The Similarities Between Business Organizations and Psychology

The Similarities Between Business Organizations and Psychology
By Michael P. Marshall, PhD



When one looks at a list of common psychology words, terms and phrases along with their definitions; and then attempt to apply these to business organizations; it is amazing how psychology applies to business organizations in a very direct manner.



Let’s review some common psychology words, terms, phrases and their definitions; and apply them to business organizations.



Get ready for amazement and a revelation that will create much personal thought and serious discussions with others.



Business Organization:

Departments, functions, employees and staff that are not working together affectively as a team and not towards a single positive purpose and goal   (a ‘Mission Statement’ alone does not fix this)


Psychology Term, Word, Phrase  +  Definition:  Dysfunctional
Inability to function emotionally or as a social unit
Not performing as expected
Affected by disease or impairment
Malfunctioning as a structure


Business Organization:

Major tasks and needed improvements rarely getting completed and often delayed with comments of ‘let’s schedule for next year’

When next year comes around, it is delayed yet again


Psychology Term, Word, Phrase  +  Definition:  Procrastination

Procrastination is the counterproductive deferment of actions or tasks to a later time
A mechanism for coping with the anxiety associated with starting or completing any task or decision
Often producing stress, guilt, crisis and severe loss of productivity
Procrastination is often surrounded with issues of anxiety, low sense of self-worth and self-defeating mentality



Business Organization:
Customers, clients and markets not having a good understanding of a business organization or lack of positive feelings toward it, is often referred to as lacking brand and lacking positive brand awareness.
The business organization internally can be confused about themselves regarding purpose, objectives, value to market clients and customers, capabilities and more.


Psychology Term, Word, Phrase  +  Definition:    Identity Crisis
Losing a sense of personal sameness and historical continuity of some shared world image
Critical period in emotional maturity and personality development involving reworking and abandoning earlier ways
The turning point of a disease for better or worse
Time of intense analysis and exploration of different ways of looking at oneself
Balance of identity and confusion, leads to making a total commitment to an identity



Business Organization:
Not seeking out, recruiting, hiring and retaining staff and employees with the highest level of skills, knowledge and expertise that is available that then causes struggles and a lack of business growth in many ways.  Not building a team of individuals with the highest level of expertise that can be found


Psychology Term, Word, Phrase   +   Definition:  Peer Group Influence
Peer groups are an important influencer throughout ones’ life
Peer groups influence and encourage attitudes, values and behavior
Peer groups can cause people to do things that they would not normally do, both positive and negative
A negative could be not being productive or exhibiting bad behavior that harms oneself or others
A positive could include being more ambitious, working as a team member, working hard to succeed



Business Organization:
It makes good business sense to hire staff and employees with the highest level of knowledge, skills and expertise.  This is what helps grow the business.
Often times, business organizations do not do so and you can hear employees comment about how the organization does not hire the most competent people that they should
This can be company-wide or focused on specific departments depending on leadership and management
Specific individuals in management in positions of authority may directly influence the hiring of staff well below their own level of knowledge and competence.  They may not feel good about the potential of hiring those with higher levels of knowledge, skills and expertise than their own.  They may feel that such higher skilled individuals are a direct threat to themselves for a variety of reasons.  This can happen both consciously and unconsciously but it usually is obvious from their actions and from the observations of others.
Of course, this hinders the business organization from growing and puts it jeopardy to struggle and fail


Psychology Term, Word, Phrase   +   Definition:  Ego Defense Mechanism
The ego is one’s self image and who we believe ourselves to be
This can be positive and productive, it can negative and non productive or it can be misleading and non productive
It is how we look at the world and how we want the world to look at us
It directly interfaces with the world around us so it can be healthy and productive or it can be not so healthy and not productive
It directly influences our perceptions, good decisions and bad decisions
When there is a threat perceived to ones’ self-ego, we can react in a negative non productive way
This can happen to maintain our self-image
This false ego and protecting of one’s ego is often stimulated from an earlier loss or traumatic experiences



Business Organization:
Making some initial attempts to improve and to grow but stopping short


Psychology Term, Word, Phrase    +    Definition:  Approach Avoidance
Conflicts, of something positive and the actual contact with that behavior
The tendency to flee or act defensively is stronger than the tendency to go forward
Conflicts occur when a goal has both positive and negative characteristics causing an individual to fear something that they desire
When the goal is far away, both positive and negative feelings about the goal are less strong
A pattern of approaching a goal or behavior and when getting close, then backing off and avoiding it



Business Organization:
Feeling that the business organization cannot grow, has low worth or value to the market and to customers and clients; and does not deserve staff and employees with high level of skills, knowledge and expertise that can help the organization to grow
Failing to be progressive and positive to grow the business


