“Having more empathy is one of the most powerful things I can do to improve as a leader.” Dan Price, CEO of Gravity Payments.
Gravity Payments is the US-based company that generated a tsunamic reaction of over 500 million interactions on social media in 2011 when Price established a US$70,000 minimum wage for his employees. “I want the scorecard we have as business leaders to be not about money but about purpose, impact, and service,” he said.
Most recently, due to the Coronavirus pandemic, the company’s revenue has halved. Price was faced with a grave decision: lay off 20% of his employees or go bankrupt. Most companies across the globe have stood down a large proportion of their staff or have had to close down. What Price did was display an exceptional level of emotional intelligence and stay in business – he went to his employees for help.
And what happened is a lesson in true leadership.
As a result of COVID-19, Gravity Payments lost half of its $4 million monthly revenue and had 4 - 6 months until bankruptcy. Price and Gravity COO Tammi Kroll scheduled 40 hour-long meetings with small groups of employees to check in and gather ideas.
When they discussed the situation with their employees, the team volunteered pay cuts that would help get them through 8 - 12 months, with no layoffs. All senior leaders did the same.
Price’s approach to dealing with his company’s financial challenges demonstrates a strong example of emotional intelligence – also known as emotional quotient (EQ).
What is emotional intelligence?
EQ is the ability to identify, understand, and manage emotions. It’s the ability to listen to what is being said and understand the meaning behind the words – and to respond with empathy. It’s about making emotions work for you, not against you.
Emotions can have such a positive or negative effect on your ability to inspire and lead a team.
Many try to shut off their feelings but as much as we distort, deny, and bury our emotions and memories, we can’t ever eliminate them. Without this understanding, it can affect the way we act, and react to others. In turn, this causes miscommunication, frustration, anxiety and even anger within your team.
The 5 components of EQ
Emotional intelligence for leadership consists of five key attributes:
- relationship management, and
- effective communication
To develop emotional intelligence, we must connect to our core emotions, accept them, and be aware of how they then affect our decisions and actions.
How to develop emotional intelligence
- Self-Assessment. Take the time to recognise your own emotions, strengths, weaknesses, values and drivers and understand how they impact others.
- Discipline. Control or redirect your disruptive emotions and adapt to changing circumstances to keep your team moving in a positive direction. Being calm is contagious, and so is panic. In a leadership role, you cannot afford to panic when things get stressful. By staying calm and positive you’ll be able to communicate more clearly with your team.
- Empathy and Compassion. Put yourself in someone else’s shoes and understand how they may feel or react to certain situations. With empathy, the capacity to feel compassion is wide open. And the emotion we feel in response to suffering motivates a desire within us to help.
- Relationship Management. Most of us have families, important obligations, and a crazy to-do list but taking time to build and maintain healthy and productive relationships helps us to gain greater EQ. When your team feel they are understood, this facilitates positive relationships.
- Effective Communication. Communication is of utmost importance. Dr Albert Mehrabian, Professor Emeritus of Psychology at the University of California, Los Angeles, is an expert on the relative importance of verbal and nonverbal messages. His studies have shown that effective communication is 7% of the words we say and 93% is tone and body language.
Misunderstandings and lack of communication are the basis of most problems between most people. Failing to communicate effectively in a workplace leads to frustration, confusion and bitterness. Effective communication encourages strong workplace relationships.
Good, clear communication also enables alignment and a shared sense of purpose as demonstrated by the recent actions of Gravity CEO, Dan Price.
Emotional intelligence is a powerful tool, critical for improving our work relationships, and creating a healthy, productive workplace and organisational culture.
How are you relating to your colleagues and managing your teams at work? And have you changed your approach since COVID-19 began?
Jane Jackson is a Career Management Coach and can be contacted here. To build your self-confidence during stressful times, Jane’s How to Build Confidence online program will guide you step by step to manage stress, develop confidence and resilience.