29 Dec Business Hierarchy
Your Business Hierarchy of Needs
Businesses also have a hierarchy of needs, much like Maslow’s hierarchy of needs for us mere mortals!
To satisfy and ascend the business hierarchy, you have to at least satisfy some of the needs below each layer, to move up the hierarchy.
By understanding the importance of solid foundations, using the hierarchy allows you to make strategic decisions about your business, meanwhile helping you focus on what is the most important factor for the long term survival of your business.
This takes you out of crisis mode, putting out fires wherever you go.
At the base of the Business Hierarchy of Needs, you will find SALES. Without sales, you do not have a foundation for a business. This is akin to having no food, as in Maslow’s 1st physiological layer.
Above the first layer is PROFITS. Without profits, there is no stability in the business and the business has no ability to grow and scale. Otherwise, the business is just paying the bills. Profits are akin to safety in Maslow’s pyramid.
Next, profits support ORDER, which is the next layer in the pyramid. Order represents systems and procedures that makes the business efficient and allows autonomy amongst the staff. System and processes further encourage growth and profits, which aligns with Maslow’s belonging layer of the pyramid.
Atop order is IMPACT. Impact implies that the business not only transacts with its customers, but it also creates transformative experiences at each transaction. A relationship is built, similar to Maslow’s esteem layer.
Finally, the Business Hierarchy of Needs is topped with LEGACY, which ensures that the business can live on without you. This aligns with self-actualisation – the qualities that connect us deeply to our humanity.
To use the Business Hierarchy of Needs, you must first identify all your business’s needs that are not being met.
Secondly, you should then prioritise these needs based on the hierarchy of needs. Which unmet needs sit closest to the base of the pyramid? These need to be fixed first before you move up the pyramid. For example, you may not be making enough sales to pay off debts, let alone create profits. Further to this example, it is no use creating systems and procedures if your sales are insufficient to cover costs.
The third step is to establish a measurable solution to the problem and action it immediately, until the problem is solved.
Step 4 is simply rinse and repeat steps 1 – 3, recognising their importance against the Business Hierarchy of Needs each time. Remember, without solid foundations in the layers below, the business will not survive.
Good luck and if you have any questions, feel free to contact me at:
Specialist Business Advisor
0409 610 637
Article inspired by ‘Fix This Next’ by Mike Michalowicz