The management dilemma: IQ or EQ?

Before we can jump into a discussion of IQ vs EQ, first we need to put the term “manager” into perspective. In my view, the manager is a person who is adept in a certain field due to past work experience, but whose main task within the organisation is to drive results (improvement, innovation or invention) through placing the right people into the right positions, collaborative empowerment of teams, shielding the productive core team from stakeholder deviations, coaching employees to foster personal growth, basically setting the fruitful ground for making things happen. There is no necessity for the manager to be a specialist in the working field, as he/she is capable of putting specialists into work.

Where we come from

Management philosophies from the beginning to the mid 19th century were highly focused on number driven process intelligence, economies of scale, building cheaper and increasing productivity as much as possible with as little input as possible. This approach was new; fuelled by technology along with first attempts at automation. The result? Cumulated wealth for people who more often than not had good educational background. The interesting historical fact is that this shift in economy impacted the educational system focus. Schools were financed by companies or philanthropists in order to build and grow the next generation of managers. Sponsorships through company foundations, corporates and philanthropists are amongst the top five sources for financial support of educational top institutes including Harvard (Rockefeller), Wharton, Stanford (founder Leland Stanford himself was a railway tycoon) and WHU in Germany just to name a notable few. On top of that, tests like IQ — Tests (with all its variations), assessment centers or interviews which focus on mathematical and processual skills to try to figure out whether you are left brain intelligent (physics, maths, rational thinking → more “intelligent”), and thus suitable for management positions.

Where we are heading to

The more technology improves in the field of AI, take over automated processes and self improvement by learning from data, the more important handling strategic decisions as well as internal and external stakeholder management will become (see similar view on automation in the a16z podcast by Andreessen / Horrowitz). In their yearly publication, the World Economic Forum describes the shift in required skill sets of employees and managers between 2015 and 2020.

“Creativity will become one of the top three skills workers will need. With the avalanche of new products, new technologies and new ways of working, workers are going to have to become more creative in order to benefit from these changes.
Robots may help us get to where we want to be faster, but they can’t be as creative as humans (yet).”

The more we let computers run the “boring” line work, the more time managers will have for forward thinking and creative tasks, which are necessary for innovation and invention. The more time they will have for leading teams in their innovation process. And maybe we can get away from managing teams.

Some studies say that..

“(…)managers who are seen as good at listening to others and gaining their input before implementing change are likely to be assessed as good at cooperating with others, able to find pleasure in life, able to foster relationships, control impulses, and understand their own emotions and the emotions of others”

But there is an interesting situation to be found in companies as described by Tim Bradberry from

“The higher you go above middle management, the more companies focus on metrics to make hiring and promotion decisions. While these bottom-line indicators are important, it’s shortsighted to make someone a senior leader solely because of recent monetary achievements. Even worse than metrics, companies also promote leaders for their knowledge and tenure, rather than their skill in inspiring others to excel. Companies sell themselves short by selecting leaders who aren’t well-rounded enough to perform at the highest levels for the long term.”

IQ or EQ?

The first pieces on emotional intelligence were published around 1990s by two psychology professors, John D. Mayer of UNH and Peter Salovey of Yale. They defined emotional intelligence as the ability to describe your own emotional status quo (also called mindsight), show empathy with peers and use this understanding to derive positive results in relationships — both work and private.

Although the topic is relatively new and the official definition of the term “emotional intelligence” is still to be agreed upon (there are endless discussions and critics around that topic this is one of the better ones by Tim Casasola or Rity Upadhyaya on emotional intelligence in product management), the core captures one important aspect of leadership: the ability to put different opinions into perspective, actively listen to ideas without neglecting them from the very beginning ( this is something that happens too often as others ideas are not yours and therefore cause stress reactions) and the willingness to put other people in the driver seat on occasion.

Will emotional intelligence help drive innovation? I believe so. Will managers who use their empathy (towards others) and mindsight (towards themselves), be more successful, create a happier working environment and thus more output? I think so. Will companies benefit midterm from managers who are not solely interested in the growth of their own pay check? For sure. Do companies invest enough in leadership training to foster this development in mid and C-Level management? Not yet.

“It’s the intersection of the two. But, if you put a gun to my head to lean one way, I’d lean EQ.”

Coming back to the initial topic, there is no questioning deep knowledge of powerful leaders, but that develops along with education and work experience. It’s about time to focus on leadership, teams and individuals, growing emotional intelligence and flair of their leaders. Investing into that field will become more relevant for businesses than ever before.

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