The Importance of Emotional Intelligence

As leaders, many of us think the key to our success is linked to how smart we are, how much we know about our business or how well we work our plans. Not so, says author and researcher Daniel Goleman, Ph.D an expert in the field of emotional intelligence. Goleman’s research with the Hay Group consulting firm found that “emotional intelligence is twice as important as cognitive abilities in predicting outstanding employee performance, and accounts for more than 85 percent of star performance in top leaders.” It’s not that IQ and business strategies don’t matter; it’s just that we need to understand that leadership is largely an “inside out” process.
Emotional intelligence (EI) is a reflection of how well we know ourselves, how we manage our moods, thoughts, and behaviors and how we respond to others. It involves competencies like conflict resolution, empathy, communication, change management, flexibility and achievement orientation.

I once heard an employee say “When it rains on our boss, we all get wet.”  Our moods and actions have a huge impact on the people we lead and studies on the effects of emotional intelligence confirm it.  An emotionally intelligent leader will have a better chance of creating a work environment with a high level of trust, risk-taking, and optimism. Their team members are more likely to be loyal, motivated and committed to high performance.   A leader with a low level of EI is more likely to create an environment that breeds fear and disunity and a disgruntled team that is probably working below their capacity.  Long-term impact is critical when assessing the effects of EI on a team or organization.  Leaders with EI “blind spots” can produce great short-term results through pressure or fear, but the results will not be sustainable.

You don’t have to look very hard to find statistics to confirm how leaders impact their organization.  Research from the Saratoga Institute that included 60,000 exit interviews over a 20 year period found that 80% of turnover is directly related to unsatisfactory relationships with one’s boss. A Gallup study found that poorly managed workgroups are an average of 50 % less productive and 44 % less profitable than well-managed groups. Jim Collins indicated in his blockbuster book Good to Great that the quality of leadership at the top of the organization was one of the biggest factors that differentiated companies that would move from “good” to “great.”  Clearly, how we lead matters and our level of emotional intelligence plays a major role in our success.

As a management consultant, I frequently ask leaders to clarify their deepest organizational values.  A common response is some variation of “we believe people are our greatest asset.”  If we really believe that, then we need to do some organizational soul searching and ask, “How are we leading and valuing our greatest assets?”

The good news for us any of us who want to polish up our leadership skills is that emotional intelligence can be learned.  So where do we start?  One of the linchpin competencies of EI is a high level of self awareness, so a good place to start is with an assessment that will help us determine EI competencies we are strong in and ones we need to develop. This helps eliminate a shotgun or “cookie cutter” approach and ensures that our coaching and development efforts are targeted.

There are a variety of assessment instruments or processes available, and they run the gamut from free assessments to more in-depth, research-validated instruments that can only be administered and interpreted by certified professionals. In my own coaching practice, I use a 360° assessment called the ESCI (Emotional and Social Competency Inventory) from the Hay Group, based on the work of Goleman and Richard Boyatzis, Ph.D. This assessment can only be administered by professionals who have completed a rigorous certification process including an EI assessment where they are required to assess their own level of EI competency.   Coaching participants should carefully evaluate the validity of the instrument they use and the credentials of the person administering this process.

The ESCI, like most 360° assessments, invites anonymous targeted feedback from people around the participant who have experienced their behaviors up close and can help serve as their mirror.  Respondents typically include direct reports, supervisors and board members, and can also include those outside of the organization like customers or suppliers.  Leaders complete their own self-assessment.

This online survey measures EI within four clusters of emotional competencies; Self-Awareness, Self-Management, Social Awareness, and Relationship Management.  Results are mutually reviewed during a coaching session and are used to help the leader identify and create developmental opportunities uniquely designed to build on strengths and further develop competencies in targeted areas.  In the process of developing their EI, leaders also have the opportunity to learn more about their “hot buttons” and how to eliminate potentially destructive responses.

A tough economy, intense global competition, and research studies are making it clear that we can’t afford to ignore the impact of emotional intelligence on leadership.  We need to realize that “soft” skills in top level leaders will create healthy work environments and produce hard, bottom-line results.