Industrial Organizational Psychology

Industrial organizational psychology is the branch of psychology that applies psychological theories and
principles to organizations. Often referred to as I-O psychology, this field focuses on increasing
workplace productivity and related issues such as the physical and mental well being of employees.
Industrial organizational psychologists perform a wide variety of tasks, including studying worker
attitudes and behavior, evaluating companies, and conducting leadership training. The overall goal of
this field is to study and understand human behavior in the workplace.

The Two Sides of I-O Psychology

Industrial-organizational psychology has two major sides. First, is the industrial side, which involves
looking at how to best match individuals to specific job roles. This segment of I-O psychology is also
sometimes referred to as personnel psychology or human resource management. People who work in
this area might assess employee characteristics and then match these individuals to jobs in which they
are likely to perform well. Other functions that fall on the industrial side of I-O psychology include
training employees, developing job performance standards, and measuring job performance.

The organizational side of psychology is more focused on understanding how organizations affect
individual behavior. Organizational structures, social norms, management styles, and role expectations
are all factors that can influence how people behavior within an organization. By understanding such
factors, I-O psychologists hope to improve individual performance and health while at the same time
benefiting the organization as a whole.

How is Industrial Organizational Psychology Different?

While industrial organizational psychology is an applied field, basic theoretical research is also essential.
With roots in experimental psychology, I-O psychology has a number of different sub-areas such as
human-computer interaction, personnel psychology, and human factors.

Six Key Areas of I-O Psychology

According to Muchinsky (2000), most industrial organizational psychologists work in one of six major
subject areas:

Employee Selection: This area involves developing employee selection assessments, such as
screening tests to determine if job applicants are qualified for a particular position.

Training and development: Professional in this area often determines what types of skills are necessary
to perform specific jobs as well as develop and evaluate employee training programs.

Ergonomics: The field of ergonomics involves designing procedures and equipment designed to
maximize performance and minimize injury.
 Performance Management: I-O psychologists who work in this area develop assessments and
techniques to determine if employees are doing their jobs well.

Work Life: This area focuses on improving employee satisfaction and maximizing the productivity of
the workforce. I-O psychologists in this area might work to find ways to make jobs more rewarding or
design programs that improve the quality of life in the workplace.

Organizational Development: I-O psychologists who work in this area help improve organizations,
often through increasing profits, redesigning products, and improving the organizational structure.

Who Should Study Industrial Organizational Psychology?

Students who are interested in applying psychological principles to real-world setting should consider
industrial organizational psychology. If you have a strong interest in psychology as well as related
subjects such as product design, computers, statistics and engineering, this may be the ideal field for
you.

History of Industrial Organizational Psychology

1903 - Walter Dill Scott - Theory of Advertising (psychology applied to busienss

1910 - Hugo Munsterberg - Psychology and Industrial Efficiency

World War 1 - Army Alpha and Army Beta to mainly test mental ability of US soldiers

 Army Alpha An intelligence test developed and used by the army for soldiers who can read.
 Army Beta An intelligence test developed and used by the army fors oldiers who cannot read

1933 – Elton Mayo - Hawthorne studies published

 Hawthorne effect – When employees change their behavior ue solely to the fact that they are
receiving attention or are being observed.

1960s - focused on developing fair selection techniques

1970s - BF Skinner - understanding of many organizational psychology issues that involved employee
satisfaction and motivation

The 1980s and 1990s brought four major changes to I/O psychology.
1. Increased use of fairly sophisticated statistical techniques and methods of analysis
2. New interest in the application of cognitive psychology to industry.
3. Increased interest in the effects of work on family life and leisure activities
4. Renewed interest in developing methods to select employees.
2000s - HR adopts to rapid increase of technology, changing demography of workforce (diversity), and
global economy.
Human Resource Management

- Is a function in an organization that focuses on the people aspect of management. It consists of

practices that help the organization deal effectively with its people during the various phases of
the employment cycle: pre-selection, selection and post-selection.

HRM Practices

The pre-selection phase involves planning practices. The organization must decide what type of job
openings will exist in the upcoming period and determine what qualifications are necessary to perform
these jobs. During the selection phase, the organization selects its employees. Selection practices
include recruiting applicants, assessing their qualifications, and ultimately selecting those who are
deemed to be the most qualified. In the post-selection phase, the organization develops practices for
effectively managing people once they have “come through the door”. These practices are designed to
maximize the performance and satisfaction levels of a firm’s employees by providing them with the
necessary knowledge and skills to perform their jobs and by creating conditions that will energize, direct
and facilitate the employees’ efforts toward meeting the organization’s objectives.

