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5 Reasons Why Companies Are Investing in Emotional Intelligence

How long do skills last in today’s market? One study shows that 78% of executives believe hard skills have a shelf life of less than five years. Another study was even bleaker, showing that half of all skills will be outdated within two years. In light of these rapid changes, emotional intelligence (EI) training is becoming that much more important as an enduring skill that will power people and companies through the next several years.

Indeed, studies like Microsoft’s Work Trend Index and the World Economic Forum’s Future of Jobs Report are increasingly putting a higher premium on emotion-powered skills. 

In this article, we’ll explore the top five reasons why companies are investing in emotional intelligence training and how it’s transforming the way businesses operate.

1. Driving Successful Business Transformation

One of the primary reasons companies are pouring resources into emotional intelligence training is to enhance their ability to successfully navigate business transformations. Currently, 89% of large companies are undergoing digital transformation. But only 31% of board directors say they have seen the expected revenue lift. And only 25% have seen the expected cost savings.

The missing link? Emotional intelligence.

Business transformations are inherently disruptive, often causing stress, uncertainty, and resistance among employees. Companies that focus solely on the cognitive and logical aspects of change management miss the mark. Emotional intelligence plays a crucial role in sensing and managing the emotional undercurrents that can make or break a transformation. In fact, a study from Oxford University’s Said School of Business found that leaders that prioritize emotions in transformation are 2.6 times more likely to be successful than those who don’t. And when a transformation is going poorly, the emotional strain on the workforce increases 136%.

Investing in emotional intelligence training helps leaders develop the skills to identify when emotions are heading south and take corrective actions. By fostering a workplace culture that values emotional awareness and resilience, companies are better equipped to manage the human side of change, ultimately leading to more successful transformations.

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2. Enhancing Team Performance

Teamwork has always been a cornerstone of business success, but in today’s project-based work environment, it’s more critical than ever. As companies continue to wrestle to find the right approach to remote, in-person, or hybrid work models, one core concern is at the center: team collaboration. As projects become increasingly complex to manage, requiring diverse expertise and skill sets, emotional intelligence is at the heart of team success.

Research from Google’s Project Aristotle found that the most successful teams weren’t necessarily the ones with the most technically skilled members. Instead, they were the teams where members had equal opportunities to contribute, were sensitive to each other’s emotions, and fostered an environment of psychological safety. In other words, emotional intelligence was a stronger predictor of team success than technical expertise.

By investing in emotional intelligence training, companies are empowering their teams to communicate more effectively, resolve conflicts amicably, and build trust. These skills are essential for creating a work environment where team members feel valued, respected, and motivated to contribute their best. In turn, this leads to higher productivity, innovation, and overall team performance.

3. Preparing for the AI Revolution

Artificial Intelligence (AI) is rapidly transforming industries, taking over tasks that once required human intervention. By 2030, AI is expected to handle tasks that currently account for 30% of the worked hours in the U.S. economy. While this shift brings about new opportunities, it also underscores the importance of uniquely human skills, such as empathy, relationship-building, and emotional intelligence.

As AI continues to handle more routine tasks, the value of human workers will increasingly lie in their ability to connect with others on an emotional level. Companies that invest in emotional intelligence training are preparing their workforce for this new reality. Employees who are skilled in EI are better equipped to understand and meet the emotional needs of customers and colleagues, making them indispensable in an AI-driven world.

Moreover, as organizations integrate AI into their operations, they must do so in a way that considers the emotional impact on employees. Fear and anxiety about job security are common emotions associated with AI adoption. Leaders with high emotional intelligence can coach their teams effectively, ensuring a smoother transition and higher employee engagement.

Text that says "by 2030, AI will handle tasks that currently account for 30% of working hours today" next to a circle chart indicating 30% with AI-line graphics in the background. Right side has line drawing of two people talking with text "that's why it's so important that companies create their competitive edge through the human side of work."

4. Building Leadership Readiness

The business landscape is becoming more complex and ambiguous, making effective leadership more challenging than ever. According to a study by DDI, confidence in leadership bench strength has declined by 33% since 2011. This decline highlights a growing trust gap between employees and their leaders, driven in part by leaders’ inability to navigate the emotional complexities of modern work environments.

Emotional intelligence is a critical component of effective leadership. Leaders who possess high emotional intelligence are better able to connect with their teams, understand their concerns, and lead with empathy. This builds trust, fosters a positive work environment, and enhances the overall effectiveness of the organization.

Companies are investing in emotional intelligence training to ensure their leaders are equipped to handle the challenges of today’s business world. By developing self-awareness, empathy, and emotional regulation skills, leaders can inspire confidence and trust in their teams, leading to higher levels of employee engagement and better business outcomes.

5. Bridging Generational Gaps

For the first time in history, there are five different generations working side by side in the workplace. This generational diversity brings unique perspectives, but it also presents challenges in communication and collaboration. Emotional intelligence is the key to bridging these gaps and creating a cohesive work environment.

Each generation has been shaped by different experiences and values, leading to varying expectations and communication styles. For example, Gen Z, the newest generation to enter the workforce, places a high value on emotional safety and mental health. They also are more likely to struggle with mental health challenges. In fact, 40% of Gen Z have been diagnosed with anxiety and 45% with depression, rates which are 2-3 times of older generations. Furthermore, 73% of Gen Z workers report loneliness. They are more likely to openly discuss their emotional well-being and expect their employers to prioritize it as well.

Investing in emotional intelligence training helps companies create an inclusive work culture that respects and values the contributions of all generations. It equips employees with the skills to navigate differences, build strong relationships, and work together effectively. This not only improves workplace harmony but also boosts employee satisfaction and retention.

Text has three statistics that say "among gen x workers, 40% have been diagnosed with anxiety. 45% struggle with depression. 73% are lonely at work. Why is why company leaders need to be prepared to have better conversations about emotional health."

The ROI of Emotional Intelligence Training

Emotional intelligence is a core skill that powers every other skill. It enables us to recognize and manage our emotions to make better decisions. It enables us to deeply collaborate with others while leveraging AI to produce an output unsurpassed in the market. Above all, emotional intelligence enables us to build resilience and a learning mindset as the world changes around at a dizzying pace. 

In fact, it’s nearly impossible to master the other skills required for success without strong sense of EI. A meta study on the effects of emotional intelligence on career success found a strong correlation between high EQ and job success. The study showed that high-eq people were significantly more engaged at work, had higher job evaluations, experimented more, and engaged in fewer counterproductive work behaviors. And frankly: They were also a lot happier at work. 

Because of its foundational nature, it can be challenging to measure the precise ROI on emotional intelligence training. Estimates across the market range from a powerful 1484% return on investment to more modest gains around 200% or 300%.

By prioritizing emotional intelligence, organizations can create a more resilient, adaptive, and high-performing workforce. In a world where change is constant and human connection is more important than ever, emotional intelligence is the key to staying competitive and thriving in the modern business landscape.

Invest in emotional intelligence training today, and watch your company transform into a more successful, empathetic, and emotionally intelligent organization.


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