Why Emotional Intelligence Affects the Bottom Line

There are five parts of communication -- what's said, what's not said, words, tone of voice, and body language. Active listening is the process of fully attending to all parts of someone's communication.
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It's a Friday afternoon and Alexus is holding a status meeting with her team. After the project manager gives a complete update, Alexus breaks the news that the project deadline has just been moved up by three weeks. After months of working on the project, she knows this news won't be taken lightly.

The project manager's eyes grow wide before she replies that she's confident that with a few adjustments to the timeline, the deadline will be met. Most of the other team members express their stress and concern but pretty quickly say that they can figure it out. The technical lead sits in the back silently staring dead ahead. Alexus leaves the meeting feeling like things went a lot better than she expected.

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What she doesn't know is that the project manager left the meeting fuming and replied to an email from a recruiter she was otherwise going to ignore. A few other team members went to the 40th floor for coffee and one was near tears from exhaustion and anxiety about the new deadline. And remember the tech lead sitting silently in the back? She was actually communicating a lot with her silence.

As a manager, how is Alexus supposed to navigate team members who aren't telling her what they really think? She asked for feedback and left time to discuss concerns, but no one seemed to express any. So what could she have done differently? Use her EQ.

What is EQ?

What's EQ? EQ is similar to IQ; IQ stands for Intelligence Quotient whereas EQ stands for Emotional Intelligence Quotient. EQ is a measure of your ability to monitor, identify, understand and use emotional information, whether it comes from you or from somebody else. This term became widely known with the publication of Daniel Goleman's Emotional Intelligence - Why it can matter more than IQ.

EQ Improves the Bottom Line

Having a high EQ isn't for promoting warm and fuzzy feelings in the workplace. It is directly related to the bottom line. Pepsi found that executives with high EQs generated 10% more productivity, had 87% less turnover, brought $3.75M more value to the company, and increased ROI by 1000%. L'Oreal found that salespeople with a high EQ sold $2.5M more than others. And when Sheraton decided to incorporate an EQ initiative, their market share grew by 24%.

You are probably wondering if your EQ is high or low. While this is by no means exhaustive, here are some qualities associated with high and low EQs:

If you have a high EQ:

  • You are able to admit and learn from mistakes
  • You can take criticism well
  • You stay cool under pressure
  • You are able to control your emotions
  • You can conduct thoughtful discussions
  • You listen at least as much as you talk

If you have a low EQ:

  • You often think others don't get your point
  • You feel that being 'liked' is over-rated
  • You think people over-react to your comments or jokes
  • Usually, others are to blame for problems on your team
  • You think you shouldn't be expected to know how colleagues are feeling

Having a high EQ is very nuanced. But the good news is that you can improve your EQ over time because it boils down to knowing how to listen.

To help improve your EQ, you must practice active listening, a crucial skill for managers and leaders. But what is it?

What is Active Listening?

There are five parts of communication--what's said, what's not said, words, tone of voice, and body language. Active listening is the process of fully attending to all parts of someone's communication.

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The truth is, there are many leaders and managers out there who aren't the greatest at listening. That is understandable because while it seems rudimentary, listening is actually difficult. As a culture, we aren't really taught to listen. Instead, we are applauded for having all of the answers.

On a more technical level, our attention span is a whopping 17 seconds, and our brain works 100 times faster than we speak. Also, feelings, assumptions and anxieties tend to dominate a lot of our attention while communicating, and that makes it difficult to concentrate on what others are saying.

The fact is that active listening takes practice. But where do you begin? You can start by understanding that listening comes in three levels. Many people are stuck on the first level, but in order to master the art of listening, leaders must be fluent in all three forms of listening.

Three Types of Listening

Here are the three forms of listening:

  1. The first form is the typical conversation style of listening. You've already figured out what a person is trying to say, and are just waiting your turn to share.
  2. The second form is the ability to incorporate body language into listening. Often a person expresses one thing (like enthusiasm) verbally, but their body (arms crossed, chin down) is telling a completely different story.
  3. The final tier is energetic listening. With this skill, leaders can sense a shift in the room when it arises. When someone is angry, insecure or fed-up, a skilled listener will be able to sense it. For example, a leader might say, "Wow, I really felt a shift in the conversation when I mentioned the fact that we need to put you at 90% project management with our new client. What are your thoughts on that?"

If we look at the scenario above, we can see that the manager at hand was not moving past the first level of listening. To start, she didn't register that her project manager's wide eyes were communicating the feeling of being overwhelmed and fed-up. She also didn't realize that when her tech lead was staring dead ahead and remaining silent, she was expressing irritation and the feeling that her voice always goes unheard. We can guess that the rest of the team members quickly agreeing to the new deadline were probably energetically expressing their anxieties. Yet our manager left the meeting feeling pretty good about things.

With active listening skills and a high EQ, this manager would have been able to read her team and address their concerns. She would have been able to problem-solve and offer help to increase the trust of her team. The overall communication in the meeting would have been greatly improved, and a new solution could have come out of a more productive discussion. She also may have prevented her project manager from starting to look for a job elsewhere.

Understanding one another is vital; the inability to do so is often the root cause of conflict, lack of engagement, and loss of talent. Yet truly communicating takes emotional intelligence and refined listening skills.


Go ahead and rate yourself! On a scale of one (low) to ten (high), what score would you give your EQ? Why is that? I'd love to know. Please leave me a comment below, send me an email, or find me on Twitter. Until then, get listening!

Anne Loehr is a sought after keynote speaker, writer, consultant, and trainer. She helps leaders in large organizations connect their everyday decisions today to the future workplace. Her end goal is to help organizations retain their top talent and not only survive, but thrive. To learn more about Anne, check out www.anneloehr.com or follow her on Twitter.

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