-month programme forms part of a new performance management strategy, which seeks to make Portman less task-driven and more focused on improving the performance of high-achievers.

Eighteen months ago, Camilla Aitchison, Dixons Group's director of management development, set out to make the company's culture more customer-focused. Coaching seemed like the ideal way to do this.

"I turned to coaching because it requires people to see things from others' perspectives, suspend their judgment and listen at a higher level," Aitchison says. "It helps people on a journey to work things out for themselves."

Dixons, which employs 40,000 people worldwide, has run five coaching courses for managers in the UK and plans to provide similar training for its Spanish managers. The company initially targeted the top 130 or so of its 28,000-strong UK workforce to take part in the programme, which is delivered by Performance Unlimited, but it now plans to develop more managers as internal coaches.

Six HR professionals have also been trained in neuro-linguistic programming and now form an internal coaching support pool. Each represents a part of the business and, at any given time, two are available to perform quality assurance and offer support to coaches across the business. Aitchison acts as the focal point. "This means there is always someone to talk to if a person is stuck or wants to share a success story," she says.

Shell Exploration and Production Europe is one of a number of companies building databases of preferred coaches. Mike Conway, vice-president of resourcing and development at Royal Dutch Shell, says: "Firms have to be clear about what they want. I know many retired HR professionals who have re-emerged as coaches; they are experts but not business-aligned. I always ask coaches what they think the company is focusing on – and often there's no insight."

Stuart Duff, head of development at occupational psychologists Pearn Kandola, welcomes the move towards national standards. "Organisations are getting better at asking questions. But we need national benchmarks to ensure that coaches have gone through the right learning process," he says.

But David Clutterbuck, co-founder of the European Mentoring and Coaching Council, believes that, although it's critical to integrate the various coaching standards, this doesn't mean they have to be the same.

"Professionalisation is not about creating a single qualification and saying: 'This is what coaching looks like.' It's about creating generics and talking about the core elements required for specific applications," he says. "People buying coaching have to know exactly what to expect and what they need."

There is no doubt that coaching is growing up fast and becoming more professional. But some say there is a danger of throwing out the baby with the bath water. Alison Hardingham, director of business psychology at Yellow Dog Consulting, lead tutor for Henley's coaching programme and author of The Coach's Coach, published by the CIPD last year, says: "I think it is extremely important that we professionalise coaching, but I worry it will miss the point. It is quite hard to define effective coaching."

Shell's Mike Conway agrees: "I'd encourage professionalism, but it creates a dilemma, because there's still a magic to coaching – a unique specialness in one-to-one relationships – that we don't want to drive out."

CIPD coaching news

The CIPD's Coaching at Work conference takes place on 13 September in London • www.cipd.co.uk/coach • 020 8612 6207

The CIPD has a wide range of coaching qualifications. Visit its open evening on 12 October to see which is best for you

• www.cipd.co.uk/training/coaching • 020 8612 6207

The CIPD's new tool, Managing external coaches, and its guide Coaching and Buying Coaching Services, are both available online • www.cipd.co.uk/tools 

• www.cipd.co.uk/subjects/lrnanddev/coachmntor/coachbuyservs

Look out for the CIPD's new Coaching at Work magazine this autumn • 020 8612 6245

Further info

Hear Alison Hardingham speak on "Coaching: a set of skills or a way of life?" at the CIPD's annual conference and exhibition in Harrogate on 26-28 October

• www.cipd.co.uk/annualconf-ex • 020 8612 6202