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Industrial-organizational psychology (IO psychology) is characterized by the scientific study of human behavior in organizations and the workplace. The specialty focuses on deriving principles of individual, group, and organizational behavior and applying this knowledge to solving problems.
IO psychologists are scientist-practitioners with specialized knowledge and training in behavior. