What is the emotional cycle of change?

The emotional cycle of change was developed in 1979 by psychologists Don Kelly and Darrell Connor. The cycle outlines some of the common emotions an individual will feel as they experience, react to, and navigate change.

Understanding the emotional cycle of change

The emotional cycle of change describes the emotions most of us experience during the change process. 

While the cycle has distinct phases, not everyone will experience the same emotions or in the same order.

What’s important is that the individual uses the cycle to better anticipate their emotional journey as they encounter new experiences.

The emotional cycle of change is relevant to almost any personal or professional context provided the individual is seeking out the change themselves.

This is the sort of experience that starts with unbridled optimism which transitions to realism, pessimism, and self-doubt.

The five stages of the emotional cycle of change

The emotional cycle of change has five phases. Let’s describe the process from the perspective of an entrepreneur who has just started a new business.

1 – Uninformed optimism 

Also known as the honeymoon period, this is the most exciting phase where the entrepreneur imagines the possibilities and potential of the new enterprise.

The individual can only imagine best-case scenarios since any obstacles or setbacks have not yet been experienced. 

Emotions: excitement, joy, anticipation. 

2 – Informed pessimism 

In the second phase, the entrepreneur has been working long enough to realize how much there is to do or learn.

Given these obstacles, they feel less positive about their chances of success and may question whether the endeavor is worth it.

Emotions: frustration, fear, anger, anxiety.

3 – Valley of despair

The third phase is the valley of despair, a critical juncture where most become overwhelmed and admit defeat.

While this point represents rock bottom, those who push forward may be rewarded for their perseverance. 

The valley of despair was named by authors and business partners Brian Moran and Michael Lennington.

Kelly and Connor were more optimistic, calling it “hopeful realism”

Many entrepreneurs find themselves moving between the first three phases as they try something new, realize it’s too hard, and rationalize that doing something else would be easier.

Emotions: despair, shame, hopelessness. 

4 – Informed pessimism

Positive emotions start to return in the fourth phase as the entrepreneur starts to believe that success is at least possible if not likely.

Hope and faith drive the entrepreneur closer to their objective through hard work and determination. Small wins build critical momentum.

Emotions: hope, optimism, humility, happiness.

5 – Success and fulfillment  

In the final phase, the entrepreneur has launched a new product or seen their company reach unicorn status. In other words, they see and experience the results of change.

Emotions: gratitude, contentment, pride.

Key takeaways:

  • The emotional cycle of change describes the emotions most of us experience during the change process. 
  • While the cycle has distinct phases, not everyone will experience the same emotions or in the same order. What’s important is that the individual uses the cycle to better anticipate and navigate their emotional journey as they encounter new experiences.
  • The five phases of the emotional cycle of change include uninformed optimism, informed pessimism, the valley of despair (hopeful realism), informed pessimism, and success and fulfillment. 

Main Free Master Guides:

Business Models
Business Strategy
Business Development
Digital Business Models
Distribution Channels
Marketing Strategy
Platform Business Models
Tech Business Models

Connected Business Concepts

First-Principles Thinking

First-principles thinking – sometimes called reasoning from first principles – is used to reverse-engineer complex problems and encourage creativity. It involves breaking down problems into basic elements and reassembling them from the ground up. Elon Musk is among the strongest proponents of this way of thinking.

Ladder Of Inference

The ladder of inference is a conscious or subconscious thinking process where an individual moves from a fact to a decision or action. The ladder of inference was created by academic Chris Argyris to illustrate how people form and then use mental models to make decisions.

Six Thinking Hats Model

The Six Thinking Hats model was created by psychologist Edward de Bono in 1986, who noted that personality type was a key driver of how people approached problem-solving. For example, optimists view situations differently from pessimists. Analytical individuals may generate ideas that a more emotional person would not, and vice versa.

Second-Order Thinking

Second-order thinking is a means of assessing the implications of our decisions by considering future consequences. Second-order thinking is a mental model that considers all future possibilities. It encourages individuals to think outside of the box so that they can prepare for every and eventuality. It also discourages the tendency for individuals to default to the most obvious choice.

Lateral Thinking

Lateral thinking is a business strategy that involves approaching a problem from a different direction. The strategy attempts to remove traditionally formulaic and routine approaches to problem-solving by advocating creative thinking, therefore finding unconventional ways to solve a known problem. This sort of non-linear approach to problem-solving, can at times, create a big impact.

Moonshot Thinking

Moonshot thinking is an approach to innovation, and it can be applied to business or any other discipline where you target at least 10X goals. That shifts the mindset, and it empowers a team of people to look for unconventional solutions, thus starting from first principles, by leveraging on fast-paced experimentation.


The concept of cognitive biases was introduced and popularized by the work of Amos Tversky and Daniel Kahneman since 1972. Biases are seen as systematic errors and flaws that make humans deviate from the standards of rationality, thus making us inept at making good decisions under uncertainty.

Bounded Rationality

Bounded rationality is a concept attributed to Herbert Simon, an economist and political scientist interested in decision-making and how we make decisions in the real world. In fact, he believed that rather than optimizing (which was the mainstream view in the past decades) humans follow what he called satisficing.

Dunning-Kruger Effect

The Dunning-Kruger effect describes a cognitive bias where people with low ability in a task overestimate their ability to perform that task well. Consumers or businesses that do not possess the requisite knowledge make bad decisions. What’s more, knowledge gaps prevent the person or business from seeing their mistakes.

Occam’s Razor

Occam’s Razor states that one should not increase (beyond reason) the number of entities required to explain anything. All things being equal, the simplest solution is often the best one. The principle is attributed to 14th-century English theologian William of Ockham.

Mandela Effect

The Mandela effect is a phenomenon where a large group of people remembers an event differently from how it occurred. The Mandela effect was first described in relation to Fiona Broome, who believed that former South African President Nelson Mandela died in prison during the 1980s. While Mandela was released from prison in 1990 and died 23 years later, Broome remembered news coverage of his death in prison and even a speech from his widow. Of course, neither event occurred in reality. But Broome was later to discover that she was not the only one with the same recollection of events.

Crowding-Out Effect

The crowding-out effect occurs when public sector spending reduces spending in the private sector.

Bandwagon Effect

The bandwagon effect tells us that the more a belief or idea has been adopted by more people within a group, the more the individual adoption of that idea might increase within the same group. This is the psychological effect that leads to herd mentality. What in marketing can be associated with social proof.

Pygmalion Effect

The Pygmalion effect is a psychological phenomenon where higher expectations lead to an increase in performance. The Pygmalion effect was defined by psychologist Robert Rosenthal, who described it as “the phenomenon whereby one person’s expectation for another person’s behavior comes to serve as a self-fulfilling prophecy.”
Scroll to Top