Episode 02: The Business Case for Prioritizing Emotional Intelligence

In this episode of the Emotional Intelli-gents Podcast, we seek to make the case for why businesses, particularly in today’s work environment, must proactively promote emotionally intelligent leaders and implement EQ centric policies to maximize productivity.  

Businesses today, more than ever, are grappling with balancing the traditional approach to achieving profitability and the seemingly ambiguous emotional needs of their teams who drive the profitable growth.   

Today’s episode will dispel the notion that emotionally intelligent people and policies will not move the profitability needle enough for companies to commit to improving in the EQ space.  The episode will share the findings of Project Aristotle, Google’s now infamous study, which defines the essence of what drives top tier teams performance and productivity.  We will discuss other data-driven studies and concrete examples clearly demonstrating why emotional intelligence skills are a ‘must-have’ for businesses and can no longer be treated as a ‘nice-to-have’.

Episode 02: Transcript

Opening Teaser (00:00):

The truth is that in today's work dynamics, EQ stands out as the differentiator that bridges the gap between traditional levers businesses have used to drive profitability, and the levers that must be used today to achieve the same end goal of profitability and growth.

Musical Intro (00:21):

1, 2, 3, 4.

Intro (00:21):

Welcome to the Emotional Intelligence Podcast, a podcast diving into how emotional intelligence can be unleashed to turn great people into great leaders. And now, your hosts, Ismail and Sameer.

Ismail (00:35):

Hello and welcome again to the Emotional Intelligence Podcast, where we help current and aspiring leaders level up their ability to achieve greatness in the workplace. I'm Ismail.

Sameer (00:45):

And, hello, I'm Sameer

Ismail (00:46):

All right, Sameer. So in this episode, we're gonna be sharing the business case for why emotionally intelligent leaders need to be a top your organization. And this is really to ensure employees have what they need to be productive and fulfilled. And then of course, the employers benefit by earning loyalty and productivity from their team members

Sameer (01:04):

That's right. EQ in today's leaders is no longer a nice to have, and it needs to be considered a must have. So in this podcast, let's get into why... Ismail, I'm ready. Let's jump right in.

Ismail (01:17):

Sounds good. So, Sameer, I think that we can agree at the end of the day that a company thrives and survives by making sure they maintain a vision that's sustainable and a balance sheet that stays in the black.

Sameer (01:33):

Agreed, agreed. And there's no debate that a company needs to keep their lights on, right? They need the salaries to be paid, they need their customers to be happy. And the question of what priority an organization places on profitability, I think that's going to yield a wide range of responses. But in the end, a universal truth of business is the bottom line matters, right? The long-term sustainability of an organization really relies on its ability to make money.

Ismail (01:59):

Totally agree. And I think we just have to get that out of the way. I think the question then becomes, what's the most effective way for a company to accomplish this? So we know that a company can always cut costs, and we're seeing a lot of that lately by way of layoffs, right? But I think we can also agree that cutting staff, it's not a sustainable solution, right? And, and my personal opinion or hypothesis is that companies should be doubling down by reinvesting in their people.

Sameer (02:27):

And, and that's a fair point, but the, the question then is how can companies invest in their people? Companies can invest in people in such a wide range of ways, but you know, you have cash strapped organizations, they may only have a finite number of spending options. So how are they getting the best bang for their buck? Right.

Ismail (02:49):

That's a great question. I mean, I think a very critical variable here for success is that companies work in teams, and those teams need to be collaborative, right? So majority, if not all projects are done with teams. So the challenge becomes how do you build the most productive team? Right? So, I want to go back, back in 2012, Google spent two years, uh, studying 180 of their own teams doing real work in a real corporate setting. And the goal of this study was to determine what the true secret to strong functioning, productive teams is. And if you're curious, you guys can look up this study known as Project Aristotle. So Google named it after Aristotle's famous quote. The whole is greater than the sum of its parts. And Google recognized that the backbone of their business is essentially the strength of their teams. So they had a huge amount of incentive to figure out what the characteristics are, are consistently present throughout their teams, right? And then use that to cross pollinate their findings throughout the company, essentially, and then kind of repeat that, just cookie cutter it, and create dozens of teams to effectively drive profitability.

