UNIT II- Psychology in Organization

The field of Industrial Psychology is described in different ways in different countries. For
example, in the United States industrial psychology has been concerned with enhancing individual
job performance through appropriate selection, training, and appraisal of staff. The overriding
concern is with improving performance outcomes for management, largely through empirical
research (Zickar & Gibby, 2007 ). In the United Kingdom, occupational psychology is the
preferred term, reflecting a broader focus on selection and other personnel/human resource
management practices to improve performance as well as a long - standing concern with employee
well – being and vocational choice. In Germany the preferred term is work psychology (Warr,
2007 ).

Professional Activities of Organizational Psychologists

The professional activities of organizational psychologists encompass a wide range of roles in
universities, consulting firms, and organizations in the public, private, and not - for - profi t
sectors. The primary functions of those in organizational psychology roles include research and
the development of knowledge, teaching, consulting, and advising on specialized OP issues within
organizations. Organizational psychologists,
because of their deep knowledge of people, teams and organizations, often get promoted into
senior leadership roles within organizations. Briefl y, the aims, rewards, and social networks for
the different types of roles performed by organizational psychologists are as follows.

Research functions include a mixture of applied and basic research aimed at addressing questions
of “ What activities or interventions produce the best performance and/or well - being outcomes? ”
and “ Why or how do activities or interventions produce different outcomes? ” Organizational
psychologists located within university schools of psychology and management conduct most, but
not all OP research. Organizational psychologists working within consulting firms also conduct
applied research, particularly as it relates to the development, validation, and application of
assessment tests and surveys. University - based organizational psychologists strive to publish
their research findings in peer - reviewed journals in order to contribute to the general body of
knowledge in the domain, gain the recognition of their peers in professional societies, and to
obtain promotion. This is less common among organizational psychologists working within
consulting firms, who maintain greater confidentiality around their results in order to protect
intellectual property and the resulting revenues from the copyright of assessment tests and
surveys. As a result, some of the largest databases on individuals and teams are not available for
research that can be published and integrated into the body of OP
knowledge. OP research is primarily published in psychology and management
journals.

Teaching and dissemination of OP knowledge occurs in different modes across a range of settings.
OP knowledge is disseminated through university - based degree courses and executive programs,
coaching programs, industry training courses, and company - based training programs. Written
forms of dissemination include textbooks, popular management books, and, increasingly, internet
blogs and magazine articles
that discuss and promote findings from OP research published in academic journals. Consultants,
academics, trainers, practitioners, professional writers, and bloggers all contribute to the
dissemination of OP knowledge. Many of those communicating OP knowledge, either through
training programs or publications, do not have any formal training in OP, which can lead to
problems of quality control in relation to the validity and content of what is being communicated.
However, many trainers, coaches, and consultants belong to professional psychological
associations and industry training associations that include certification requirements and other
forms of quality assurance.

Consulting and advising services are provided to individuals and organizations by organizational
psychologists working in consulting firms and by university – based OP academics who combine
consulting activities with their research and teaching duties. The functions of consulting and
advice services includes helping practitioners to define and solve problems, personal guidance on
problems, development and career advice, design and evaluations of systems and interventions,
and expert testimonies.

Practice includes all the application of OP knowledge and training in the performance of work
roles within organizations. These include specialized OP roles in areas such as change
management, selection, and training, as well as the application of OP knowledge in management
and other roles. In particular, OP knowledge in the areas of leadership and teams are key
contributors to the successful performance of many
roles within modern organizations.

Recruitment and Selection:

Ability tests for selection. Standardized ability tests are among the most effective predictors of
later job performance. Measures of general mental ability, whether collected directly from single
tests of intelligence or created from a battery of specific ability tests (verbal, mathematical,
reasoning, etc.), validly predict overall job performance on all jobs, and more strongly so for more
complex jobs (Schmidt & Hunter 1998; 2004 ; Sackett, Borneman, & Connelly, 2008). Somewhat
surprisingly, GMA has also been shown to negatively predict counterproductive work behavior
such as abuse of others or misuse of property (Dilchert, Ones, David, & Rostow, 2007 ). Dilchert
et al. suggest that more intelligent individuals may have the foresight to anticipate
the consequences of deviant behavior and thus inhibit themselves from displaying it. Taken
together, this evidence would seem to strongly support the use of testing for GMA in most
selection programs. However, some firms are skittish due to likely adverse impact or concern
about applicant reactions. They may use education requirements as a proxy for GMA, which is
less contentious but also considerably less effective
(Berry, Gruys, & Sackett, 2006 ). A relatively recent development in ability testing is the use of
unproctored online testing of job applicants. Concerns have been raised about reduced
standardization of testing conditions, loss of security of test items, practice effects for repeated test
takers, and cheating (Tippins, 2009 ). Advantages to organizations are very much quicker and less
expensive screening of large and geographically dispersed applicant pools before smaller numbers
of successful candidates are assessed in person.

