{"id":28823,"date":"2024-11-06T03:50:23","date_gmt":"2024-11-06T08:50:23","guid":{"rendered":"https:\/\/coachingfederation.org\/blog\/stress-risk-tolerance-personality-type-what-leaders-should-know\/"},"modified":"2024-11-06T03:50:23","modified_gmt":"2024-11-06T08:50:23","slug":"stress-risk-tolerance-personality-type-what-leaders-should-know","status":"publish","type":"post","link":"https:\/\/coachingfederation.org\/blog\/stress-risk-tolerance-personality-type-what-leaders-should-know\/","title":{"rendered":"Stress, Risk Tolerance, and Personality Type: What Leaders Need to Know"},"content":{"rendered":"<p><span data-contrast=\"auto\">Moderate stress is normal and has positive benefits. However, as stress levels increase, our thinking can become clouded by negative emotions, and we\u2019re <\/span><a href=\"https:\/\/www.ncbi.nlm.nih.gov\/pmc\/articles\/PMC5346059\/\" target=\"_blank\" rel=\"noopener\"><span data-contrast=\"none\">prone to make poor decisions<\/span><\/a><span data-contrast=\"auto\">.<\/span><\/p>\n<p><span data-contrast=\"auto\">Numerous studies show stress can affect our approach to risk, which is strongly tied to investment and business strategy. The last thing you want is for your leaders to make poor strategic decisions because they\u2019re not self-aware and not managing their stress properly.<\/span><\/p>\n<p><span data-contrast=\"auto\">But how do you prevent stress from taking over your leader\u2019s decision-making processes?<\/span><\/p>\n<h2><b><span data-contrast=\"auto\">Keeping Your Cool in Stressful Times Starts with Self-Awareness<\/span><\/b><\/h2>\n<p><span data-contrast=\"auto\">Self-awareness is key. If you know how your personality type affects your natural approach to risk-taking, as well as what stresses you, you\u2019re better able to keep yourself in check and avoid regrettable decisions.<\/span><\/p>\n<p><span data-contrast=\"auto\">Let\u2019s look at how personality preferences may influence our risk tolerance, based on the Myers\u2013Briggs Type Indicator<\/span><span data-contrast=\"auto\">\u00ae<\/span><span data-contrast=\"auto\"> (MBTI<\/span><span data-contrast=\"auto\">\u00ae<\/span><span data-contrast=\"auto\">) assessment. MBTI personality type identifies whether we:<\/span><\/p>\n<ul>\n<li><span data-contrast=\"auto\"> Focus attention on the outside world of people and things (Extraversion) or the inner world of thoughts and feelings (Introversion).<\/span><\/li>\n<li><span data-contrast=\"auto\"> Trust and use information based on experience and the evidence of the five senses (Sensing) or consider the future and how things connect to make the big picture (Intuition).<\/span><\/li>\n<li><span data-contrast=\"auto\"> Make decisions based on objective logic (Thinking) or on values and how the decision will affect people (Feeling).<\/span><\/li>\n<li><span data-contrast=\"auto\"> Live in a more structured, organized way (Judging) or in a more flexible, spontaneous way (Perceiving).<\/span><\/li>\n<\/ul>\n<h2><b><span data-contrast=\"auto\">How Personality Type Affects Risk Tolerance and Risk Aversion<\/span><\/b><\/h2>\n<p><span data-contrast=\"auto\"><a href=\"https:\/\/www.tandfonline.com\/doi\/abs\/10.1207\/s15427579jpfm0604_1\" target=\"_blank\" rel=\"noopener\">One study<\/a> found that investors with a higher tolerance for risk were more likely to have a Thinking preference, while those with a Feeling preference were more risk-averse.<\/span><\/p>\n<p><span data-contrast=\"auto\">Furthermore, <a href=\"https:\/\/econpapers.repec.org\/article\/eblecbull\/eb-17-00614.htm\" target=\"_blank\" rel=\"noopener\">another study<\/a> found that those who prefer Introversion, Sensing, Feeling, and Judging were more risk-averse.<\/span><\/p>\n<p><span data-contrast=\"auto\">The research team also found an interaction effect between E-I (Extraversion-Introversion) and T-F (Thinking-Feeling). Among those who preferred Extraversion, those with a Feeling preference were more risk-averse than those with a Thinking preference. In other words, leaders who prefer ESFP, ESFJ, ENFP, and ENFJ types were more likely to be risk-averse than those with preferences for ESTP, ENTP, ESTJ, and ENTJ.<\/span><\/p>\n<p><span data-contrast=\"auto\">As stress levels rise, we tend to overuse our natural personality preferences.<\/span><\/p>\n<p><span data-contrast=\"auto\">If we\u2019re prone to be risk-takers, under stress, we may take bigger risks, and vice versa if we\u2019re naturally risk-averse.<\/span><\/p>\n<p><span data-contrast=\"auto\">By recognizing this tendency, leaders can check themselves during extreme strategic choices, such as the decision to liquidate parts of the business, reorganize departments, or proceed with layoffs (the last of which much research, including <a href=\"https:\/\/joshbersin.com\/2022\/06\/be-careful-with-the-layoffs\/\" target=\"_blank\" rel=\"noopener\">Bersin<\/a> and <a href=\"https:\/\/www.shrm.org\/hr-today\/trends-and-forecasting\/special-reports-and-expert-views\/documents\/employment-downsizing.pdf\" target=\"_blank\" rel=\"noopener\">Casio<\/a>, has shown to yield more negative than positive outcomes).<\/span><\/p>\n<h2><b><span data-contrast=\"auto\">Understanding Stressors and Coping Mechanisms<\/span><\/b><\/h2>\n<p><span data-contrast=\"auto\">In addition to understanding our natural risk tolerance or risk aversion under stress, understanding personality type helps us better control stress by easily identifying things that stress us out.