Sameer (04:01):

Okay. All right. Yeah, and that makes a ton of sense. So what did the study by Google ultimately determine? You mentioned that they were trying to find the true secret, right? What's, what was the secret sauce to establishing strong, productive teams that Google was able to find out through this Project Aristotle?

Ismail (04:18):

It's really interesting what they discovered. So like I said, it lasted about two years, and there were five factors that they found were essential to any high performing team. And let me list them off for you real quick. Okay. So this is an order of importance, the first one being the most important psychological safety. And, and that's, uh, team members feeling safe to take risks and be vulnerable in front of each other. Second is dependability, uh, which is a team, which is team members, getting tasks done on time and with quality. Third was structure and clarity, and that's team members having clear roles, plans, and goals. Fourth was meaning and work that that work that they were doing is personally important to people. And finally, impact, which is team members feeling like their work matters and creates change.

Sameer (05:09):

Hang on, let's unpack that a little bit more. So you said in order of importance. So then are we saying that psychological safety, which you mentioned is team members feeling safe to take risks and be vulnerable in front of each other? Google through Project Aristotle determined that the number one factor consistently present on high performing teams is psychological safety.

Ismail (05:32):

That's right. You got it. Like, they concluded that that was the number one factor.

Sameer (05:36):

That's really interesting. So what <laugh>, I'm just, you know, I'm taking aback by this a little bit, because what Google finds in this study is that the number one indicator of strong, productive teams... the teams that are designing the new products, launching the new products, they're improving the existing products, user experience, all of which are generating revenue for the company. Google found that the most important factor is not the technical ability of the team.

Ismail (06:02):

Correct? Even though technical ability was a factor, Google analyzed during Project Aristotle, and, and look, I can see that you're getting giddy about this. But like, to put it really simply, the most important factor indicating a strong team was psychological safety. And that is the basis of which an EQ skill is based on, right? So meaning you can't have psychological, you can't achieve psychological safety unless your leaders are emotionally self-aware and aware of their emotional tendencies of others, and frankly, able to manage them all.

Sameer (06:37):

Wow. Okay. All right. I feel, feel so validated right now. Allowing others to feel safe, be vulnerable. It requires leaders to be emotionally intelligent, right? And so to maximize the productivity and efficiency of teams, leaders and team members must use the, the same four competencies, right, that we talked about in episode one. Self-awareness, self-management, social awareness, relationship management. I mean this, well, I'm rarely ever this right man!

Ismail (07:01):

<laugh>, why don't we, why don't we do this? Let's develop the need for psychological safety a little further, okay. And explore exactly why the psychological aspects of the work experience truly drive the business case for prioritizing EQ.

Sameer (07:15):

All right, let's do it. I wish my wife was listening to this podcast to hear me be right about something <laugh>.

Ismail (07:25):

Hey, if you've enjoyed the show so far, or found some helpful information, check the show notes where you can join our mailing list, get additional EQ tips and tricks, and also stay up to date on upcoming topics and events. All right. So, so far we've established that psychological safety is a key driver of productivity and engagement. So I think it's safe to say productivity and engagement of your teams are kind of the foundational driver to achieve both profitability and growth for any organization.

Sameer (07:58):

And I think what it's telling us is that when people aren't spending time and energy playing politics, hiding mistakes, navigating those toxic bosses, all in an effort to like self preserve, they can dedicate that time and energy to executing tasks, right? Which inevitably is gonna increase its productivity, increase profit. But Ismail, we keep alluding to, the investment companies need to be making to ensure that psychological safety of its team members is preserved. But I don't think we've really made the case for why it's so important, right? We talk about some of these factors, uh, that I just listed, but about executing more. But I think there's something deeper there. And so, you know, in your opinion, or from your perspective, why do companies need to make this investment?

Ismail (08:44):

That's a fair question. And you know, for me, I, I think it sort of relates to Maslow's hierarchy of needs. And so that says, once humans fulfill the need of food, water, and shelter, they're gonna, they're gonna seek out, you know, to be accepted for who they are. And then really, ultimately, they're gonna finally learn how to grow and become their best selves.

