Why Emotional Intelligence Beats High IQ When It Comes to Succeeding In Business
In the workplace, soft skills are often more important than your knowledge.
If you expect your business to succeed only because you’re a smart person, you might end up disappointed.
Even when the competitors aren’t as clever as you, it doesn’t predict your business to win over them. Why? Because intelligence and high IQ are only the tips of the iceberg when it comes to building a successful brand.
The Carnegie Institute of Technology shows in their research that,
“85% of your financial success is due to skills in “human engineering”, your personality and ability to communicate, negotiate, and lead.”
In the same research, they found that only 15% of the success was due to technical knowledge skills and intelligence.
Another research by the Center for Creative Leadership looked at the reasons why companies went belly up.
“Three main reasons for failure are difficulty in handling change, inability to work well in a team, and poor interpersonal relations.”
None of the companies failed due to a lack of smart employees. They failed because their employees missed an important kind of intelligence — emotional intelligence.
In addition to this, Nobel Prize-winning psychologist Daniel Kahneman points out that EQ often beats IQ for one simple reason.
“People would rather do business with a person they like and trust rather than someone they don’t, even if the likable person is offering a lower quality product or service at a higher price.”
Why high IQ in business doesn’t equate to success
Warren Buffett, one of the most successful investors in the world, talks about the connection between intelligence and business in his book called Warren Buffett Speaks.
“You don’t need to be a rocket scientist. Investing is not a game where the guy with the 160 IQ beats the guy with a 130 IQ. Rationality is essential.”
He adds that while talent and IQ are relevant in building a business, the main predictors of your success are “your habits, character, temperament, and ability to think independently.”
All of these personal traits “together allow you to behave rationally.”
Hence, being intelligent doesn’t necessarily equate to being successful. Higher intelligence can be even an obstacle when building a successful brand for the following reasons.
Intelligent people can have difficulties to delegate or work in a team
Smart people often believe they can complete tasks better than others due to their intelligence. They assume that everyone less intelligent can’t get the same good results as they did.
This is known as illusory superiority, a sort of cognitive bias when a “person overestimates their own qualities and abilities, in relation to the same qualities and abilities of other people.” Research has shown that being intelligent doesn’t prevent you from this behavior.
Because of this bias, creative yet less intelligent employees in the business don’t get an equal chance to step into the process of co-creating a product or service.
Smart people can be less patient with people needing a longer time to process information or understand a concept. However, it doesn’t mean that the ones who aren’t fast thinkers can’t manage the tasks well once they understand them.
Smart people can get bored easily and avoid repetitive tasks
Intelligent people often get bored by repeating the same tasks, as it seems like they aren’t learning anything new.
They might move to another job or strategy, which isn’t always helpful. A successful business stands on tasks repeated for a long time. You can’t expect your brand to rise above others after the first or second try.
Smart people also tend to seek complex solutions for tiny problems, same as they like overthinking things only to show off their intelligence.
EQ matters more than IQ
Researchers from Institute for Health and Human Potential have collected data from leading research institutions about the importance of emotional intelligence in business. They found that “over 80% of competencies that differentiate top performers from others are in the domain of emotional intelligence.”
When it comes to numbers and profits, researchers mention cases when an EQ training of their employees was a real game-changer.
“After a Motorola manufacturing facility provided training in stress management and Emotional Intelligence, 93% of employees had an increase in productivity.”
“After supervisors in a manufacturing plant received training in emotional competencies, lost-time accidents were reduced by 50 percent, formal grievances were reduced from 15 per year to 3 per year, and the plant exceeded productivity goals by $250,000.”
Another research from 1997 done by Hay/McBer Research and Innovation Group discovered that,
“In a national insurance company, insurance sales agents who were weak in emotional competencies such as self-confidence, initiative, and empathy sold policies with an average premium of $54,000. Those who were very strong in at least 5 of 8 key emotional competencies sold policies worth $114,000.”
What you need to learn to increase your EQ levels
Emotional intelligence is defined as “the ability to understand, use, and manage your own emotions in positive ways to relieve stress, communicate effectively, empathize with others, overcome challenges and defuse conflict.”
To become emotionally intelligent, you need to master four key skills, and those are:
3. Social awareness
4. Relationship management
The main reason for making wrong decisions is oftentimes stress. Thus, stress management is one of the first skills to master.