<\/span><\/p>\n<p><span data-contrast=\"auto\">Here\u2019s a list of typical stressors for four of the 16 MBTI personality types (for a more complete list of stressors by type, <a href=\"https:\/\/www.themyersbriggs.com\/Search\/\/-\/media\/Myers-Briggs\/Files\/Resources-Hub-Files\/Infographics\/Stress-around-the-world-infographic-US.pdf\" target=\"_blank\" rel=\"noopener\">check out this infographic<\/a>):<\/span><\/p>\n<ul>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559684&quot;:-2,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\uf0b7&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"1\" data-aria-level=\"1\"><span data-contrast=\"auto\">ISFJ: Disregard for established rules and regulations, insufficient time to prepare.<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559684&quot;:-2,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\uf0b7&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"2\" data-aria-level=\"1\"><span data-contrast=\"auto\">INTP: Socializing, noise, and other interruptions, following strict guidelines.<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559684&quot;:-2,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\uf0b7&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"3\" data-aria-level=\"1\"><span data-contrast=\"auto\">ENFP: Organization at the expense of creativity, micromanaging, over- commitment.<\/span><\/li>\n<li data-leveltext=\"\uf0b7\" data-font=\"Symbol\" data-listid=\"1\" data-list-defn-props=\"{&quot;335552541&quot;:1,&quot;335559684&quot;:-2,&quot;335559685&quot;:720,&quot;335559991&quot;:360,&quot;469769226&quot;:&quot;Symbol&quot;,&quot;469769242&quot;:[8226],&quot;469777803&quot;:&quot;left&quot;,&quot;469777804&quot;:&quot;\uf0b7&quot;,&quot;469777815&quot;:&quot;hybridMultilevel&quot;}\" aria-setsize=\"-1\" data-aria-posinset=\"4\" data-aria-level=\"1\"><span data-contrast=\"auto\">ESTJ: Disregarding established rules, inefficiency, lack of control, constant changes.<\/span><\/li>\n<\/ul>\n<h2><b><span data-contrast=\"auto\">Don\u2019t Ignore Stress: Make Necessary Changes<\/span><\/b><\/h2>\n<p><span data-contrast=\"auto\">You may have noticed two distinct camps \u2014 one stressed by a loss of structured routine and another stressed by too much structure.<\/span><\/p>\n<p><span data-contrast=\"auto\">It\u2019s easy to see how either of these could be someone\u2019s reality in leadership or executive positions.<\/span><\/p>\n<p><span data-contrast=\"auto\">If a leader suddenly finds themselves working from home or managing a team in a remote or hybrid work environment without previous experience, they may find that their routine has been unpleasantly disrupted and the structure they\u2019d built disappearing.<\/span><\/p>\n<p><span data-contrast=\"auto\">On the other hand, a leader who prefers less structured work environments and is suddenly switched to remote work may find that their companies are asking for more reporting and checking in, all in the name of accountability. And they\u2019re asking for the leader to also pursue the same accountability with the employees they manage.<\/span><\/p>\n<p><span data-contrast=\"auto\">Either way, the path to clear-headed thinking, which is paramount to striking a balance between risk tolerance and risk aversion that\u2019s necessary for sound management, starts with asking yourself:<\/span><\/p>\n<ul>\n<li><span data-contrast=\"auto\"> What stresses me out?<\/span><\/li>\n<li><span data-contrast=\"auto\"> How is this increased stress level affecting my natural tendencies toward risk aversion or risk tolerance \u2014 will I tend to make more or less aggressive decisions?<\/span><\/li>\n<li><span data-contrast=\"auto\"> Which elements causing stress in my life do I have control over, and what can I do to mitigate them?<\/span><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Moderate stress is normal and has positive benefits. However, as stress levels&hellip;<\/p>\n","protected":false},"author":3,"featured_media":7029,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_seopress_robots_primary_cat":"","_seopress_titles_title":"Personality & Stress: How Type Affects Stress & Risk Tolerance","_seopress_titles_desc":"Different personality types handle stressful situations differently. Learn how to identify personality types & handle stressful or risky situations.","_seopress_robots_index":"","_searchwp_excluded":"","footnotes":""},"audience-type":[119,122],"display-option":[],"post-type":[128],"topic":[59,78],"_person-tax":[1873],"class_list":{"0":"post-28823","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","6":"hentry","7":"audience-type-hr-organizational-leaders","8":"audience-type-managers-leaders-using-coaching","9":"post-type-blog","10":"topic-coaching-in-organizations","11":"topic-coaching-skills-for-leaders","12":"_person-tax-1873","13":"not-partnership-post","19":"_person-tax-27777","20":"has-featured-image"},"acf":[],"_links":{"self":[{"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/posts\/28823","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/comments?post=28823"}],"version-history":[{"count":0,"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/posts\/28823\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/media\/7029"}],"wp:attachment":[{"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/media?parent=28823"}],"wp:term":[{"taxonomy":"audience-type","embeddable":true,"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/audience-type?post=28823"},{"taxonomy":"display-option","embeddable":true,"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/display-option?post=28823"},{"taxonomy":"post-type","embeddable":true,"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/post-type?post=28823"},{"taxonomy":"topic","embeddable":true,"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/topic?post=28823"},{"taxonomy":"_person-tax","embeddable":true,"href":"https:\/\/coachingfederation.org\/wp-json\/wp\/v2\/_person-tax?post=28823"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}