Pre-Selection Practices

Human Resource Planning

It helps managers, anticipate and meet changing needs relating to the acquisition, deployment and
utilization of its employees. It maps out an overall plan (strategic plan), then through the process called
demand and supply forecasting, it estimates the number and types of employees needed to carry out
successfully its overall plan.

Job Analysis

Is a systematic procedure for gathering, analyzing, and documenting information about particular jobs.
The analysis specifies what each worker does, the work conditions and the worker qualifications
necessary to perform the job successfully. Job analysis information is used to plan and coordinate nearly
all human resources practices.

Selection Practices

Recruitment

Organizations use recruitment to locate and attractjob applicants for particular positions. Organizations
may recruit candidates internally or externally. The aim of recruitment practices is to identify suitable
pool of applicants quickly, cost efficiently and legally.

Selection

It involves assessing and choosing among job candidates. To be effective, selection processes must be
technically sound (accurate and legal).
Post-Selection practices

These practices are implemented by companies to maintain or improve their workers’ job performance
levels.

Training and Development

Training and development are planned learning experiences that teach workers how to perform their
current and future jobs effectively. Training focuses on present jobs, whereas development prepares
employees for possible future jobs. Training and development practices are designed to improve
organizational performance by enhancing the knowledge and skill levels of employees

Performance Management

Through performance management, organizations measure the adequacy of their employees’ job
performance and communicate these evaluations to them. One aim of performance management is to
motivate employees to continue appropriate behavior and correct inappropriate ones. Management
may also use performance management in making important decisions such as promotions, transfers,
separation and pay raises.

Compensation and Benefits

It consist of pay (monetary) which is the wage of salary that employees earn and benefits (non-
monetary) which are provided to the employees in addition to their pay, such as health insurance or
discounts.

Productivity improvement Programs

It ties job behavior to rewards; the aim is to motivate employees to engage in appropriate job behaviors.

HRM Practices Influenced by External Factors

Events outside the work environment can have far reaching effects on HRM practices.

1. Legal and Environmental Issues

The laws are designed to guarantee employees’ (and prospective employees’) right to fair and safe
treatment, affect the manner in which other HRM practices are implemented. It includes anti-
discrimination laws, contractualization, overtime, downsizing, etc.

2. Workplace Justice

It addresses the issue of the employee rights. To have fair workplaces, organizations must comply
with laws that give workers the right to be treated in a nondiscriminatory manner. Workplace justice
laws constrain how employers may implement workplace rules, disciplinary and discharge
procedures, and that infringe on employees’ privacy.
 3. Union Influence

Unionized companies must adhere to written contracts negotiated between each company and its
union. Union contracts may regulate HRM practices such as discipline, promotion, grievance
procedures, overtime allocations and others.

4. Safety and Health Concerns

Organizations respond to issues about health and safety by instituting accident prevention programs
and programs designed to ensure the health and mental well being of their employees.

5. International Influences

Many organization realize that they must enter foreign markets in order to compete as part of a
globally interconnected set of business markets.

Who is Responsible for Developing and Implementing HRM practices?

HR Professionals’ Responsibilities

1. Establish HRM procedures

2. Develop/choose HRM methods
3. Monitor/evaluate HRM practices
4. Advise/assist managers on HRM-

Line Managers’ Responsibilities

1. Implement HRM practices

2. Provide input for HRM practices
SELECTION PHASE OF EMPLOYMENT

Recruitment

Is the process of attracting individuals on a timely basis, in sufficient numbers, and with appropriate
qualifications to apply for jobs in an organization.

Recruitment Goals

1. Achieving cost efficiency. Recruitment represents a major expense and holding down cost while
keeping quality process and productivity level is a major objective.
2. Attracting Highly Qualified Candidates. To get the best of the target population.
3. Help ensure that individuals who are hired will stay in the company
4. Assist the company’s efforts to comply with non-discriminatory laws
5. Help company create a more culturally diverse workforce

Recruitment Planning Process

Step 1 : Identify the Job Opening

This usually happens when an employee turns in a letter of resignation or when someone gets
terminated. In the Philippines, a 1 month notice for resignation is mandatory, and thus allow
organization prepare for recruiting a replacement and turnover of responsibilities. A job opening may
also exist if there is an increase in manpower or a newly created job is established.

Step 2: Decide How to Fill the Job Opening

Alternatives to Recruitment

1. Outsourcing
- is the process of hiring an external provider to do the work previously done internally.
Examples are headhunters

2. Contingent Workers
- are equivalent of “just in time inventory “disposable workers”, contractual or seasonal
workers, “project based”

3. Professional Employer Organization (Agency)

- is a company that leases employees to other businesses.
a. Staff Builders Inc.
b. Metro Eye Manpower Agency

4. Overtime
- alternative to recruitment, especially in meeting short term fluctuations in work volume.
 - It may be of help to both employees and employer. Reduces recruitment, selection and
training cost for the employer and additional income on the part of the employee.