Personality tests for selection. One of the most contentious and active areas of research for the
past 15 years has surrounded the issue of personality testing for selection purposes. Personality
testing became popular after World War II but fell into disrepute after a review by Guion and
Gottier (1965) concluded that personality did not consistently predict job performance. Personality
testing has made a huge comeback after a meta - analysis by Barrick and Mount (1991) . They
used the “ Big Five ” typology to organize the many personality scales used in previous validation
studies and concluded that the personality trait of conscientiousness had a nonzero relationship to
job performance across jobs. Personality traits appear to be somewhat stronger (but still modest)
predictors of organizational citizenship behavior and counterproductive work behavior than of
core task performance, and are also useful in predicting leadership. When all the Big
Five measures are combined in a multiple regression equation, the prediction of outcomes is
improved.
Advocates of personality for selection point out that validities are quite respectable when
personality measures are contextualized (ask about how one feels and behaves at work rather than
in general), when personality traits are selected based on a thorough job analysis and logical
rationale about which traits might support performance in that job, when jobs are high in
autonomy (and thus the situation is “ weak ” ), and when criteria to be predicted are discretionary
behaviors such as citizenship rather than those dominated by ability like objective core task
performance (Hogan, 2005 ;Hough & Oswald, 2008 ).
Few Widely used Tests in industries
Myers Briggs Type Indicators: The Myers Briggs personality test is generally based on the
personality indicator developed by Katharine Cook Briggs and her daughter Isabel Briggs Myers.
Their development of the test occurred in the 1940s and was built upon psychological research
performed by Carl Jung in the 1920s. The type test is based on a series of questions that gather
information on how a person usually responds or relates to various situations.
The answers to these questions are calculated to determine the person’s individual personality
type. Important insights can be gained by understanding personality type, such as optimal career
choice, better romantic partnerships, and paths to personal growth.

Big Five Factor Inventory: Five factors are Extraversion, Agreeableness, Neuroticism,
conscientiousness, openness to experience.
 Openness - People who like to learn new things and enjoy new experiences usually score
high in openness. Openness includes traits like being insightful and imaginative and having
a wide variety of interests.
 Conscientiousness - People that have a high degree of conscientiousness are reliable and
prompt. Traits include being organized, methodic, and thorough.
 Extraversion - Extraverts get their energy from interacting with others, while introverts get
their energy from within themselves. Extraversion includes the traits of energetic,
talkative, and assertive.
 Agreeableness - These individuals are friendly, cooperative, and compassionate. People
with low agreeableness may be more distant. Traits include being kind, affectionate, and
sympathetic.
 Neuroticism - Neuroticism is also sometimes called Emotional Stability. This dimension
relates to one’s emotional stability and degree of negative emotions. People that score high
on neuroticism often experience emotional instability and negative emotions. Traits
include being moody and tense.

Personality Types
Tests that draw on the method by Briggs and Myers sort people into 16 different types which are
organized by four pairs of opposite traits.
These pairs are:
 Extraversion (E) and Introversion (I)
 Sensing (S) and Intuition (N)
 Thinking (T) and Feeling (F)
 Judging (J) and Perceiving (P)
One of each pair is combined to create a 4-letter abbreviation for each personality type, such as:
ESFP: extraversion (E), sensing (S), feeling (F), perception (P)
INTJ: introversion (I), intuition (N), thinking (T), judgment (J)
These personality traits are grouped into four categories that describe the way in which a person
interacts with the world. Everyone experiences both traits in each pair, but usually one is more
dominant than the other in the Myers Briggs personality test.

