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3 Reasons Empathy is Good for Business Soft skills are vital for leaders, regardless of your industry. Here's why being empathetic plays a major role in successfully growing your company.

By Stu Sjouwerman Edited by Jessica Thomas

Opinions expressed by Entrepreneur contributors are their own.

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Good business leaders today need a whole slew of skills and traits to stand out and get results, not the least of which is empathy. This characteristic can easily put you and your company on the fast track to success. But why exactly is empathy so powerful, and how can you develop it in yourself and your team?

Related: The Future of Leadership is Empathy—And Companies are Better for It

Why empathy matters

There are three main reasons why empathy is crucial for professionals.

1. You sell to a person, not to an organization

Sometimes, you might sell to a group instead of an individual. But at the end of the day, you're still selling to people with real feelings and experiences — not an inanimate entity. So you have to have a very clear perspective of who your current or potential customer is. Having a very transparent, clean line of communication with them, understanding what problems they need to manage and understanding what they have to have to get their job done is a must. It is what keeps your business relationships viable and prevents them from withering on the vine.

2. Feeling heard builds true connection

Active listening is a natural part of building empathy and mutual understanding. When you let customers or prospects truly talk about what their problems are and hear them out in an engaged way, you're better able to show them that you grasp what they're struggling with. They start to feel like there's finally someone on the other side who understands what they're going through or thinking, making it much easier to get a relationship started. And relationships ultimately are what businesses are all about.

Importantly, active listening isn't just about parroting back what you've heard (e.g, "What I'm hearing from you is…") or making eye contact. It's about training yourself to mentally slow down and wait until the person has finished talking to form your response, rather than formulating an answer as they talk and trying to make sure the conversation steers to points you personally want to make. Get as comfortable as you can with waiting to answer, because the silence can encourage them to continue and direct the conversation in a deeper way. Pause to think critically after they are done, too, so that the person you're talking to grasps you really are respectfully and fully considering what they've just told you.

3. Empathy translates immediately into free cash flow

If all of your staff have a high level of empathy with your prospects and customers, then they can provide them with fantastic service. That's the number one factor that translates to word-of-mouth support. It's advertising you can never buy that has a direct, positive influence on your bottom line. Once you have that support, your business can enjoy much better stability, which makes it easier to compete and flexibly adapt in tough times. It also ups the odds you'll have the resources to invest in innovation, staffing or whatever else you need.

Related: Empathy in Business Is Vital to an Entrepreneur's Success

Teaching empathy effectively downstream

Being empathetic on your own is good, but teaching others how to be empathetic is far better, because you'll have many different people who can connect with others on behalf of your business.

But how can you do this well? It's pretty simple — just be an example.

Strategies like active listening are a powerful start to modeling good empathy for others. But you also want to explain and show the difference between System 1 and System 2 thinking. These systems, as behavioral economist Daniel Kahneman describes, give a simple overview of how we process most information. System 1 thinking, which you might call reactive or intuition, is quick and emotional. System 2 thinking is more rational and takes a bit of time.

In a business environment, you usually don't want to get into System 1 thinking. You want to stick to System 2 thinking and stay cool, calm and collected. And as a teacher and model, you need to explain to your team how to deal with employees, coworkers, customers and prospects with a level-headed — rather than impulsive — approach.

Related: Why Empathy Is Important in Leaders Right Now

Your best tool for cutting what doesn't work

Empathy is a valuable knife that can cut away much of the inefficiencies and communication problems businesses face. And although it's great to look for empathetic people right off the bat during the hiring process, don't be afraid to be a teacher. Modeling it for your team and reinforcing the behavior can totally change your company atmosphere, so be observant and have the courage to open up when it counts.

Stu Sjouwerman

Founder and CEO, KnowBe4

Stu Sjouwerman (pronounced “shower-man”) is the founder and CEO of KnowBe4, Inc., which offers a platform for security awareness training and simulated phishing.

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