"EI"

Most people recognise the term "IQ" and understand that it refers to a person's "Intelligence Quotient": that is, it measures "how clever they are." Intelligence literally means "information" - but in assessing "cleverness" the best recognised IQ measures (Wexler and Stanford-Binet) measure much more than just "how much you know."

The most authoritative assessments of IQ break intellectual competence into basic areas: language skills, logic, memory and visuo-spatial skills. Also factored into most IQ tests is the component of time: both speed of recall and the rate at which subjects can work out solutions to problems.

When it comes to EI (Emotional Intelligence), most of us now recognise the notion of a concept parallel to the "intelligence" of IQ, but concerned with feelings rather than intellect. But saying that a "high EQ means you're clever at feelings" goes about as far as equating high IQ with just "being clever." In other words, there is more to EI than a useful but vague notion that you can be "good with emotions independently of intellect" - or, to paraphrase one authority's succinct illustration: "You can be optimistic without being intelligent."

A simple, practical definition of Emotional Intelligence is: "The capacity for recognising our own feelings and those of others, for motivating ourselves and for managing emotions in ourselves and others." (Daniel Goleman, ‘Emotional Intelligence') Harding & Yorke would paraphrase this as "putting Empathy into action"!

John D. Mayer, in "What Is Emotional Intelligence?" defines EI thus: "Emotional intelligence represents an ability to validly reason with emotions and to use emotions to enhance thought... it includes the abilities to accurately perceive emotions, to access and generate emotions so as to assist thought, to understand emotions and emotional knowledge, and to reflectively regulate emotions so as to promote emotional and intellectual growth."  (Mayer, Salovey, & Caruso, 2004, p. 197).

Emotional intelligence further refers to an ability to recognise the meanings of emotion and their relationships and to reason and problem-solve on the basis of them. Emotional intelligence is involved in the capacity to perceive emotions, assimilate emotion-related feelings, understand the information of those emotions, and manage them.  (Mayer & Salovey, 1999, p. 267, my Italics).

As for the individual E and I: in Mayer's model, Emotion refers to a "feeling state" that conveys information about relationships. For example, "happiness is a feeling state that also conveys information about relationships" - typically, that one enjoys the company of others. Similarly, fear is a "feeling state" that corresponds to a relationship - the urge to shun or resist others (the familiar "flight or fight"). Note that, in Harding & Yorke's Empathy Model, the negative feelings are generally expressed in terms of Alienation (the antipathy or aversion to people that Mayer equates with fear), whilst the positive states are all variations on the core concept of feeling good in the context of relationships (welcomed, friendly, warm, happy and good-humoured, amongst others).

Intelligence in Mayer's model refers to the "capacity to reason validly about information." He maintains that "the use of the term Emotional Intelligence in this fashion is consistent with scientific literature in the fields of intelligence, personality psychology, and emotions." He quotes examples familiar from IQ measurement to support this:

• Verbal intelligence concerns the mental ability to reason with and about verbal information, and of verbal knowledge to enhance thought
• Spatial intelligence concerns the mental ability to reason with and about spatial information (i.e., the shape of objects and their orientation in space) and of spatial knowledge to enhance thought

...and so on.

Emotional Intelligence Models

Mayer's Four Branch Model of Emotional Intelligence describes four areas of capacities or skills that collectively describe many of areas of Emotional Intelligence:

• Managing emotions
• Understanding emotions
• Facilitating thought
• Perceiving emotions

This has been called the ability model of Emotional Intelligence, as it further defines Emotional Intelligence as involving the abilities to:

• accurately perceive emotions in oneself and others
• use emotions to facilitate thinking
• understand emotional meanings, and
• manage emotions

Daniel Goleman (an originator, with Mayer, of established EI models) identified five main ‘domains' that represent an emotionally intelligent state:

• Knowing your emotions
• Managing your emotions
• Motivating yourself
• Recognising and understanding other peoples' emotions
• Managing relationships / managing the emotions of others

Goleman has also published some "Emotional Intelligence Competencies Related to Outstanding Leadership":

• Personal Competence
  • The Self-awareness Cluster:
    • Emotional self-awareness: recognizing our emotions and their effects
    • Accurate self-assessment: knowing one's strengths and limits
    • Self-confidence: a strong sense of one's self worth and capabilities
  • The Self-management Cluster:
    • Adaptability: flexibility in dealing with changing situations or obstacles
    • Emotional Self-control: inhibiting emotions in service of group or organisational norms
    • Initiative: proactive, bias toward action
    • Achievement orientation: striving to do better
    • Trustworthiness: integrity or consistency with one's values, emotions, and behaviour
    • Optimism: a positive view of the life and the future