Interviews. Interviews are among the most commonly used selection procedures. One of the
clearest fi ndings in our literature is that interviews that are structured in terms of both questions
asked and scoring procedures do a better job of predicting job performance than unstructured
interviews (Huffcutt & Arthur, 1994 ). Interviews are usually well accepted by applicants, produce
less adverse impact than ability tests, and contribute incrementally to the prediction of
performance beyond GMA and personality. A structured interview is a method not a construct,
and interview questions may be used to assess a variety of attributes including personality, mental
ability, job knowledge, and specific skills (Huffcutt, Roth, Conway, & Stone, 2001 ). It has been
suggested that interviews often capture motivational variables, and so may be especially effective
in predicting typical performance (Klehe & Latham, 2006 ). Structured interviews may be seen as
a major success story for industrial psychologists in terms of influencing practice. Two particular
forms, the situational interview ( “ what would you do if … ” ; Latham, Saari, Pursell, &
Campion, 1980 ) and the behavior description interview ( “ tell me about a time you … ” ; (Janz,
Hellervik, & Gilmore, 1986 ) are very effective and have been widely accepted in organizations.
Evidence suggests that behavior description interviews are more valid than situational interviews
for complex jobs (Huffcutt, Roth, Conway, & Klehe, 2004 ).
Assessment centers and individual assessment. Assessment centres are another success story for
industrial psychology. An assessment center is a content - valid half - day to three - day series of
simulations of work tasks, most often designed for supervisory or managerial roles. Exercises
usually include an in - basket test, a leaderless group discussion, role plays, and other problem -
solving activities. Psychological tests, public speaking tasks, and interviews may be included as
well. Assessors rate candidates on multiple skill dimensions (e.g., leadership, planning,
persuasiveness) after each exercise, and again at the end of all exercises. Assessment centers are
most often used for selection, with either internal or external candidates, and also provide useful
information regarding the development needs of candidates. The overall assessment ratings
produced at the end of assessment centers are predictively valid for job performance, promotions,
and salary advancement. Assessment center performance is correlated with GMA and personality,
and there are mixed fi ndings on the extent to which assessment center ratings have incremental
validity beyond these predictors (Meriac, Hoffman, Woehr, & Fleisher, 2008 ; Schmidt & Hunter,
1998 ). See Thornton and Rupp ( 2006 ) for a comprehensive treatment of assessment center
issues.
Some psychologists, including those with industrial or clinical backgrounds, conduct individual
assessments for selection purposes. The assessment may consist of a variety of tests as well as an
in - depth interview, and culminates in a written description of the strengths and weaknesses of a
candidate for a particular upper management position.

Job Analysis
Job analysis has been an integral part of the practice of industrial psychology since the very first
test validation efforts shortly before World War I. Job analysis is simply describing the content of
a job, usually in terms of important duties or tasks and/or the human behaviors and knowledge,
skills, and abilities required to execute those duties (see Brannick, Levine, & Morgeson, 2007 for
more on job analysis). It is essential to understand the job thoroughly in order to choose selection
practices likely to be valid, develop appraisal criteria with which to measure job performance,
design training, set pay, develop career ladders, and so on. The last few years have seen
discussions of whether job analysis is still relevant in a changing world. Traditional job analysis is
past - oriented, focusing on describing ajob as it is currently performed rather than as it might
come to be performed in the future. Yet job content may be less stable over time as organizations
become more
agile and flexible, making time - consuming and expensive job analysis studies unattractive and
likely to be quickly out dated. Further, responsibility for accomplishing duties increasingly is
located at team rather than job level, and job analysis has historically concentrated on individual
jobs (Singh, 2008 ). At the same time, a competing approach to traditional job analysis,
competency modeling , has gained widespread acceptance with practitioners and is now employed
to describe managerial jobs in a substantial majority of large organizations.
Competency models usually contain a limited number of generic worker – oriented attributes that
are felt to characterize, to varying degrees, high performance in a wide range of jobs. They are
chosen to emphasize and communicate strategically important behaviors and cultural values, such
as customer service and innovation, throughout the organization — a function completely lacking
in traditional job analysis. Competencies are used to tie together human resource practices,
especially in training and appraisal. Competency modeling has been criticized as less rigorous and
much less detailed than traditional job analysis, as using less psychometrically sound means of
development and data collection, and as lacking the specifi c detail needed
to guide employee selection efforts (Shippmann et al., 2000 ). However, it does have a more
strategic orientation than traditional job analysis. Some experts feel that competency modeling and
job analysis serve different purposes, and that both can contribute to the effective management of
people in organizations (Sanchez &Levine, 2009 ).

