Business Hierarchy of Needs

April 10, 2008

Anyone that has had basic exposure to the field of psychology would be familiar with Maslow’s “Heirachy of Needs”. Businesses have a similar heirachy of needs.


Maslow’s Hierarchy of Needs is often presented as a triangle :

Physiological Needs

A person’s physiological needs include air, food, water, shelter, sleep etc. Physiological needs are the difference between life and death. A business also has physiological needs : they need suppliers to provide raw materials as inputs, workers to process these raw materials and clients to buy the resulting outputs. Without all three the company will eventually die.

Safety Needs

Safety for people means things like security, morality, law and order. From a business point of view ‘safety’ means one of two things :

  • • Being profitable. A business can survive without profits by breaking even year after year but that doesn’t take into account the opportunity cost of the capital tied up in the business. Investors want a return on their investment.
  • • Fulfilling its mission. Despite not earning a profit (or in some cases even making a loss), not for profit organisations can feel ‘safe’ if they fulfil the mission their benefactors (e.g. governments, philanthropists) have entrusted them with

Belonging Needs

For people these include family, friendship, affection and relationships. The parallel in business is obvious : businesses want to build close relationships with their suppliers and customers.

Esteem Needs

Things like achievement, status, reputation are as important to people as they are to businesses. Business want to be the preferred supplier, they want to be seen as an industry leader and they want prestige. Not because they want to feel “warm and fuzzy” inside – but because all of this translates to the bottom line.

Self-Actualisation

Innovation, creativity, adaptability/agility and learning are all self explanatory and relate equally well to individuals and to businesses.

Why is all of this important? Before you write a proposal or pitch an idea to the executives, the VERY LEAST you should do, is to find out where your organisation fits into the hierarchy of needs. For example, if you’re pitching the benefits of SOA don’t try and sell something at the “self-actualisation” level (like agility) if your organisation has major problems at a lower level, for example supply chain problems. If you propose something that will satisfy that physiological need you improve the odds of your proposal being approved.

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