External Environment of Recruitment

1. Labor Market
- demand and supply of specific skills in the labor market
2. Legal Considerations
- consideration regarding equal opportunities
3. Promotion
- (promotion fro within) is a policy of filling vacancies above entry level positions with
current employees
a. provides motivation to current employees
b. current employees will need only small period to adjust to the job

Step 3: Identify the Target Population

The organization needs to (1) specify worker requirements and (2) decide whether to target a certain
segment of the applicant population

Step 4: Notify the Target Population

Once the applicant population has been identified or targeted, the company must determine howto
notify these individuals using a variety of recruitment methods.

Recruitment Methods are specific means used to attract potential employees of the company.

Internal Recruitment Methods

a. Job Posting. A job vacancy notice is posted and all qualified employees may apply.
b. Employee Referrals. Organization may ask their employees about persons they know who
can fill the job openings. It can make use of the social media (facebook, tweeter, etc)

External Recruitment Sources

- fill entry level jobs
- acquire skills not possessed by current employees
- obtain employees with different backgrounds to provide diversity of ideas.
a. Schools / Colleges and University
b. Competitors in the labor market
 poaching – the process of actively recruiting employees from competitors.
c. Former employees
d. Unemployed
e. Military Personnel
f. Self-employed Workers
Online Recruitment Methods

a. Internet Recruiter
- person whose primary responsibility is to use the internet in the recruitment process
(also called “cyber recruitment)
b. Virtual Job Fair
- on-line recruiting method engaged in by a single employer or group of employers to
attract a large number of applicants
c. Corporate Career Websites
- job sites accessible from a company homepage that lists available positions and
provides applicants to apply.
d. Jobs Domain
- a company registers part of its corporate name online and job candidates can access it
more quickly that they could if they had to go directly to the organizations web
e. Weblogs (blogs for short)
- individuals can access the information easily
f. General Purpose Job Board
- jobstreet.com
- trabaho.com
- jobsdb.com

Traditional External Recruitment Methods

a. Employee Referrals. Organization may ask their employees about persons they know who
can fill the job openings. It can make use of the social media (facebook, tweeter, etc)
b. Applicant Initiated Recruitment (Walk-ins). The company accepts unsolicited applications or
resume form individuals interested working for the company.
c. Media Advertising. The company places advertisement of the position in appropriate media
(news papers, radio , tv, billboards, etc.)
d. Employment Agencies
- private employment agencies
- public employment agencies
e. Job Fair
- is a recruiting method engaged in by a single employer or group of employers to attract
a large number of applicants to one location
f. Internships (OJT)
- involves placing a student in a temporary job with no obligation either by the company
or by the student to accept a permanent position.
g. Executive Search Firms
h. Professional Associations
i. Unsolicited Applicants (walk-ins)
j. Open-houses
k. Event Recruiting
l. School / Campus Recruitment
SELECTION

- is the process of choosing from a group of applicants the individual best suited for a particular
position in the organization. It matches properly the people with jobs and the organization.

Environmental Factors

1. HR Functions
 compensation
 benefits
 safety and health
 training
2. Legal Considerations
 non-discriminatory practices
3. Speed of Decision-Making
 Organizations that fills job quickly tend to have a higher total return to shareholders
4. Organizational Hierarchy

 Managerial position vs clerical or entry level positions

5. Applicant Pool

 Number of applicants recruited for a particular job

6. Type of Organization

 Private, Government, NGO, profit or non-profit

7. Type of Employment

 Probationary, Contractual, Temporary, Seasonal, etc.

Selection Process

1. Review of Applications and Biodata Inventories

2. Preliminary Interview
3. Employment Test
a. Personality Test
b. Cognitive Test
c. Work Samples Test
4. Employment Interview
5. Reference and Background Checks
6. Selection Interviews
7. Medical/Physical Exam
8. Hiring Decision

Application Blanks / Biodata inventories

A completed application serves three primary purposes. One is to determine whether the candidates
meet the minimum qualification for the job (e.g., educational attainment and work experiences).
Second, applications help the employers judge the presence (or absence) of certain job attributes
(needed job competency or direct exposure/experience). Lastly, information contained in the
application can be used to “red flag” any potential problem areas concerning the applicant.

Biodata inventories are similar to application blanks in that they ask applicants to provide Background
information about themselves. However, it differs in terms of how the companies interpret applicant
responses. Application blanks are usually evaluated subjectively, while biodata inventories are
objectively evaluated.

