Emotional Intelligence & Job Performance in Banking & Insurance Sector in India

Abstract

Introduction Until recently, the government and public sector undertakings dominated the service sector in India. During the last two decades, financial sector reforms and other liberalization measures initiated by the Government of India have increased participation by the private sector in the development and delivery of various services. Thus, keen competition among different segments of banking and insurance sector has emerged. Moreover, the competition has resulted in levels of stress. This may cause a rate of employee turnover. Today, the service enterprises depend heavily on quality of manpower and hence, we must give due weightage to emotional intelligence while managing human resources. The recruitment, retention and training functions need to be redefined. In fact, emotional intelligence has been said to matter twice as much as IQ i.e. intelligence quotient (Goleman, 1998). The studies abroad e.g. Lagrange R Rapisarda (2002), and Donaldo-Feidler & Bond (2004) and in India e.g. Jain & Sinha (2005) ; Sinha & Jain (2004) suggest that emotional intelligence improves the organizational effectiveness and organizational commitment or job satisfaction. These measures are expected to have a positive effect on the job performance. For example, Jayan (2006) found higher levels of emotional-competence for the high managerial performers. Further, Bechara, Tranel &Damasio (2000) found a direct (positive) relationship between emotional intelligence and performance. Recently, O'Boyle Jr. et al., (2010) conducted a meta-analytic study and found that emotional intelligence yields predictive validity above and beyond the five factor model and cognitive ability. The study classified emotional intelligence studies into three streams and found that all three streams of emotional intelligence exhibited substantial relative importance in the presence of FFM and intelligence when predicting job performance. But, there are studies which dispute the existence of a direct relationship between emotional intelligence and job performance. However, these studies imbibe a number of methodological weaknesses. The use of non-standardized measures/scales may generate a low correlation between emotional intelligence and performance. For example, competencies (influence, achievement orientation, empathy, and achievement-orientation) identified as components of emotional intelligence by Rapisarda (2002) cannot be construed to reflect emotional intelligence/competence. Similarly, Jayan (2006) utilized a weaker technique namely, uni-variate ANOVA that fails to abdicate the effects of substantial (measurement) errors. Given the limitations of these studies, the present study re-examines the relationship between emotional intelligence and the job performance. A statistically strong technique, i. e, multiple regression analysis has been used to ascertain the effect, if any, of emotional intelligence on the job performance. Its built-in-procedure neutralizes the measurement error expected in the aforesaid non-standardized domains. The Sample The self- report questionnaire was constructed and the data was collected from 250 employees working in public-sector banks, private sector banks, cooperative banks and insurance companies from different districts of Haryana (Yamunanangar, Kurukshetra, Panipat, Sonipat, Panchkula, Kaithal and Ambala), Chandigarh, Mohali (Panjab) and Delhi during 2007 and 2008. The sample is composed of employees from cooperative banks (14.4 %), insurance (19.2 %), private sector banks (16.4%) and public sector banks (50%). None the less, different categories of employees (clerical workers:34.8 percent, supervisory staff: 24.4%, and managerial staff: 40.8%) working in financial undertakings have been represented in the sample. The Data &Reliability The emotional intelligence scales focus mostly on the lifestyle and social intelligence of employees i. …