Impact of Managers’ Emotional Competencies on Organizational Performance

Abstract

The research objective of the study is to identify if there is a statistically significant effect of EI competencies on organizational performance, like emotional self-awareness, achievement orientation, adaptability, optimism, and emotional self-control on one side and financial, employee, and operational performance on the other side. The authors used SmartPLS software in order to test the questionnaires and the proposed research hypotheses (PLS-SEM). The questionnaires included three main parts: scales related to the demographic profile of respondents, the most common 360-degree Emotional and Social Competency Inventory—ESCI 360—to assess managers’ emotional intelligence, and scales to measure the respective organizations’ performance. The data for the present study were collected from 80 managers from medium-sized and large organizations in the Republic of Serbia. Managers were required to rate their emotional intelligence and organizations’ performance using a five-point Likert scale. The findings indicate that two EI competencies, such as adaptability and optimism, have a positive impact on organizational performance, while achievement orientation has a negative impact on organizational performance. With this research, we tried to reduce the gap that exists due to the insufficient research on emotionally intelligent managers in developing countries, as well as the existence of contradictory results in this area so far. This study delivers practical implications to organizations, experts and leaders on how to define the learning material for training and coaching, with the aim of obtaining key emotional competencies, thus increasing organizational performance. The more adaptable and optimistic the managers are, the more they will be in a position to perform well in an organization and create an effect on financial, employee and operational performance.