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10.13007/217
Ideas for Leaders #217
Decision-Making With Emotional
Intelligence
Key Concept
Decisions, especially decisions involving risk, are often guided by emotions,
such as anxiety, that in fact emerge from completely unrelated events.
Emotionally intelligent leaders are less likely to make a mistake with
“incidental” anxiety because they recognize the irrelevant source of their
emotions. Leaders can also help others reduce the impact of incidental
anxiety by simply pointing out the true source of their emotions.
Idea Summary
Emotional intelligence — the awareness and understanding of emotions —
has a variety of workplace applications and benefits. Leaders who perceive
and relate to the emotions of those they direct are going to be seen as more
caring and understanding leaders. Leaders who can better manage their own
emotions will also develop more positive relationships with subordinates and
superiors. Finally, emotionally intelligent negotiators have been proven to be
more effective.
One important facet of emotional intelligence is not only the ability to perceive
and attend to the existence of emotions but also the ability to understand the
sources of these emotions. “Emotion-understanding ability” allows you to
analyse the cause-and-effect relationships between emotions and events,
both backward (identifying the past event that caused the current emotion)
and forward (predicting the emotions that will result from current or future
events).
This ability is neither as obvious nor prevalent as it may sound. Many of us
attribute our emotions to the wrong causes. For example, imagine an investor
who is involved in a car accident on his way to work. If he has low emotion-
understanding ability, he might attribute his anxiety to an upcoming business
meeting instead of to its correct cause, the car accident.
This anxiety is an example of an “incidental” emotion — an emotion that
arises out of environmental factors, whatever they may be, and is unrelated to
the current decision or situation. In their research, Jeremy Yip of Yale
University’s Centre for Emotional Intelligence, and Stéphane Côté of the
University of Toronto’s Rotman School of Management, used experiments
involving incidental emotions to show that emotion-understanding ability
facilitates decision-making.
The experiments built on previous research that showed the negative effects
of incidental anxiety — as exemplified in the investor story above — on risk-
taking. People are less willing to take risks because of anxiety that is
unrelated to the risk.
Authors
Côté, Stéphane
Yip, Jeremy
Institutions
University of Toronto Rotman School of
Management
Yale University
Source
Psychological Science
Idea conceived
January 2013
Idea posted
September 2013
DOI number
Subject
Leadership
Decision Making
Emotional Intelligence
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In their first experiment, Yip and Côté demonstrated that participants with
lower emotional-understanding ability let incidental anxiety negatively impact
their risk-taking more than participants with higher emotional-understanding
ability. Their second experiment revealed the why of the first experiment
results: Yip and Côté proved that lower emotional-understanding ability
increased the negative impact of incidental anxiety because participants didn’t
understand the source of their anxiety. Once participants with lower
emotional-understanding ability were told their anxiety was irrelevant to the
decision, the effect of incidental anxiety on the decision decreased.
Business Application
Emotional Intelligence has been front and centre in the leadership
conversation since the publication of Daniel Goleman’s groundbreaking
bestseller, Emotional Intelligence. This new research, however, shines a light
on a facet of emotional intelligence that is often ignored, and yet has
important leadership and professional development implications.
Leaders must not allow incidental emotions to colour their decision-making,
especially involving risks. Leaders are often warned to pay attention to
assumptions and biases. This research helps leaders address “affect-driven”
biases — biases that emerge from incidental emotions and impact decision-
making. Heading into a meeting that involves some major decisions, the
anxious investor we met earlier is less likely to take risks, even calculated
risks, precisely because of his anxious state. If before the big meeting,
however, he explicitly recognizes that his anxiety is related to the car accident
(because he’s wondering how he’s going to pay for the damages and what
will be the impact on his insurance rate), he will not let that anxiety guide his
decisions or attitude in the meeting.
Leaders must also help their subordinates, whether employees or managers,
to disarm affect-driven bias. Identify those with lower emotional intelligence
and point out the root cause(s) of the emotions that are impacting their
decision-making capabilities.
Further Reading
“The Emotionally Intelligent Decision Maker: Emotion-Understanding
Ability Reduces the Effect of Incidental Anxiety on Risk Taking,” Jeremy
A. Yip and Stéphane Côté, Psychological Science, January
2013. DOI: 10.1177/0956797612450031
Further Relevant Resources
Stéphane Côté’s profile at Rotman School of Management
Jeremy Yip’s profile at Yale Centre for Emotional Intelligence
Rotman School of Management Executive Education profile at IEDP
© Copyright IEDP Ideas for Leaders 2013
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