How HR can drive productivity through emotional intelligence

Australian companies need to embrace Emotional Intelligence (EI) as a core competency in order to boost productivity and performance, according to Linda Simonsen, CEO of engagement and EI consultancy FuturePeople

Australian companies need to embrace Emotional Intelligence (EI) as a core competency in order to boost productivity and performance, according to new research.

It identified a significant positive correlation between EI on the frontline and better customer experience, sales and productivity, which in turn presents an untapped opportunity for increased sales and business growth, said Linda Simonsen, CEO of engagement and EI consultancy FuturePeople, which released the research report.

“Effective EI skills drive deeper engagement across the enterprise, including both employee and customer engagement, leading to greater commercial success,” said Simonsen.

“With 70 per cent of customer interactions grounded in emotional factors, it’s imperative that frontline staff are measured and developed in areas of EI allowing them to exceed customer expectations and boost company sales”.

The report, Accessing the Triple Bottom Line through Emotional Intelligence, was conducted in conjunction with EI research specialists, Genos International, and drew on more than 1,000 interviews with frontline staff and leaders in the services sector across Australia.

“Effective EI skills drive deeper engagement across the enterprise”

“Emotional fitness” is also a new organisational capability which can drive enhanced business performance and global competitiveness, with the rise of the experience economy and changing landscape of work, she added.

“The ability to connect emotionally with customers is the key to enhanced performance and engaged employees on the frontline,” said Simonsen.

“EI is the method to achieve this – in context of digitalisation and automation, when customers do need to interact with a person, they expect a highly engaged, emotionally intelligent person who can understand their individual situation and deliver a personalised solution.

“The type of person needed on the frontline has changed and they need to be recruited, developed and engaged differently,” she said.

With the rise of automation and robotics and both employees and workplaces that are dispersed, flexible, diverse and global, the ability to engage people to drive innovation, Simonsen said collaboration and relationships will be the differentiator and competitive edge.

“Organisations that are socially and emotionally intelligent focused on relationships internally and externally will be the market leaders.

“The new currency of effective leaders is ‘emotional’,” she said.

“The ability to connect emotionally with customers is the key to enhanced performance and engaged employees on the frontline”

The research also identified a gap in Australian workplaces, with some 80 per cent of CEOs believing their brand delivers amazing service to their customers, but only 8 per cent of customers agree.

“Our research shows that gap to below EI and this needs to be addressed urgently for companies to get ahead in today’s competitive business climate,” said Simonsen.

Leaders with high EQ lead authentically and connect their people to purpose to build high performing teams of engaged people, who apply discretionary effort to deliver better outcomes for customers and the organisation, she said.

“Leader development and succession strategies need to focus on engagement capability – baseline levels of EQ as a qualifying factor and development programs that enhance EQ to improve engagement with employees and colleagues with the end customer at the centre of behaviour and decision-making,” she said.

C-level executives need to view employee engagement and customer engagement not as separate things but intrinsically linked and frame strategy in context of ‘heartonomics’, which is the economic value of how we make people feel in business.

“They need to view investing in the EQ of the organisation as a strategic initiative to enhance performance, growth and shareholder return,” said Simonsen.

“Leader development and succession strategies need to focus on engagement capability”

She observed that organisations are investing in CX (customer experience); customer journey mapping, and technology to enable customers to self-serve via digital channels and social media management in light of the awareness of the importance and value of engaged customers.

“However, there is a gap between the perceived service that organisations are delivering and the actual experience customers are having – this represents a huge opportunity for organisations to stride out in front by focusing on aligning people and customer strategies to compete on the basis of how they make both feel,” she said.

“This is particularly the case in the banking sector.”

The role of the frontline ‘human being’  in delivering customer experience is being overlooked, according to Simonsen, who said investment is being directed into automation and technology rather than developing the emotional competency of the people actually delivering ‘experience’ to create loyal customers to act as brand advocates.

“Organisations are struggling to enhance customer experience due to the need to deliver a seamless horizontal customer experience within an organisational structure that is vertical and often siloed,” she said.

“Smart organisations are enhancing customer experience and engagement by focusing on business heads collaborating effectively across the organisation with the overall strategic goal in mind, and they are investing in the EQ of leaders to achieve this.”

“There is a gap between the perceived service that organisations are delivering and the actual experience customers are having”

She recommended HR leaders view EQ as a strategic organisational capability to build in the context of the evolution of work.

“Invest in understanding the role that emotional intelligence plays in their organisation in terms of contributing to bottom line performance – the role it plays in leaders engaging employees, cross-departmental collaboration, driving innovation and enhancing productivity and customer relationships,” she said.

“Frame organisational development and cultural initiatives within an emotional intelligence framework; initiatives informed by the knowledge that how we make people feel.”

Simonsen recommended building an emotionally intelligent HR function which is focused on engaging internal stakeholders around the value of engagement with employees and customers, and providing leaders with the toolkit to harness EI to deepen engagement and performance.

Image source: supplied