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21st century finance: Emotional Intelligence

30th Oct 2014
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It's not just another soft skill or HR buzzword; emotional intelligence (EI) is a skill proven time and time again to be synonymous with career and relationship success. 

And because much of an accountant or FD's work relies on relationships, whether its clients, colleagues or other businesses, having good EI is crucial. 

The following article is part of a series AccountingWEB is running on the importance of 21st century finance skills.

Emotional Intelligence 

Emotional intelligence is one of the key skills accountants and FDs need to move forward in their careers and achieve success. Find out why in each of these sections:

Having good EI can enable you to tackle stressful situations by recognising your emotions and the emotions of others, and learning to step back and deal with them in a calm and rational manner.

As accounting professionals experience many stressful scenarios, knowing how to deal with these occurrences in the most effective way can take much of the pain out of your working life. 

Business psychologist Viv Thackray, CABA trainer and owner of Koha Consultancy, spoke to AccountingWEB about what EI is, what accountants can do to improve it and about further resources for self-development. 

What is EI? 

According to Thackray, this is the ability to recognise, reason with, understand and manage emotions in both yourself and others.

There are two key skills people need to have, to develop their EI. 

"One is the ability to quickly reduce stress in the moment. For example, someone shouts at you in work. This is very stressful, and sometimes our response might not be the one we'd like," the psychologist said.

Therefore, improving your EI to deal with situations such as this, i.e. taking a step back, assessing the situation before emotionally responding will improve the impact they have on you and on others.

In addition, people need to be comfortable with their own emotions to act in constructive ways, she added. 

Recognising poor EI

That's a brief overview of what EI is. But how do you recognise whether yours is good or bad and therefore whether its in need of improvement?

Losing your temper quite often and having an inability to recognise how both you and others feel could be an indicator of poor EI, according to Thackray.

"When people come on a session with us, I ask them at the start to take a few minutes to pause, take a breath and recognise how they are feeling. Some really cannot do that." 

Recognition of emotions is the first thing people need to do. If they can't recognise how they're feeling, it needs to be worked on. 

Improving EI

There are many ways of improving your EI, from seeking help from a psychologist specialising in this area, to educating yourself by taking a look at the online resources at the bottom of this article.

But Thackray advised that practicing mindfulness is one of the best techniques for improving EI skills.

Mindfulness is a state of being in the here-and-now, rather than worrying about the past or future. It's a skill that allows us to know what's going on inside and around us, kind of like meditation. 

Thackray advises those wishing to improve their EI to start by using a simple breathing exercise. 

"Stop, take a breath, observe your emotion and react the way you want to react instead of allowing emotions to dictate how you reply," she said.

"Be aware of yourself in the moment when stressful opportunities arise and quickly reduce stress by performing that simple breathing exercise.

Take it one step at a time, too, and don't overload yourself with things to work on. Trying to do too much will lead you to being less likely to achieve anything. 

"Make sure you have good motivation, and you are committed to the goal. For example, if its wanting to reduce your dependency on your mobile phone, commit first to not having it on the table for a specific period of time. 

"You may identify lots of things about your EI you want to work on but pick the simplest, most basic thing first. Once you have mastered this, move onto the bigger areas. 

One programme that already exists, based on mindfulness is Google's own training project, Search Inside Yourself.

Other resources include author of Emotional Intelligence Daniel Goleman's Ted talk: Why aren't we more compassionate?

In addition to mindfulness, mental rehearsal of situations and reactions is just as effective as literally doing something, Thackray said. 

Is EI for everyone?

At the 2020 Group conference in Birmingham recently, Gordon Gilchrist spoke of the importance of hiring someone or some people into your firm who have emotional intelligence.

Sure, there are accountants and FDs out there who are incredible with numbers but not great when it comes to having empathy with a client or colleagues. And many more may simply feel uncomfortable when discussing emotions in the context of work. 

Perhaps there is a lesson here. EI is a skill that everyone needs to improve, and there is so much that can be done - even in private and self-supported - to better it. But perhaps those in the firm with better EI should be the ones to provide client care, while the others improve their soft skills? 

For more on emotional intelligence, see: 

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Replies (18)

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By JC
30th Oct 2014 12:12

Risk Intelligence ...

Sounds as though this should go hand in hand with Risk Intelligence - which in many respects should be higher up the scale than EI, especially for accountants

How one makes decisions based upon what one knows whilst allowing for unknown areas

Donald Rumsfeld

'.. There are known knowns. These are things we know that we know. There are known unknowns. That is to say, there are things that we know we don't know. But there are also unknown unknowns. There are things we don't know we don't know ..'

Taking too little risk can be just as dangerous as too much

Take a test - http://www.projectionpoint.com/index.php/frontpage

 

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By redboam
30th Oct 2014 14:20

CFI?

I find that the sort of intelligence that many of my clients tend to look for is to come up with the right answers to solve cash flow problems from time to time. There can be plenty of emotion attached to that but not a lot of intelligence to begin with.

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By KWest
30th Oct 2014 14:40

???

Emotion or lack of it doesn't solve anything. What clients look for is competence.

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By Rachael White
30th Oct 2014 15:45

Of course

Competence and getting the job done is extremely important. 

But in order to do this correctly should we not both be empathetic toward clients in difficult situations and partners in our firm who are struggling with their workloads, for example?

Clients like to have a good relationship with accountants - even if its just them taking an interest in their businesses as this article illustrates. 

So perhaps EI is an important element of getting more than just the job done?

