Emotional Intelligence and Leadership: Why EQ Makes a Better Leader

Emotional intelligence, or EQ as it is often referred to, is widely recognized as a critical attribute in a successful leader. Leaders with emotional intelligence are astutely in sync with themselves and the emotions of others, which gives them a solid awareness of how those around them feel. This awareness is a valuable asset for leading a group of people.

Emotional intelligence is defined as the ability to recognize, interpret, and respond to emotions and cope with stress in the present moment and consciousness of how your words and actions influence others both positively and negatively. Five characteristics of emotional intelligence for leadership are self-awareness, self-management, empathy, relationship management, and effective communication.

emotional intelligence
Image courtesy of Management 30

What are leaders?

Before we jump into the topic of EQ, let’s take a step back to look at leadership. A historical shift occurred over the last few decades that transformed the entire notion of what a leader is that mirrors the transformation of thought from workers as replaceable cogs in a wheel to irreplaceable determinants of organizational success.

Production era

During the production era from about 1860 to 1930, organizations focused on manufacturing products to satisfy the growing demand of a burgeoning middle class. Most workers in these factories, mines, and infrastructure projects like the railroad were immigrants fleeing famine or worse. Many didn’t have a firm grasp of English or any skills other than the strength of their backs. If a worker left, there were literally hundreds begging to fill the job.

Leaders were fundamentally unconcerned about their workers and expected a fair day’s work for an unfair day’s pay. Leaders (bosses) gave orders and workers either performed or were replaced quickly by those who would.

Marketing era

As the production era gave way to the sales era and, later, the marketing era, the availability of workers declined, especially during the world wars when able-bodied men served in Europe, Africa, and Asia. Moreover, businesses transformed from low-skill jobs in manufacturing and other types of manual labor to jobs demanding higher skill levels and relying more heavily on worker productivity gains that weren’t as easy to demand. Jobs were no longer solitary, with workers performing isolated tasks on an assembly line, but requiring coordinated efforts across workers to achieve more complex goals.

Of course, changes in the nature of work weren’t the only shift during this era. The union was born at this time, transferring some power from the organization and its leaders to the workers. Now, counteracting the organization’s efforts to exploit workers, unions successfully forced higher pay and better working conditions for workers.

This required a leader who could inspire workers toward their best efforts and build collaboration.

Digital era

As jobs became more complex, requiring the use of technology and other skill-based tasks, and collaboration spread from internal employees to building relationships with supply chain partners and customers, employees became the difference between success and failure for a business. Customers also changed in the digital era. They no longer purchased products based solely on price but considered shared values in making purchase decisions. How a company treated its workers (and society as a whole) gained traction as a tool for driving purchase decisions, as you can see below.

corporate social responsibility
Image courtesy of Customer Insight Group

For instance, reports regarding the treatment of Amazon workers by the company led many consumers to turn away from the brand or, at least, reduce their purchases from the e-commerce giant. On Amazon Prime Day, boycotters went so far as to march past Bezos’s house (he owns a majority share in the company) to protest the treatment of workers, tax avoidance, and other social issues. Of course, the unethical treatment of workers also spawned fresh unionization efforts to counteract the treatment. Despite their value to workers, unions reduce the flexibility of the firm to adapt to change, as happened in the 1970s and caused the collapse of the US steel manufacturing industry.

By managing workers in an equitable manner, you both achieve organizational goals and reduce the potential for the emergence of collective bargaining.

Modern leadership

Both leadership style and organizational structure required a major update to accommodate this shift in work. And, the modern leader was born.

No longer were organizations led from the top down but run as a partnership between the organization and the workers. A great example of this comes from Johnsonville Sausage Company, an old-line manufacturer full of unskilled labor. Stayer, who owned Johnsonville, embraced the concepts of servant leadership where leaders are cheerleaders and coaches rather than all-knowing bosses.

Stayer instituted the following changes leading to both increased productivity and profits:

  • A meaningful profit-sharing plan allowed workers to share in the profits produced by their labors to encourage higher productivity
  • Workers received wage increases by taking on more responsibility and learning new skills
  • The company paid for workers to learn (anything, not just job skills) and contribute to their communities (with time off)
  • Everyone with a good idea was encouraged to share and develop the idea, then receive profits when their idea paid off
  • Workers took ownership of problems, as those closest to the problem. They were charged with determining the cause and developing the solution
  • And more

Why EQ leaders are more effective

Now that we have this history under our belts, it’s easier to see how modern leadership fits with a leader who possesses EQ. A leader who understands what it is to be a modern leader who values his/her employees, strives to engage the with the business and its outcomes, and works to hire, train, and retain the right workers knows the importance of understanding their employees at a deeper, more emotional level, while keeping his/her emotions in check to avoid acting on them to the detriment of the business.

