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What Is Industrial-Organizational Psychology?

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Credit: Rido/Shutterstock

Industrial-organizational (I/O) psychology focuses on individual behaviors and needs in the workplace, and offers solutions to most employee concerns. While the two sides of this field study similar topics, they offer different perspectives and specialized insight to help employers get the best out of their team.

With the help of I/O psychologists or qualified consultants in the field, employers can improve their workers' wellbeing and increase efficiency and productivity in the workplace. Here's everything you need to know about this field of study.

The industrial side of I/O psychology "examines specific problems and issues that companies have to deal with," said J. Michael Crant, professor of management and organization in the Mendoza College of Business at the University of Notre Dame.

Industrial psychologists can help organizations with the following tasks:

After studying a company's culture and work processes, industrial psychologists have a well-educated idea of what type of employee will work best with the way the business already works. Industrial psychologists can help with many parts of the hiring process, including creating interview questions that can help hiring managers identify the best candidates for certain positions. When using industrial psychology for hiring, Amy Cooper Hakim, founder of the Cooper Strategic Group, suggested considering the values, personality and motivation of the applicant.

To keep things running smoothly, businesses need to make sure their employees have the skills and knowledge they need to do their jobs. Industrial psychologists can identify missing skills among employees and create effective training to help fill these gaps.

By studying human behavior from the top of the business down, industrial psychologists can identify ways to make jobs more efficient and employees more productive for the overall good of the company. This is a major component of many popular management theories from the early 1900s, some of which continue to influence modern management practices.

According to Crant, organizational psychology generally addresses bigger-picture issues. Psychologists in this field want to motivate the workforce and create stronger teamwork, he said.

Various studies have shown that employees who feel comfortable, safe and happy at work are more productive and efficient. If you don't feel you're getting everything you could out of your employees, organizational psychologists may be able to help in the following areas:

Organizational psychologists study employee behaviors and attitudes to gauge overall employee satisfaction. Using their findings, psychologists then suggest changes to improve employees' well-being and happiness at work, which makes for more productive employees.

If organizational psychologists find that employees are stressed or unhappy, they may suggest work-life balance programs to ease the stress on employees, thereby helping them to produce not just more work, but better work. Successful work-life balance programs decrease turnover rates and burnout while increasing motivation and commitment. [Read related story: 5 Ways to Improve Your Work-Life Balance Today]

A major difference between organizational and industrial psychology is where the psychologist focuses their point of view. Where the industrial side works from the top of the organization down, organizational psychologists work from the bottom up. By doing this, they may be able to provide helpful suggestions on managerial practices, company organization and other elements that might be creating job stress.

If you own a small business and only have five to 10 employees, it might not be worth the investment to hire an I/O psychologist. However, for midsize and large businesses, these professionals are a valuable asset if you want to increase the satisfaction and productivity of your employees. Depending on the scale of your company and the work that you feel needs to be done, a consultant might be a better fit for you.

In-house psychologists are the better choice if you have a large, global organization, want to develop ongoing training programs, or need to do long-lasting studies of workplace culture in multiple locations.

I/O consultants are the better choice if you have a smaller organization, only want to study one particular area or department, or need only limited information.

Regardless, you don't need an on-staff professional to implement I/O psychology into your organization. By conducting personality assessments, you can learn how to work best with your team based on individual preferences, work styles and behaviors.

Hakim said personality assessments can be used to help screen applicants as a "multiple-hurdle approach" to hiring, or to help develop employees. Here are six common personality tests you can utilize:

  • DiSC Assessment: This test identifies communication styles in the workplace and helps employees understand how to more effectively work together and talk to each other. Learn more about using the DiSC model in this Business News Daily article.
  • Myer-Briggs: Also known as the MBTI, this test puts you into one of 16 personality types to help you understand how you perceive the world and why you make decisions. Though this is a popular test, there is some controversy surrounding it, according to Crant, since it doesn't always produce the same results when someone takes the test multiple times.
  • Predictive Index: The Predictive Index, or PI, is a short, simple test that helps you understand your employees' behaviors at work. This can help you align goals and improve efficiency.
  • Five-Factor Model of Personality: The FFM separates people into the "big five" traits – extraversion, agreeableness, conscientiousness, neuroticism and openness to experience.
  • Occupational Interest Inventories (OIIs): OIIs identify employees' interests in the workplace, helping you understand their preferred assignments and roles. This aids in task delegation and employee retention.
  • Situational Judgement Tests (SJTs): SJTs use stimulated situations to test how workers would react in a given circumstance. That way, you can gauge their customer service skills and confront any possible flaws in their approach.

It's important to note that these tests aren't suited for every organization, and attempting to analyze the results of any personality tests on your own, without the help of a professional, can lead to controversy and misunderstandings. We advise that you consult a professional psychologist before you administer or share the results of any personality tests in your workforce.

You can learn more about I/O psychology and find qualified professionals by visiting the Society for Industrial and Organizational Psychology website.

Additional reporting by Jill Bowers. Some source interviews were conducted for a previous version of this article.

Sammi Caramela

Sammi Caramela has always loved words. When she isn't working as a Business.com and Business News Daily staff writer, she's writing (and furiously editing) her first novel, reading a YA book with a third cup of coffee, or attending local pop-punk concerts. Sammi loves hearing from readers - so don't hesitate to reach out! Check out her short stories in Night Light: Haunted Tales of Terror, which is sold on Amazon.