• Social Competence
  • Social Awareness Cluster:
    • Empathy: understanding others and taking active interest in their concern
    • Service orientation: recognizing and meeting customer's needs
    • Organisational awareness: perceives political relationships within the organisation
  • Relationship Management Cluster:
    • Inspirational Leadership: inspiring and guiding groups and people
    • Developing Others: helping others improve performance
    • Change catalyst: initiating or managing change
    • Conflict management: resolving disagreements
    • Influence: getting others to agree with you

(Goleman, Boyatzis and McKee, 2002)

It is clear, then, that Emotional Intelligence models concern themselves with feelings-relevant abilities in the same way that IQ systems break down intellect into its component parts (indeed, the parallel is reinforced by the increasing frequency with which EI is being replaced with "EQ"). The emotional abilities of most established EI core models correspond to workplace competencies that are also established in training, coaching and leadership theory. The opportunity for business is threefold:

• there is a "gap" between the robust measures for IQ and the more flexible models for EQ - a gap that Harding & Yorke has been closing for over 10 years, with its Empathy measurement discipline
• where IQ testing has yet to sponsor systematic interventions to improve what it measures, much interpersonal development theory and practice (the stuff that could raise EQ) is already in place
• the ideal development of "emotional better practice" (and its commercial advantages in customer loyalty) will come through the application of rigorous measurement, expert development work in response to the diagnostics and regular validation

To put it back into Mayer's terms: the essence of EI is the communication of relationship data and valid reasoning from that information. This is also the essence of Harding & Yorke's Empathy work.

Emotional Intelligence at Work

It is now being recognised by market leaders that differentiation is crucial to business survival, and that differentiation through quality of product, price and service is no longer enough. Organisations need to differentiate the customer experience by making the customer feel better.

Rapport is an example of an emotionally based behaviour in which people can be trained or coached. Organisations need people who can connect with customers emotionally. Similar challenges are also faced internally: for instance, retaining loyal workers who feel connected in some way to the organisation. "Employee engagement" has rapidly become a key item on the HR agenda.

With the commercial imperatives of a changing world constantly driving organisations to adapt, the volume and pace of that change places increasing demands on people. Most respond negatively to changes that are imposed on them - hence the need for leaders who acknowledge such emotions, whilst at least maintaining (if not improving) performance standards.

This is not to say that emotional skills were unimportant before; but they have now become prominent, even critical, amongst leadership qualities. Today's leaders, more than ever, need to be able to win "hearts and minds" in delivering against ever-increasing expectations.

Emotional awareness and emotional capability are therefore required characteristics of any effective contemporary leader. Coaching, for instance, is one classic competence that requires the manager to establish and develop with the individual an emotional connection through which performance can be enhanced.

Organisations have used psychological models for many years to develop desired behaviours, adapting them to their individual requirements in emotional ability. Emotional Intelligence is one useful model to identify qualities that have an impact on performance. Many organisations have already identified competencies of their own - probably including emotional elements relevant to their particular cases. The key is to focus on the competencies that deliver against individual business expectations - and then support these with development to help people "be as good as they can be" in that professional context.

Customer Feelings Research: Background, Present and Future

The significance of Empathy as the most fundamental differentiator in customer perception of quality and value is often acknowledged as a "given" and quoted as "common sense." The appeal to commercial organisations in competitive markets is clear.

Many references are made to historic research by the Rockwell Institute and Michael LeBoeuf's famous citing of Attitude as the main factor in customer decisions. Even stronger correlations, however, have been found in more recent studies; and our own specialised Empathy investigations are beginning to generate further ideas.

MORI found "compelling empirical evidence that the relationship between customers and Employees is critical in creating or destroying value." (Measuring Value: Linking Employee & Customer Research to Business - delivered by Peter Hutton, Deputy Managing Director, MORI, at the 4th International Conference on Corporate Governance and Direction, Henley Management College, 15-17 October 2001).

Hutton also refers to a MORI study for MCA in 1999 that showed the main reasons for consumers repurchasing products or services, or recommending suppliers to others:

1. product or service quality (e.g. reasonable performance expectations)
2. price (on which no healthy businesses wants to trade, as undercutting constantly reduces customer perception of value)
3. how staff treated them

Given the "inevitability" of reasons 1 and 2, it was concluded that "staff behaviour at the point of sale becomes a critical differentiator." In the Public Sector context, we can reasonably substitute service delivery for "point of sale," and see that ‘differentiation' as an indicator both of customers' recognition of excellence in the service they receive and of individual bodies' "competitive" performance in the area of attracting funding.

