You may have heard the quote, “a goal without a plan is just a wish.” This applies to many areas of life, but especially to small businesses. Setting goals backed by a detailed plan for execution can be a lifesaver for small businesses, especially in the first few years.
Although only 20% of businesses fail in the first two years, this number jumps to nearly 50% by the first five years. With this in mind, we’ll look at Maslow’s hierarchy of needs and show how you can apply this concept to your company’s goal-setting to ensure you fall in the group that succeeds.
Hierarchy of Needs
Developed by Abraham Maslow in 1943, the Hierarchy of Needs consists of a five-tier model of human necessities, visualized in a pyramid structure. Needs listed on the lower tiers on the pyramid are theorized to be of higher priority than the ones above. For example, the needs on the bottom, like food and water, must be met before higher-level needs like self-actualization.
Starting from the bottom of the pyramid, the hierarchy of needs are as follows:
- Physiological needs: This category includes basic needs required for survival, like food, water, and sleep.
- Safety needs: This includes the necessity of shelter and safety, as well as financial security, emotional security, health, and well-being.
- Social needs: In this category, we see the human desire to belong, feel loved, and have intimate relationships. Having these needs fulfilled motivates other behaviors.
- Esteem needs: This category can be broken down into esteem for oneself, like dignity and accomplishment, and desire for respect from others, like status and prestige.
- Self-actualization needs: The highest on the pyramid is self-actualization, when one feels fulfilled and that they are achieving their full potential. At this highest level, a person realizes their potential and seeks personal growth or creative expression.
So, how do these needs relate to a professional life? To achieve your business goals and the ultimate level of professional fulfillment, certain needs need to be met. Using Maslow’s template, we can build a hierarchy of needs for a small business.
- Physical: This covers the basic needs for a business, and can include making sure your income covers operating expenses such as rent and utilities.
- Safety: In a business context, this could mean reaching a safety net goal that can cover any unexpected expenses or losses, allowing your business to continue growing and expanding should a minor hiccup occur.
- Social: Once a person has their survival and safety needs met, they seek relationships and companionship. A business might do this by establishing a strong social media presence and joining business development and networking groups.
- Esteem: A person’s self-esteem can be compared to a company’s brand. As a small business or entrepreneur, if you have built a solid reputation, your growth opportunities will continue to expand as brand awareness increases. Your company or professional reputation may hold a certain status, which fulfills the desire for esteem.
- Self-actualization: A company or consultant can reach a point of self-actualization, perhaps through a certain revenue goal or a more abstract goal of being recognized as an expert in the field. Another example may be reaching a point of brand recognition for your small business and feeling like you’re carrying out your business’s mission statement.
So, how can you use this tool to set and reach your business goals?
Translating the Hierarchy of Needs Into Business Goals
Now that you understand the hierarchy of needs, we can rework the five-tier pyramid into more of a business goal-setting theory. This hierarchy allows you to break up your different goals into different levels and plot a course for your business.
Physiological Needs: Business Basics
Much like the hierarchy of human needs, it’s hard to think about achieving goals if basic needs are not met. In business terms, this means setting up a safe and legal work environment. Does your business have the correct tools to do the best job? Does your business space have proper heat, AC, and lighting? Are you able to pay your rent and basic operating expenses?
Safety Needs: Healthy Work Environment
Next on the pyramid is making sure your business is a safe and secure place for everyone on your team. Have you created an environment where everyone treats coworkers with respect? Can they expect to show up every day and not worry about being harshly criticized or humiliated?
Social Needs: Feeling of Belonging
If you have employees, building an inclusive culture around everyday work can be a big boost to productivity. But this can apply to a business’s interactions with the community as well. You may want to join a chamber of commerce or a networking group to foster positive relationships with both other businesses and the community.
Esteem: Building a Good Reputation
Building a good reputation can be done in many ways. Perhaps your company is heavily involved in local charities, or you have positive online reviews on how you treat your employees. But ultimately, a good reputation comes down to how you run your business, and how you treat others.
Self-Actualization: Branching Out
Finally, once you’ve established these levels, you are free to focus on the bigger picture. Your goal may be to expand your business through franchising and establishing a bigger market share. It could also mean stepping back from daily operations to do consulting or freelance work. It may also mean selling your business to begin a new project or to retire. By this point, you should be proud of your accomplishments!
Create Goals for Your Company Today
What can you achieve by using the five-tier pyramid to compile this high level of thoughtful goal setting? Ultimately, you give yourself a chance to create an actionable plan. Take your business to the next level by applying Maslow’s hierarchy of needs to your business goal setting.
As a small business owner, consultant, or freelancer, your business deserves a chance to achieve the level of self-actualization attainable through proper goal setting and an actionable plan. For additional support and resources for business owners, contact the ZenBusiness team today. We can help you with more of the administrative tasks involved in running a business so that you can focus on developing and meeting your business goals.