Sameer (09:06):

Maslow's hierarchy. I think that was probably my sophomore of high school, so thanks for jogging my memory on that. But no, that's absolutely true, and I think it's really applicable to business today, right? One of the challenges they face is as a world advances, right? We look at globalization, technology, basic human needs of food and water and shelter, those who are being satisfied for many, right? Not all right, but, but many. So now humans are turning their attention to that next tier of needs, which in this case is that sense of belonging and becoming, which Ismail just referenced. And so today, businesses are being asked to do so much more for their employees than ever before in human history, businesses are being really required to emotionally connect with their workforce.

Ismail (09:50):

And this is so different from generations past, right? Where you had to punch in, punch out, you collected your check that time culture, right? And, and so at work, like you did your work and then you went home and didn't even think about it.

Sameer (10:06):

I think it was a couple weeks ago, I was watching football with my dad. We were just talking about work, and we got into this discussion, right? He's been retired, retired now for about a decade. And he was commenting on the remote work culture and how back in his day if work got busy, he stayed in the office until the work got done. And he was comparing that to today's generation, right? That wants these really big salaries and a ton of flexibility. And then, you know, I had to kind of remind him that when he left the office back in his time, he had the luxury of disconnecting. And there are, as you know, no more physical boundaries of work, right? Today's workforce is reachable, it seems like 24/7. So it makes sense that when an employee is giving so much of self to work, that there's a responsibility on the part of the employer to care about that individual holistically, cultivate an emotional connection and support them emotionally.

Sameer (11:05):

And I think that there is absolutely an expectation from today's workforce to be supported in this way. It really isn't optional anymore for businesses to get on board with this metaphysical need of emotional connection and support. And I'll go as far as even saying that there's a mandate, right, from today's workforce to be supported holistically. And, you know, Glassdoor, um, employee reviews, the internet, social media, it definitely, you know, amplifies when companies are not supporting individuals in this way. And, you know, to really reach this much needed goal for companies, they need to be promoting high EQ people and high EQ policies into their business.

Ismail (11:53):

A hundred percent. I mean, I think this phenomenon that you're describing, like the blending of work life, they're putting the kibosh on these are putting, it's putting the kibosh on longstanding existing myths that emotions don't belong at the work, in the workplace. And for decades, it's caused leaders to believe they needed to be stoic or cold in the face of any displays of human emotions from their teams, right? But in reality, many businesses, I think they're starting to recognize that the counter approach is what's needed. And we're seeing more employers today leaning into the highly emotional aspects of their employees' lives. I'll give you an example like concrete in terms of how you can see this. So Hilton Hotels, they offer adoption assistance programs that'll reimburse team members something like $10,000 per child with no limit for the number of adoptions. I think Facebook offers employees 20 days of bereavement leave in the event of a family member's death. And I mean, these are things that are big changes. I think before it was either no days or five days, something like that, right? And especially since Covid reared its ugly head, organizations are having to make significant changes to how they approach their employees and EQ there.

Sameer (13:11):

Yep. No, no doubt. I feel you on that. And it, it seems like employees are seeking more and more from their employers, companies are shifting their focus to empowering, right? Instead of just simply employing, and they're finding that to be, you know, really fruitful for them. So I think, you know, emotions travel with us, the boundaries between work and life, they continue to blur right or wrong. People are bringing more work home and more personal life is then spilling back into work, right? We can try all we want. We can't flip a switch, can't leave our pain, our joy, sorrow, excitement all at the office door. It travels with us.

Ismail (13:51):

You know, I'd even go as far as asking now, like what office door?

Sameer (13:56):

Yeah. Yeah. Great point.

Ismail (13:58):

Look, the pandemic has created this wholesale change in business operations, and they're rethinking the importance and strategy of co-location of teams. Uh, remote work is here to stay. I think we all know that. And even more importantly, the pandemic has changed the landscape of how we view not only loneliness and depression, but just mental health in general, and accept it or not, this is gonna be an ongoing topic for quite some time. So keeping this in mind, the current moment represents a huge opportunity for leaders to lean into the concepts of eq. And this is just in order to reengage people at work and then ultimately sustain it.

