Artificial intelligence (AI) has improved the way we run businesses. For example, the tech has made market trend prediction quite straightforward. However, regardless of its growing importance, it still lags behind in emotional intelligence (EI).
Nothing comes close to the efficiency of AI when it comes to data analysis and interpretation. However, the tech lacks the ability to comprehend/navigate human emotions and relationships. This limitation makes it ineffective for core business areas like workplace culture and customer relations. Today, we will cover the importance of emotional intelligence in business. But first, let’s define what it is.
What is Emotional Intelligence?
In the simplest terms, emotional intelligence is the ability to recognise, comprehend and manage your own emotions while considering the emotions of others as well. It is a very important skill for developing meaningful understanding between people. If you can’t understand what the other person is feeling, there are very low chances you will stand on the same ground.
We cannot overstate the importance of emotional intelligence in a modern business. Even though AI is slowly taking over from people, customer relations is still an area uniquely reserved for humans. But what roles does emotional intelligence play?
The Role of Emotional Intelligence in Business
Leadership and Decision Making
In business, emotional intelligence is an important tool for strengthening leadership and improving decision-making skills. That is because it equips leaders with self-awareness and empathy, which affords them the ability to make sound judgements. Such leaders are also more in tune with their emotions, biases and stress triggers, which means they can make rational decisions based on objectivity rather than impulse.
We all know that AI is quite proficient when it comes to providing data-driven insights. However, regardless of this, leaders still require the right skills for AI-driven business (such as emotional intelligence) to make sense and implement the insights to drive the business forward.
Creativity and innovation
Another importance of emotional intelligence in the workplace is promoting creativity and innovation. It goes without mentioning but, creativity and innovation are the keys to both survival and expansion of any business. Emotional intelligence is a crucial ingredient for creating a risk-taking and open-minded culture within the work environment.
With emotional intelligence, leaders are able to create a safe space where employees feel emboldened to share their ideas without fear of criticism. Employees, at the same time, become more confident in presenting these innovative concepts to their bosses. Such openness encourages experimentation, which is a key step in efforts towards innovation.
Customer Relations and Brand Loyalty
As mentioned earlier, EI is about understanding both your emotions and those of others (customers who rely on your business for goods and services). That said, emotional intelligence enables employees to read customer emotions, concerns and tone, which allows them to tailor experiences more effectively.
By enabling employees to personalise experiences, emotional intelligence ensures each customer feels heard, appreciated and valued. In other words, it promotes customer satisfaction, which is one of the main building blocks of brand loyalty.
Communication and Conflict Resolution
Emotional intelligence also helps promote effective communication and conflict resolution within the workplace. But how?
Since emotionally intelligent people are more in tune with the emotions of others, they listen to understand and not just respond. That way, conversations are clearer and more meaningful, whether within or across the ranks.
In addition, emotional intelligence also brings empathy to communications. It ensures each party recognises and validates the emotions of the other. That helps diffuse tension and ensures messages shared are received positively.
Last but not least, emotional intelligence also helps individuals manage their emotions more effectively. Proper management of emotions is essential for staying composed, even under immense pressure, which may help prevent conflicts from escalating unnecessarily.
Positive Workplace Culture
Emotional intelligence also plays a crucial role in creating a positive workplace environment. That is a crucial factor for the success of any business.
Leaders with emotional intelligence can create a culture of trust and respect that trickles down to the employees. For the employees, that creates a sense of being valued, which boosts their morale and motivation to improve in their respective roles.
Emotional intelligence also promotes collaboration within and across departments. As we’ve already mentioned, emotionally intelligent people are better at communicating and calming unnecessary tensions that could hamper the chances of teamwork. Such a collaborative workplace can ensure lower risks of stress among employees, and thus minimises the risk of burnout and creates a healthy work-life balance.
Conclusion: The Irreplaceable Role of Emotional Intelligence in Business
- Ethical reasoning – AI is a rigid system that sticks to set guidelines. Unlike emotionally intelligent humans who have the capabilities to navigate moral dilemmas and make ethical considerations before making any decisions.
- Self-awareness – People also possess the ability to recognise their biases and adjust their behaviours after self-reflection. That is something you cannot replicate with an AI system.
- Human connection – Empathy and emotional bonds with others are the building blocks of strong customer relationships. Unfortunately, AI lacks these two, making it quite ineffective when it comes to customer relations.
There is no doubt that AI has transformed the business world. However, emotional intelligence remains irreplaceable. That said, it is essential to note that both AI and EI offer the best results when used together. For that reason, leaders must cultivate a workplace that is adaptive, harmonious and emotionally aware. Institutions like ESCP Business School are perfect for training leaders on how to get the best of both AI and EI in a business setting.
