Industrial Organizational Psychology Summary
Psychology (Psy1)
INDUSTRIAL PSYCHOLOGY
 A branch of psychology that applies the principles of psychology to the
workplace
 With the purpose of enhancing the dignity and performance of human beings
and the organizations they work in by advancing the science and knowledge
of human behavior
 It relies on research, quantitative methods and testing techniques
 I/O psychologists are trained to use empirical data and statistics than
clinical judgment to make decisions
 Difference from other related fields (ex: HR):
o Application of psychological principles like the use of psychological
tests
o Psychologists examines factors that affects the people in an
organization as opposed to the broader aspects of running an
organization
2 APPROACHES OF ACHIEVING THE GOAL OF I/O PSYCHOLOGY
 Industrial approach – focuses on determining the competencies needed to
perform a job, staffing the organization with employees who have the
competencies and increasing competencies through training
 Organizational approach – creates an organizational structure and culture
that will motivate employees to perform well, give them the necessary
information to do their jobs and provide working conditions that are safe and
results in an enjoyable and satisfying work environment
MAJOR FIELDS OF I/O PSYCHOLOGY
 Personnel Psychology
o Study of areas such as job analysis, recruitment, selection,
determining salary levels, training employees and performance
evaluation
o Uses tests to select and promote employees
o Construct performance appraisal instruments
 Organizational Psychology
o Concerned with the issues of leadership, conflict management,
organizational change, group process within an organization and
job satisfaction
Conducts surveys of employees’ attitudes, usually serving the role
of a consultant who makes recommendations on ways problems
can be improved
o Develop organization-wide programs like team building,
restructuring, employees empowerment to improve employee
performance
Ergonomics/Human Factors
o Concentrate on workplace design, human-machine interaction,
ergonomics, physical fatigue and stress
o
INDUSTRIAL/ORGANIZATIONAL PSYCHOLOGY
OUTLINE
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IMPORTANT EVENTS AND PEOPLE IN THE HISTORY OF I/O PSYCHOLOGY
1870s – Appendage of organizational psychology to industrial psychology
William Bryan
 A psychologist who studied the skills of telegraphers as they use the Morse
code
 (1st force) He stressed out examining real skills used in everyday life
 (2nd force) Desires of industrial engineers to improve productivity of industrial
employees evolve
1910 – Industrial Psychology came to be a special area of psychology
Walter Dill Scott
 1903 he published his 1st book: “Theory of Advertising” emphasizing on the
need of psychology in advertising
 1911 published his 2nd book: “Increasing Human Efficiency in Business”
which is about tactics, loyalty and human efficiency
Frederick Taylor
 An engineer considered to be the Father of Scientific Management who
sought to improve industrial efficiency
 One of his important works is the “Principles of Scientific Management”
Lillian Moller Gilbreth
 A female psychologist who pioneered in industrial management techniques
 Her works are concerned with the human aspect of time management
 She was the 1st to recognize the effects of stress and fatigue among workers
 1908 she gave a speech to industrial engineers pointing out that human
beings is the most important aspect of the industry but have not receive any
attention
Hugo Munsterberg
 Created the Army Alpha Test (German)
 Considered to be the Father of Industrial Psychology
 He is a popular figure in American Education who applied traditional
psychological method to industrial setting
 He published the book: “Psychology and Industrial Efficiency” which is about
selecting workers, designing work stations and using psychology in sales
 He is also famous for his study “What makes a safe trolley operator?”
