IQ and technical skills are important, but emotional intelligence is the sine qua non of leadership.

What Makes a Leader ?

by Daniel Goleman

The most effective leaders are alike in one crucial way: they all have a high degree of emotional intelligence. Without it, a person can have the best training in the world, an incisive, analytical mind, and an endless supply of smart ideas, but he still won’t make a great leader.

There is a clear relationship between emotional intelligence and effective performance, and this is especially important for leaders. The leader’s mood and behaviours drive the moods and behaviours of anyone else.

Performance is driven by 3 categories of capabilities:

1. technical skills (such as project management, business planning etc.),
2. cognitive capabilities (such as analytical thinking, helicopter view, long-term vision) and
3. competencies that demonstrate emotional intelligence (such as the ability to work with others, effectiveness in leading change etc.)

Of these capabilities emotional intelligence proves to be twice as important as the others for jobs at all levels.

Emotional intelligence plays an increasingly important role at the highest levels of the organisation, where difference in technical skills are of negligible importance. In other words, the higher the rank of a person considered to be a star performer, the more emotional intelligence capabilities show up as the reason for his or her effectiveness.

How can you tell if someone has high emotional intelligence and how can you recognise it in yourself?

There are a number of components of emotional intelligence: self-awareness, self-regulation, motivation, empathy and social skills.

The research of David McClelland, the renowned researcher in human and organisational behaviour, confirmed that emotional intelligence not only distinguishes outstanding leaders but is also linked to strong performance. In a 1996 study of a global food and beverage company, McClelland found that when senior managers had a critical mass of emotional intelligence capabilities, their divisions outperformed yearly earnings goals by 20%. Meanwhile, division leaders without that critical mass underperformed by almost the same amount. McClelland’s findings applied to the company’s U.S. divisions as well as to its divisions in Asia and Europe.

In short, the numbers are telling us a persuasive story about the link between a company’s success and the emotional intelligence of its people and in particular of its leaders. And on top of that, research demonstrated that people can, if they take the right approach, develop their emotional intelligence.

The Five Components of Emotional Intelligence in work

1. Self-Awareness: the ability to recognise and understand your moods, emotions, strengths, weaknesses, needs and drives as well as their effect on others.

People with strong self-awareness are honest with themselves and with others. They recognise how their feelings affect themselves, how they affect other people and their job performance. Thus, a self-aware person who knows that tight deadlines bring out the worst in him, plans his time carefully and gets his work done well in advance.
Another person with high self-awareness will be able to work with a demanding client. She will understand the client’s impact on her moods and she will go one step further to turn her anger into something constructive.

Self-aware people understand their values and goals. They know where they are headed and why, so, for example, one will be able to be firm in turning down a job offer that is tempting financially but does not fit with his principles or long-term goals. A person who lacks self-awareness is apt to make decisions that bring on inner turmoil by treading on buried values. The decisions of self-aware people match with their values; consequently they find work to be energising.

How can you recognise self-awareness? It shows itself first of all through candour and the ability to assess oneself realistically. People with high self-awareness are able to speak accurately and openly about their emotions and the impact they have on their work. In recruitment interviews, self-aware candidates will be open about their failures and will often describe their mistakes with a smile. During performance reviews, self-aware people will describe their limitations and strengths candidly and are comfortable talking about it.

Self-aware people can also be recognised by their self-confidence. They have a firm grasp of their capabilities and are less likely to set themselves up for failure by, for example, overstretching on assignments.

Despite the value of having self-aware people in the workplace, Goleman’s research indicates that senior executives don’t often give self-awareness the credit it deserves when they look for potential leaders. Many executives take candour about feelings for “wimpiness” and fail to give due respect to employees who openly acknowledge their shortcomings. Such people are too readily dismissed as “not tough enough” to be leaders. In fact, the opposite is true: people generally admire and respect candour. Furthermore, leaders are constantly
required to make judgement calls that require a candid assessment of capabilities – their own and those of others.

Emotional intelligence increases with age. This phenomenon is called: “maturity”. Emotional intelligence can be enhanced through training. However, much of this training focuses on the wrong part of the brain. Emotional intelligence is born largely in the neurotransmitters of the limbic system of the brain, which governs feelings, impulses and drives. Research indicates that the limbic system learns best through motivation, feedback and extended practice.  Therefore, training in emotional intelligence should help people break old habits and establish new ones. That takes much more time than conventional training and also it requires an individualised approach.

