The Power of a Positive Emotional Climate

There is no doubt that factors such as business acumen and intelligence play a critical role in leadership. But they are not enough to succeed as a leader. As I wrote about in Serve to Be Great, to succeed over the long term, a leader must also be able to serve and care for team members consistently and effectively. He or she must be able to create and sustain a workplace culture that people enjoy being a part of. In other words, the emotional climate of the workplace must be positive.

It doesn't really matter how smart a leader is or how strong his or her business acumen is. If the leader is unable to drive positive emotions in team members, he or she will eventually fail. In general terms, this failure would come about because disengaged team members would eventually fail to serve the customer. The quality of the product or service would decline, as would customer service. No organization that fails to serve its customers can survive for very long. As we saw above, Campbell Soup Company was a good example of this downward spiral toward collapse.

Conversely, when the emotional climate is strong, the customer is better served. Happy, loyal team members lead to happy, loyal customers. Happy, loyal customers drive positive business outcomes.

Intuitively, most people see this quite clearly. There is also research that supports our intuition and quantifies the effect of a positive emotional climate. One study suggests that for every one percent increase in service climate, there is a corresponding two percent increase in revenues.¹ In another study involving 19 insurance companies, researchers found that in 75 percent of cases emotional climate alone served as an accurate prediction of both profitability and growth.²

The Leader Drives the Emotions of the Team

It is now commonly accepted that emotions are contagious, so to speak. Likely because of the way humans evolved in groups—which meant it was important for people to be able to affect the emotions of others—the emotional areas of our nervous systems operate in what is often referred to as an “open loop.” Our emotional state affects the emotional state of the people around us, which can actually alter hormone levels, sleep, heart function, and the immune system in others.³

When strangers share the same space, the most emotionally expressive person tends to affect the mood of the others without even speaking.⁴ But this effect is much stronger when people know each other. People who work together are more likely to affect each other's moods, and the effect is stronger when the group is more cohesive.⁵

As we would likely guess, the person who has the greatest impact on the emotions of others tends to be the leader. Whether we like it or not, as leaders, people are watching us, and our emotional state affects them emotionally. This is even true for leaders who tend to hide in their office a lot. A chief executive officer (CEO) who doesn't interact a whole lot with anyone but senior management can significantly affect the emotional climate of the organization through a sort of “ripple effect” that starts with direct reports who in turn influence others.¹¹

The Emotionally Intelligent Leader

Understanding how the leader affects the emotional climate of the organization makes it clear that our people skills, our emotional and social intelligence, are essential for being effective as a leader over the long term. Emotional and social intelligence are what close the gap between wanting to serve and care for team members—and thereby creating a positive emotional climate and a sustainable, high-performance culture—and actually doing it.

This is why I strongly encourage clients to begin any training for emotional intelligence with an anonymous, 360-degree assessment of each participant's emotional and social intelligence called the Emotional and Social Competency Inventory (ESCI), which was developed by Daniel Goleman, Richard Boyatzis, and the Hay Group and is based on years of research that links emotional and social intelligence competencies to business outcomes.¹²

Although we cannot administer the full ESCI in this book (it is an anonymous, 360-degree assessment done online with much more precisely calibrated questions that measure much more specific aspects of the core competencies listed below), I'd like to give you an idea of the core competencies that the ESCI measures so that you can get at least a rough idea of your strengths and weaknesses in these areas by asking people you work with to rate you informally. For each competency, you could ask a few people who know you well to rate you on the following scale:

1. 1 = Never displays (emotional self-awareness) __
2. 2 = Rarely displays __
3. 3 = Sometimes displays __
4. 4 = Often displays __
5. 5 = Almost always displays __

If you'd like to learn more about these critical competencies and how to apply them, I highly recommend the excellent, internationally best-selling book by Daniel Goleman, Richard Boyatszis, and Annie McKee, Primal Leadership. In that book, the authors list four areas of emotional and social intelligence, which are then divided into specific leadership competencies. The ESCI follows the same general outline. The first area is self-awareness, which is the foundation of all emotional and social intelligence.

