Sunday, December 30, 2007

Emotional Intelligence

Emotional Intelligence
Emotional Intelligence is about how individuals manage both themselves and others. It is about understanding and gaining an accurate insight into an individual’s motivation to succeed. This includes how to make decisions, why people behave the way they do, and how to maximize one’s performance. This is the key to human capital management.

What Exactly is EQ?
In the same way that we know that IQ (or intelligence quotient) is a valid and reliable indicator of a person's mental strength and capability,
Today we have the EQ (or emotional quotient) as a valid and reliable indicator of a person's emotional strength and capability.
IQ tells a person how intellectually smart he/she is;
EQ tells a person how emotionally smart he/she is. In the new workplace, you particularly want to know that. Your business and your future depend on EQ.
In the new workplace, EQ beats IQ every time. We demonstrate IQ when we speak, write, solve mental challenges. IQ is fairly stable by around 17-18 years of age and does not change.

THE NEW WORKPLACE FORMULA:

High EQ means Clear Thinking + Healthy Emotions + Appropriate Actions

I like to look at EQ as perspective. It is the ability to reframe life's events. Obviously, in the new workplace, this is a central competency.

EQ comprises a collection of so-called ``soft" skills, including self-awareness, an understanding of how your mood and behavior affect others; impulse control, including how you manage stress on the job; initiative, whether you can be counted on to report to work on time, manage your own time, and meet expectations; and the ability to motivate and lead others.

Emotional Intelligence Effects in Business :

The following 19 real effects on emotional intelligence contributes to
the bottom line in any work organization.

1. The US Air Force used the EQ-I to select recruiters (the Air Force’s front-line HR
personnel) and found that the most successful recruiters scored significantly higher in the
emotional intelligence competencies of Assertiveness, Empathy, Happiness, and Emotional Self
Awareness. The Air Force also found that by using emotional intelligence to select recruiters,
they increased their ability to predict successful recruiters by nearly three-fold. The
immediate gain was a saving of $3 million annually. These gains resulted in the Government
Accounting Office submitting a report to Congress, which led to a request that the Secretary of
Defense order all branches of the armed forces to adopt this procedure in recruitment and
selection.
(The GAO report is titled, “Military Recruiting: The Department of Defense Could
Improve Its Recruiter Selection and Incentive Systems").

2. Experienced partners in a multinational consulting firm were assessed on the EI
competencies plus three others. Partners who scored above the median on 9 or more
of the 20 competencies delivered $1.2 million more profit from their accounts than
did other partners a 139 percent incremental gain.

3. An analysis of more than 300 top-level executives from fifteen global companies
showed that six emotional competencies distinguished stars from the average:
Influence, Team Leadership, Organizational Awareness, self-confidence.

4. In jobs of medium complexity (sales clerks, mechanics), a top performer is 12 timesmore
productive than those at the bottom and 85 percent more productive than anaverage
performer. In the most complex jobs (insurance salespeople, account managers), a top
performer is 127 percent more productive than an average performer. Competency research
in over 200 companies and organizations worldwide suggests that about one-third of this difference is due totechnical skill and cognitive ability while two-thirds is due to emotional competence. (In top leadership positions, over four-fifths of the difference is due to emotional competence.)

5. At L’Oreal, sales agents selected on the basis of certain emotional competencies
significantly outsold salespeople selected using the company’s old selection
procedure. On an annual basis, salespeople selected on the basis of emotional
competence sold $91,370 more than other salespeople did, for a net revenue increase
of $2,558,360. Salespeople selected on the basis of emotional competence also had
63% less turnover during the first year than those selected in the typical way

6. In a national insurance company, insurance sales agents who were weak in emotional
competencies such as self-confidence, initiative, and empathy sold policies with anaverage
premium of $54,000. Those who were very strong in at least 5 of 8 key emotional
competencies sold policies worth $114,000

7.In a large beverage firm, using standard methods to hire division presidents, 50% left within
two years, mostly because of poor performance. When they started selecting based on
emotional competencies such as initiative, self-confidence, and leadership,only 6% left in two
years. Furthermore, the executives selected based on emotional competence were far more
likely to perform in the top third based on salary bonusesfor performance of the divisions they
led: 87% were in the top third. In addition,division leaders with these competencies
outperformed their targets by 15 to 20 percent. Those who lacked them under-performed by
almost 20%

8.Research by the Center for Creative Leadership has found that the primary causes of
derailment in executives involve deficits in emotional competence. The three primary ones
are difficulty in handling change, not being able to work well in a team, and poor interpersonal
relations.