World War I
 I/O psychology has made its 1st impact
 I/O psychologist were employed to test recruits and place armies on
appropriate positions
 They used the “Army Alpha” and “Army Beta” tests of Mental Ability by
Munsterberg to assess armies
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New interest in the application of cognitive psychology to the industry
Increased interest in the effects of work on family life and leisure activities
I/O psychology developed new methods of selecting employees
CRITERIA AS STANDARDS OF DECISION-MAKING
CRITERIA
 Are evaluative standards by which objects, individuals, procedures or
collectives are assessed for the purpose of ascertaining their quality
Conceptual Criterion
 Is a theoretical construct, an abstract idea that can never actually be
measured
 It is an ideal set of factors that constitute a successful person as conceived
in a psychologist’s mind
Hawthorne Experiments (Western Electric Company)
 Most significant research in I/O psychology which shows enormous
problems of production in relation to efficiency
 The study attempted to find out the relationship of lighting or illumination to
employees’ productivity
3 FORMS OF RELATIONSHIP BETWEEN ACTUAL AND CONCEPTUAL CRITERIA
Hawthorne Effect – the positive change in behavior that occurs at the onset of an
intervention followed by a gradual decline often to the original level of the behavior
prior to the intervention
Criterion deficiency – is the degree to which the actual criteria fail to overlap the
conceptual criteria – that is, how deficient the actual criteria are in representing the
conceptual ones
The Psychological Corporation
 Founded in 1921 by James Cattell
 With the purpose of advancing psychology and promote its usefulness to the
industry
 As the largest publisher of psychological test i t also served as the “clearing
house” in order to protect against quacks and to provide the list of
psychologists who can render services
Criterion relevance – the degree to which the actual criteria and the conceptual
criteria coincide
World War II
 The “Army General Classification Test” (AGCT) was used to assess and
place draftees and assess the skills and abilities of military men
Major Changes in 1980s – 1990s
 Increase use of fairly sophisticated statistical techniques and methods for
analysis
Actual Criterion
 The operational or the actual standard that researchers measure or assess
Criterion contamination – the part of the actual criteria that is unrelated to the
conceptual criteria
Bias – the extent to which the actual criteria systematically or consistently
measure something other than the conceptual criteria
Error – the extent to which the actual criteria are not related to anything at all
JOB ANALYSIS
 Is a procedure useful in identifying the criteria or performance dimensions of
a job
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A formal procedure by which the content of a job is defined in terms of tasks
performed, the situation in which the work is performed and the human
attributes needed to perform the job
It is the process of gathering, analyzing and structuring information about a
job’s components, characteristics and requirements
IMPORTANCE OF JOB ANALYSIS
1. Writing Job Description
2. Employee Selection
3. Training
4. Personpower Planning
5. Performance Appraisal
6. Job Classification
7. Job Evaluation
8. Job Design
9. Compliance with Legal Guidelines
10. Organizational Analysis
JOB DESCRIPTION
 A relatively short summary of a job, usually 2-5 pages, it must describe a job
in enough detail that decisions about activities such as selection and training
can be made
 It should be updated on a regular basis
 Is the written result of job analysis procedure which serve as basis for HR
activities
8 SECTIONS OF A JOB DESCRIPTION
 Job Title – an accurate title that describes the job
 Brief Summary – a paragraph which describes the nature and purpose of the
job which can be used in help-wanted ads
 Work Activities – list of tasks and activities in which the worker is involved
which can be divided into categories
 Tools and Equipments Used – list of all tools and equipments needed on the
job
 Job Context – should describe the environment in which the employee
works, the stress level, work schedule, physical demands, levels of
responsibilities, temperature, number of co-workers, degree of danger, etc.
 Work Performance – outline of standards of performance and how employee
will be evaluated
 Compensation Information – info about salary grade and the compensable
factors used to determine salary
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Job Competencies – knowledge, skills, abilities (KSAOs) needed on the job
at the time of hiring and those that can be obtained after hiring
THINGS TO CONSIDER WHEN PREPARING FOR A JOB ANALYSIS
 A trained staff from the HR department, a consultant, or trained job
incumbents and supervisors should conduct the job analysis
 The job description should be updated if a job changes significantly
 Participants of job analysis should be chosen randomly with the
consideration of job competence, race, gender, education, personality, and
viewpoints
 On smaller companies every employees should participate on the job
analysis
 Levels of specificity, formal vs informal tasks should also be taken into
consideration
CONDUCTING THE JOB ANALYSIS
1. Identify the Tasks Performed – identify major job dimensions and the tasks
performed for each dimension, the tools and equipments used and all the
conditions to which the tasks are performed
Methods of Gathering Information
 Interview – a job analyst interview Subject Matter Experts (SMEs)
about their job
o Individual interview – one-on-one interview to get the
employees’ perspective on the jobs’ duties and
responsibilities
o Group interview – used when large number of employees
perform the same job
o Panel discussion – panel of experts representing all levels
of the organization discuss the standards of the job
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Direct Observation/Observation of Incumbents – lets the job analyst
actually see the worker perform her job and obtain information that
the worker may have forgotten during the interview
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Questionnaire/Inventory – use readily available structured/
unstructured questionnaire that acquire existing knowledge about
job information into a taxonomy which is applicable for large
number of employees
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Job Participation – analyze a job by actually performing it