Here’s an example of a Wall Street executive whose subordinates were terrified of working with him. People even went so far as to hide bad news from him. Naturally, he was shocked when confronted with these facts. He went home and told his family – but they only confirmed what he had heard at work. When their opinions on any
given subject did not agree with his, they too, were frightened of him. He decided he wanted to improve his empathy – more specifically his ability to read people’s reactions and see their perspectives. To this end, he took a coach and his first step was to go on vacation to a foreign country where he did not speak the language. While
there, he monitored his reactions to the unfamiliar and his openness to people who were different from him.

When he returned home, humbled by his week abroad, he asked his coach to shadow him for parts of the day in order to give him feedback on how he treated people with new or different perspectives. At the same time, he used interactions with people as opportunities to practice “hearing” ideas that differed from his. Finally, the executive had himself videotaped in meetings and asked those who worked with and for him to give him feedback on his ability to acknowledge and understand the feelings of others. It took several months but the executive’s emotional intelligence did ultimately improve and the improvement was reflected in his overall performance on the job.

2. Self-regulation : the ability to control or redirect disruptive impulses and moods. The capability to suspend judgement – to think before acting.

Self-regulation, which is like an ongoing inner conversation, is the component of emotional intelligence that frees us from being prisoners of our feelings. Self-regulated people feel bad moods and emotional impulses just as everyone else does but they find ways to control them and even to channel them in useful ways.

Imagine a manager who has just watched his team doing a lousy presentation for the Board of Directors. He may feel tempted to get angry, leap up and scream at the group or pound the table but if he had a talent for self-regulation, he would approach this differently: he would choose his words carefully, acknowledging the team’s bad performance without rushing to a hasty judgement. He would then step back and consider the reasons for the failure. Are they personal – a lack of effort? Are there any mitigating factors? What was his role in this? He would then call the team together, lay out the incident’s consequences and make clear his feelings about this. He would give them his analysis of the problem and a well-considered solution.

Why is self-regulation such an important capability for leaders ?  First of all, because people who are in control of their feelings and impulses – that is, people who are reasonable – are able to create an environment of trust and fairness. In such an environment, politics and infighting are sharply reduced and productivity is high. And self-regulation has a trickle-down effect : no-one wants to be known as a hothead when the boss is known for his calm approach. Fewer bad moods at the top mean fewer throughout the organisation.

Secondly, self-regulation is important for competitive reasons. Today businesses are constantly in change and uncertainty. Companies merge and split regularly. Technology transforms the workplace at a dizzying pace. People who have mastered their emotions are able to roll with the changes. When a new change program is announced, they don’t panic, instead, they are able to suspend judgement, seek out information, and listen to executives explain the new program. As the initiative moves forward, they are able to move with it.

Another important factor is that self-regulation enhances integrity. This is not only a personal virtue but also an organisational strength. Many of the bad things that happen in companies are a function of impulsive behaviour.
By contrast, consider the behaviour of the senior executive at a large food company. He was scrupulously honest in his negotiations with local distributors. He would routinely lay out his cost structure in detail, thereby giving the distributors a realistic understanding of the company’s pricing. This approach meant the executive couldn’t always drive a hard bargain. Now, on occasion, he felt the urge to increase profits by withholding information about the company’s costs. But he challenged that impulse – he saw that it made more sense in the long run to counteract it. His emotional self-regulation paid off in strong, lasting relationships with his distributors that benefited the company more than any short-term financial gain would have.

Like self-awareness, self-regulation does not get its due. People who can master their emotions are often seen as cold fish – their considered responses are sometimes seen as a lack of passion. People with fiery temperaments are seen as “classic” leaders – their outbursts are seen as charisma and power. But when such people make it to the top, their impulsiveness often works against them. In Goleman’s research, extreme displays of negative emotion have never emerged as a driver of good leadership. Research shows that “good guys” – that is emotionally intelligent men and women –  finish first. Of all the elements affecting bottom-line performance, the importance of a leader’s mood and its attendant behaviours are most surprising. The leader’s moods and behaviours drive the moods and behaviours of everyone else. A cranky and ruthless boss creates a toxic organisation filled with negative underachievers who ignore opportunities. An inspirational inclusive leader spawns acolytes for whom any challenge is surmountable. The final link in the chain is performance: profit or loss.

