What is Organizational Psychology?

What is Organizational Psychology? One organizational psychology definition is “the science and study of behavior in the workplace.” Organizational psychology, also known as industrial-organizational psychology or work psychology, involves applying psychological and behavioral principles and practices to organizations in order to help them solve particular issues. These could include improving employee experience and retention, increasing productivity, or learning to work together following a major transition such as reorganization.

The “industrial” side of industrial-organizational psychology refers to matching and evaluating employees within their particular job roles. Among other things, this includes training employees and evaluating their performance. The “organizational” side refers to how the organization itself impacts the individual employee’s behavior. Management styles, role expectations and social norms all factor into this equation.

History of Organizational Psychology

What is Organizational Psychology?

The study and philosophy of management has existed for millennia, but it’s only been in the past century or so that the specific application of psychology to the workplace has evolved as a distinct field of study. In fact, many of today’s most famous organizational psychologists came from other disciplines but made significant contributions to the field.

Two individuals in particular stand out as the forefathers of this field. In the early 1900s, Walter Dill Scott wrote two landmark books, Influencing Men in Business and Increasing Human Efficiency in Business. With these, he “became the first to apply the principles of psychology to motivation and productivity in the workplace.”[i] He applied his theories about workplace productivity while working with army personnel during WWI. Hugo Munsterberg, considered the father of industrial psychology, conducted laboratory research in the field and applied it to solve workplace problems. He also wrote Psychology and Industrial Efficiency, which explored personnel selection and equipment design.

The first doctoral degrees in industrial psychology were offered in the 1920s. And both WWI and WWII provided opportunities for creating and/or refining various industrial and organizational psychology practices, from employee classification to stress tests to assessing morale and motivation. As advances continued in the fields of psychology, business and management, industrial-organizational theory and practice also developed and shifted. In the 1990s, a dramatic focus developed on the intersection of employment law and psychology around topics such as civil rights, sexual harassment, and bullying. These areas, along with work-life balance and workplace stress, continue to be “hot topics”.

The 1980’s brought about great change in the ways that business professionals viewed their organizations. This change was primarily due to the emerging dominance of Japanese companies in the market. Western industries, including those in the United States, were losing business to Japanese competitors because they were able to produce high quality goods at a lower cost. The lower costs were not a result of reduced wages either, they were a result of the Japanese companies’ ability to reduce waste and increase their productivity. Western firms were forced to adopt these practices in order to remain competitive. The push for increased efficiency resulted in several new management approaches; popular buzz words for these approaches are; Kaizen, Total Quality Management, Lean Operations, Six Sigma, ISO 9000, and continuous improvement. While these concepts are most easily understood from the perspective of a manufacturing environment and are most effective in increasing operational efficiently, this shift in the ways that people view an organization also directly impacted the job duties of industrial psychologists. The role of industrial psychologists within this system is to assist the management team in building a corporate culture where every employee is committed to surpassing quality standards and focusing on the process of continuous improvement. Organizational psychologists help to identify prospective employees who have the ability to adopt the company’s culture, and look for ways to help the management team enhance efficiencies. How this is accomplished varies, the psychologist might conduct trainings, identify and address employee concerns, or implement companywide programs to build the culture and earn employee buy in.

What Do Organizational Psychologists Do?

To begin with, organizational psychologists practice under a variety of titles. Depending upon where he/she is employed and the corresponding job responsibilities, an organizational psychologist might be called: President, Vice President, Director, Manager, or Consultant. Organizational psychologists might specialize in the following areas of practice: organizational development, organization effectiveness, organization capability, talent management, management development, human resources, training and development, career planning, or leadership… just to name a few.

Most organizational psychologists work in one of six areas:

  • Training and development: Organizational psychologists working in this area determine what skills employees need, then develop, administer and evaluate the relevant training.
  • Employee selection: Organizational psychologists employed in this area are involved in the process of hiring employees.
  • Ergonomics: These organizational psychologists focus on creating a workplace that maximizes performance and minimizes injury.
  • Performance management: Organizational psychologists who focus on performance management develop, administer and analyze data collection methods such as tests and questionnaires to determine how well employees are doing their jobs.
  • Work life: These organizational psychologists are responsible for designing programs that provide increased employee satisfaction and improved productivity in the workplace.
  • Organizational development: These psychologists focus on improving the structure of a workplace, usually with the goal of increasing productivity and/or profit.

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