Episode Notes

Practical intelligence is on my radar screen. Who has it, and who doesn’t? Why is it a critical aspect of small business success and life fulfillment? Our society would be better off if practical intelligence were valued as analytical and creative intelligence and not belittled. We need all three types of intelligence in entrepreneurial leadership and life. And here’s why.

I listened online to a panel discussion in 2010 of three MBA students who became entrepreneurs. A Stanford Graduate School of Business professor assembled a forum to discuss “what they don’t teach in business school about entrepreneurship.” All three panelists have had major successes and a few failures. I realized that what they described as lacking in their education was practical intelligence. 

They learned about sales but were never required to sell. They received accolades for their strengths but needed guidance on their weaknesses, which helped forge complimentary business partnerships. Having all the answers worked at school but not in starting new businesses, where trusting the discovery process is critical in finding your niche.

Listening to the panel reminded me of another Stanford student, Elizabeth Holmes, who dropped out of school and founded Theranos, Inc. at 19 in 2003. Amazingly, she raised over $70M touting a breakthrough technology that could give you information from a simple finger prick blood sample. Theranos, Inc. was valued at $10 billion in 2013. The Theranos technology or automated devices didn’t stand up to scrutiny. The devices had a fatal flaw; they didn’t work.

Why weren’t the venture capitalists and private investors trying the devices for themselves? Blind faith and believing the hype? Or were they missing practical intelligence? They trusted without verifying the equipment. This skill comes in handy when raising a teenager. Trust and verify.

If we embraced practical intelligence, we would be less vulnerable to manipulation, exploitation, and scams. We would invest monies in entrepreneurs who demonstrate how they can shift and do what is necessary to build a business or lead a democracy. We would know how to see through the hyperbole and falsehoods and dismantle the narcissism behind the mystic. Next week I will showcase examples of entrepreneurs demonstrating practical intelligence.

Where do we learn practical intelligence if analytical and creative intelligence is taught in school? We learn practical intelligence through experience in a wide variety of environments, adapting our behavior and expectations on the spot, and through meaningful conversations with others who share their experiences. It is referred to as ‘street smarts’ or ‘common sense,’ with the contrast being book smarts.

What if we equally valued, encouraged, and integrated the development of all three forms of intelligence in all classrooms and all subjects? We would be more appreciative of the benefits of acquiring analytical, creative, and practical intelligence. We would probably feel more whole and confident because society isn’t downgrading a vital aspect of our humanness; adaptability and responsiveness.

Robert Sternberg coined the phrase practical intelligence and developed the triarchic theory of intelligence; analytical, creative, and practical intelligence. 

• Analytical intelligence “plays a significant role in one’s overall intelligence. It involves critically analyzing one’s cognitive and physiological strengths and weaknesses. It also incorporates effectively processing information, solving problems, making critical judgments on information, and effectively completing academic tasks.” Many entrepreneurs have told me they are better at practical tasks than academics. They apply analytical intelligence when they analyze cash flow activities, for example, and study the actions that led to the financial results, something that directly affects them. They are not learning for the sake of learning.
• Practical intelligence is “gained from experience in various circumstances and environments. It aids an individual in adapting their behaviors and expectations to their present environment.” In entrepreneurship, we immerse ourselves in the culture we create. We adapt as we get new information. If we take responsibility for our path, we learn new behaviors and clarify expectations as we influence others to take risks to grow with us and potentially financially prosper.
• Creative intelligence “is the creation of solutions to new problems based on previously learned information. In other words, old behaviors, and tactics are used to enable success in new environments.” Creativity works for entrepreneurs when we can make a living from our creations or use creativity to engage our imagination in advancing our society and solving big problems through business ownership.

I received a desperate call from an entrepreneur decades ago. The experience is seared in my brain. This human invented the next type of ‘must-have’ tennis shoes. This unnamed entrepreneur lived in an apartment in the 1990s with one whole room devoted to his many kinds of shoes (not co-founder Phil Knight of Nike). He spent a half hour describing everything he had done, the money he invested in getting patents for his shoes in nine or ten countries, including the United States. The partners that came and went, and how he obliterated the relationships with his key U.S. manufacturers. He took no responsibility for where he was in life; he was broke and wanted more free advice, possibly another person to blame.

I told him the hard truth. He has a history of destroying key relationships in his life. His narcissism, meaning his shame and insecurities, was sabotaging his life. He needed to redefine his life and find a different way to support himself. No one could save the fate of his venture.

The track record of rehabilitation for those suffering from narcissism is low. They can’t seem to get outside of themselves. I believe the practical first step out of shame and insecurity is to hold ourselves 100% responsible for our circumstances and where we are in life. I thank entrepreneur and author Jack Canfield. He is most famous for co-authoring the Chicken Soup for the Soul series. There is a difference between being a victim and acknowledging that you were victimized. Choose the latter.

Being raised by someone suffering from narcissism made me keenly aware of all the practical steps I needed to take to basically save my soul and become worthy, respectful of myself and others, compassionate, and kind. A practical vow I took in 2015 was to do no harm and not knowingly put myself in harm’s way. I still live by this vow. It is working.

Engaging in the triarchic theory of intelligence has helped me recognize our humanity, appreciate how far I have come, and how I can continue to contribute to others on the path to evolve with their ventures. I have integrated my past and feel psychologically and emotionally free from being raised in a household with an entrepreneurial father with narcissism and a mother with an undiagnosed borderline personality disorder. I can appreciate the gifts that made me who I am and understand that my parents did the best they could. They were more than their maladies.

Robert Sternberg believes that to be considered intelligent, a person needs to have all three types of intelligence and know when and how to use each. In entrepreneurship, applying the same curiosity about one’s venture to examining one’s life is the difference between living an abundant life and viewing your life as a tragedy. Character development starts with practical intelligence activities that help you know oneself.

Do you have all three types of intelligence? Expand your knowing of when and how to apply practical, analytical, and creative intelligence in relationships, your venture, and life.  Happy Valentine’s Day! Spread the love.  DOWNLOAD

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