Uses of Job analysis information

Organization Design HR Management Work and Equipment Additional Uses
Design
Organizing Job evaluation Engineering design Vocational guidance
Human Resource Recruitment Job design Rehabilitation
planning Selection Methods counselling
Role definition Placemen improvement Job classification
Orientation safety systems
Training and HR research
development
Performance appraisal
Promotions and
transfers
Career path planning
Labour relations

Selection
Improving employee selection was one of the first and has long been one of the most central
concerns for industrial psychologists. The standard paradigm involves measuring relevant
individual differences in job candidates (predictors) and using them to predict individual
performance after hire (the criterion). Before predictors can be used, however, they must be
proven to be valid in significantly predicting post – hire performance on the criterion measure.
The basic model for criterion - related validation has been in place since about 1920 (Vinchur,
2007 ). It includes:
1. Conduct a thorough job analysis to identify the knowledge, skills, and abilities
(KSAs) likely to be required to complete job tasks;
2. Develop a criterion measure of job performance;
3. Design or choose one or more selection devices to measure KSAs that appear to
be important for job performance;
4. Administer selection devices and criterion measures to employees and empirically
determine the relationship between them;
5. Determine a decision rule for using scores on the selection devices for hiring

Advertisements and Consumer Psychology.

Consumer psychology is a specialty area that studies how our thoughts, beliefs, feelings, and
perceptions influence how people buy and relate to goods and services. One formal definition of
the field describes it as "the study of individuals, groups, or organizations and the processes they
use to select, secure, use, and dispose of products, services, experiences, or ideas to satisfy needs
and the impacts that these processes have on the consumer and society."

Professionals in this field look at things like the decision-making process, social persuasion, and
motivation to help understand why shoppers buy some things but not others. In this overview of
the profession, learn more about what consumer psychologists do and where they work.
This field is often considered a sub-specialty of industrial-organizational psychology and is also
known as the psychology of consumer behavior or the psychology of marketing.

Consumer psychologists study a variety of topics including:

 How consumers choose businesses, products, and services

 The thought processes and emotions behind consumer decisions
 How environmental variables such as friends, family, media, and culture influence buying
decisions
 What motivates people to choose one product over another
 How personal factors and individual differences affect people's buying choices
 What marketers can do to effectively reach out to their target customers

What Consumer Psychologists Do

So what exactly does a typical consumer psychologist do? These professionals play a critical role
not only in helping businesses understand what their customers want and need but also in helping
sellers promote and market their products and services to buyers.

Consumer Psychologists Help Businesses Understand Their Customers: Because businesses

need to understand their consumers in order to develop products and marketing campaigns that
appeal to their target audience, consumer psychologists often spend a great deal of time learning
more about what makes shoppers tick. This often involves first figuring out the target audience for
a particular product including the gender, age, and socioeconomic status of the typical shopper.

Next, the consumer psychologist might begin researching the types of products and marketing
messages that appeal to these types of buyers.

Consumer Psychologists Help Develop Marketing Messages: Other consumer psychologists

might focus on social marketing, or how ideas and messages spread among groups. Researchers
might be interested in getting out information about a product or an important public health
message. Learning how beliefs and attitudes spread among groups can help organizations learn
how to better get their message out and encourage word-of-mouth marketing.

Consumer Psychologists Conduct Research on Consumer Attitudes and

Behaviors: Consumer psychologists often conduct research to learn more about buyer behavior.
Common research methods used by these professionals include experiments, phone surveys, focus
groups, direct observations, and questionnaires.

Chances are good that you have participated in at least one market research survey in your life.
These are often conducted by phone, but may also be done online or through direct mail. In
a survey, consumers are often asked to describe their past shopping behavior, factors that
influenced their decision-making, and their future buying plans.

Researchers also typically gather details about each respondent's sex, age, race, educational
history, and current financial situation. This type of information can be very useful since it allows
researchers to look for patterns and learn more about who buys certain products.

For example, using a survey might allow researchers to discover that women between the ages of
30 and 45 who have a household income between $50,000 to $100,000 are most likely to buy a
particular product or service. By knowing this, they can then begin designing marketing
campaigns aimed at this target audience.