A More Emotionally Intelligent Brain

It should be quite clear that, assuming relatively equal levels of cognitive ability and business acumen, a leader who excels in most of the emotional and social competencies above (very few people excel at all of them) is going to significantly outperform a leader who is poor in most of the competencies above. More important than knowing about these competencies, though, is knowing how to develop them. Let's explore that now.

I wish I could tell you that after reading this chapter, you will have greater emotional and social intelligence. But that is not the case. If you want to be a highly effective leader, you will need to practice. There are two widely accepted methods for improving emotional and social intelligence that have been shown to result in positive changes to the function and structure of the brain.

The first method is simply to make the effort to practice the competencies in real-world situations. You might like to begin in relatively easy situations, perhaps even away from work. Emotional intelligence is something that's acquired through what is known as implicit learning, which happens in areas of the brain other than the neocortex, where thinking occurs.

Fortunately, this means that practicing behaviors in one setting, such as leading a group of volunteers on the weekend, will make it more likely that we exhibit the same behavior in other leadership contexts, such as at our workplace. The more often we practice a given behavior, the stronger the neural network associated with that behavior becomes and the easier it is to behave that way in the future.

The second method for rewiring the brain to be more emotionally intelligent is to practice mindfulness training. Mindfulness training affects, either directly or indirectly, every emotional and social intelligence leadership competency. We'll explore the competencies most affected by mindfulness training—emotional self-awareness, emotional self-control, achievement drive, adaptability, positive outlook, empathy, inspirational leadership, and conflict management—in various ways throughout this book.

Perhaps most important, though, is that mindfulness training is essentially the very foundation of emotional intelligence development. Every emotional and social intelligence competency can be improved by improving self-awareness. Thus, as Daniel Goleman often stresses, self-awareness is the core competency of emotional and social intelligence.

As we've discussed in earlier chapters, mindfulness training is at its essence self-awareness training and has been shown to change both the functioning and physical structure of the brain in the areas associated with self-awareness. Because self-awareness is the foundation, or core competency, of emotional intelligence, it follows that mindfulness training is perhaps the most powerful tool there is for developing emotional intelligence.

One of the most successful EI training programs in the business world was created as a result of the cofounder, Chade-Meng Tan (“Meng”), making a connection, similar to the one described above, between mindfulness, self-awareness, and EI. The program, which was started at Google in cooperation with Daniel Goleman, is called Search Inside Yourself (SIY). The SIY program offers an excellent approach to developing emotional intelligence, which is a combination of mindfulness training and practical application of emotional and social intelligence leadership competencies.

Since the early days of the program, SIY has been one of the most popular and highest-rated programs at Google. People often comment that the program helped them improve performance, get promoted, be a better leader, or discover their best work. Even more important, participants have reported that the program changed their lives.

Based on the success of the SIY program at Google, Meng wrote a book by the same name, which became a New York Times bestseller. Demand for the program outside of Google also began to increase rapidly, so Meng cofounded the Search Inside Yourself Leadership Institute (SIYLI—pronounced “silly.” Yes, on purpose), along with the current CEO of the organization, Marc Lesser. The institute is growing and experiencing increasing demand for the SIY program.

A Training Regimen for Emotional Intelligence

I hope that you are as excited as I am about the fact that the emotional and social competencies so essential for leadership excellence are skills we can develop with practice. With mindfulness training, every one of us can systematically train to change our brains in ways that increase our EI.

Because mindfulness training and the self-mastery and people skills that fall under the umbrella of EI are so interwoven, we will be touching on emotional and social competencies—and how they are cultivated with mindfulness training—throughout much of the rest of this book. Thus, you will be able to create a sound EI training regimen by practicing the competencies listed in this chapter and engaging in the mindfulness training methods outlined in Part 2 of this book.

For now, let's return to the story that opened this chapter and consider a real-world example of the power of emotional intelligence.

A Human Approach

When Douglas Conant took charge of Campbell's in 2001, he was given what appeared to be mission impossible: turn around a company that seemed destined to either fail or be bought out. But he believed that a turnaround was possible.