Psychology Term, Word, Phrase    +    Definition:   Low Self-Esteem and Depression
Low Self-Esteem:
Lack of self -worth and confidence
Feeling overwhelmed by the pace of life and a failure compared to everyone else
Playing it safe and not trying anything new
Behaving timidly and not asserting oneself
Not asserting oneself and putting oneself down
Trying to escape unpleasant realities
Dwelling on the negatives
Taking pleasure in stories about the troubles of others
Being negative; nothing is good and everything is horrible
Do not like one-self and ones’ looks
Putting little effort into things because of doubt to be successful
Depression is more than just a feeling of being ’down in the dumps’ for a few days.  It is over a longer period of time
Symptoms include; sadness, loss of interest, loss of interest in activities that once gave pleasure and was enjoyed, difficulty sleeping, change in weight, energy loss, feelings of worthlessness and helplessness, and sometimes even thoughts of death and ending all
The symptoms persist and interfere with everyday life



Business Organization:
Resisting expanding business within current market, into other markets in application and geographically, national and international


Psychology Term, Word, Phrase    +    Definition:  Anti Social
Lack of adherence to social standards and beliefs that allow members of that society to coexist peaceably
Extremely selfish and self-centered
Sometimes arrogant, overly confident and cruel
Most deviants have an early onset and showed clear signs of anti social behavior early in growing up and developing



Business Organization:
Feeling that they are the greatest and ‘the best’ no matter how wrong or lacking


Psychology Term, Word, Phrase     +    Definition:  Delusions of Grandeur
Fixed beliefs that are false
Fantastic beliefs that one is powerful, great, famous and knows everything
Sufferer does not have insight into their loss of touch in reality



Business Organization:
A fear and avoiding efforts to change, improve and grow, no matter what staff encourages, market demands and customers and clients ask for


Psychology Term, Word, Phrase     +    Definition:  Phobias and Fears
An intense fear for something that in reality poses little or no danger
The experience can be so nerve-wracking that you may go to great extent to avoid it



Business Organization:
MBWA / ‘Management by Walking Around’ is always effective.  This is where management continually walks though the business talking with employees and staff to inquire how is everything, how are they and any suggestions that they have.  This shows employees and staff that management cares about them and they value their personal efforts, inputs, ideas and suggestions
When this is not a normal occurrence in an organization and management occasionally and suddenly comes out of their office to demand abnormal tasks to be done immediately lacking beneficial meaning, it can be a symptom of something else


Psychology Term, Word, Phrase     +    Definition:  Manic, Manic Depression, Bi Polar
Manic is when an individual is excessively distracted by an unimportant stimuli.  It is a state of abnormally elevated or irritable mood, arousal and energy levels
When it is linked to other times of depression as in a cycle, it may be referred to as manic depression or bi polar



Business Organization:
A belief about themselves, their markets, capabilities, value, customers and clients that is not close to reality


Psychology Term, Word, Phrase     +    Definition:  Schizophrenia
Interpreting reality abnormally
Abnormal perceptions that contribute to chronic problems individually and socially



Business Organization:
Continue to act and do things over and over again that are not affective or productive but hoping that someday results may be different or better
This wastes time and money and contributes to the decline of the business


Psychology Term, Word, Phrase    +    Definition:  Psychosis
Loss of contact in reality
Impaired reality testing
Unable to distinguish between personal subjective experiences from reality



Business Organization:
Business executives and managers that deliberately mislead, lie, cheat and steal to cause harm to others; customers, clients, employees, the business organization


Psychology Term, Word, Phrase     +    Definition:
Psychopath or SCDD Social Conscience Deficit Disorder
Not concerned with wrecking or hurting of others
Having only contempt for others’ feelings and ready to take advantage of them
Lack of empathy, unable to empathize with the pain of their victims
Lack of remorse, shame or guilt
Persistent lying and stealing
Rationalizes the pain and harm they cause to others
Exploits others
Authoritarian and secretive
Grandiose sense of self
Superficial charm
Incapable of true emotions
No concern for their impact on others and no remorse
Oblivious to the devastation that they cause
A pattern of violating the rights of others
Usually the behavior starts in child hood
Changes their image and life story as needed to avoid criminal prosecution
Business Organization:
Not making decisions, taking too long to make decisions or making bad decisions that causes a business to decline


Psychology Term, Word, Phrase     +    Definition:  Poor Decision Making
Decision making is vital for individual’s health and social well-being
Good decisions are based on a foundation of knowledge and sound reasoning
Decisions that are made on a basis of flawed logic, emotionalism or incomplete information will hinder an individual, personally and socially
The quality of a decision in a timely manner affects health, mentally and physically



Business Organization:
Difficulty in recognizing, understanding and affectively resolving problems contributing to business decline


Psychology Term, Word, Phrase    +    Definition:  Problem Solving
A mental process that includes problem finding, problem shaping, understanding and affective resolution
This is defined as a ‘higher-order’ in the cognitive and thinking process
This is critical for survival and health



Business Organization:

Making poor decisions that hurt the business even though better options are obvious and available.  Recruiting and hiring lower skilled staff even though it is clear that higher skilled individuals with more knowledge are available to hire and would contribute to the growth of the business.


