How to Expand Your Small Business Team Based on Maslow’s Hierarchy of Needs

One of the most important – and also most challenging – aspects of business growth for entrepreneurs is figuring out who to hire and when to hire them. In her article, How to Build a Brilliant Team, Katherine Duncan describes how to hire correctly for optimal business performance and growth. Her first tip is to start by filling the key roles of the highest importance to the company. After these basic needs of the company are met, you can then move on to hiring other team members.

In 1943, Abraham Maslow proposed a psychological theory known as Maslow’s Hierarchy of Needs. The theory reflects on fundamental human needs and their hierarchical nature, arguing that basic needs must be met before a person can focus on higher-level emotional or intellectual needs. The theory has been criticized for a number of reasons but is, nonetheless, still used today in business education as a way of understanding a consumer’s motivations for buying a given product or service.

Whether or not you believe the theory holds up for the individual, it is a great way of looking at a business and can help an entrepreneur expand his/her team in the right order.

The graphic below shows Maslow’s Hierarchy of needs as it applies to both the individual and to the small business:

In any small business the owner wears a million hats and must address a range of company needs simultaneously in order to get things started. The roles a founder plays do not fall neatly into the hierarchical categories described above. However, when looking to expand beyond the original founder, and owner should start by honestly evaluating his/her needs and then, starting at the base of the pyramid and working his/her way up, fill in the gaps with new team members who excel in meeting the various needs:

  1. Basic Needs: A business’ primary needs are the basic elements necessary for survival: the supplies and tools needed to deliver a product or service and a customer to deliver it to. Without either of these your company does not exist. This is why Duncan identifies a salesperson as one of the first employees that must be hired after the person or people that actually perform the work.
  2. Safety: Once the company’s basic needs are met, it looks to preserve itself. A manager who can appropriately track where resources come into and leave the company and appropriately plan for the future and allocate those resources will ensure that the basic needs of the company will continue to be met and should be the next key hire.
  3. Love/Belonging: After ensuring the company’s survival, a business owner next strives to make sure that the team is cohesive, happy, and committed to the company’s mission. Proper team building ensures that employees continue to do their jobs well and the company can grow. Thus, a leader who can motivate, inspire, and create cohesion should be next on the list of hires.
  4. Esteem: Now that the company is secure and the team is happy, it is important that its brand is managed appropriately so that the team remains proud to be a part of that brand and customers want to be associated with the brand. It’s at this stage that a marketing strategist becomes valuable enough to justify a salary.
  5. Self-Actualization: Finally, the company is thriving and is ready to continually strive to meet its full potential.

This way of looking at who to hire when is clearly an overview and at the high level. Other roles particular to your company’s needs can be fit into the model where you deem appropriate. The basic principle remains the same, however: when hiring, address the company’s most basic needs first and higher level needs second. It does no good to have an amazing brand manager for your widget company if you’re not able to produce any more widgets.


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