In another celebrated piece, Harvard Business School service experts W. Earl Sasser, Jr., Leonard A. Schlesinger and James L. Heskett undertook five years' research into case studies that included American Express, Southwest Airlines, Taco Bell, Ritz-Carlton, ServiceMaster and British Airways. Their conclusion, published in "The Service Profit Chain" (Simon & Schuster 1997), was that results in business are a complex function of the interactions between service providers and service recipients.

This came to be expressed in the concept of the "Employee/Customer Satisfaction Mirror." Management in the leading organisations studied were seen to employ "a quantifiable set of relationships that directly links profit and growth to not only customer loyalty and satisfaction, but to Employee loyalty, satisfaction, and productivity." The strongest correlations that emerged:

1. Profit and Customer loyalty
2. Employee loyalty and Customer loyalty
3. Employee satisfaction and Customer satisfaction

These relationships were also shown to be "mutually reinforcing": satisfied customers contributing to Employee satisfaction and vice-versa.

Such studies endorse Harding & Yorke's contention that true service excellence can only be fully measured with reference to customer feelings. Empathy can be the major differentiator, for good or ill, in performance. Leaders planning to change their Cultures into more empathetic ones need, first of all, to understand the starting point for their journey.

In other words, you need to understand "the way you are now" (and how you came to be like that) in order to become "how you want to be." These goals are often crystallised in Brand aspirations.

The Current Situation - and Opportunity

We can certainly justify investment in Empathy Research and Development. When we look deeper into the actual return on such investment, we do indeed find correspondences between service development spend and payback. Significantly, though, the upward path is not a straightforward line but a complex "wave," an S-shape with plateaux (as expected) around the undifferentiated, neutral average and (less anticipated) just above and below the critical points where the customer response moves into the extremes of positive and negative. It is the extreme positive, of course, in which we're interested!

This establishes what we might call a "ceiling" through which even the recognised centres of excellence are only now beginning to punch. Those companies considered to be advanced in terms of positively branded customer experiences currently find themselves at the foot of a curve whose next incline is steeply upwards. This is a significant opportunity. For example, in Health Insurance, we find at the top of the ERIC survey a company often chided by its peers for its high service investment.

Who, then, will have the insight and motivation to grasp this opportunity? The current UK service experience is an undifferentiated thing - it's rare for us to find a truly distinguished provider enjoying the loyalty that goes with that advantage. Even the best of the current players find themselves looking at a steep slope ahead of them - and a fair amount of cultural baggage behind. Everyone has tended to compete on price, speed, convenience - and inertia has been established. So far, service remains undifferentiated, and those traditionally sceptical about the "soft" issues find themselves apparently proven right.

Empathy has tended to play "second fiddle" to process within the typical corporate environment. That, as we said, is the real opportunity here; and we are starting to see a new era dawning. At last, we are hearing less talk of "satisfaction" and more of how it feels to be a customer.

A Balanced Emotional Scorecard

To take Empathy upwards, the solid footing of Process-based satisfaction needs to be incorporated into the journey. ERIC Analysis therefore balances the factual aspects of an interaction with the behavioural elements. ERIC emotional scores (How we feel) are decimal numbers - the Advisor can score points for making the caller feel good; but, of course, they must also fulfil the practical requirements for the contact, including accurate, relevant information.

The scores therefore differentiate between a behavioural question-sequence and the "Facts" or "Process" Scores (such as Number of Rings before answered). On the process side, we have devised a generic "best practice" map of certain things that can reasonably be expected to happen in a customer-supplier interaction. This complements the Empathy Model for "better behavioural practice" common to all Harding & Yorke offerings. In process questions, we are recording whether or not a target event happens; we then take the percentage of times (frequency) the inspirational "best practice"(such as an offer of further assistance at the end) occurs and express that as a decimal, too.

The ERIC Balanced Emotional Scorecard for each Industry and Participating Company is shown with ERIC (Empathy/Emotional) numbers at the top, and Process (Facts) Numbers below. This is a new standard in expressing performance in the "soft" issues against procedural compliance, giving a proportionally-meaningful number rather like the "best case" expression of blood pressure as the systolic number over the diastolic. For example, ABC Limited might have an ERIC Rating^TM (Empathy or behavioural score) of 5.8, with a Process Rating of 8.4. We are thus able to look at ‘The Way You Do It' over ‘What You Do.'