9 .After supervisors in a manufacturing plant received training in emotional
competencies such as how to listen better and help employees resolve problems on
their own, lost-time accidents were reduced by 50 percent, formal grievances were
reduced from an average of 15 per year to 3 per year, and the plant exceeded
productivity goals by $250,000. In another manufacturing plant where supervisors received
similar training, production increased 17 percent.
There was no such increase in production for a group of matched supervisors who
were not .

10. One of the foundations of emotional competence -- accurate self-assessment – was
associated with superior performance among several hundred managers from 12
different organizations.

11. Another emotional competence, the ability to handle stress, was linked to success as a store
manager in a retail chain. The most successful store managers were those best able to handle
stress. Success was based on net profits, sales per square foot, sales per employee, and per
dollar inventory investment.

12. Optimism is another emotional competence that leads to increased productivity. New
salesmen at Met Life who scored high on a test of “learned optimism” sold 37 percent
more life insurance in their first two years than pessimists .

13. A study of 130 executives found that how well people handled their own emotions
determined how much people around them preferred to deal with them.

14. For sales reps at a computer company, those hired based on their emotional
competence were 90% more likely to finish their training than those hired on other
criteria.

15. At a national furniture retailer, sales people hired based on emotional competence had half
the dropout rate during their first year .

16. For 515 senior executives analyzed by the search firm Egon Zehnder International,those
who were primarily strong in emotional intelligence were more likely to succeed than those
who were strongest in either relevant previous experience or IQ.
In other words, emotional intelligence was a better predictor of success than either
relevant previous experience or high IQ. More specifically, the executive was high in
emotional intelligence in 74 percent of the successes and only in 24 percent of the
failures. The study included executives in Latin America, Germany, and Japan, and
the results were almost identical in all three cultures.

17. The following description of a “star” performer reveals how several emotional
competencies (noted in italics) were critical in his success: Michael Iem worked at
Tandem Computers. Shortly after joining the company as a junior staff analyst, he
became aware of the market trend away from mainframe computers to networks that
linked workstations and personal computers (Service Orientation). Iem realized that unless
Tandem responded to the trend, its products would become obsolete (Initiative and
Innovation). He had to convince Tandem’s managers that their old emphasis on mainframes
was no longer appropriate (Influence) and then develop a system using new technology
(Leadership, Change Catalyst). He spent four years showing off his new system to customers
and company sales personnel before the new network applications were fully accepted (Self-
confidence, Self-Control, Achievement Drive)

18. Financial advisors at American Express whose managers completed the Emotional
Competence training program were compared to an equal number whose managers had not.
During the year following training, the advisors of trained managers grew their businesses
by 18.1% compared to 16.2% for those whose managers were untrained.

19. The most successful debt collectors in a large collection agency had an average goal
attainment of 163 percent over a three-month period. They were compared with a group of
collectors who achieved an average of only 80 percent over the same time period. The most
successful collectors scored significantly higher in the emotional intelligence competencies of
self-actualization, independence, and optimism. (Self actualization refers to a well-
developed, inner knowledge of one's own goals and a sense of pride in one's work.)

Recruiting people with the 'Right Stuff':

The cluster of abilities that forms Emotional Intelligence has been shown to be strongly correlated with Superperformance at work. We all know people who are intellectually very bright but just don't work well with other people. Or their personal lives are so chaotic that it becomes difficult for them to work. On the other hand there are the people who don't show much evidence of intellect but whose lives are happy and successful. They have warm relationships, make good leaders, work productively and are financially stable. Now we know that it is their emotional intelligence that makes this happen.

Benefits -
The new recruit gets up and running faster than usual
They integrate easily into a new team
They quickly learn the 'political' networks in the organisation and negotiate for resources effectively
Significant savings are made through not having to give excessive training or spending on rehiring when the person leaves before you have broken even on their recruitment costs.

How it works -
Once the selection procedure has come down to a short list the applicants are given an EQ Profile to complete. This is then discussed with them during the final interviews. The levels of their intrapersonal and interpersonal skills, adaptability, stress tolerance and general mood can be seen from the profile. This can also be compared with the team profile of the group they will be joining, if there are mismatches that do not bring a new and needed strength into the team the recruit is unlikely to settle in productively.

1 comment:

Snowlark said...

Great post! I'd love to get my hands on an example EQ Profile or test for my own research. I'll leave you a note on Plaxo as well ...

--Steve

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