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  • Writer's pictureJeremy Noble

What is Organizational Psychology?

I was chatting with an Irishman at a bar while on vacation recently when, in between discussions about the anger of the Irish and his love for the people of the American South, he asked, “What do you do?” When I answered that I’m an organizational psychologist, he responded, “What’s that?”

It hit me that if this highly successful businessman in his 50s was unaware of what Organizational Psychology was, then many others may be as well. What’s more, many business leaders may be unaware of the positive impacts that an organizational psychologist can have on their business. So, what is Organizational Psychology?

Organizational Psychology, or what’s traditionally been called Industrial Organizational (I/O) Psychology, has been around for well over a century. At its core, it’s the application of psychological theories to the workplace. Said differently, the goal of organizational psychologists is to bring science to the policies and decisions made in the workplace to maximize organizational success. Organizational Psychology is not limited to corporations, however; there are psychologists in the government, military, and education system as well who deliver science-based assessment, evaluation, and strategies to improve workplace performance.

For the sake of simplicity, I’ve taken the liberty of binning elements of Organizational Psychology into the following four domains: Personnel Psychology (job hiring and placement), Psychology of Groups/Teams (assisting employees to work well together), Leadership Development (helping organizational leaders lead effectively), and Organizational Development (understanding how organizational policies and procedures affect human behavior).

Personnel Psychology

In his book Good to Great, Jim Collins shares that great organizations place an extraordinary amount of emphasis on hiring the right people. Organizational psychologists benefit organizations by applying science to the hiring process. There are a few fundamental truths that make Personnel Psychology relevant: 1) people have distinct psychological traits, 2) people differ from one another in those traits, 3) different jobs require different traits, and 4) we can measure those differences. Organizational psychologists can help organizations determine what traits are necessary for the job, accurately and reliably measure them in job candidates, and provide decision-makers with objective findings on which job candidate is most suitable for the position.

Why does this matter?

Bad hires can cost an organization 30% of the individual’s first year expected earnings, at a minimum. Some argue the cost is even higher. When you take onboarding and training, hours spent recruiting, reviewing resumes, and interviewing, the time and energy spent managing poor performance, the impact on team morale, the reduction in productivity, and possible legal fees for disputed termination into consideration, a haphazard hiring program can be exceptionally costly.

Psychology of Groups/Teams

Most jobs come with co-workers. Not all co-workers get along or work well together. Organizational psychologists help organizations improve their team dynamics to maximize productivity and employee well-being. Examples include surveying or interviewing team members to understand their level of cohesion, applying interventions intended to improve group performance, and making recommendations to leadership to change policies, practices, or personnel.

Why does this matter?

Want to keep your employees? Social support in the workplace is a protector against burnout. Human beings naturally crave being part of a social group. The more cohesive that group, the more the team members benefit. Members of cohesive groups are more motivated to work, are less likely to quit, and are even less likely to experience negative psychological states like depression. When your employees work well together, everyone benefits.

Leadership Development

Organizational psychologists will implement leader development programs to help organizational leaders grow professionally. These programs may be in the form of educational classes such as teaching leaders how to best motivate, retain, or provide feedback to their employees. They may also be in the form of one-on-one coaching. Coaching is a collaborative partnership in which a coach and client engage in a thought-provoking exchange intended to help the client reach their professional goals.

Why does this matter?

If there's one place to invest, it's in your company's leaders. In their book It's The Manager, Gallup shares that 70% of what makes an employee engaged is due to the leadership style of their manager. Disengaged workers cost organizations $3,400 for every $10,000 paid to them. Companies with engaged employees see a 10% increase in customer ratings, 21% increase in profitability, 70% decrease in safety incidents, 41% decrease in absenteeism, and up to 59% decrease in turn-over. Want more engaged employees? Cultivate better leaders.

Organizational Development

I like to think of an organization like a single human being. If someone's diet is poor, their physical abilities will be degraded. The same is true for an organization- if it hires the wrong people, it will perform poorly. If someone behaves in a way that is inconsistent with their values, their mood will suffer. The same is true for an organization- if it behaves in a way that goes against its company values, the collective morale will suffer. I could go on and on with this analogy, but the point is that organizations, like people, need a regularly scheduled checkup to make sure they are functioning optimally. Organizational psychologists bring a unique skillset to the table to make this happen. An organizational psychologist can measure certain psychological constructs in the workplace like employee morale, engagement, job satisfaction, etc. and provide those results to organizational leaders. They can also recommend or perform interventions that are proven by research to improve those constructs making the workplace operate more optimally. This is akin to seeing a nutritionist, learning you are deficient in vitamin D, and following their guidance to remedy your deficit by changing your diet.

Why does this matter?

As stated earlier, employee engagement is king. There are dozens of ways to improve employee engagement which is something that has been proven by research to increase profits. Enlisting the help of an organizational psychologist will allow you to uncover those ways, make necessary changes, and measure the outcomes to ensure your changes are making a difference.


As an organizational psychologist, I bring the science of human behavior to the workplace. I help organizational decision-makers make well-informed decisions that are empirically proven to get results. Said differently, I let you, as a leader, sleep soundly at night knowing you hired the right people, your subordinate leaders are taking care of their employees, and your company is thriving- because you have the data to prove it.

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