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What is Industrial Organizational Psychology?

Industrial organizational psychology applies the principles of psychology to the workplace with the goal of enhancing the dignity and performance of employees and the organizations where they work. This is a very broad mandate and there are subdivisions of IO that meet different needs within an organization.


Industrial Psychology


Industrial psychology, also known as personnel psychology, is more focused on individuals rather than the broader organization. Psychologists in this area analyze jobs, recruit applicants, select employees, determine salaries, conduct trainings, and evaluate employee performance. Rather than approaching this process subjectively, IO psychologists use quantitative measures and statistics to make better informed and more objective decisions. They can use off the shelf assessments or build their own. These assessments are constantly evaluated for validity, reliability, and fairness to ensure that they are suited to the task.


Personnel psychology generally begins with an in-depth job analysis to get a complete picture of what an employee does and what skills are required to achieve in that position. This information can be used to set an employee’s salary, assess employee performance, and identify new candidates for the position should the need arise. This process generally involves a wide range of assessments from personality inventories to skill-based tests depending on the requirements of the job. This information can also be used to identify areas that need further development, develop training programs, and evaluate training outcomes.


Organizational Psychology


Organizational psychology is focused on macro level issues within an organization such as leadership, job satisfaction, employee motivation, communication, conflict management, organizational change, and group processes. This process involves large scale employee assessments concerning their feelings about the organization to help the organization understand its strengths and weaknesses. This information is then used to make recommendations on how strengths can be augmented, and weaknesses improved. This can translate into employee training programs, team building exercises, restructuring, and employee empowerment programs.


With training in both subject areas, industrial organizational psychologists serve an important role within organizations. It is a rapidly expanding field with more and more business recognizing the utility of IO services. Many larger companies employ a full-time staff of IO psychologists to assist in all areas of the organization. Most businesses cannot afford these levels of service and use IO psychologists as consultants to address specific problem areas or assist with personnel hiring. If you are looking for someone to apply the principles of psychology to your business, feel free to schedule a free initial consultation. Keep moving forward!


Ian Mudge M.A., L.P.C.

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