WHEN I went to school in Zimbabwe years ago, we always related intelligence to getting higher grades and we thought it was a direct function of IQ.
I first bumped into Emotional Intelligence through Daniel Goleman, the author of the best-selling book “Emotional Intelligence: Why it Can Matter More Than IQ” a couple years ago. I was one those who dismissed this as another fad from some overfed and bored professor seeking relevance.
Emotional intelligence is a psychological characteristic that describes how effectively an individual identifies, understands, and regulates emotions and then uses them in problem solving and decision making. It measures a person’s ability to perceive, understand, use, and manage emotional signals.
What then has emotional intelligence got to do with toiling Zimbabweans chasing a living across the globe? For many people money whether we have it or not elicit emotional responses. Understanding these emotions around money enables us to manage it better.
Traditional intelligence is a person’s ability to use observed information or data to think productively. Emotional intelligence is a scientifically validated function of the human brain to process and utilise emotional information.
According to Salovey emotional intelligence is a person’s ability to recognize and interpret emotions and to use and integrate them productively for optimal reasoning using moods or emotions as data or information. It comprises factors such as self-awareness, self-discipline, and empathy determining personal and professional success.
It is fine to have strong emotional reactions but it is what you do with those emotions that can be a problem for yourself and others. We need to recognize our emotions and then manage our responses to those emotions in a manner that enhances our health and relationships with others.
It is important to realise that what you do affect other people, and that achieving your personal success will also involve other people. You will achieve more by fostering good relationships with other people. We are all unique and have personal likes and dislikes.
Emotional intelligence is made up of self-awareness, managing our emotions, empathy, and social skill. Emotional self-awareness is the foundation on which most of the other elements of emotional intelligence are built.
Having a high emotional quotient is one of the most optimal ways to achieving peace of mind around your money. Emotional intelligence is a core skill-set, grounded in science that underlies performance. The good thing about emotional competencies is that they are measurable, learnable and can be improved through training and coaching.
Conscious thinking requires emotions, feelings, and intuition. Unconsciously, our emotions allow us to identify ideas and thoughts as good, bad, or indifferent. Financial emotional intelligence brings together our intuitive and deliberate decision-making processes. It takes our intuition for inspiration and wisdom, which means taking the time to reflect on our choices, ponder the evidence, and consider how our decisions will affect our emotional state.
Financial emotional intelligence allows us to channel our emotions into more productive outcomes. Financial emotional intelligence is a person’s ability to recognize and interpret emotions related to financial situations and to use and integrate those emotions productively for optimal financial reasoning and problem solving. As an investor you feel positive emotions from a realized gain but relatively stronger negative emotions from a realized loss of the same size so this impacts on your risk assessment.
It has been suggested emotional intelligence is responsible for more than 90% of our success. Financial decisions call on us to use past data to develop current hunches and estimate anticipated risk and rewards for our needs in the future. In the popular conception, EI comprises a broad range of personality traits, social skills, and qualities, such as “character”
Emotional intelligence where we use emotions productively should be distinguished from simply “emotional.” where one may feel and/or act more intensely than others. It is important to perceive emotions by recognizing emotional signals in people’s faces and via other communication channels and using emotions to enhance thinking and problem solving. Understanding emotions helps us to analyze emotions, predicting how emotional states will change over time, and evaluating the influence of emotions on an outcome and managing emotions by understanding and regulating responses to emotional stimuli in the context of a particular goal situation.
Momentary moods, especially stemming from negative feelings, such as sadness or anger, influence real economic decisions; investors with the ability to use emotions intelligently make better investment decisions. Impulsiveness is the immediate response to thoughts or deeds without any consideration of the appropriateness or consequences.
Money is simply supposed to be “a medium of exchange that facilitates trade.” Your beliefs about money determine how much money flows in, or out of your life. Our unconscious thoughts about money stem from earlier life experiences, whether good or bad. If we were brought up in a village in Muzarabani where no one ever had it now that you live in one of the capitals of the world it can continue to affect your decisions around it. Financial fears and insecurity can seriously impact our relationships. It is a fact that money is a major cause of more emotional problems than any other issue.
Most of us earn money by exchanging our talents and time for money that we then exchange for the things we need and want in life. Happiness to one person is being able to afford boarding fees for their child at a prestigious school while for another person it is taking a relaxing vacation it Victoria Falls. The nature of purposeful living is to create whether it could be an empire, a cartoon, a strategic plan, a poem, a song, a career or a retirement village.
According to the Harvard Business Review’s “Breakthrough Ideas for Tomorrow's Business Agenda” article emotional intelligence isn't a luxury you can dispense with in tough times but a basic tool that, deployed with finesse, is the key to professional success.
In conclusion Mayer & Salovey said, “emotional intelligence is the ability to 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”.
Tafirenyika L. Makunike is the chairman and founder of Nepachem cc (www.nepachem.co.za), an enterprise development and consulting company. He writes in his personal capacity