In today’s economy, where worker shortages are rampant, it’s even more critical to retain your best workers and encourage all your workers to pull together for the common good. These shortages crippled our supply chains, resulted in serious stock-outs (for instance baby formula), and exasperated safety issues (such as shortages of healthcare workers and first responders).

When you connect with your fundamental emotions, embrace them, and know how they affect your decisions and behaviors, you become emotionally independent and obtain the traits that allow you to understand how emotions affect those around you. According to Daniel Goleman,

80%-90% of the competencies that differentiate top performers are in the domain of emotional intelligence.

Understanding the impact of emotional intelligence on workplace performance for those who report to you and the behaviors and problems accompanying their emotional state is a tremendous asset in establishing a great team. For example, one of the typical causes of high turnover is a lack of effective communication, resulting in disengagement and skepticism.

A leader who lacks emotional intelligence can not accurately assess the needs, desires, and expectations of those under their supervision. Those in leadership positions who respond to their emotions without keeping them in check might foster mistrust among their employees and harm their professional relationships to a significant degree. It is possible that reacting with irregular emotions will spoil the entire corporate ethos, attitudes, and good feelings for the firm and its mission. Self-awareness and understanding of how the leader’s verbal and nonverbal communication affects the team is an essential characteristic of influential leaders.

To better understand the emotional intelligence competencies required for effective leadership, assess your position on the listed factors below. You can also use a Myers Briggs Test Indicator, which provides a better idea overall of your personality type, although many experts discount the results obtained through this instrument as inconsistent and inaccurate.

Characteristics of EQ leaders


This is characterized as the ability to perceive one’s own emotions, strengths, weaknesses, values, and drivers and the ability to understand the impact of those emotions, strengths, and drivers on others.

We cannot wholly understand ourselves unless we take the time to reflect on who we are, why we make certain decisions, what we do well, and where we fall short. To attain your full potential, you need confidence in your abilities and acceptance of both your personality’s good and the bad aspects. You can improve your EQ through introspection and reevaluation on a routine basis.


Discipline is another term for self-regulation. Managing or diverting our disruptive emotions and responding to changing situations are all necessary to keep the team moving positively.

Leaders can not afford to lose their composure under pressure. Panic is infectious, just as exuding calm. The moment you take on a leadership position, you can no longer afford to worry when things get tough. By remaining calm and positive, you think more clearly and communicate more effectively with your colleagues.

Compassion and empathy

Being able to put yourself in someone else’s position and comprehend how they might feel or behave in a particular circumstance is known as empathy. When someone possesses empathy, they feel compassion for others because they take time to understand how they would feel and respond to a particular set of actions. For example, understanding leads us to want to help others in reaction to their pain.

The greater our ability to empathize with others, the better we are at determining what inspires or bothers them.

Relationship management

It is impossible to form meaningful connections with others when you are distracted. Even though many of us have families, other responsibilities, and a seemingly endless to-do list, cultivating and sustaining healthy and productive connections is critical to one’s potential to develop greater levels of emotional intelligence.

It takes the capacity to communicate effectively and manage relationships successfully to move a group of individuals in the right direction.

Effective communication

Communication is of the utmost significance in every situation. Yet, according to studies, effective communication is only 7 percent dependent on the words we use and 93 percent dependent on our tone and body language.

In most cases, misunderstandings and a lack of communication are the root causes of disagreements. Employees become frustrated, resentful, and confused when they cannot communicate properly on the job. In the workplace, effective communication can help to minimize hurdles and build stronger working connections. There is a sense of value and success among employees when they know their position within the organization and understand how their contributions contribute to the end direction and goal. Effective communication results in coherence and a sense of shared purpose among all parties involved.

Emotional intelligence (EQ) is a must-have for any leader, a powerful tool for exceeding goals, enhancing meaningful work relationships, and creating a healthy, productive workplace and organizational culture; emotional intelligence (EQ) is a must-have for any leader.

Benefits of emotional intelligence in leadership

A lot of research on emotional intelligence (EQ) found that companies perform better in a variety of categories when there is high emotional intelligence, including:

  • Increased profits for the business
  • Increased earnings for individual employees
  • Less time lost because of accidents
  • Lower turnover of employees
  • Faster career advancement

What enterprise would not want these advantages for their employees and customers? But, aside from that, when you successfully find leaders with high emotional intelligence, such leaders automatically assist in developing those talents in those around them.

Leaders who are emotionally intelligent help to develop emotionally intelligent teams. A positive feedback loop is created when high EQ leaders generate happier and more successful employees, fostering a culture of engagement where people want to remain and offer their time and talents.

As a result, firms with high levels of emotional intelligence in their leadership function more efficiently, effectively, and profitably than their counterparts.

And the good news is that once you get it going, it tends to become a continuous cycle that continues to feed on itself as time passes.

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