A.S #2: Value Creation: The Personal MBA by J. Kaufman
‘’Understanding human needs is half the job of meeting them’’. -Adlai Stevenson
Value Creation is discovering what people need or want, then creating it.
In order for someone to have a business, there should be something a value that you can produce or create which people want or need.
To understand the human needs, Josh mention the Maslow’s hierarchy of needs by psychologist Abraham Maslow in his book.
Maslow believes that we as a human being progress through these 5 hierarchical stages in the pursuit of what we want, and Maslow also argue that when one need is fulfilled, a person seeks to fulfill the next one, and so on. Self-actualization is the highest level of human needs and physiological is the lowest one.
Another theory mentioned in the book regarding the human needs and wants was the ERG theory by Clayton Aderfer, its kind of Aderfer’s version of Maslow’s theory.
The ERG stance for Existence, Relatedness and Growth. This theory explains that people seeks these three desires in their lives. From getting food and shelter (for survival), meeting and making friends and the desire to improve oneself as we acquired the last two.
Same with Maslow’s argument, Clayton believe that when one need is fulfilled, we seek to fulfill the next one.
Though ERG theory explains the general priority of human desires, it does not tell us the methods people use to satisfy these human desires that we all have according to josh.
A Harvard Business School professors Paul Lawrence and Nitin Nohria, the author of ‘’Drive: How Human Nature Shapes our Choices’’ believe that there are 4 ‘’Core Human Drives’ that influence our decisions and actions in satisfying all these desires that mentioned above.
These are as seen in the book:
1.The Drive to Acquire -the desire to obtain or collect physical objects and immaterial qualities (e.g status, power and influence).
Businesses: retailers, investment brokerages and political consulting companies.
2.The Drive to Bond -the desire to feel valued and loved by forming relationship, either platonic or romantic.
Businesses: restaurants, conferences and dating services.
3.The Drive to Learn -the desire to satisfy our curiosity.
Businesses: academic programs, book publishers and training workshops.
4.The Drive to Defend -the desire to protect ourselves, our love ones and our property.
Businesses: home alarm systems, insurance products, martial arts training and legal service.
Josh add another human drive in his book,
5. The Drive to Feel -the desire for new sensory stimulus, intense emotional experience, pleasure, excitement, entertainment and anticipation.
Businesses: movies, games, concerts and sporting events.
We have now a clear picture of what actually people want or need and what are the methods they use to satisfy these needs. We can now ask ourselves:
Are these business ideas we have in mind has value for people, do they need these, do they want these?
But it doesn’t end there. If we want to build a business, we should also know how to execute these ideas, and execution is the most important of all.
‘’Don’t just be a thinker, be a doer too’’ -A.S
Gary Vaynerchuk said in one of his talk that we have a lot of ideas in mind, we can write probably a hundred or even a thousand ideas a day, but what matter most is execution.
If you don’t transform your ideas into reality. Then its nothing but an ideas.
And because of this drive to learn, our desires to satisfy our curiosity. This post is not enough, we want to learn something practical. Something to guide us to make our business ideas happen and successful. Right?
Luckily, we gonna post next time of what you can do on your business ideas base on ‘’The Personal MBA by Josh Kaufman’’.