Sameer (14:39):

Yeah, mental health challenges, I think especially our Gen Z workforce. Gen Z ages, 18 to 25. They have the highest prevalence of serious mental illness, more so than any other age group. I think I read it recently, it was a National Institute of Mental Health study. It said that Gen Z is the loneliest generation in the workplace, right? With 73% reporting that they sometimes or always feel alone. So, you know, it's really bad and it's a huge crisis. It's something that companies are gonna have to respond to.

Ismail (15:15):

And I know there's a cohort of listeners out there that are just gonna be completely panicking at the moment, but, you know, this group of people coming in is our future and Gen Z, they're lonely, they're psychologically stressed. And then the future sustainability of organizations, hinges on our ability to support our workforce emotionally. And this depends on whether leaders or institutions promote and prop up emotional intelligence.

Sameer (15:51):

Yep. And as well, I really think, you know, through this conversation, we've made the case for that. And, you know, I'd even go as far as to say the business case, right? For why fostering emotionally intelligent institutions and leaders is a valuable investment for companies and organizations that are looking to bolster their bottom line. The truth is that in today's work dynamics, EQ stands out as the differentiator that bridges the gap between traditional levers businesses have used to drive profitability and the levers that must be used today to achieve the same end goal of profitability and growth.

Ismail (16:28):

Yes, well put, well put. I mean, I think there's one last thing that I'll add before we wrap up here is that where the business case really drastically shifts in favor of prioritizing EQ is that that return on investment of prioritizing it is a multiple factorial. So what we're seeing is indisputable benefits of having EQ forward leaders principles, and ultimately creating a high EQ culture.

Sameer (16:56):

Agreed. I mean, a true symbiosis employees, you know, they're seeking out a trade of their time for monetary compensation, and they're increasingly measuring satisfaction by the amount of self-fulfillment they get in the office. It's no longer just the size of their paycheck. And so, while this might seem like it detracts from the pure altruism of eq, we're sitting here talking about supporting people emotionally and connecting with them, but then at the same time we're talking about how that is gonna drive the bottom line. Both are important, right? And that's kind of what we're trying to get at today. But it's really important that people understand and businesses understand that there is a true symbiosis between value-driven, meaningful work, and the retention, sustainability, and happiness of a business' workforce.

Ismail (17:47):

So for folks out there listening who are interested in some hard data to support the case for eq, uh, we're gonna go through some examples here. So, US Air Force reduced recruiter turnover from 35% annually to 5% annually by selecting high candidates in emotional intelligence. And that was a total cost savings of 3 million per year on just a $10,000 investment.

Sameer (18:12):

L'Oreal realized a $91,370 increase per head for salespeople selected for EQ skills. The group also had 63% less turnover than sales staff, not part of the EQ program.

Ismail (18:26):

AT&T participated in a large cross-industry study that found that in all levels of management from line supervisors to senior executives, increased emotional intelligence accounted for 20% more productivity than low EQ leaders. 91% of the top performers were high in EQ, while 26% of the low performers were high in EQ and emotional intelligence explained nearly 60% of job performance across companies in the study.

Sameer (18:53):

A multinational consulting firm measured the EQ of senior partners on emotional intelligence competencies. Partners high in EQ were responsible for 1.2 million more in profit each in their clients than low EQ partners. High EQ partners showed 139% gain in profit.

Ismail (19:15):

And, these are just a few of the case studies that we've read here, but if you're interested in more, feel free to reach out to us. You can find all the ways to contact us in the show notes below. Thank you so much for listening. The show really wouldn't be possible without you. If you're a fan of the show, please take a look at the show notes where you can find more information about the podcast and information that can support you as well as how you can support us.

Sameer (19:41):

Definitely. Thank you Ismail, and thank you everyone who listened until our next episode, I'll leave you with this quote from Maya Angelou. People will forget what you said. People will forget what you did, but people will never forget how you made them feel.