2. Write the Task Statements – it should be properly written containing the
action (what is done) and the object (to which the action is done) and the
where, when, why and how the job is done
COMPETENCY MODELING – the activity of determining the specific competencies
that are characteristic of high performance and success in a job
Difference of Job Analysis and Competency Modeling
3. Rate the Task Statements
 Conduct a Task Analysis – where a group of SMEs would rate each
statement based on the frequency and importance or criticality of
the tasks
4. Determine Essential KSAOs
a. Knowledge – body of information needed to perform the task
b. Skills – proficiency to perform the learned task
c. Ability – basic capacity for performing a wide range of different
tasks, acquiring knowledge or developing a skill
d. Other characteristics – personality, willingness, interest, motivation
and tangible factors like licenses, degrees, years of experience
5. Selecting Tests to Tap KSAOs – use of interviews, work samples, ability
tests, personality tests, reference checks, integrity checks and biodata
Job Analysis
Examines both the work that gets
performed and the human attributes
needed on the job
Identify specific and different KSAOs
that distinguishes jobs within the
organization
KSAOs are identified using technical
methods
Does not try to capture/include
organization-level values and vision
Competency Modeling
Does not consider the work being
performed
Competencies apply to all employees;
more universal and abstract than the
KSAOs
Include review sessions and group
meetings of many employees thus
employees readily identify with and relate
to resulting competencies
Links personal qualities of employees to
overall mission of the organization
OTHER JOB ANALYSIS METHOD
General Information about Work Activities:
 Position Analysis Questionnaire (PAQ)
 Job Structure Profile (JSP)
 Job Elements Inventory (JEI)
 Functional Job Analysis
JOB EVALUATION
 Is a useful procedure in determining the relative value of jobs in the
organization which in turn helps determine the level of compensation
 Assess the value of each job in an organization
 Job analysis describes a job while in a job evaluation you compare jobs in
terms of those things that the organization considers important determinants
of job worth
Information about Tools and Equipments
 Job Components Inventory
COMPENSATION – all forms of rewards earned by employees in return of their labor
Information about Work Environment
 AET (Ergonomic Job Analysis Procedure)
Information about Competencies (KSAOs)
 Occupational Information Network (O*NET)
 Critical Incident Technique
 Job Components Inventory
 Threshold Traits Analysis
 Fleishman Job Analysis Survey
 Job Adaptability Inventory
 Personality-Related Position Requirements Form (PPRF)
FORMS OF COMPENSATION:
 Direct financial compensation (wages, salaries, bonuses and commissions)
 Indirect financial compensation (benefits, leaves, retirement plan)
 Non-financial compensation (career development, opportunities for
recognition or advancement)
To determine successful compensation system there should be fairness or equity
2 FORMS OF PAY EQUITY:
 External Equity
o Compares the job to the external market
When employees in an organization perceive that they are being
rewarded fairly in relation to those who perform similar jobs in
another organization
Internal Equity
o Comparing jobs within an organization to ensure that the people in
jobs worth the most money are paid accordingly
o When employees in an organization perceive that they are being
rewarded fairly according to the relative value of their jobs within an
organization
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Compensable Factors – dimension of work (a skill or effort) used to assess the
relative value of a job for determining compensation rates
Hay Plan – also known as Hay Guide Chart-Profile Method which is used to identify
compensable factors used in determining compensation of managers and executives
Salary Surveys – company send surveys to other organizations and ask about how
much an organization pay its employees in various positions
METHODS OF JOB EVALUATION
 Ranking Method –simplest method of job evaluation wherein jobs are
usually ranked from highest to lowest in each department and the
department rankings are combined to develop an organizational ranking
 Classification Method – a predetermined number of job groups or classes
are established and pays are assigned to these classifications
 Factor Compensation Method – more systematic and scientific method
wherein each job is ranked according to a series of factors and pay will be
assigned by comparing the weights of the factors required for each job
 Point Method – jobs are expressed in terms of key factors in which
equivalent points are assigned after prioritizing each factor in order of
importance then points are summed up to determine the wage rate for the
job
JOB PERFORMANCE CRITERIA – the criteria for success in a certain job depend on
how that job contributes to the overall success of the organization
2 TYPES OF JOB PERFORMANCE CRITERIA
 Objective Performance Criteria – a set of factors used to assess job
performance that are objective or factual in character
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Subjective Performance Criteria – a set of factors used to assess job
performance that are product of someone’s subjective rating of these factors
EIGHT MAJOR JOB PERFORMANCE CRITERIA
 Production
 Sales
 Tenure or turnover
 Absenteeism
 Accidents
 Theft
 Counterproductive workplace behavior
 Customer service behavior
RECRUITMENT – process of attracting people with the right qualifications ( as
determined by a job analysis) to apply for a job
2 FORMS OF RECRUITMENT
 Internal Recruitment – promote someone from the organization to do the job
 External Recruitment – hire someone from outside the organization
METHODS OF RECRUITMENT
 Newspaper Ads
o Applicants may respond on a newspaper ad in 4 ways:
 Respond by calling – used to quickly screen applicants
 Apply-in-person – applicants fill out specific job application
form and employers get a physical look of the applicants
 Send-Resume – the organization who uses this type of ad
expects large response and does not have the resources
to speak to thousands of applicants
 Send-Resume to a Blind Box – resumes were sent to an
address other than the organization
 Electronic Media – advertising on television and radio stations
 Situation-Wanted Ads – are placed by the applicants rather than the
