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Emotions affect bottom line

Smart managers recognize employee well-being linked to success

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2222Those words were famously sputtered by Tom Hanks as the exasperated baseball manager Jimmy Dugan in the 1992 film A League of Their Own. Since then, they have been immortalized in many workplaces, from restaurants ("There's no crying in the kitchen!") to the corporate office ("There's no crying in the boardroom!"), signifying the importance of keeping a lid on raw emotion when there's a job to be done.

But in recent years, there has been an about-face when it comes to emotions in the workplace. Thanks to bestselling leadership books such as Emotional Intelligence and Executive EQ, managers are becoming more aware of the link between employee emotions and decision making, creativity, teamwork and yes, even job performance.

When you think about it, this shift makes much more sense than expecting workers to leave their emotions at the door each morning. It is much more reasonable to accept that people will come to work as whole beings complete with personal traits, quirks, attitudes, experiences and moods -- both good and bad.

Smart managers are realizing that organizational success is directly related to how well they elicit, utilize and sustain employees' emotions. In fact, emotional states directly affect the bottom line. This is because they have an impact on each of the five major pillars that uphold a company's competitive advantage:

Intellectual capital: Intellectual capital refers to the resources that determine the value and innovation of an organization. Research shows that emotions have a direct influence on intellectual functioning. Negative emotions cause thinking to become more rigid, less original and more haphazard. When employees are feeling down, they don't have the interest to create or the energy to recognize new opportunities.

On the other hand, confident people who feel passionate about the work they are doing are more likely to come up with great ideas, find effective solutions and envision possibilities. Emotions play a major role in determining both the amount and the liquidity (sharing, disseminating and using ideas) of intellectual capital.

The more ideas that are generated and the greater the liquidity, the more successful the organization is as a whole.

Customer service: All negative customer service experiences are based on emotion or lack of it. In fact, it has been reported that 68 per cent of customers have taken their business elsewhere because they were treated with indifference. If an organization employs a frontline team that is demoralized or disinterested, then no amount of training will counteract the poor service they are providing. The emotions that are causing the dispirited climate must be directly and immediately addressed before customers are lost.

Organizational responsiveness: The marketplace is rapidly and constantly evolving and organizations need to be fast and flexible in responding to change if they want to stay competitive. Not surprisingly, disengaged employees who feel threatened or stressed out are resistant to change and likely to cling to obsolete practices. Meanwhile, those who feel secure and committed in their jobs are not only unafraid of change, they are motivated by it because they see it as energizing and exciting.

Productivity: Productivity is a perpetual workplace issue, but by better understanding how closely employee emotion ties in to productivity managers can get a handle on how to optimize resources. Quite simply, emotions fuel productivity. The happier the employee, the faster they process information and the more likely they are to want to work hard. The happier the overall workforce, the more energy an organization has to power its production.

Recruitment and retention: Today more than ever, an organization's success depends on its ability to recruit and retain high-quality people, and this ability is once again linked to the emotions of its employees. Companies that are known as being fun places to work because their workers are happy, treated well and are obviously proud and passionate about the work they do will certainly attract top talent and reduce the costs associated with employee turnover.

Employees' emotions are inextricably linked to what happens in an organization. When managers become aware of this, they begin to realize that addressing emotions is not a "touchy feely" matter that has no place at work, but a smart business strategy that impacts their competitive advantage and ultimately, the bottom line.

-- With reporting by Barbara Chabai

John McFerran, PhD, F.CHRP, is managing director of Boyden Global Executive Search. He can be contacted at


Republished from the Winnipeg Free Press print edition October 23, 2010 I2

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