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New HR Insights: Erikson’s Theory of Human Development and Its Massive Impact on Your Business

Why it’s important, vital characteristics, what is a crisis, real-life examples of Erikson’s theory in HR and every business and: Spot the spooky coincidence with employee motivation

Initiative VS guilt. Industry VS inferiority. Intimacy VS isolation. Ever heard of the Erik Erikson Theory of Human Development? You definitely should have. If you’re in human resources or people development, or if you own your own company, or even if you manage people in an organisation in any way. Erikson’s theory gives you incredible insights into real-life situations in business every day.

Also called Erikson’s 8 stages of development, psychosocial development or even child development, Erikson’s theory has huge implications for employee wellbeing, staff retention, employee engagement, staff turnover and employee motivation.

We look at Erikson’s theory, ask why it’s important for business, look at vital characteristics and what Erikson calls a “crisis” in development. Then, we show you how it applies to HR and business, with specific real-life examples of Erikson’s theory. Plus: There’s a spooky link in here with our post on motivation science – can you spot it?

WHO IS ERIK ERIKSON?

Erik Homburger Erikson was one of the most renowned psychologists and psychoanalysts of the 20th century, most notably for his famous theory on human development. Born in 1902 in Frankfurt, Germany, Erikson’s family fled the rise of Nazism in Europe for the United States in the 1930s, where he did groundbreaking work on human development until his death in Masachutses in1994.

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He was the first person to coin the phrase “identity crisis”. But he’s perhaps best known for his breakthrough: Erikson’s Theory of Psychosocial Development (or just Human Development Theory). 

ERIKSON THEORY OF HUMAN DEVELOPMENT

Erikson’s theory is broken into eight stages of human development, from birth to late adulthood (although it has a striking implication for work and relationships we’ll get to in a minute). Each stage happens in a certain period of life, and it features a vital psychosocial “crisis” each human faces in that part of life. And the outcome crisis determines your path of development and your behaviour. 

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Most importantly, they flow chronologically, so each stage leads to the next – every stage is dependent on the outcome of the one before:

1 TRUST VS MISTRUST

Stage: 0–2 years

In the first stage of life, the first crisis our minds have to grapple with it: Can I trust the world? This is most often between baby and mother, and it has to do with feeding and abandonment.

2 AUTONOMY VS SHAME/DOUBT

Stage: 2–4 years

After Trust, we all ask: Is it OK to be me? This has to do with self-identity and independence.

3 INITIATIVE VS GUILT

Stage: 5–8 years

Then we explore whether it’s OK to be yourself inside the wider world, in family life. Can I take my own initiative? Can I start using tools and solving problems?

4 INDUSTRY VS INFERIORITY

Stage: 9–12 years

Then we ask whether we can make it as ourselves in the wider world of community, at school etc. This is where competence is learned and industry is developed – people thinking and doing for themselves to the benefit of the community.

5 IDENTITY VS ROLE CONFUSION

Stage: 13–19 years

This is where we ask: Who am I really? It’s where we look at peers and role models and develop our deeper identities, usually through social relationships.

6 INTIMACY VS ISOLATION

Stage: 20–39 years

This is when we ask: Can I love and be loved? It’s where we develop deep friendships and romantic relationships.

7 GENERATIVITY VS STAGNATION

Stage: 40–59 years

This is the big one where we ask: Can I make my life really count? It’s where we explore our relationships, responsibility and environment, grappling with the idea that your life can have a real lasting impact.

8 EGO INTEGRITY VS DESPAIR 

Stage: 60+

This is the introspective phase, where we look back over everything and ask ourselves whether it was OK to be ourselves. We look at the impact of our lives and develop a sense of integrity if we feel it was successful. Or, we fall in despair if not.

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WHY IS ERIKSON’S THEORY IMPORTANT?

It gives us a framework for how we humans develop. And it gives insights into where things might have gone wrong or right in life. Remember, each stage flows into the next. The outcome of the previous stage has a huge impact on whether you can solve the “crisis” in the next stage. 

For example: If you battle to develop trust right in the beginning, it has a sliding effect into all other stages – you probably also won’t develop autonomy, you won’t learn to take initiative, you won’t become industrious (maybe become stagnant and lazy) etc.

Can you see where this is going? Yes, Erikson’s theory has an incredible insight into how our minds work in the business world.

ERIKSON’S THEORY IN BUSINESS

If you looked closely at how Erikson’s theory of psychosocial development flows, you’ll have spotted that many of those stages are things that every business hopes to find inside every employee. We want employees to be industrious (work hard), take initiative and take responsibility for themselves and the company.

So that’s why experts started looking into businesses, and guess what they found? Whenever we enter into a new relationship, it develops along the same lines as Erikson’s theory. For example, when we start at a new company, we first figure if we can trust the organisation, our bosses etc. Then we move onto the next stage, we see if we can be ourselves inside this company (autonomy). And so on.

Author and founder of the Pacific Institute in Canada, Lou Tice, used Erikson’s theory as a base for the institute’s Investment in Excellence in Resources manuls. And it shows us what happens in the minds of the people inside our companies:

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1 TRUST

The first thing people do is ask: Can I trust this company, my bosses, my colleagues? When you can trust, you can move on to the next stage and grow. When trust is violated, people withdraw – they stop cooperating, withhold information, sabotage your company. Trust is linked to integrity: Can I believe what this person/company is saying to me?