organizations
 Point-of-purchase Method – same as the “POP” (point-of-purchase) in
advertising wherein job vacancy notices are posted in places where
customers/current employees are likely to see (ex: windows, bulletin boards)
 Recruiters
o Forms of Recruiters:
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Campus Recruiters – send recruiters to colleges to
answer questions about themselves and interview
students for available positions
 Virtual job fairs – applicants can talk via an instant
message to a recruiter, learn more about the company
and submit resumes
 Outside Recruiters
 Public Employment Agencies – operated by the
state and local public agencies and are strictly
non-profit
 Employment Agencies – may charge the
company or the applicant when the applicant
gets the job
 Executive Search Firms – also known as “head
hunters” who gave higher-paying non-entry level
positions and always charge the organization and
usually 30% of the applicant’s 1st year salary is
charged
Employee Referrals – in which current employees recommends family
members and friends for a specific job opening
Direct Mail – an employer typically obtain a mailing list and sends helpwanted letters/brochures to people listed through the mail
Internet
o Employer-based websites – organization lists available job
openings and provides info about itself and the minimum
requirements needed to apply for the job
o Internet Recruiter – s private company whose website lists job
openings for hundreds of organizations and resumes for thousands
of applicants
Job Fairs – designed to provide information in a personal fashion to as many
applicants possible
REALISTIC JOB PREVIEW – giving an applicant an honest assessment for a job
(those informed applicants tend to stay longer because they know what to expect –
according to studies)
EXPECTATION LOWERING PROCEDURE – lowers applicants’ expectations about
work in general
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Reduce the chance of a legal challenge
Cost-effective
SELECTION TECHNIQUES
Effective selection is essential to recruit people with the right skills and experience to
drive the organisation forward. Employers spend a lot of time and money recruiting
new staff, so it is important that they follow good practice and get it right first time.
(Source)
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EMPLOYMENT INTERVIEW – most commonly used method
o Types of Interviews:
 Based on Structure – source of questions, extent to which
the applicants were asked the same questions and the
scoring system
 Structured – source of question is a job analysis,
all applicants were asked the same questions
and a standardized scoring system is used
 Unstructured – interviewers are free to ask any
questions
 Based on Style – determined by the number of
interviewers and interviewees
 One-on-one – 1 interviewer is to 1 applicant
 Panel interview – multiple interviewers ask and
evaluate the same applicant
 Group interview – multiple applicants answering
questions at the same time
 Serial interview – series of single interview
 Based on Medium – extent to which they are done in
person
 Face-to-face – interviewer and applicant is at the
same place
 Telephone – do not allow visual cues
 Video conference – conducted on remote areas
and the setting is not personal
 Written interview – involves applicants answering
a series of question and send back their answers
through mail or email
o
3 CHARACTERISTICS OF EFFECTIVE EMPLOYEE SELECTION TECHNIQUE
 Valid – should be based on job analysis, predicts work-related behavior and
measures constructs it purports to measure
Types of Interview Questions
 Clarifiers – allows the interviewer to clarify information in
the resume, cover letter and application, fill in gaps and
obtain information
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Disqualifiers – questions that must be answered in a
particular manner or the applicant may not be qualified
Skill Level Determinants – tap interviewee’s level of
expertise
Future-focused questions – also called “situational
questions” ask an applicant what she would do in a
particular situation
Past-focused questions – also called “patterned behavior
description interview” wherein applicants are asked to
provide specific examples of how they demonstrated job
related skills in previous jobs
Organizational-fit questions – tap the extent to which the
applicant will fit into the culture of an organization or with
the leadership style of a supervisor
Ways of Scoring Interview Answers:
 Right/Wrong Approach – applicable for skill determinants
which can be scored simply when an answer is correct or
incorrect
 Typical Answer Approach – create a list of all possible
answers to each question, have SMEs rate the
favorableness of each answer and use the ratings to serve
as a benchmark answer for each point on the scale
 Key Issues Approach – SMEs create a list of key issues
they think should be included in the perfect answer
RESUME – summaries of an applicant’s professional and educational
background
Characteristics of an Effective Resume
 The resume must be attractive and easy to read
 The resume cannot contain typing, spelling, grammatical
or factual mistakes
TYPES OF RESUME:
 Chronological Resume – list previous jobs in order from
the most to the least recent
 Functional Resume – organizes jobs based on the skills
required to perform them rather than in order to which they
were worked
 Psychological Resume – combined strength of
chronological and functional, the 1st paragraph contains
the strength, then education and work experience
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REFERENCE CHECKS – process of confirming the accuracy of the
information provided by the applicant
Reference – is an expression of an opinion either orally or a written checklist
of applicant’s ability, previous performance, work habits and character
potentials for future success. This is usually sent in general using “To Whom
It May Concern”
COVER LETTERS – tells the employer that you are enclosing your resume
and would like to apply for a job
Important Contents:
 Salutation – address the letter to the correct person or
position
 Paragraph
 1st paragraph – contain the fact that your resume
is enclosed, the name of the job you are applying
for and how you know about the job opening
 2nd paragraph – state that you are qualified for
the job and provide at least three reasons why
 3rd paragraph – state why you want to work with
the company
 Last paragraph – contain the information about
how they can reach you.
