Why business IQ is not enough in the era of the relationship economy

Friday, 14 February 2020

Why business IQ is not enough in the era of the relationship economy

Originally coined in the 1960’s, the term “emotional intelligence” (EQ) hit the mainstream when it became the topic (and title) of a 1995 best selling book by author and science journalist David Goleman. Goleman’s in-depth review of research on the human brain and human behavior led him to the conclusion that cognitive intelligence alone is not a reliable predictor of future success in life and business. Rather it is emotional intelligence that plays a major role in determining success in life.1 This (at the time) relatively new way of looking at people and success has since gained wide acceptance and EQ has become highly valued within the workplace and beyond.

Twenty-five years later, it’s hard not to draw parallels with a shift happening in the business world. Thanks to technology and global connectivity, cultural, language and geographic barriers to information flow and communication have all but disappeared. That’s great news for consumers as it means more choice than ever before. But for businesses it means competition is at an all-time high and relying on status quo business IQ – price, product and distribution - is no longer enough. 

Welcome to the Relationship Economy

Welcome to the relationship economy - where customer experiences and brand loyalty (business EQ) reign supreme. As Forrester puts it, “Competitive strategy can no longer rely on strength of manufacturing, distribution, or information. It’s the Age of Customer and Forrester’s data proves that the right Customer Experience is the only way to significantly differentiate”.2

Emotional Intelligence and Business

So, what does EQ mean when it comes to business? Much like the original ideas espoused by Goleman, businesses would do well to better understand the feelings, motivations and emotions of their customers and then use that insight to guide their actions. 

For their part, customers want more than a transaction. They are looking for everything you would expect from a relationship - alignment of values, trust, personalization, exceptional service and open dialogue. And, for better or worse, consumers today are less loyal and quick to switch should the relationship sour. According to the American Express 2017 Customer Service Barometer, more than half of Americans have scrapped a planned purchase or transaction because of bad service, and 33 percent say they’ll consider switching companies after just a single instance of poor service.

If business EQ is the secret ingredient of meaningful, lasting and mutually beneficial relationships, it’s critical that businesses be attuned to their customers by gathering emotional intelligence in real-time, continuously. They need to be able to pick up signals before things turn bad or identify things that work well and do more of them. There is one place where consumers are freely sharing their emotions, unprompted, in the moment. Every minute of every day, people around the world are sharing their thoughts, experiences and opinions as they happen on Twitter. Social listening helps tap into these insights, allowing businesses to sharpen their customer EQ and act in the best interest of the relationship.  

Ready to improve your business’s emotional intelligence? Get inspired at data.twitter.com.

1 Daniel Goleman, Emotional Intelligence: Why it can matter more than IQ, 1995, Bantam Books
2 Forrester. (2017). Why and how to lead a CX transformation. Available at: https://www.forrester.com/report/Why+And+How+To+Lead+A+CX+Transformation/-/E-RES137883

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