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By johnjenkins
30th Oct 2014 17:24

I am a robot, I am a robot. I do not have emotions, I do not have compassion, I add up and I uhyugbbufguhjnxncuifue. (said in a dalek style voice)

The more I listen to this sort of crap (sorry Rachael) the more I feel we are losing it. Do you really think that our clients want us to have all these gimmicky ways of working. Good relations with clients sometimes include disagreements. You give them options, they choose. You try to guide them in what you think is the right direction and if they go another way you try and persuade them otherwise. Let's not forget we work for our clients, not the other way round.

I see even the big boys have opted out. Clients put monthly bookkeeping on cloud, outsourcers in India do the business, no language barrier as all figures.

We won't be called Accountants anymore just NC's with EI, RI but no I on the job we are supposed to be doing.

Can't wait for the next buzz words. What about Constantly Reducing Accountants Profile.

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Replying to Glennzy:
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By chris.arnold
07th Nov 2014 09:10

@John Jenkins Anyone else see the irony here?

When companies like Google take this subject seriously, and incorporate it into their hiring process and value it as highly as IQ, I would think it's fair to say it has some value.

As for your clients expecting this of you, I agree with John Jenkins completely - I don't think it's a steadfast requirement by any means. Emotional intelligence is not far from having personal skills - you don't need personal skills to be able to complete your job to an extremely high standard, but I've not come across many highly successful or C-level folk who can't hold a conversation.

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By chatman
05th Nov 2014 12:42

EI not Helpful in Business

As I understand it, psychopathic traits are more common in senior managers and business executives than in the general population http://www.tandfonline.com/doi/abs/10.1080/10683160310001634304#.VFoaZcl... and there is no evidence that EI helps at all.

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By johnjenkins
05th Nov 2014 16:24

@chatman

Has this ever been updated? There aren't many senior staff about these days. It's mostly bosses and juniors.

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By chatman
05th Nov 2014 16:32

@ John Jenkins

Not sure what you mean about senior staff.

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By johnjenkins
05th Nov 2014 16:45

I suppose

in those days it would have been middle management. Most of those were done away with at the last recession and HR became fashionable.

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By chatman
05th Nov 2014 18:48

@John Jenkins

I think it meant the most senior people.

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By johnjenkins
07th Nov 2014 11:23

Google etc.

have the pick of the market place when it comes to labour so they can use any particular fad that they think is important at the time to choose their staff. Most large companies used to have a personnel department, some still do, but it is probably a luxury that isn't affordable. We have HR clients who specialise in head hunting etc.

I was listening to a speaker yesterday at PE and she said she could tell the mood of her staff by the way they took their coat off. Then treated them accordingly. My how things have changed.

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By chris.arnold
07th Nov 2014 11:39

Things are always changing, it's the ability to adapt that results in success. Firms that haven't adopted online systems and technologies for example are losing business to those that do, I've seen it repeatedly and am thinking of those firms that still refuse to have a website and are wondering why their client base isn't growing as fast as local competition.

I see the softer skills such as emotional intelligence as the skills that can differentiate you, those that add some shine to you amongst the infinite pool of competitors.

Getting the job done isn't good enough any more. You have to be able to get the job done and be able to have good relationships with people - something emotional intelligence helps develop.

Treating people with contempt and sarcasm, and calling something "cr*p" doesn't strike me as "dealing with people in a calm and rational manner".

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By johnjenkins
07th Nov 2014 12:17

@chris

When you have been around as long as me and you see the way my profession has been bombarded with "should do's" "can't do's" and all the other buzz words and sales techniques that are supposed to make us "stand out" etc. you start beginning to think what is all this crap? Is there someone who sits in a office thinking this crap up?

Knowing your client and getting the job done professionally, has and always will be, is what being an Accountant is all about. 

If you want confirmation just look what happened to the banks since the 1990's.

I'm not naive enough to think that our profession won't change. After being at PE yesterday and listening to what is going on it's quite obvious that my sort of Accountancy will deal with the small stuff under the VAT threshold and for business bigger than that there won't be Accountants, just business consultants and tax specialists.

Do good doctors need EI or a good bedside manner? I hardly think so.

When I stop getting clients by referrals then I will hone in on my personnel skills.

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By abaco
07th Nov 2014 20:15

On "cr*p"

@ John Jenkins

It never ceases to amaze me what some people get away with to make a living. In my book this EI thing comes under the heading selling smoke" but your description of "crap" will do just fine.

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By chatman
07th Nov 2014 22:27

EI is Important
EI is extremely important in life; I just don't think many senior people in business have it.

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By johnjenkins
10th Nov 2014 09:21

@chatman

I presume you're not talking about bosses or juniors. So your "senior" people must be "middle management" ie. they have the job of interpreting bosses demands (wishes) and making sure the juniors carry out those wishes. IMV this has never worked and these are the people who get stressed and sometimes their health suffers. You've only got to look at HMRC to see why it doesn't work.

Now to the nitty gritty. If you have "what it takes" then it's highly likely you will end up running your own business. If not, and you have knowledge of your job, then you might progress up the ladder to a reasonable salary until the next recession and you find you are no longer needed because someone like yourself 30 years ago has replaced you for a quarter of your salary.

What is important in life is that we stop this constant strive, that is selling driven, to be better than anyone else and to be perfect. It hasn't worked for the banks and it's certainly not working for HMRC. The professional bodies in Accountancy should take heed. Their days are numbered. 

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By alastairlawrence
08th Apr 2016 06:05

Emotional Intelligence

Emotion is the behavior found in human attitude. Basically professionals are facing problems in case of emotional issues in their work and behavior; for a result they are unable to deal with different situations. Here in this article also we learn crucial facts about emotional intelligence accountant's guide; hope account professionals are able to learn some essential factors from here.

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