What Is Organizational Psychology? Understanding Its Role in Modern Workplaces

Today's employers are increasingly focused on understanding employees’ thoughts, feelings, and behaviors within the workplace. This understanding is crucial because it directly influences team communication, conflict resolution, and leader-team interactions.

If this idea interests you, then the field of organizational psychology may be worth looking into as you prepare to attend college. Specifically, the American Psychological Association refers to organizational psychology (also known as industrial-organizational psychology) as "deriving principles of individual, group, and organizational behavior and applying this knowledge to the solution of problems at work."

So, what are the key components of organizational psychology, and how can they be applied to improve the modern workplace? We're diving into this, along with practical tips for aspiring psychologists looking to enter the field, below.

The Historical Roots of Organizational Psychology

The history of organizational psychology dates back to the early 1900s, when Hugo Munsterberg released the book Psychology and Industry Efficiency, and a number of studies were completed on worker productivity in the Hawthorne Studies of the 1920s.

By 1945, the Industrial and Business Psychology Division of the APA was formed, which later became the Division of Industrial and Organizational Psychology in 1973. Today, organizational psychology remains relevant in the modern workplace.

Key Theories and Concepts

Within the field of organizational psychology, there are several key theories and ideas to be aware of:

• Motivation Theories, which are behind understanding the many factors that influence worker behavior (including both intrinsic and extrinsic factors).
• Social Learning & Expectancy Theories, which suggest that employees are primarily motivated by the belief that their effort and performance will result in better rewards.
• Leadership Models, which posit that leadership styles (and the individual effectiveness of leaders) can affect employee performance.

Applications in Modern Workplaces

So, what is organizational psychology, and why does it matter in today’s workplace? The concepts and theories guiding organizational psychology can be applied in the modern workplace in a number of ways, from employee selection and training to engagement and organizational culture.

Employee Selection and Assessment

During the recruitment and hiring process, employers can draw upon organizational psychology to evaluate and assess job applicants, ultimately choosing certain people for roles based on their talents, personalities, leadership styles (where applicable), and other criteria.

Training and Development

When it comes to training employees, organizational psychology can also be applied to ensure that training programs are properly teaching employees the essential skills they need to know, and that those skills align with company values and goals. This may be especially applicable when it comes to leadership development.

Motivation and Engagement

Boosting motivation and employee engagement can also be done by applying organizational psychology methods, which can help employers determine the factors that are most influential in encouraging employee productivity.

Organizational Culture & Change Management

The importance of a strong and positive workplace culture is especially clear in the modern workplace, so employers are working diligently to better understand areas of improvement based on organizational psychology concepts. Meanwhile, periods of change or transition may also be better managed when theories of organizational psychology are applied to improve communication and manage resistance.

Employee Well-Being & Work-Life Balance

Finally, when organizational psychology is applied in the workplace, this can also help to mitigate conflicts between employees while ensuring that all employees enjoy a better work-life balance.

Career Opportunities in Organizational Psychology

Interested in a career as an organizational psychologist? There are numerous opportunities worth exploring, with some of the most common job titles including:

• Organizational Development Consultant - Works with employers to improve their workplaces by analyzing organizational issues and making direct recommendations for change.
• Talent Management Specialist - Applies concepts of organizational psychology to help businesses hire the right workers for their job openings.
• Training and Development Manager - Applies organizational psychology ideas to the training side of the workplace, ensuring that all training and development materials align with organizational goals and employee needs.
• Human Resources Analyst - Collects and interprets workforce data to improve long-term strategic planning and performance management among HR teams.
• People Analytics Specialist - Collects and analyzes workforce data to pinpoint trends while working with business leaders to support HR-related decision-making.
• Executive Coach or Leadership Development Consultant - Works specifically with leaders to provide coaching, training, and leadership development to improve workplace leadership styles and outcomes.
• Academic Researcher or Professor - Conducts important research on organizational psychology to inform future trends in the field. Many of these researchers work for colleges/universities and may teach psychology courses at the college level as well.

Educational Requirements

While different job titles in organizational psychology may have different educational requirements, entering the field typically requires a minimum of a bachelor's degree in psychology, applied psychology, or a related field of study. Some more advanced roles may require a master's degree or another advanced degree, and some states require psychologists to earn licensure/certification as well.

Skills Needed for Organizational Psychologists

Aside from a formal education, working as an organizational psychologist also requires the following skills:

• Analytical thinking, especially when assessing and interpreting data or evaluating workplace systems.
• Communication skills, both when working with organizational decision-makers and employees.
• Emotional intelligence, including the ability to understand and manage one's own emotions while interpreting the feelings of others.
• Problem-solving, particularly when it comes to facilitating conflict resolution and making recommendations to improve workplace systems.
• Research and statistical literacy, whether conducting one's research or interpreting research done by others.
• Ethical judgment and the ability to act with integrity in all things work-related.
• Adaptability and flexibility, especially when circumstances change or evolve unexpectedly.

Certification, Licensing, and Training

Each state sets its requirements for the certification or licensing of organizational psychologists, so it's important to research your state's requirements before you enter the field. In some states, psychologists may need to complete a certain number of supervised work hours before they can apply for licensure. In many states, it is also necessary to pass an exam (such as the Examination for Professional Practice in Psychology) before getting licensed.

Benefits for Organizations and Employees

When organizational psychology is applied in the modern workplace, both employers and employees can benefit in a number of ways.

Improved Hiring and Retention

Organizational psychology concepts can inform recruiting and hiring practices, which can lead to optimal hiring decisions that improve retention.

Increased Employee Engagement

Applications of organizational psychology can lead to better workplace environments for employees, which can improve engagement and productivity over time.

Better Leadership Development

When leaders' training is tailored with organizational needs in mind, leaders can become more effective in motivating and inspiring their respective teams.

Enhanced Organizational Performance

Theories of organizational psychology can help workplaces better align their goals, objectives, and values. When everybody is on the same page in this regard, this can lead to enhanced organizational performance.

Stronger Workplace Culture

Workplaces that apply concepts of organizational psychology may also foster a more positive workplace culture, which can lead to better retention, greater productivity, and more satisfied employees overall.

Future Directions of Organizational Psychology

The field of organizational psychology continues to evolve, with professionals now working with technologies like artificial intelligence (AI) to better understand human behavior and make informed decisions when it comes to performance management, workplace culture, training, and hiring. In some cases, psychologists are even using tools like conversational AI to understand organizational behavior better and make recommendations to employers to enhance worker mental health and well-being.

Learn More in CCO's Online Applied Psychology Program

Understanding what organizational psychology is can help future professionals prepare for impactful roles in various career paths. As employers look to create better workplaces for employees, the role of the organizational psychologist is likely to become increasingly important. If you're interested in studying psychology to understand human behavior and contribute to this important research, choosing the right psychology program is crucial.

At Champlain College Online, we offer an online bachelor's in applied psychology that includes coursework in such essential topics as social psychology, the psychology of personality, conflict engagement, and more. Plus, because this program is offered completely online, you can pursue your education without putting other areas of your life on hold.

Learn more about this program by getting in touch with our team today. Eager to get the ball rolling on your education? You can start your online application for admission here!