His plan included two major elements. Of course, strategy and business acumen played a role. Conant realized that sales had to be restored, so his approach included strategies for changing the consumer perception of Campbell's products, making in-store displays more appealing and redesigning products that hadn't been changed in decades. However, he also realized that none of these strategies could be executed without the help of thousands of employees. Without a huge change in culture, Conant knew that the help he needed wouldn't come and that his plan would never be executed.

The main focus of Conant's plan was based on his insight that “you can't win in the marketplace if you aren't winning in the workplace.” He needed to help leaders better serve and care for the team members at Campbell's and transform the culture from a veritable toxic prison where engagement levels were extremely low to a winning culture with a positive emotional climate where people are highly engaged in their work. This required him to apply many of the emotional and social competencies discussed in this chapter.

One of Conant's first moves was to change the most obvious elements that would contribute to a more positive emotional climate, such as taking down the fence so that the headquarters building no longer looked like an actual prison. He also created an inspiring vision of future success and communicated it often, in person, which required him to go out of his comfort zone (Conant is a self-proclaimed introvert).

Next, Conant worked on transforming the leadership team into one focused on building trust with team members and being, in his words, “tough-minded on standards and tender-hearted with people.” Conant designed and personally ran a two-year leadership development program to help leaders grow, which included homework assignments that he would personally grade, often within 24 hours.

In his efforts to boost engagement, Conant led by example. He made it a goal to take 10,000 steps per day and have meaningful interactions with as many employees as possible. As he points out in his book TouchPoints: Creating Powerful Leadership Connections in the Smallest of Moments, instead of seeing conversations in the hallway as something that got in the way of his work, Conant approached them as opportunities to listen deeply to team members, build trust with them, and learn about their ideas for making the company better.

When Conant was in his office, he spent a good deal of his time there appreciating team members who were performing well. On most days, he would handwrite 20 notes of appreciation. It is estimated that during his 10 years at Campbell's, Conant sent roughly 30,000 handwritten notes thanking the 20,000 employees for jobs well done.

Little by little, Conant's efforts to improve the emotional climate at Campbell's bore fruit. At first, there was a lot of change. Many people weren't a good fit for the leadership team, so turnover of senior leaders was high. But, eventually, the leadership team became highly engaged and built high levels of trust with team members. When Gallup polled the workforce at Campbell's in 2010, it learned that for every 17 engaged employees, only one was disengaged. To put this in perspective, Gallup considers an engagement ratio of 12 to one world-class. Even more incredible, the engagement ratio for the top 350 leaders was 77 to one!

Because of the improved emotional climate and the increased engagement, innovation and performance soared at Campbell's, and Conant's marketplace plans were successfully executed. Over a period of eight years, Campbell's averaged 4 percent growth in earnings per year, which was among the best in the industry. Over a six-year period, Campbell's had a cumulative shareholder return of roughly 60 percent, which was more than four times the 13 percent return of the Standard & Poor's 500 during the same period.

One afternoon, though, in July of 2009, Conant's streak of successes seemed as though it might abruptly end. He was being driven from Campbell's headquarters in Camden to his home in Morris County. As Conant and the driver approached Exit 6 of the New Jersey Turnpike, the Lincoln Navigator they were in struck the rear end of a tractor trailer. Although the drivers of both Conant's vehicle and the semi were not seriously hurt, Conant was taken to the hospital with broken ribs and later required surgery.

But what seemed like a great misfortune actually highlighted what may be Conant's greatest success. During his recovery, Conant was soon flooded with get well notes from people from many areas of Campbell's and even people from outside the company. Conant said of the notes, “As my wife and I sat and read them in the hospital room, I could feel them helping to speed my recovery. The blessings of their notes reminded me that the more supportive feedback you give to others, the more you may very well receive in return.”

Conant's efforts to create superior engagement and to serve and care for team members by listening to them, building real human relationships with them, and appreciating them did more than help turn Campbell's around. His efforts afforded him a wonderful taste of those priceless, intangible riches that are realized only when we prioritize people over the numbers.²⁹