Managing stress will help you avoid impulsive decisions, adapt to changes faster, take initiative at the right time, fulfill commitments, and focus on essential tasks.
Identify the source of stress
Before you learn how to cope with stressful situations, you need to know what exactly is triggering them. For this purpose, you can use a stress journal.
Write down all the stress triggers along with the feelings you had in particular moments. Examine your reactions and think of other ways to handle the situations better.
Apply the rule of 4 A’s
4 A’s of stress management stand for words: avoid, alter, adapt, or accept
- AVOID — Learn to say no and avoid people or environments causing you stress.
- ALTER — Every stressful situation can be altered with a less stressful option. This involves making compromises, expressing and communicating feelings about a particular issue, or creating a schedule where stressful activities are balanced with relaxing activities.
- ADAPT — Avoid perfectionism and practice gratitude for things that went well to gain confidence for future tasks.
- ACCEPT — Learn to forgive and avoid the need to control things that are out of your control.
The keystone of self-awareness is mindfulness practice. A method with roots in Buddhism is used to learn how to become solely focused on the present moment.
Benefits of mindfulness include the ability to become fully engaged in activities without distraction. It also helps to relieve stress, lower blood pressure, improve sleep, reduce chronic pain, and escape regrets or worries.
The two best-known mindfulness techniques are meditation and conscious breathing.
While self-awareness is about looking inward, social awareness is the exact opposite — you have to look outward to understand others’ behavior. To accomplish social awareness, you need to master self-awareness first.
Being socially aware is about your ability “to understand people in a social or business setting and respond in a socially integrated and perceptive way.”
Tips for becoming a socially aware person:
- Always be present and learn how to listen instead of talk.
- Observe body language, voice, and facial expression to understand how people feel.
- Accept that people from different cultures or backgrounds might have various habits, thinking patterns, or needs.
- Be always polite and use people’s names when you speak to them.
- Announce negative news only when the person is in the right mood. This will decrease the negative impact of the news.
Once you understand your behavior and the behavior of others, you can proceed further with building relationships. Strong relationships at the workplace lead to “lower business costs, improved performance outcomes, lower staff turnover and absenteeism, and fewer safety incidents.”
How to build good relationships at work
- Observe nonverbal communication — facial expressions can often tell more than words.
- Use laughter as a way to relieve stress and negativity during meetings — everything goes easier with a positive attitude.
- Resolve conflicts in a constructive way — conflict is a natural part of humans’ relationships, and if it’s resolved positively without threats and punishment, it can strengthen the relationships.
Importance of emotional intelligence in leadership
More than three years ago, Tesla CEO Elon Musk was facing claims that the injury rate at the Tesla Fremont factory is higher than the industry average. After hearing these allegations, Musk got personally involved in resolving them.
In his email to the factory employees, he wrote,
“No words can express how much I care about your safety and wellbeing. It breaks my heart when someone is injured building cars and trying their best to make Tesla successful.
Going forward, I’ve asked that every injury be reported directly to me, without exception.
I’m meeting with the safety team every week and would like to meet every injured person as soon as they are well, so that I can understand from them exactly what we need to do to make it better.
I will then go down to the production line and perform the same task that they perform.
This is what all managers at Tesla should do as a matter of course. At Tesla, we lead from the front line, not from some safe and comfortable ivory tower. Managers must always put their team’s safety above their own.”
This is an outstanding example of emotional intelligence in leadership. Musk didn’t only express worries about the injured employees — he promised he’ll get personally involved in resolving them.
Instead of denying the higher injury rate, firing employees who dared to speak about the problems publicly, or trying to cover the accidents, he took the responsibility and looked for solutions.
Ex CEO of Campbell Soup Company Douglas Conant is another example of a person with high EQ levels.
He used to walk through the production plant and engage with his employees personally. Besides this, he wrote every day up to 20 notes to the employees. He aimed to show his gratitude and celebrate employees’ contributions to the company.
In more than ten years, he had written over 30,000 notes. This way, he pointed out how important is personal interaction with employees.
If you aren’t succeeding at work as an employee, a manager, or a leader, rethink your attitude towards yourself, your staff, and the customers.
Maybe your annual revenue didn’t go down because of the wrong strategy, weak marketing, or high prices. Maybe your colleagues or employees aren’t tired and frustrated from working hard for long hours every day.
All of these issues can be simply caused by a lack of emotional intelligence in the workplace.
This post was originally published in the publication ILLUMINATION on Medium.