What is Maslow's Hierarchy of Needs and how is it relevant to managers?

Maslow's hierarchy of needs is a motivational theory where the needs of the individual are illustrated as layers of a triangle. It is based on the assumption that an individual works from the bottom up: it is only once his basic physiological needs of food, water and shelter have been satisfied that he will begin to view safety needs as paramount, desiring health and financial security. His needs will then escalate through the next three layers: love/belonging, esteem and ultimately self-actualisation. 

Maslow's Hierarchy of Needs is relevant to managers because it allows them to understand what will best motivate their employees based on which layer of the triangle they currently find themselves on. Managers will know that lower-level employees are currently working at a lower rate of pay, and whilst they may have fulfilled their physiological needs, will be highly motivated through financial incentives which bring them closer to financial security. Alternatively, those working at a more senior rank in the company will have likely already achieved this, and instead may be motivated more by increased responsibilities which add to their self-confidence and esteem.