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Lead Your Team Personal Growth

What Is Emotional Intelligence, and Why Does It Matter?

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fizkes/Getty Images

Emotional intelligence in business, or the ability to understand your emotions and others', is crucial regardless of what industry your business is in. By honing your emotional intelligence skills, you can gain an edge over others (and possibly boost your income and job satisfaction) by successfully working with difficult people and resolving complex problems.

"Understanding your emotions, controlling them, and understanding other peoples' might be the most important asset in working with others," said Eric Lupton, CEO of Life Saver Pool Fence.

In a study published in the Journal of Vocational Behavior, Joseph C. Rode, professor of management at the Farmer School of Business at Miami University of Ohio, and his coauthors found emotional intelligence is linked to higher salaries and increased job satisfaction

Business News Daily spoke to experts about emotional intelligence and career success, including when you need it in the workplace, the five components of a high emotional quotient (EQ), and how you can boost your emotional intelligence skills.

Lupton defines emotional intelligence as the ability to be aware of, manage and control your emotions; it also encompasses the ability to empathize with others.

"[Emotional intelligence] is crucial for all types of relationships, from personal to professional," he said.

Similarly, Rode noted that emotional intelligence "represents the intersection of emotions and general mental ability."

"It can also be thought of as the extent to which one actively thinks about emotion or uses emotions as important information in a manner similar to other information, such as facts and opinions," Lupton added.

Emotional intelligence, and its associated people skills, are crucial, because people are an important part of any business. Emotions, said Rode, are important pieces of information that must be considered in decision-making – even when that means knowing when you should tune them out.

"While emotional intelligence includes the ability to use emotions to increase motivation and focus, it also includes the ability to detach from very powerful short-term emotions when needed to better focus on the tasks at hand," added Rode.

Because of the powerful role emotions play when planning goals and communicating with subordinates, managers must be especially mindful of their negative emotions that could arise in the workplace and negatively reflect on them.

Connelly Hayward, a master trainer in emotional intelligence, explained what the five components of emotional intelligence are:

  1. Self-awareness is the ability to recognize and understand your emotions and the effect those emotions have on you and others around you.

  2. Self-regulation is the ability to think before acting and suspend judgment about a situation, person or experience. With self-regulation, redirecting disruptive impulses is a must.

  3. Social awareness involves understanding the emotional state of those around you. In other words, it is the ability to sense the emotional temperature of a room. Social awareness also encompasses recognizing how your words and actions affect others.

  4. Social regulation is the ability to influence the emotions of others. Social regulation involves knowing when it's appropriate to influence the emotional condition of others and when it's appropriate not to do so.

  5. Motivation is the passion you have for work that goes beyond money, recognition or promotion.

You might wonder why emotional intelligence in business is important and why you need it. As Hayward points out, leaders influence and guide people who come from varying backgrounds with different perspectives and temperaments, which requires a higher level of emotional intelligence. 

A high EQ is needed for decision-making and stress management. A leader needs to know their own emotional state, the emotions of others and they must be able to selectively utilize that information (or omit it) to make calculated, clear-headed decisions. Hayward said managers equipped with a high EQ are able to effectively defuse tense situations and positively resolve problems while maintaining a clear head and calm disposition.

Leaders can boost their emotional intelligence by taking the time to learn about people and becoming more self-aware of their own emotions. If you practice becoming more mindful of your own feelings and your reactions to others, you'll become more empathetic.

"While some people are going to be naturally gifted with a higher EQ than others, like anything else, it is possible to improve with patience and dedication," said Lupton.

"Taking time to get to know people around you and consciously seeking to empathize can go a long way toward having an effectively higher EQ," Lupton added. "If you look at someone else and see yourself reflected back in them, you can begin to treat them in a more compassionate manner."

Besides improving your relationships with your boss and co-workers, improving your EQ skills might lead to a higher paycheck. Rode's study found that people with a high EQ have, on average, higher salaries than people who don't.