A leader’s emotional intelligence creates a certain culture or work environment. High levels of emotional intelligence, as research showed, create climates in which information sharing, trust, healthy risk-taking and learning flourish. Low levels of emotional intelligence create climates of fear and anxiety. Because tense or terrified employees can be very productive in the short term, their organisations may post good results but they never last.

3. Motivation : a passion to work for reasons that go beyond money or status. A propensity to pursue goals with energy and persistence.

One trait that virtually all effective leaders have, is motivation. They are driven to achieve beyond expectations – their own and everyone else’s. The key word here is achieve. Many people are motivated by external factors such as a big salary or the status that comes with the job of being part of a prestigious company. By contrast, those with leadership potential are motivated or driven by a deeply embedded desire to achieve for the sake of achievement. If you are looking for leaders, how can you identify people who are motivated by the drive to achieve rather than by external rewards? The  first  sign  is  a passion for the work itself – such people seek out creative challenges, love to learn, and take great pride in a job well done. They also display an unflagging energy to do things better. People with such energy often seem restless with the status quo. They are persistent with their questions about why things are done one way rather than another; they are eager to explore new approaches to their work.

A cosmetics company manager, for example, was frustrated that he had to wait two weeks to get sales results from people in the field. He tracked down an automated phone system that would beep each of his salespeople at 5 p.m. every day. An automated message prompted them to punch in their numbers – how many calls and sales they had made that day. The system shortened the feedback time on sales results from weeks to hours.

People who are driven to achieve constantly raise the performance bar and they like to keep score. They want to be “stretched” and they want to track their progress – their own, their team’s and their company’s. Motivation to achieve translates into strong leadership. If you set the bar high enough for yourself, you will do the same for the organisation when you are in a position to do so. Likewise, a drive to surpass goals and an interest in keeping score can be contagious. Leaders with these traits can often build a team of managers around them with the same traits. And of course, optimism and organisational commitment are fundamental to leadership – just try to imagine running a company without them.

4. Empathy : the ability to understand the emotional makeup of other people. Skill in treating people according to their emotional reactions.

 Of all the dimensions of emotional intelligence, empathy is the most easily recognised. We have all felt the empathy of a sensitive friend or teacher and we have all been struck by its absence in an unfeeling colleague or supervisor. But when it comes to business, we rarely hear people being praised for their empathy. The very word seems unbusinesslike, out of place amid the tough realities of the marketplace.  Empathy means thoughtfully considering employees’ feelings – along with other factors – in the process of making intelligent decisions. For an example of empathy, consider what happened when two giant broker companies merged, creating redundant jobs in all divisions. One division manager called his people together and gave a gloomy speech that emphasized the number of people who would soon be fired. The manager of another division gave his people a different kind of speech. He was upfront about his own worry and confusion, and he promised to keep people informed and to treat everyone fairly.

The difference between these two managers was empathy. The first manager was too busy with his own fate to consider the feelings of anxiety in his colleagues. The second knew intuitively what his people were feeling and he acknowledged their fears with his words.

Empathy is particularly important today as a component of leadership for at least three reasons :

• the increasing use of teams
• the rapid pace of globalisation
• the growing need to retain talent

Consider the challenge of leading a team. As anyone who has ever been a part of one can attest, teams are cauldrons of bubbling emotions. They are often charged with reaching a consensus – hard enough with two people already and much more difficult when more people are involved. Alliances form and clashing agendas are set. A team’s leader must be able to sense and understand the viewpoints of everyone around the table.

A marketing manager at a large informational technology company was appointed to lead a troubled team. The group was in turmoil, overloaded with work and missing deadlines. Tensions were high among the members of the team, so the manager took some steps. She took the time to listen to everyone in the group – in a series of one-on-one sessions: she asked what was frustrating them, how they rated their colleagues, whether they felt they had been ignored. And then she directed the team in a way that brought it together: she encouraged people to speak more openly about their frustrations, and she helped people raise constructive complaints during meetings. Her empathy allowed her to understand her team’s emotional makeup. The result was increased collaboration among team members but also added business as the team was called on for help by a wider range of internal clients.

Globalization is another reason for the rising importance of empathy for business leaders. Cross-cultural dialogue can easily lead to miscues and misunderstandings. Empathy is an antidote. People who have it understand the subtleties of body language. They can hear the message beneath the words being spoken. Beyond that, they have a deep understanding of the existence and importance of cultural and ethnic differences.