Psychology Term, Word, Phrase     +    Definition: Self Defeating Personality Disorder
Chooses people and situations that lead to disappointment, failure or mistreatment even when better options are clearly available
Fails to accomplish tasks crucial to his or her objectives despite demonstrated ability to do so
This behavior does not occur only when depressed



Business Organization:
Lacking or struggling to have a better and more in-depth understanding to the needs of the markets, customers and clients
(Understanding the needs of the markets, customers and clients is part of the foundation to affective marketing and selling)


Psychology Term, Word, Phrase    +    Definition:  Needs Analysis
Needs Analysis includes all activities needed to collect information about others wants, wishes, desires, requirements and expectations
Some needs may be unclear needing uncovering and clarifying more
Needs can change



Business Organization:
All business organizations need to improve in all departments and functions; quality, efficiency, expand capabilities, increase team effort, eliminate wastes, eliminate needless efforts, computerize and automate, and increase knowledge and effectiveness
Many business organizations either fail to do this adequately or struggle with it


Psychology Term, Word, Phrase    +   Definition: Self-Improvement and Self-Empowerment
Individuals’ and group effort improving intellectually, mentally, emotionally, physically, economically and all with a substantial psychological basis
Gaining control over oneself
Empower self in many areas in ones’ life
Definitions can range from psychological, sociological, business to philosophical
Such efforts help regain self-confidence, self-sufficiency and gain skills for such
Results from such include; increase of self-image, increase of one’s thinking and effective decision making, stimulates positive thinking, increase of assertiveness, increase of feeling of well-being and stimulates growth
It also stimulates a stronger sense of self and the ability to change things and improve
There are even more common business situations that parallels psychology words, terms, phrases and their definitions.
Most businesses and companies have many of these ailments, issues and problems.


Some business organizations have far more of these ailments than others.


Outsiders looking at businesses with such ailments often think that it is ridiculous to have such issues and that the business organizations should know better.



Employees and staff who work for businesses with such ailments and issues often feel frustrated and angry at the situation.


These ailments, issues and challenges can be improved with some aggressive and progressive internal ‘turn-around management’ efforts.


As Albert Einstein once mentioned, ‘you cannot fix a problem with the same attitudes that created it’.


As many legal experts mention, ‘an attorney representing themselves in a court of law for their own personal problem and issue, has a fool for a client’


As Sigmund Freud once mentioned, ‘people do not get better unless they recognize the problem, are highly motivated to improve and willing to pay for it’


To this extent, a professional business advisor and consultant can be an immense benefit to help business organizations navigate through the changes and improvements needed to get into better health and business growth.



Recruiting, hiring and retaining staff and employees with the highest level of knowledge, skills and expertise that is available, is fundamental and the right step to take, as well.


When your automobile is not working and needs repairs, you seek out a good auto mechanic.


You do not say, they are too good of an auto mechanic to fix your car.


When a house appliance breaks and needs repair, you contact a good repair person to come over to fix the appliance.


You do not say, they are too good to fix your appliance.


When your telephone or computer does not work and seems broken, you contact a good repair person.


You do not say, they are too good to fix your equipment


When your family pet is sick, you take it to a good veterinarian.


You do not say, they are too good of a veterinarian to help your pet get well.


When you or a family member is personally physically sick and ailing, you seek out a good medical doctor.


You do not say that they are too good of a doctor to help you get better and get back your health.


When you or a family member has mental health problems, you seek out a good psychologist or a good psychiatrist to help.


You do not say that they are too good to help you get better.



There is no reason to feel different about hiring staff and employees with the highest level of knowledge, skills and expertise that is available.


There is no excuse for anything less.


Fill your business organization with staff that has the highest level of competence and expertise that you can find and fully support their efforts.


You will see critical improvements that will help improve the business health and grow the business.



Like an individual with ailments, business organizations with ailments can get better and improve their business health.


For additional information or assistance, please feel free to contact me directly.



Michael P. Marshall, PhD
Personal website:
Michael has 25 years of business experience in numerous markets with a variety of products and services.  Prior to his extensive business career, he was a behavioral health counselor.
His education includes a PhD in business, MBA, BS degrees in psychology and social human behavior, Federal International Business Certification, and over 34 other advanced certifications in; business management, business development, sales, marketing, marketing communications, customer service, product management and development,  training and business  strategy.
His passion is ‘Business Development’ and ‘Creatively Finding Ways to Grow the Business’

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