Prioritizing What to Focus on in Your Organization

Maslow’s hierarchy of needs is a psychology theory used to understand the levels of intrinsic motivation. While the original hierarchy argued that a lower level must be completely satisfied before moving to pursuit of a higher level, today’s scholars generally believe that the levels overlap at times.

I think that businesses follow a similar theoretical framework - one that can help leaders think about allocating their organizational resources (time, talent, and capital):

Hierarchy of Resource Allocation - Dan Farmer

Hierarchy of Resource Allocation - Dan Farmer

Order ≠ importance. Order signifies that the higher functions are best fulfilled after prior levels have been fulfilled. Similar to the modern interpretation of Maslow’s hierarchy, layers sometimes overlap.

First things first. This framework helps us think about which layers need investment and when. The lowest “incomplete” layer is where organizations should focus their energy. For example, it’s probably unwise to advocate expanding a company’s Enablement Functions (layer 3) when the Mission & Strategy (layer 1) need revision. Investing in higher layers prior to lower layers is likely to lead to wasted time and money.

Think twice. While in Maslow’s hierarchy, lower level activities are very tangible, the lower activities needed in this hierarchy are conceptual and, as a result, are often not deliberately decided. For example, the lemonade stand owner may not explicitly write down a mission or strategy, and may simply have a recipe in their head. But even lacking the deliberate thought, this constitutes the first two layers.

Inspiration drawn from Thomas Davenport’s “What's the Big Idea?: Creating and Capitalizing on the Best New Management Thinking.” Harvard Business School Press, 2004.