One of the important skills that entrepreneurs must develop is effective decision making. This is true not only because some of the decisions they are called upon to make could affect their business in
significant ways, but also because entrepreneurs make hundreds of decisions throughout any given day and usually those decisions are made quickly, almost instinctively. Any one of those decisions could negatively affect the business.
Would you be surprised to learn that effective decision making is not simply a rational, logical, objective process—that it does in fact include emotion? Introducing emotion into decision making doesn’t mean that we make the best decisions when we’re angry, afraid, or even extremely happy. What it means is that emotion is a kind of moral compass that fundamentally affects the way we make decisions. In fact, Jennifer George wrote in an article in Human Relations in 2000 that neurological research has found that people who don’t have the part of their brains that manages emotions tend to make very bad decisions. One could argue that sociopathic criminals fall into that category since they lack the emotional intelligence needed to make wise decisions.
So what is emotional intelligence? It’s your ability to combine emotions and reasoning to make effective decisions. Why is this important? Because we now know that when it comes to performance, emotional intelligence contributes more to success than either your technical or cognitive skills. One of the gurus in the area of emotional intelligence is Daniel Goleman (Check out his book Working with Emotional Intelligence – he also has a 2011 book out called The Brain and Emotional Intelligence: New Insights). Goleman finds that emotional intelligence accounts for 90% of the difference between average and high performers! If that doesn’t get your attention, then try this. When management teams achieved a critical mass of EI, they exceeded their earnings goals by 20%, while those who did not have that critical mass, undershot their goals by nearly the same amount.
Back in
March of 2010, I wrote about the JPL team that successfully landed two Mars Rovers on the surface of the planet after a crushing failure with the Mars Polar Lander mission in 2000. Although their technical achievements were spectacular, the real reason the team succeeded this time was the critical mass of emotional intelligence they had developed. They believed in each other—they were emotionally connected—they would not let each other down. Every decision had an emotional component.
Starting a business is an emotional experience; if you’re a glass-half-full kind of person, you are more likely to spot opportunity where others don’t. If you’re enthusiastic about your business, you increase your chances of securing funding and partners. If you have empathy with customers and your employees, you’ll have a better chance of creating a loyal following. Your emotional intelligence plays into every decision you make.
The next time you have to make an important decision, pause for a few seconds and ask yourself the following questions:
- What kind of mood am I am in and how will that affect my decision?
- How do I feel about the person I’m dealing with?
- Do I have a bias toward success or failure in my decision making on this issue?
- Have I considered all the alternatives?
Don't shy away from your feelings--use them to your advantage!
