Psychology in Business Management: Abraham Maslow’s Eupsychian Management

Ceylan Cizmeli Perhaps one of the most prominent examples of how psychological theories can be applied to a wide variety of other settings is the works of Abraham Maslow. In addition to his mostly known concept of the `hierarchy of needs` and humanistic approach to psychology, Maslow’s early conceptualizations of motivation, self-actualization and synergy have offered several window opportunities for the managers, management theorists. It was only by chance that Maslow met with the industrial settings as the real player in it. In the mid-1940s he had a health problem characterized by an unexplainable extreme fatigue and he had to resign from his teaching job for a while. However, the life was not easy, he had to support his family. Luckily, one of his relatives offered him an easy job as a plant manager at their family business Maslow Cooperage in rural Pleasanton, CA. He was supposed to supervise the coopers who repaired wooden barrels for a nearby winery. He left this job and returned back to teaching and doing research after getting recovered from his illness, however, the observations that he made there proved to be invaluable for his later conceptualizations. In 1954, after his return to academy, Maslow wrote a book with the title of Motivation and Personality. The positive outlook on human nature he depicted in this book was taken by Douglas McGregor, who were a professor at MIT then, and incorporated into a management theory. McGregor published a book, The Human Side of Enterprise, in 1960 based on Maslow’s humanistic approach and presented two different managerial perspective, i.e. Theory X which views workers as inherently lazy and irresponsible and Theory Y which views workers as inherently hardworking and cooperative. Within this formulation, Theory Y was just a mirror of Maslow’s optimistic view of human nature. In the summer of 1962, Maslow decided to take a sabbatical. Well, it was not unusual for a professor at that time. What was not so common then was to choose a high-tech company for that. After he published his book Toward a Psychology of Being in which he presented his theory of hierarchy of needs, Andrew Kay, the president of a high-tech company Non-Linear System (NLS), was interested in Maslow’s theory on motivation and personality. NLS was planning to reorganize the work place in accordance with Theory Y of management and invited Maslow to observe the work environment. Maslow did not want to miss the opportunity of real-life testing of his theory and accepted that invitation. The company’s work environment was being re-organized around the theme of employee productivity, creativity and cooperation, and the results were great: Decreased absenteeism and turnover accompanied by increased productivity and profits! The managers were very surprised by these quick results, however, as it appeared in Maslow’s diary he wrote during that days, he was rather skeptical about the underlying reasons of this outcome. Rather than seeing the management as dichotomous (Theory X vs. Theory Y), he suggested that it was the synergy that drives the convergence of the company’s and employees’ interests through what he called `enlightened management`. 1

Everyone is courageous enough for eupsychian processes. in 1965 he published a manuscript with the title of `Eupsychian Management` .Based on his observations at NSL. 10. Here is the list of those principles: Underlying concept 1. 11. It is good-will present among all the members of the organization rather than rivalry or jealousy. Thus. taking into account the changing nature of the source of motivation for people as they move further in the hierarchy of needs. while a highly paid job could be a great motivator. the take-home message of the enlightened management for managers was this: `You have to have different personnel policies for different people in different situations for them to be truly efficient and effective!`. As people move from basic needs towards self-actualization needs in his so-called hierarchy of needs. The enlightened management reflects a great trust in employees and assumes that every worker prefers to be a prime mover rather than a passive helper. Every well-developed people would rather create than destroy. his insightful ideas has become one of the basis for many American leaders’ activities in management and education settings. Since then. Maslow wrote his book Maslow on Management. He called this compensation (that you come to give more importance to these than how much you are paid over time) as meta-pay. 3. Hostility is primarily reactive rather than character-based. that they are tough. Trust in human nature 2 . He listed 36 principles of enlightened management in that book. assuming independence or finding a meaning in the job. Maslow argued that neither X nor Y is a real representation of what is going on in business environment. and organizing the work environment accordingly are what give rise to the enlightened management. So. 2. Every well-developed people would rather be interested than be bored. Everyone is more likely to prefer responsibility to dependency. 5. at the later stages being creative. relating it with the society could be more powerful sources of motivation. Assume that people can take it. I. referring to the ideal management. Principles to assume Everyone is to be trusted. stronger than most people give them credit for. the sources of motivation change for them. Everyone is more likely to get more pleasure out of loving than out of hating. and described the necessary conditions to be provided for workers to enable them to reach a point of selfactualization and become more productive. By eupsychian management. 8. At the very initial stage. 9. Based on his observations at NLS. There is the wisdom and the efficacy of self-choice by everyone. 6. Everyone has a conscience. 4. 7.

. Everyone prefers meaningful work to meaningless work. 22. 19. 14. 32. 26. Everyone has metamotives and metapays. IV. Everyone prefers to be respected. Everyone involved in the organizations are healthy enough. Everyone is open to development. 16. III. Everyone can enjoy good teamwork. 33. 24. Everyone has the potential tendency to identify with more and more of the world.II. Everyone has the impulse to achieve. 34. 28. 29. but that he prefers fearing the boss to despising the boss. Everyone has the "ability to admire". Everyone has the potential to grow through delight and boredom. 3 . Everyone dislikes fearing anyone (more than he likes fearing anyone). Assume that there is no dominance-subordination hierarchy in the jungle sense or authoritarian sense (or "baboon" sense). whatever this means. Everyone has the same ultimate managerial objectives. preferably in public. Strong belief in the need for self-actualization within human nature 12. 25. Everyone has the preference for working rather than being idle. 31. People in eupsychian plants are not fixated at the safety-need level. 27. 13. everything relevant to the situation. Everyone prefers or perhaps even needs to love his boss (rather than to hate him). 35. Everyone likes to be justly and fairly appreciated. 17.e. friendship. Everyone prefers to be a whole person. i. not a part. 20. 15. identity (in contrast to being anonymous or interchangeable). good group spirit. and that everyone prefers to respect his boss (rather than to disrespect him). Everyone has a tendency towards selfactualization. uniqueness as a person. Everyone is to be informed as completely as possible of as many facts and truths as possible. cooperation and productivity of workers 23. Everyone prefers to be a prime mover rather than a passive helper. Everyone has a tendency to improve things. 18. Strong belief in capacity. The organization is healthy enough. 21. Everyone prefers personhood. Preference for mutual exchange and fair performance evaluations within working environments 30.

we must assume that there is also a countertrend. Complexity of human nature 36.e. an alternative approach to management that goes beyond the dichotomous perspective proposed by McGregor. That’s to say. i. it was very clear for Maslow that it would be very hard to achieve the enlightened management within an unstable economic environment with a fragile economy. there has been a growing movement towards humanizing the workplace. 4 . Today Abraham Maslow’s theory of eupsychian management is still inspiring many managers and management thinkers to create a humanized the workplaces despite the increasing complexity of working environments. Is it really possible and cost-effective to achieve this ideal? It is open to argument. After making his theory of Eupsychian Management public. Maslow was elected to the presidency of American Psychological Association in 1966. He knew very well that those principles of humanistic approach to business environment only worked under good conditions.V. it is really important to underline that no matter how positive and optimistic Maslow was. however. and until his death in 1970 he worked on formulation of `Theory-Z` . he was a realist as well. Every time we talk about a good trend in human nature.

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