Discover 106% more energised employees and 50% more profit just by focusing on the elements of trust: Here are 5 ways to build trust in a team, 6 Ways to build trust in leadership, 7+ steps to foster trust in your company and all the vital science behind workplace trust.

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2 AUTONOMY

If you’ve learned to trust, you feel that it’s OK to be yourself in this company. And that sense of independence is what makes you feel free to explore and come up with creative solutions. (Which is exactly what we want people to do in companies.) If you didn’t learn to trust, you’re afraid to explore new ideas or be creative.

3 INITIATIVE 

Every company everywhere wants its employees to take the initiative. To come up with solutions and new ideas that will move your company forward. The problem is that if they didn’t develop a sense of independence, the opposite happens – they look to management for all the answers.

4 INDUSTRY

Another super important one for companies: We want you to work hard and produce so we can all benefit. We want industrious employees. But, if we never allowed an employee to feel like it’s OK to take initiative, the opposite happens – low productivity.

5 IDENTITY

We develop our roles in the company after we’ve learned that it’s OK to master our skills and become industrious. And your identity in the company is important because it’s your sense of self and contribution: I’m the go-to person for x, y and z. 

6 INTIMACY

This is where social capital comes in. Time and again, studies have shown that the interpersonal relationships between team members are a huge contributing factor to a company’s success. It’s why human resources and people development exists.

To get a sense of how important this is, check out this incredible TED Talk by Margaret Heffernan:

WATCH: THE IMPORTANCE OF SOCIAL CAPITAL

7 GENERATIVITY (GENEROSITY)

Generativity means being able to give something without selfish motivation. Do you want employees to take responsibility without you having to coerce them into doing everything? Then this is the key. It’s what makes longer-time employees coach and train new employees in your organisation – and you can imagine the benefits of that.

8 INTEGRITY

Integrity means seeing order to the world. Developing a set of core inner values that you live by out of your own, not because you’re afraid of punishment. And it’s super important because integrity in your company and your employees will affect new employees’ experience when they start all the back at number 1, trust. 

See the cycle?

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REAL-LIFE EXAMPLES OF ERIKSON THEORY AT WORK

Remember, you want your employees to be industrious and take initiative. But to get there, you first have to create trust and give them a sense of autonomy. So, if the employee cannot trust you, they will likely deliver to their full potential.

And integrity is the key to trust. If your company claims to be green and to love the environment, for example, but your employees know you secretly dump waste into the ocean, they question your integrity. And that means they can’t really trust you. This has a knock-on effect all the way down: they stagnate, they don’t take initiative, they have low productivity.

But it’s the same along any of the steps along the way. If you do allow trust and autonomy etc. but you don’t invest in the continuous development and upskilling of your people, you’re impacting their industry and identity, which causes troubles further down the line.

There is a simpler way to look at it, though.

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A SIMPLIFIED VIEW OF ERIKSON’S THEORY FOR BUSINESS

To help your business understand the practical applications of Erikson’s theory better, look at it this way. To flourish, your employees need a sense of:

BEING VALUED

The sense that I am individually important and not just a cog in the machine. Plus: Compare this with the concept of “Belonging” in the Circle of Courage and “Connection” in LifeXchange’s own Human Development Cycle.

AUTONOMY

The independence to use of myself to solve problems and look for opportunities. Plus: Compare this with the concept of “Independence” in the Circle of Courage and “Responsibility” in LifeXchange’s own Human Development Cycle.

MASTERY

The ability to upskill, learn and perfect what I do. Plus: Compare this with the concept of “Mastery” in the Circle of Courage and “Competency” in LifeXchange’s own Human Development Cycle.

PURPOSE

The sense that what I’m doing is valuable and has a real impact. Plus: Compare this with the concept of “Generosity” in the Circle of Courage and “Purpose” in LifeXchange’s own Human Development Cycle.

COINCIDENCE? WE THINK NOT

You may have spotted that the list above – autonomy, mastery, purpose and being valued – are also the logical conclusions of our recent post on what really motivates employees.

WATCH: DAN PINK ON EMPLOYEE MOTIVATION

In case you missed it, check out how all the above ties into our look at the weird science behind employee motivation.

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OK, HOW DO I GET THE BENEFITS OF ERIKSON’S THEORY IN MY BUSINESS?

Well, that’s actually exactly what we at LifeXchange Solutions do. It’s LifeXchange’s purpose. We get up in the morning to research and understand what influences people’s behaviour in business. And we use neuroscience and neuro-linguistic programming along with remarkable research and insights like the theories above to show companies how to really mobilise their employees for massive growth. 

See what we do for companies in the field of neuromanagement, our strength-based development and LifeXchange’s full-service organisational development.

In fact, because we’re a proudly South African company ourselves, we at LifeXchange have created our own Human Development models, specifically catered for South African companies. And we’d love to tell you all about it.

Got an organisational management question? Ask us.


You might also like to discover the value of resilient teams in your business with our look at the Circle of Courage.

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And discover more refined insights specifically for growing your business with LifeXchange’s unique Human Development Cycle.

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NEW: Proof of the power of neuroscience. Dr Cobus is once again attempting the impossible: See him ride first-time the backwards brain bike.

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Discover what happens when your employees don’t have autonomy with our look at mental pushback.

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And learn how to use science to set and achieve seemingly impossible business goals with a look at how to rewire your brain for success.

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