Finally, empathy plays a key role in the retention of talent, particularly in today’s information economy. Leaders have always needed empathy to develop and keep good people but today the stakes are higher. When good people leave, they take the company’s knowledge with them. That’s where coaching and mentoring come in. It has repeatedly been shown that coaching and mentoring pay off, not just in better performance but also in increased job satisfaction and decreased turnover. But what makes coaching and mentoring work best is the nature of the relationship. Outstanding coaches and mentors get inside the heads of people they are helping. They sense how to give effective feedback. They know when to push for better performance and when to hold back. Unfortunately empathy does not get the respect it deserves in business. People wonder how leaders can make hard decisions if they are “feeling” for all the people who will be affected. But leaders with empathy do more than sympathize with people around them : they use their knowledge to improve their companies in subtle but important ways.

5. Social Skill : the ability to find common ground and build rapport. Proficiency in managing relationships and building networks.

The first 3 components of emotional intelligence are all self-management skills. The last two, empathy and social skill have to do with a person’s ability to manage relationships with others. Social skill is not as simple as it sounds. It is not just a matter of friendliness, although people with high levels of social skill are rarely mean-spirited. Social skill, rather, is friendliness with a purpose : to move people in the direction you desire, whether that is agreement on a new marketing strategy or enthusiasm about a new product.

Socially skilled people have a network in place when the time for action comes. They have a wide circle of acquaintances and they have a talent for finding common ground with people of all kinds. They know that nothing important gets done alone.

People tend to be very effective at managing relationships when they can understand and control their own emotions and can empathise with the feelings of others. Even motivation contributes to social skill. Socially skilled people are good at managing teams. Likewise, they are expert persuaders – a manifestation of self-awareness, self-regulation and empathy combined. They know when to make an emotional plea  and when an appeal to reason will work better.

Social skill is considered a key leadership capability in most companies. People seem to know intuitively that leaders need to manage relationships effectively. After all, the leader’s task is to get things done through people and social skill makes that possible. A leader who cannot express his empathy may as well not have it at all. And a leader’s motivation will be useless if he cannot communicate his passion to the organisation.

How can you improve your emotional intelligence ?

The more we act a certain way – be it happy, depressed or cranky – the more the behaviour becomes ingrained in our brain circuitry and the more we will continue to feel and act that way. Suppose you are perceived as a cranky person and you wish to change this. You need to “rewire” your brain toward a more positive behaviour. The process of reprogramming your brain consists of 5 steps :

1. Imagine your ideal self : Who do you want to be? How do you behave? How would it feel? What effect
   would you have on people? What would life look like?
2. Imagine who you are now : What do I do today ? Seek out negative feedback, ask a colleague or two to play the devil’s advocate. Do a 360° feedback : it reveals how people experience you.
3. Also understand your strengths. Knowing where your real self overlaps with your ideal self will give you the positive energy you need to move forward to the next step in the process, to bridge the gap between your real self and your ideal self.
4. How do I get from here to there ? (from the real self to the ideal self) Make an action plan on how to grow towards your ideal self. Here are some ideas : ask each member of your team to give you feedback. Spend an hour each day to reflect on your behaviours. This mental preparation is extremely important when we’re trying to replace old habits by new ones. Ask a trusted colleague as an informal coach.
5. How do I make the change stick ?

It requires practice. The reason for this lies in the brain. It takes doing and redoing, over and over again, to break old habits. One must rehearse a new behaviour until
it becomes automatic. While it is best to practice new behaviours, sometimes just envisioning them will do.

Who can help me ?

Create a community of supporters whom you trust. Ask them honest feedback while you’re working to improve your emotional intelligence skills. We cannot improve our emotional intelligence or change our leadership style without the help from others. We not only practise with other people but also rely on them to create a safe environment where we can experiment.

Conclusion

IQ and technical ability are important ingredients of strong leadership. But the recipe is not complete without emotional intelligence. We know now that – for the sake of performance – these are ingredients that a leader needs to have. When we say that managing your mood and the moods of your followers is the task of primal leadership, we certainly don’t mean to suggest that mood is all that matters. There are all the other challenges leaders must conquer, from strategy to hiring to new product development. It’s all in a long day’s work. But taken as a whole, neurological, psychological and organisational research is startling in its clarity : emotional leadership is the spark that ignites a company’s performance, creating a bonfire of success or a landscape of ashes. Mood matters that much.

And it is fortunate then that emotional intelligence can be learned. The process is not easy. It takes time and most of all, commitment. But the benefits that come from having a well-developed emotional intelligence, both for the individual and for the organisation, make it worth the effort.