Psychology Applied to Business

1
Psychology Applied to Business
2
1911-The Coca-Cola Connection

• What does the Coca-Cola company have to do with
  the beginning of a relationship between
  psychology and business?
• Harry Leta Hollingsworth
• The old Applied vs. Pure debate rears its head
  once again!
• What was the effect of this research effort on
  the future of psychology and business?

3
First Areas of Interest

• Social changes made Applied Psychology very
  appealing
• Immigration, industrialization, growth of cities
• Psychology entering business shifted the focus of
  attention

4
Old focus

• New large corporations created management
  problems
• Efficiency
• Product development
• Getting cheap materials
• Keeping labor costs down

5
-1920s-New Focus

• Attention shifted toward the worker
• Selection (testing)
• Training
• Employee satisfaction

6
Toward a New Psychology of Business

• Hugo Munsterberg
• Not the first to be interested in psychology and
  business
• Earlier efforts have to do with testing,
  advertising, etc.
• Wrote Psychology and Industrial Efficiency
• Focused on the promise of psychology to fulfill
  greater efficiency

7
What can Psychology offer?

• More effective advertising
• Better trained workers
• Improved management techniques
• Better performing workers
• Higher quality output
• A more scientific approach to all of this!

8
1920s and 1930s a more Psychological approach

• Frederick Winslow Taylors scientific management
• Frank Gilbreath (and Lillian) engineer who used
  photography to help improve efficiency

9
The Down Side

• Workers and labor groups didnt greet this with
  total enthusiasm
• Quacks like Dr. Katherine Blackford gave
  psychologists a bad name with pseudo-scientific
  approaches like
• character analysis systems
• Phrenology
• Graphology

10
After World War II

• Industrial psychology had focused on the
  individual level (changing one worker or a
  department)
• There was growing awareness that a much broader
  approach was needed
• Industrial/Organizational psychology was born!
• APA Division 14 Industrial Psychology

11
Personnel Types vs. Organizational Types

• Personnel types
• Job analysis
• Matching people to jobs
• Organizational types
• Overall working conditions
• Leadership
• Job satisfaction
• Employee motivation

12
Theories Used in I/O Psychology

• Job Performance
• Task-specific elements
• Goal-setting
• Cross-culturally
• Used throughout the world
• Used differently depending upon culture/context

13
Controversies/Issues

• Banding
• Predicting job performance from personality
• Teams
• 360-Degree feedback
• New modes of assessment