Everyone knows what “intelligence” is. It means being smart and able to do complicated mental tasks, like read a spreadsheet, write code, or figure out how much profit will be made if a product makes its quarterly sales goal.

But what is “emotional intelligence”? And what does it have to do with maintaining innovation leadership?

The term was coined in 1990 in a research paper by two psychology professors, John D. Mayer of University of New Hampshire and Peter Salovey of Yale. Some years later, Mayer defined it in the Harvard Business Review this way:

“From a scientific (rather than a popular) standpoint, emotional intelligence is the ability to accurately perceive your own and others’ emotions; to understand the signals that emotions send about relationships; and to manage your own and others’ emotions. It doesn’t necessarily include the qualities (like optimism, initiative, and self-confidence) that some popular definitions ascribe to it.”

Eight years later, Rutgers psychologist Daniel Goleman linked the importance of emotional intelligence, or EQ, to business leadership.  In his 1998 article for HBR entitled, “What Makes a Leader,” he wrote:

“The most effective leaders are all alike in one crucial way: they all have a high degree of what has come to be known as emotional intelligence. It’s not that IQ and technical skills are irrelevant. They do matter, but…they are the entry-level requirements for executive positions. My research, along with other recent studies, clearly shows that emotional intelligence is the sine qua non of leadership. Without it, a person can have the best training in the world, an incisive, analytical mind, and an endless supply of smart ideas, but he still won’t make a great leader.”

Innovation leaders are all incredibly aware of their impact on others and sensitive to the fact that they serve a wide range of personas, and they’re willing to do the heavy work of being self-conscious. Emotional intelligence relates to your ability to be self-aware, empathetic, and sensitive to the feelings and motivations of other people. These are the conditions in which innovation thrives.

It requires living consciously and paying attention to the impact your actions and statements have on others. In order to connect, incentivize, and motivate others, you need to understand them to their cores. In essence, you need to feel what they feel, and by doing so you can open up dialogue and engagement strategies that are incredibly relevant and meaningful to that stakeholder’s persona.

Emotional Intelligence Leads to Better Innovation

The best innovation leaders bring people along, because—plain and simple—they care enough to understand the individuals they lead. But happily there’s a measurable benefit: the results can boost the bottom line.

This was demonstrated with certainty by Cary Cherniss, professor of applied psychology at Rutgers University, in his research paper “The Business Case for Emotional Intelligence,” which surveyed nineteen proven case studies of leaders and employees who produced higher sales or other positive key performance indicators and who had above-average emotional intelligence. For example, in the case of a manufacturing plant, after supervisors received training in emotional competencies, including how to listen more effectively and how to help employees resolve disagreements on their own, lost-time accidents were reduced by 50%, formal grievances were reduced from an average of 15 per year to just three per year, and the plant exceeded productivity goals by $250,000. In another manufacturing plant where supervisors received similar training, production increased 17 percent.

For a group of matched supervisors who were not trained, there was no such increase in production.

Does having emotional intelligence mean that you’re a softy? That you lack the requisite toughness to lead in times of disruption?

Absolutely not! If you don’t take my word for it, listen to what Jack Welch, one of the toughest leaders in American business, said when speaking to The Wall Street Journal: “A leader’s intelligence has to have a strong emotional component. He has to have high levels of self-awareness, maturity and self-control. She must be able to withstand the heat, handle setbacks, and when those lucky moments arise, enjoy success with equal parts of joy and humility. No doubt emotional intelligence is more rare than book smarts, but my experience says it is actually more important in the making of a leader. You just can’t ignore it.”

TalentSmart studies show the link between EQ and job performance:

• EQ alone explains 58% of a leader’s job performance.
• 90% of top performers are high in EQ.
• Just 20% of low performers are high in EQ.

A study published in the Journal of Organizational Behavior in November 2014 showed individuals who displayed emotional intelligence were more likely to bring home a bigger paycheck than their emotionally stunted colleagues.

Emotional intelligence is good for innovation, good for business, and good for your bottom line!