1. When Intelligence Is Missing
Why raw smarts aren’t enough and what happens when other intelligences are missing in SME leadership
Intro - The IQ Myth – Smart ≠ Successful
From a young age, we’re told that being smart means having a high IQ, that logic, knowledge and technical skill will take you to the top. This belief runs deep in Western culture and it’s carried over into business leadership.
But here’s the truth -
IQ alone won’t make you a successful business owner. And it might even get in your way.
High IQ might help you plan, analyse and solve structured problems. But it doesn’t help you with any of these things -
Manage conflict
Stay calm under pressure
Build trust
Inspire creativity in others
Sense when your team is burning out
In short, IQ doesn’t help you connect. And in small-to-medium businesses, connection is everything.
That’s why this series focuses not on IQ - which is largely fixed, but on three trainable intelligences that actually move the needle in real-world leadership -
Lost relevance, missed market opportunities
When even one of these is missing, the business (and the people inside it) can suffer.
Case Study - Matt – Smart Leader, Failing Culture
Matt runs a software development company in Auckland. Technically brilliant, Matt built the product himself and hired smart people to match. He expected high performance - clear thinking, crisp logic, measurable results.
Matt believed empowering his team meant giving them full autonomy and expecting them to rise to the challenge. But something strange happened -
Projects got delayed
Staff started withdrawing
One talented developer quit without notice
Matt was baffled. “They have everything they need. Why can’t they step up?”
Here’s why -
He gave no emotional support or regular feedback
He didn’t notice rising stress levels or conflict
He dismissed creative ideas as “distractions from core logic”
Matt was leading with IQ alone and it created a cold, disconnected environment that no one wanted to stay in.
The real cost -
Two top team members lost
Burnt-out junior staff unable to speak up
Stalled product innovation and declining morale
Reputation damage in a small, connected industry
“I thought hiring smart people and giving them space was enough. But people need more than space. They need care, clarity, and culture.”
When Emotional Intelligence Is Missing - Trust Breaks Down
What you’ll see -
Short tempers, fast reactions, or emotional shutdown
Lack of feedback or unsafe conversations
Staff who disengage quietly
Good people leaving without warning
Case Study - Rob – Christchurch Electrical Business
Rob ran a solid technical team, but didn’t handle emotions well. He reacted harshly to errors and avoided tough talks. When a lead sparkie quit with no notice, it forced Rob to realise people weren’t leaving the job, they were leaving him.
Costs - Lost staff, customer dissatisfaction, damaged leadership confidence
When Somatic Intelligence Is Missing - Burnout Creeps In
What you’ll see -
Chronic fatigue, brain fog, irritability
Poor sleep, high stress, short attention span
Decision-making that feels rushed or rigid
Physical symptoms being ignored until collapse
Case Study - Kiri – Hawke’s Bay Creative Studio
Kiri pushed through intense workloads, ignoring her body’s warning signs. When her health finally gave out, she lost projects, team confidence and months of momentum. All avoidable, if she’d known how to listen to her body.
Costs - Revenue loss, recovery downtime, credibility hit
When Creative Intelligence Is Missing - Innovation Dies Off
What you’ll see -
Same strategies reused, despite changing conditions
Dismissal of new ideas as “too risky” or “not practical”
Frustrated staff with no outlet for innovation
Slow erosion of market position
Case Study - Toby – Outdoor Retailer, Lower North Island
Toby resisted every new idea his team offered - marketing, layout, events. He clung to what used to work, even as foot traffic and sales declined. By the time he adapted, it was too late.
Costs - One store closed, revenue loss, late entry into digital sales
What’s the Pattern?
Across all these cases, including Matt’s, the real issue wasn’t a lack of effort or skill. It was a lack of the right kind of intelligence.
Missing Intelligence
Emotional Intelligence
What Shows Up
Conflict, confusion, poor communication
Real-World Cost
Staff turnover, poor culture, customer drift
Missing Intelligence
Somatic Intelligence
What Shows Up
Stress, poor boundaries, burnout
Real-World Cost
Sick leave, errors, lost leadership energy
Missing Intelligence
Creative Intelligence
What Shows Up
Stagnation, disengagement, slow adaptation
Real-World Cost
Lost relevance, missed market opportunities
Creative Intelligence
And when only IQ is present, you get a business that looks good on paper but feels terrible to work in.
In Closing - Whole-Body Leadership Wins
Yes, intelligence matters. But the kind that makes your business thrive isn’t just logic. It’s emotional clarity, physical presence and creative courage.
"A high IQ might get you into business, but it's emotional, somatic and creative intelligence that keeps you there."
If you’ve been relying mostly on IQ, it’s not a failure. It’s just a signal: there’s more to unlock.
If you’d like a confidential, free of charge, free of obligation conversation about your business, here’s how to get me.
📞 Phone +64 275 665 682
✉️ Email john.luxton@regenerationhq.co.nz
🌐 Contact Form www.regenerationhq.co.nz/contact
If you’d like to read more RegenerationHQ thinking on SME business and other things, go here – www.regenerationhq.co.nz/articlesoverview
🔹 RegenerationHQ Ltd - Business Problems Solved Sensibly.
Supporting NZ SME Owners to Exit Well, Lead Better and Build Business Value.