To measure emotional intelligence, Rode and his coauthors required participants to solve multiple emotional problems that had right and wrong answers, similar to an IQ test. Study participants were shown pictures of people's faces and were asked to identify the particular emotions. Participants were also presented with different scenarios and were asked to identify the best response.

"Following this research, we argued that emotional intelligence should be more relevant to success – and salary – at higher organizational levels, where leadership becomes a relatively more important part of one's job," said Rode.

But what is the connection between high emotional intelligence and high salary? Brad Flowers, partner of boutique branding agency Bullhorn Creative, said this important quality helps you accurately read situations and time your requests appropriately.

"The most difficult part of getting a bigger salary is asking for it," Flowers said. "Emotional intelligence – combined with a smart case – equips you with the tools to recognize the perfect moment to ask, how to ask appropriately for your audience and how to deal with any answer you receive." 

Jennifer Hancock, founder of Humanist Learning Systems, added that people with a high EQ typically have higher salaries because they tend to be more productive.

"People who are good at working with other people and getting other people to work with them tend to get more work done," said Hancock. "They have good reputations since people like working with them."

The following examples of emotional intelligence in the workplace were submitted by Business News Daily readers: 

"When a leader needs to correct the performance of a team member, that member may get defensive and react in ways that could be inappropriate or rude. The leader needs to call upon their own EQ to defuse the anger and frustration but also ensure that the subordinate understands what is being asked of them. The ability to deliver bad news without causing a scene is an art that EQ goes to the heart of. Another recurring theme is a team member who is a great performer (such as an outstanding salesperson) but who consistently leaves other people in the organization feeling diminished or insulted. These toxic team members have the ability to call upon enough EQ to close a deal but are insensitive to the damage they leave around them." – Submitted by Amie Devero, Managing Director, Amie Devero Coaching and Consulting 

"My favorite example of emotional intelligence is knowing not to fire off an email response when you're hot over the topic or situation. Don't swoop and lose the trust of whoever is on the other end. Take time, self-regulate, and be aware of all of the facts and details in whatever situation you're responding to. You will regret hitting the send button at some point if you're not in control and measured in your reactions." – Submitted by Karen Oakey the Director of Human Resources at Fracture 

"Saying 'Hold on, give me a minute to collect myself before I respond, please,' or asking a co-worker or boss, 'Your face indicates you might be concerned, even upset about this development. Is that true?' are ways you can employ emotional intelligence in highly charged situations but that will help you suss out the problem and develop solutions. In addition to being more direct and specific with co-workers, take time to meditate. Meditating, especially meditations where you mentally scan your body, noting where you are holding stress, helps you improve your ability to balance charged emotions while making clear decisions." Submitted by Scott Crabtree, Chief Happiness Officer, Happy Brain Science

Emotional intelligence tests can offer valuable insight into your EQ skills. By evaluating your own emotional intelligence and training yourself on how to be more aware of your own emotions and those of the people around you, you learn how to

  • Better manage stress.
  • Communicate more effectively.
  • Empathize with others.
  • Be a stronger leader.

Below are some additional resources where you can evaluate your EQ skills:

Some source interviews were conducted for a previous version of this article. Sammi Caramela also contributed to the reporting and writing in this article.

Marisa Sanfilippo

Marisa Sanfilippo is an award-winning marketing professional who has more than six years experience developing and executing marketing campaigns for small and medium sized businesses with a focus on digital marketing. After graduating Stockton University with a B.A. in Communications and minor in writing, Marisa worked as a freelance journalist for numerous publications, ultimately earning a position as an e-marketing specialist for a credit union. While in that position, she earned HubSpot's Inbound Marketing Certification and helped build the organization’s digital marketing strategy from the ground up. Her efforts helped lead the credit union to success on and offline including: a 200%+ organic increase in Facebook followers, a sales generating blog, and much more. Later on, she worked on a social media campaign that gained recognition by The Huffington Post.

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