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Are Leaders With Low Emotional Intelligence Weakening Your Bottom Line?

Erik Samdahl | i4cp

October 14, 2010

Organizations with emotionally intelligent executives could have an advantage in today’s high stress work environment, suggests i4cp’s latest research on emotional intelligence (EI).

i4cp found that only about a quarter of companies with a 1,000 or more employees have implemented an emotional intelligence initiative in parts of their organizations. But among those that have, high market performers were considerably more likely to focus those initiatives on the executive levels.

There is a big difference at the top of organizations. Among companies that have these initiatives, about two thirds of high-performing organizations apply the concept to their executives. But fewer than half of the low-performing organizations do so.

In this study, emotional intelligence was defined as the degree to which a person has the ability to recognize and understand emotions and the skills to manage personal, individual and team performance using such awareness.

The i4cp study asked about the areas in which organizations are using emotional intelligence. It turns out that higher performers were more likely to focus EI initiatives on leadership development than on other areas such as communication. What’s interesting, though, is that what they really seem to want are better team leaders. Nearly four fifths of high performers said they expected improved team performance from their programs.

Determining the return on investment, or ROI, of such initiatives is not a priority. About two thirds of companies that sponsor such initiatives said they have no idea what kind of returns they get. When it comes to measuring the impact of emotional intelligence initiatives, those that do take the time cite manager evaluations and appraisals – “changes in behavior” and 360-degree performance appraisals – as the most popular ways to gauge success. Higher market performing organizations were, however, considerably more likely than their low-performing counterparts to use individual “emotional quotient” metrics to gauge the impact of these programs.

As with most management programs, there’s not a lot of great ROI data on which to rely. But we did find that about 32% of high performing organizations with 1,000 or more workers said they have EI initiatives, compared with just 19% of low performers. This isn’t proof that emotionally intelligent execs run better companies, but it’s intriguing and warrants further research.

Further findings from i4cp’s emotional intelligence study are available exclusively to i4cp members. Additional topics covered include:

• Measurement approaches
• Emotional intelligence program ownership
• Functional uses of emotional intelligence
• Employee retention and culture benchmarks
• The importance of various EI categories (self motivation, self awareness, self regulation, social awareness and social skills)

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