What is Industrial and Organisational Psychology?

Psychology is the science of human behaviour. Industrial and organisational psychology is that science applied to human behaviour in the workplace. You may have heard this type of psychology called occupational psychology, business psychology, or work psychology as well. For simplicity’s sake, we will refer to it as organisational psychology throughout this article.

In the field of organisational psychology, trained organisational psychologists apply psychological theories and models to the working world: both to organizations and workplaces, and to the individual members of that business’ workforce. Simply put, organisational psychology is the science of how people think and behave at work, which translates into how organisations behave. Given that we spend roughly one third of our lives at work or working, a working situation where we are satisfied and supported is an ideal worth striving for. Organisational psychologists can help workplaces and individuals to achieve these goals. Around the world, organisational psychologists are helping to build more effective workplace cultures, help companies find the right people for their roles, and reduce employee turnover by improving workplaces.

 The history of organisational psychology

Organisational and industrial psychology arose in the United States alongside the field of psychology, in the late 19th and ear centuries. The first organisational psychology textbook, Psychology and Industrial Efficiency by German-born psychologist Hugo Münsterberg was published in 1910. Münsterberg, who worked at Harvard University in Cambridge, Massachusetts, was most intrigued by psychological tests in industry to improve recruitment, but his textbook became the founding text for the burgeoning field of organisational and industrial psychology. However, three other men also contributed to and developed the tone and practice of the field: James Cattell, Walter Dill Scott, and Walter Bingham.

James Cattell worked for many years at Columbia University, in New York City. He created the Psychological Corporation in 1921, which is still in existence today. Cattell also owned and edited several psychological journals, and through his publishing and networking contributed to the growth of the fledgling field of industrial and organisational psychology.

Walter Dill Scott started his work in advertising, applying psychological principles to solve problems in that industry. He started using industrial / organisational psychologists as consultants when he started his own company, and thereby legitimized the use of the practice.

Walter Bingham became the face of industrial and organisational psychology, starting the first academic program: the Division of Applied Psychology. Bingham also took it upon himself to publicly represent industrial and organisational psychology whenever possible, contributing to the media and speaking on radio and thereby growing public recognition of the field.

 The World Wars and Industrial and Organisational Psychology

Before the Second World War, industrial and organisational psychology was divided: industrial psychology covered ability testing, while organisational psychology focused on employee behaviour and well-being.

World War I brought a sudden need for thousands of young men to be assigned to the duty for which they were best suited. Bingham and Scott volunteered to help, and began working on testing that would be suitable to assess and assign new troops, adapting the Stanford-Binet intelligence test(previously only for individual use) for group use. The new test was called theArmy Alpha, and measured verbal ability, numerical ability, ability to follow directions, and information knowledge. The rapid scaling-up of testing during WWI set the precedent for the implementation of industrial and organisational psychology in the industrialisation that occurred in the post-war period, as private companies wanted to use the testing that had delivered competent soldiers. Testing to determine recruits’ mental abilities soon became a regular occurrence, as it is today.

World War II soon followed, and ability testing became even more important as technological advancements brought new jobs.

Meanwhile, the human relations movement, founded by sociologist George Elton Mayo in the 1930s, was examining the effect of workers’ morale and needs on productivity and company success. Not surprisingly, when workers who felt that their leaders listened to them, when they were part of communications, and when their basic needs were met, productivity went up. In other words, satisfied workers do better jobs.  

Industrial and organisational psychology were joined as field psychologists began to study both group and individual behaviour, the workplace as a whole and the individual employees.

 Post-war to present

As technology has changed and affected the working world, the field of industrial and organisational psychology has changed to keep up with the business, recruitment, and the workplace. Most industrial-organisational psychologists today work in one of the following six areas:

1) Employee selection: this can be considered recruitment. Psychologists administer various screening tests, known as psychometric assessments, to measure prospective employees’ suitability for a particular role.

2) Ergonomics: although we usually think of this in relation to office chairs, ergonomics has a broader application. The field is about designing equipment and procedures to maximize performance and minimize injury.

3) Organisational development: psychologists working in development help to improve organisations, often through re-organising workplace structure and working to increase productivity and profits.

4) Performance management: this area involves developing assessments and techniques to evaluate employees, and find areas for improvement.

5) Training and development: although this might seem similar to employee selection, it is not exactly the same. Psychologists working in training and development assess what types of skills are essential to perform specific jobs, and develop employee training programs.

6) Work life: focused on employees, this area of the field is all about improving employee’s work lives and productivity.


Industrial and organisational psychology today is often employed to measure success in hiring and performance, improve workplaces, and develop training programs. It has become an invaluable part of the broader field of business.  






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