Business Advice from Sigmund Freud

Business.com / HR Solutions / Last Modified: February 22, 2017

Sigmund Freud was an expert in the underlying motivations of human behavior. Let's apply some Freudian principles to the business world.

In psychoanalysis, people explore hidden reasons that explain negative behavior by talking about their issues with an impartial analyst. Almost all forms of counseling are rooted in Sigmund Freud’s notion of the “talking cure.”

Might your business benefit by a few sessions of lying on the couch to evaluate your motivations and strategies, as well as anything that might be blocking success? After all, Freud was a pretty smart businessman -- he figured out a way to get paid for listening to people before the practice of psychoanalysis was widely recognized.

Using Freud's Advice During Performance Evaluations

Bonnie Oglenski, a professor at City University of New York, uses Freudian theory to diagnose the dynamics of workplace interactions. She provides the example of subordinates who see their manager as a parent figure.

That could be good or bad, depending on whether the manager understands that he or she is perceived this way. Subordinates who idealize the manager are likely to be overly sensitive to criticism, Oglenski suggests, and, consequently should be handled differently in a performance review than a subordinate who doesn’t have issues with constructive criticism. 

If Corporations are People, Do They Need Therapy?

Forbes writer Coeli Carr contends that an organization as a whole can have Freudian characteristics. These include a focus on:

  • Past events and achievements. Companies become fixated on improving existing products or services rather than innovating new ones.
  • A “phallic-centric” culture dominated by male hierarchies and masculine stereotypes.
  • Top-down management and power relationships.

Freud was not only interested in the role of strong figureheads and competition to achieve recognition (most famously, the Oedipal Complex); his own personal and professional relationships provide a case study in unbending orthodoxy. Many of Freud’s psychoanalytical disciples broke with him because of his refusal to consider independent views that challenged his authority.

If a close analysis of your organization reveals such Freudian characteristics, the company might be in need of a little therapy. If your business is relying on past achievements, you might want to devote some energy to creatively destroying your own brand. If valuable employees are leaving the company because they feel the business doesn't recognize their contributions, it may be time to re-examine your management style and promotion policies.

Freud and the Psychology of Marketing

Of course, where Freudian analysis really comes into play is how your customers feel about your products -- meaning how they really feel about them. Marketing has always played on subconscious desires, as attested by any ad featuring attractive people doing something appealingly adventurous beyond the capabilities of ordinarily people.

Harvard Business Review blogger Paul Michelman recounts his own psychoanalysis in the name of Coca-Cola. His experience suggests there are reasons we like a product beyond that we just happen to like it. Understanding those reasons helps not only to sell it better, but to improve the characteristics that make people want to buy it.

One way businesses put Freud to work in the marketing department is by creating buyer personas. A buyer persona is a psychological profile of your typical customer or target customer. Some companies give their buyer persona's names -- like "Jane" -- and then subject every marketing decision to, "What would Jane want?"

Don't Obsess to the Point of Inaction

Perhaps one of the biggest lessons to learn from Dr. Freud is that as important as self-reflection and analysis are, sometimes you can go overboard to the point where you’re unable to take appropriate action because you are overthinking. As Freud allegedly said, "A certain degree of neurosis is of inestimable value."

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