In part one we explored identity, in part two we explored why off-the-shelf management operating frameworks are insufficient in family business, the role of emotion, and 5 roadblocks to effective family business leadership. In our third and final blog of the series we will explore making emotional intelligence a superpower. You can give it a try through two practical exercises.
Series Take Aways:
The role of identity in decision-making and problem-solving processes.
Why modern management and governance frameworks are insufficient in family business.
The 5 roadblocks that hinder leadership effectiveness in family business.
The concept of emotional intelligence and its importance as a leadership superpower.
Practical exercises to enhance your leadership effectiveness immediately.
Emotional Intelligence as a Leadership Superpower
Emotional Intelligence (EI) has been studied for several decades, but only recently has its true importance been embraced as the key trait for successful organizational leadership. In fact, modern research consistently points to EI being more important than IQ for leadership and organizational success. Management operating frameworks that focus on organizational effectiveness are missing the mark if those at the top are not also trained to develop EI in themselves and every other member of their leadership team.
Following the release of his book “In Search of Excellence: Lessons from the world’s best run companies” and the development of the McKinsey 7S with Robert Waterman, Jr., management guru Tom Peters built a career on six words. He did not know it when the book launched in 1982, but those six words, “Hard is soft. Soft is hard.” encapsulate why EI is critical.
When organizational effectiveness is weak, the hard stuff - strategy, structure, & systems - improvements are the easy part. The more powerful intervention is to focus on the soft, people stuff by moving leaders with high EI into place. Leaf Babin and Jocko Willink, ex-Navy SEALs, who, in 2015, wrote “Extreme Ownership: How the Navy SEALs Lead and Win,” illustrate this point well.
One of the compelling stories that captures the essence of the message involves how each SEAL training group (or "boat crew") faced a grueling and competitive ocean racecourse challenge. One boat crew consistently performed poorly and lost, while another crew was consistently winning. The instructors decided to switch the leaders of these two boat crews to see if it would make a difference. Remarkably, the previously losing crew began to win under the new leadership, demonstrating the profound impact of effective leadership on team performance. This story underscores the book’s central theme: the importance of leadership and taking extreme ownership for the success and failures of the team, and the power of emotional intelligence in motivating a team.
What is Emotional Intelligence?
EI is the ability to recognize, understand, and manage one's own emotions, as well as the emotions of others. It encompasses three key attributes: self-awareness, social (other) awareness, and self-regulation. These skills enable individuals to navigate social complexities, build strong relationships, and make informed, empathetic decisions.
EI is the critical superpower for leadership, particularly in family business where soft skills requirements are far more complex and demanding than other forms (eg., privately held non-family, private equity backed, and public companies). Leaders with high EI handle stress better, resolve conflicts more effectively, and create a positive work environment. They are also better at inspiring and motivating their teams.
In part 2 of our blog series, we introduced a G3 – G4 generational transition example. The family CEO of the G3 business had spent years developing EI in herself and her leadership team. She had sufficient empathy to wisely invest the time and effort needed to understand the perspectives of different family members during succession planning discussions. She used an assertive leadership approach that was warm, offered clear expectations, constructively challenged faulty mental models, and provided a psychologically safe environment.
She could have achieved faster results by prioritizing tasks over relationships. However, her approach emphasized collaboration and relationship-building, which opened the door to previously unexplored options. By focusing on alignment and buy-in, she worked with others to create a comprehensive transition plan. While not everyone agreed with every decision, the process fostered a shared understanding of the rationale behind them—prioritizing the best interests of both the business and the family. This ultimately led to stronger outcomes and greater collective support.
Want more on EI? See our blog.
Practical Exercises to Enhance Leadership Effectiveness
Exercise 1: Emotional Self-Awareness
CAVEAT: This exercise does not apply if you are or were in a verbally or physically abusive relationship. If that is the case, there are other resources needed to support change.
Take a slow deep breath in and out, remind yourself that you are safe in the present. Then think of a verbal argument that you regret – we’ve all had them. Where does your regret stem from? Did you react impulsively? Were you mean-spirited or say things you wish you hadn’t? Were you passive and let someone steamroll you? Now look deeper what were you feeling at the time? What are you feeling now? What does this inner experience say about who you are as a person? Stop there.
Emotion is a natural biochemical and physiological response to a stimulus—something that happens to us, beyond our control. What we can control are our feelings and the behaviors that follow. But what connects emotion and feeling? Feelings arise from the meaning we assign to our emotions in the brief space between stimulus and response. It is within this fleeting moment that we have the power to choose our response. Growth lies in making mindful choices, and true power comes from the ability to regulate our feelings and behaviors with intention.
Imagine that you could get in a time machine and change the conversation. See yourself at the point of being triggered and push the pause button. Ask yourself:
What outcome do I want from this?
Why does that outcome matter to me?
What does the other person need from me?
Reimagine the conversation by starting with a question like, “What do you need or want from me right now?” Then, simply listen. Imagine the shift in response when your focus begins with seeking to understand. This approach not only deepens your self-awareness but also helps you regulate your emotions, empowering you to remain calmly present despite any differences. You become a better listener by recognizing that you control your reactions, the other person cannot harm you, and agreement is not required. Your role is to hear and acknowledge their perspective with an open mind.
Exercise 2: Emotional Awareness Journal with a Twist
Begin to track your emotions by journaling or making short recordings throughout the day. Pick two people that you regularly interact with. Pick one that feels safe and easy for you and one that is challenging.
Part 1 - After each meeting make a quick note:
Write down the topic of conversation, the emotions and feelings you experienced.
Note what you observed in the other person’s behaviors that triggered the associated emotions and feelings.
Reflect on your responses and think about novel ways to handle similar situations in the future.
Part 2 – Ask a person you feel safe and easy with to keep their own journal of the meetings. Ask them to:
Write down the topic of the conversation.
Their observations about how they felt toward you during the conversation.
Affirmations for what went well and suggestions for what would’ve made the conversation more productive for them.
Keep these journals for two weeks, then review:
For the person that is easy for you to engage with, what do you most enjoy about the conversations? How are disagreements handled?
For the person that was difficult, what triggers do you most struggle with? How do you typically respond? How are disagreements handled?
What can you learn about yourself from these reflections?
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