How to Use Emotional Intelligence to Make Better Decisions 

If you’re an HR leader, senior manager, or other professional within the alternative investment industry, cultivating a high level of emotional intelligence, also known as “EQ,” is crucial to your team’s success. As the ability to recognize, understand, and manage your own and others’ emotions, EQ plays a huge role in the decision-making process and can impact your influence in your workplace and your teams’ productivity and profitability. Developing a high level of emotional intelligence requires developing many valuable leadership skills, such as decision-making, self-awareness, self-regulation, empathy, and social skills.

Still don’t quite see the link between EQ and better decision-making? Here’s what you need to know.

The Interplay Between EQ and Decision–Making

Emotions can significantly influence your decision-making processes. Whether in your professional life or personal life, just about everyone has made a poor snap decision because they were angry or otherwise upset. Likewise, some may have experienced making poor decisions because they were overly optimistic or unable to read the room, aka others’ emotions. You could also experience analysis paralysis because your emotions are running wild, filling you with fear, anxiety, or dread. Emotions and emotional circumstances affect how we perceive risks, opportunities, and priorities.

As such, developing a high level of emotional intelligence — the ability to recognize and regulate your own emotions and recognize and influence others’ emotions — can significantly impact your decision-making process. When you can use logic and reason to deal with your emotions, as well as the emotions of others, you can likewise use logic and reason to make the best decisions possible for your teams and organization.

At the same time, as you make better decisions, you’ll also notice that developing skills related to EQ can improve your overall work environment. When you can recognize your teams’ emotions and deal with them properly, you can reduce your teams’ stress and anxiety, leading to a mentally healthier workplace. Not only does this improve individual well-being for team members, but it also enhances team dynamics and productivity.

In short, there are no downsides to developing a higher level of EQ; making it a key part of your leadership development is a wise decision. However, what are the two primary decision-making-related benefits you’ll notice when investing in EQ? Greater emotional clarity and more emotional energy.

EQ and Greater Emotional Clarity

Developing a high level of emotional intelligence equips you to process feelings logically and make reasoned decisions. This skill helps prevent intense emotions from clouding your judgment, enabling you to make informed and unbiased choices.

Focus on honing your self-awareness to enhance your emotional clarity and reap its advantages. This involves being able to pinpoint and acknowledge your emotions as they occur and then manage them appropriately. Techniques such as mindfulness exercises, meditation routines, and keeping an emotion journal can be instrumental in improving this aspect of EQ.

EQ and Greater Emotional Energy

Dealing with intense emotions frequently can be draining, leaving you with minimal mental and emotional stamina when faced with significant choices.

However, as you cultivate a stronger EQ, you’ll discover an uptick in your emotional energy. This boost will enhance your motivation and confidence, allowing you to tackle decisions with a clear mind.

Balancing Emotional Intuition with Logical Reasoning

Despite all the known decision-making benefits that come with EQ, one thing that you might hear from hesitant leaders is that too much focus on logical reasoning can get in the way of emotional intuition. Therefore, the key is to find a middle ground where emotions inform, but don’t overwhelm, the decision-making process and where data is considered without becoming the sole driver.

To strike this balance, try incorporating structured decision-making tools. For example, use a SWOT analysis to assess a situation objectively, then reflect on your emotional response to each factor. Alternatively, create a decision matrix that includes quantitative data and a column for ‘gut feeling’ to ensure logic and intuition are considered. By doing so, you’ll achieve a decision-making process that reduces internal conflict and promotes mental harmony, leading to sounder decisions and a more cohesive team environment.

What About High–Stakes Decisions?

Maintaining a balance between emotional intelligence and logical reasoning is not only possible but essential, especially when making high-stakes decisions.

By leveraging the balance that EQ offers, you’ll be well-equipped to make the necessary choices to cultivate a resilient and flexible work environment. This approach leads to a more positive and efficient workplace, proving beneficial in various scenarios such as negotiations, conflict resolution, or strategic planning sessions. EQ is a valuable asset in all these areas.

The Bottom Line

Emotional intelligence transforms decision-making into a strategic asset, driving business success and mental well-being. Learn how to adopt some of the relevant EQ practices at our upcoming “Emotional Intelligence Panel” event on Oct. 10. Save your spot.