Preliminary and Employment Interview

Nearly all companies consider the employment interview to be a vital selection tool. Rarely would an
applicant be hired without having first been interviewed. Interviewers may seek four types of valuable
information during the interview.

- Technical Knowledge
- Self Evaluative Information
- Situational Information
- Behavioral Description Information

Employment Test

Employment testing allows organization further assess the candidates competencies, personality and
job fit.

Mental Ability Test is designed to measure the level of intelligence or aptitude of the applicants.

Personality Tests are designed to assess a variety of personality characteristics that are
important for applicants for certain jobs

Work Sample Tests require applicants to perform some of the actual (or simulated) duties of the
vacant position.

Background Investigation / Reference Checks

Is an in depth probe of an applicant’s background. This is a selection tool where the company conducts
or hires agencies to do an investigation of certain applicants. This usually involves verifying information
regarding past employment, organization affiliation, religious activities, family background, etc.
TRAINING AND DEVELOPMENT

Training and development attempts to make workers better employees by bringing about permanent
changes in their knowledge base, attitude, and/or skills. Workers who lack needed competencies can
create problems that undermine efficient operation

3 Types of Training

1. Orientation Training- all new employees, even those with appropriate technical sills, need some
sort of orientation training to learn about their jobs, the company, and its policies and
procedures.
2. Remedial Training – are designed to correct deficiencies in employees’ skill or knowledge levels
or to improve employee attitude.
3. Change-related training – enables employees to keep up to date with various types of changes
dealing with new laws or procedures, or change in the organization’s strategic plan.

The Instructional Process

1. Deciding what to teach

2. Deciding how to maximize participant learning

3. Choosing the appropriate training methods

4. Ensuring that training is used on the job

5. Determining whether training programs are effective

Step 1 : Deciding what to teach

Assessing training needs. A training need exist when (1) employees’ job behavior is somehow
inappropriate, or (2) their level of knowledge or skill is less than that required by the job, and (3) such
problem can be corrected through training

Determining training objectives. These are statements describing what the trainees should be able to do
as a result of the training

Step2 : Deciding How to Maximize Participant Learning

Once the firm identifies appropriate training needs and objectives, trainers must prepate instructional
materials. When preparing training materials, one must keep the following adage in mind: “adults can
be ordered into a classroom and prodded into a seat, but they cannot be forced to learn”. To maximize
learning, the program should be presented in a way that (1) gains and maintains the trainees’ attention
(2) provides the trainees with an opportunity to practice the skills being taught, and (3) provides the
trainees with feedback on their performance.
Step 3: Choosing the Appropriate Training Method

A variety of training instructional methods may be used to train employees:

1. On the Job Training

2. Job Instruction Training
3. Lecture
4. Case Method
5. Role Playing
6. Behavior Modeling
7. Computer-Based Instruction
8. Video Training
9. Interactive Video Training

Step 4: Ensuring that Training is Used on the Job

According to studies, only 10% of the training information is transferred to the job. For transfer to
occur, the trainees must generalized the learned behavior from the classroom to the job context and
maintain those behavior over time on the job.

Overlearning is learning training materials o well that it will be long remembered, even without frequent
practice. The greater the overlearning, the greater the subsequent retention and transfer.

Matching Course Content to the Job. Another strategy for enhancing transfer is to ensure a close link
between the training and job settings so that the trainees will understand how the learned material can
be applied to the job setting.

Action Plan. This is a plan developed by trainees at the end of a session that indicates the steps they will
take on the job to apply the new skills.

Multiphase Training Program. A training program administered in several sessions in which trainees are
given homework that requires them to apply that lesson back on the job and to discuss this experience
during the next training session

Performance Aids. Devices are given to trainees to help them remember training material when they
return to the job.

Step 5: Determining Whether Training Programs are Effective

Training Evaluation is an assessment of the effectiveness of the company’s training program.

Evaluations are made to determine whether the training program has achieve or met its objectives.

Measuring Instruments for Evaluation

1. Trainee reactions.
2. Testing
 3. Performance Appraisal
4. Records

Evaluation Design. Evaluations should be able to detect whether the desirable outcomes have been
achieved and it is because of training. The best designs typically used the following features:

Pre-test : to show the trainees’ base or pre-training level of knowledge, skill, or performance

Post-test: to show the trainees’ post-training level of knowledge, skills, or performance

Control group: a control group is identical in makeup to the group trained, except that these people
have not received training.

Note:

References:

Kleiman, L. (2010): Human Resource Management, A Managerial Tool for Competitive Advantage, 5th

Edition. South-Wetern College Publishing.

Bolin, A. & Heatherly, L. (2001). Predictors of employee deviance: The relationship between bad

attitudes and bad behavior. Journal of Business and Psychology

//SirBal