Signature – use “cordially” or “sincerely” above your
signature
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LETTER OF RECOMMENDATION – letter expressing an opinion regarding
an applicant’s ability and previous performance and usually sent to a specific
person
o
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Raynes (2005) Guidelines to follow when providing References:
 Explicitly state your relationship with the person you are
recommending
 Be honest in providing information
 Let the applicant read your reference before sending it
APPLICANT’S TRAINING AND EDUCATION – all applicants must have a
minimum level of education or training to be considered
Theory-based – the number of
dimension is identical to the number
postulated by a well-known theorist (ex:
MBTI)
o Statistically-based – number of
dimensions determined through
statistical process called “factor
analysis” (ex: 16PF)
o Empirically-based – number and
location of dimension is determined by
grouping answers given by people
known to possess a certain
characteristics (ex: MMPI)
Test of Psychopathology – determine whether individuals
have serious psychological problems such as depression,
bipolar disorder, schizophrenia, etc
 2 types:
o Objective Tests – structured scoring so
that respondent is limited to a few
answers that will be scored using
standardized ways
o Projective Tests – provide respondent
with unstructured tasks such as
describing inkblots or drawing pictures
o
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JOB KNOWLEDGE TESTS – designed to measure how much a person
know about the job
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ABILITY TESTS - used when applicants are not expected to know how to
perform the job at the time of hire
o Cognitive Ability – oral and written comprehension, oral and written
expression, numerical facility, originality, memorization, reasoning
and general learning
o Perceptual Ability – consist of vision, color discrimination, depth,
depth perception, glare sensitivity, speech clarity and hearing
o Psychomotor Ability – test for finger dexterity, manual dexterity,
control precision, multi-limb coordination, response control, reaction
time, arm-hand steadiness, wrist-finger speed and speed of limb
movement
o Physical Ability – often used for jobs that require physical strength
or stamina
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WORK SAMPLES - applicants perform the actual job-related tasks
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ASSESSMENT CENTERS – a selection technique characterized by the use
of multiple assessment methods that will allow multiple assessors to actually
observe applicants perform simulated job tasks
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APPLICANT’S EXPERIENCE
o Experience can be measured in 4 ways:
 Reference Checks
 Interviews
 Bio-data – a selection method that considers the
applicant’s life, school, military, community and work
experience
 Experience Ratings of applications/resume – consider
amount of experience, level of performance demonstrated
during previous experience and how related is the
experience to the current job
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PERSONALITY INVENTORIES
o Two Categories of Personality Inventory:
 Test of Normal Personality – measure the traits exhibited
by the normal individual’s everyday life
 Basis of Number of Traits and Type of
Personality dimension measured:
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INTEREST INVENTORIES – tap vocational interests of the applicant
Strong Interest Inventory (SII) – most commonly used interest test which
asks individuals to indicate whether they like or dislike 325 items such as
bargaining, repairing electrical wirings and taking responsibility
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INTEGRITY TESTS – also called “honesty test” which tells an employer the
probability that an applicant would steal money or merchandise
o 2 Types of Paper-and-pencil Integrity Test:
 Overt Integrity test – based on the premise that a person’s
attitudes about theft in society as well as previous theft
behavior will predict his future honesty
 Personality-based Integrity test – were general in that they
tap a variety of personality traits thought to be related to a
wide-range of counterproductive behavior