Maslow's Hierarchy of Needs

Maslow's Hierarchy of Needs

If there is one piece of basic psychology I use just about every day in managing my business, it's the hierarchy of human needs developed by Abraham Maslow in the 1940's. Simply put, Maslow theorized that people have successive layers of needs, and that as each lower layer is satisfied, then the person moves on to the next layer up.

The lowest layer is that of physiological needs - the need to eat, sleep, stay warm, use the bathroom, etc. The second layer is safety - the need to have physical and psychological security, such as wanting the presence of law and keeping a job. The third layer is that of love and belonging - being the need to be part of a family, group, or gang. Some would say that this third layer is very much a Japanese domain, where belonging to a group seems to take priority over the achievement of higher layers.
How many times have you seen very capable people deny themselves a fuller career due to their desire to stay with some smaller company on the basis that it is their "family"?

The fourth layer is that of self esteem and status. This is where high-achievers dwell, and are able to distinguish themselves commercially and professionally. The fifth layer is "Actualization". This is probably the most tricky layer to define, and generally seems to apply the same values and ideals as many management books do. For example, Wikipedia gives the following description (extract): "Self actualized people embrace the facts and realities of the world rather than denying or avoiding them. They are spontaneous in their ideas and actions. They are creative. They are interested in solving problems, which often includes the problems of others."

While some critics blast Maslow's hierarchy, especially the Actualization layer, as psychobabble, I don't think you can deny the commonsense of the lower layers. For example, why do we pay a minimum salary to fresh graduated employees, when the temptation is force them to "train" with us for nothing? The reason is because they need to eat. If we don't pay them, then even though they may desperately want to be in our company and industry, they physiologically cannot go without a minimum living wage and thus will wind up going somewhere else.

OK, maybe that example is too obvious. Let's try something a bit more sophisticated. What if a talented employee keeps coming back to you as a manager and asking for more money? You don't want to lose that person, so how do you apply the Maslow theory? You look at their salary and their personal circumstances. If they are being well paid and they are settled in with a fulfilling home life, then the lower layers of needs are pretty well taken care of.

So rather than money alone, this person is probably subconsciously asking to move up into the Belonging and/or Self esteem layers - just they don't recognize that need in themselves and consequently keep asking for more cash. Veteran managers will know that often times frequent demands of more money are really signals of the person's desire to change/improve their situation, such as entering the "manager's club" and gaining more self esteem.

I also apply Maslow's theory in doing sales. Some customers want to talk about sports, others their love life (especially if they're young guys), while others are climbing the social ladder. By understanding which level each of these people is relating on, you can then know how to conduct the relationship and for what type of social interaction the client is looking. As I always tell my sales staff, "Selling is less about the product/service and more about how you interact with the decision maker."

Maslow's hierarchy of needs also applies well in crises. Let's say that a major client has just cancelled the company's biggest contract. The natural reaction is to start firing ASAP. The problem with mass lay-offs is that many staff, and particularly the Japanese staff, will take offense at such a heavy-handed attitude and will turn to unions and other resources to fight back. Instead, the appropriate way to handle things is to understand where each person is on the Maslow pyramid and deal with them appropriately. For some, getting fired is desirable, because they need the unemployment checks to feed their families, whereas for others they'd rather resign of their own free will since being fired would mean a blot on an otherwise exemplary resume and thus become a social stigma.

I am only scratching the surface of what Maslow's theory involves. While the thesis is controversial and there are indeed more logical variations available today, such as Dr. William Glasser's Choice Theory, I simply like to interpret Maslow's easy-to-understand theory in my own way. It forces me to put myself in the shoes of the other person and provides a framework that lets me be able to correctly guess what the other person wants from me in a social interaction.