Personal Development

Why emotional intelligence makes the best leaders

emotional intelligence in leadership board

Effective leaders have something in common — and it isn’t necessarily technical skills or a high IQ. Research indicates that effective leaders have a high degree of emotional intelligence.

Daniel Goleman, a Rutgers psychologist who has studied the link between emotional intelligence and business leadership for decades, calls emotional intelligence the “sine qua non of leadership. Without it, a person can have the best training in the world, an incisive, analytical mind, and an endless supply of smart ideas, but [they] still won’t make a great leader.”

But what is emotional intelligence, and how can CEOs cultivate it? For answers, we checked in with Amanda Madorno, a Vistage speaker and coach who specializes in helping leaders develop this critical skill.

What is emotional intelligence?

Emotional intelligence is the ability to understand and manage your emotions, as well as recognize and influence the emotions of those around you. Leaders can “use this understanding to guide their behavior, solve problems and manage the behavior of others,” explains Madorno.

3 benefits of emotional intelligence

Emotional intelligence supports leadership development in several ways. As a CEO, it can help you:

1. Grow personally and professionally.

Emotional intelligence makes it easier to take an honest look at yourself, identify your strengths and weaknesses, and make changes necessary for growth.

2. Make better decisions.

By managing your emotions, you can make decisions in a more measured, thoughtful and analytical way.

3. Communicate effectively.

Emotional intelligence increases your tendency to ask open questions, engage in active listening and own up to your mistakes. It also reduces the tendency to respond to situations impulsively.

Like leaders, companies benefit from emotional intelligence in important ways. A study by Harvard Business Review Analytic Services found that 38% of emotionally intelligent organizations report significantly stronger customer experiences (40% versus 12%) and higher levels of customer loyalty and customer advocacy (31% versus 8%) than companies lacking emotional intelligence.

Another study published by Waterford Inc. found that companies led by people with high emotional intelligence have, on average, 50% less turnover, 56% higher customer loyalty and 38% above-average productivity. They’re also 27% more profitable.

“There are compelling bottom-line reasons for developing emotional intelligence,” says Madorno.

Importance of emotional intelligence in leadership

If emotional intelligence is so valuable for leaders — and their companies — why aren’t more invested in developing it? Madorno points to three challenges in particular.

One, most CEOs aren’t a good judge of their own emotional intelligence. “When I coach leaders, I do an initial assessment, and it’s a brutal awakening for some,” Madorno says. “It’s one of the first times they may have received feedback on where they are on the ‘emotional quotient’ scale.”

Two, CEOs may get lulled into autopilot mode, which is the antithesis of emotional intelligence. This commonly happens when a leader achieves a certain level of success and loses the drive to grow. “There is something about becoming a leader that makes us complacent,” says Madorno. “We become resistant to change, and we end up with a lot of blind spots.”

Three, some CEOs may not recognize that emotions are actually driving their behavior. “If we don’t manage our emotions, they manage us,” says Madorno. “This can result in rash decisions and disastrous results.”

To make the case for emotional intelligence, Madorno, an experienced equestrian, often draws parallels between riding a horse and leading a company. In fact, she often integrates horses into her executive leadership courses. Her reason: Whether you’re trying to ride a horse or lead a company, you need emotional intelligence to succeed.

Demonstrating this emotional intelligence comes from answering three questions affirmatively, Madorno says. “Can I trust you? Are you who you say who you are? Do we have a connection that matters?” Both horses and people pick up on what you communicate.

4 core aspects of emotional intelligence

To score high on emotional intelligence, leaders need to focus on developing four core competencies: self-awareness, self-management, relationship awareness and relationship management.

1. Self-awareness

Self-awareness is about understanding your strengths and weaknesses, recognizing your emotions, and knowing how emotions impact you and your team’s performance. Leaders who have strong self-awareness are highly aware of how they feel. To build this competency, Madorno recommends practicing three things: Notice your feelings, pay attention to what’s happening in the moment and give yourself time to consider your reaction.

2. Self-management

Self-management is about managing your emotions — especially in high-stress situations — and maintaining a positive attitude. Leaders who have strong self-management don’t make rushed decisions, rarely attack others, have a flexible mindset and practice staying calm. To build this competency, Madorno recommends focusing on recognizing, processing and channeling your emotions to make rational decisions.

3. Relationship awareness

Relationship awareness is about having empathy. Madorno notes that there are two types of empathy: Emotional empathy is the ability to feel what someone else is feeling, and it helps you develop compassion. Cognitive empathy is the ability to intellectually recognize someone else’s perspective, and it helps you relate to others.

4. Relationship management

Relationship management is the ability to influence, coach and mentor others. Leaders with this competency have strong social skills and know how to effectively resolve conflict, whether it exists between team members, customers or vendors. Leaders with strong relationship-management skills are great communicators who know how to get their team on board and build meaningful connections with others.

At its most basic level, emotional intelligence gets to the heart of what it means to be a good CEO. People want “a leader they can respect and who also treats them with kindness and respect,” says Madorno. “Emotional intelligence is all about establishing this connection.”

Category: Personal Development

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Vistage Staff About the Author: Vistage Staff

Vistage facilitates confidential peer advisory groups for CEOs and other senior leaders, focusing on solving challenges, accelerating growth and improving business performance. Vistage member companies grow 2.2x fa…

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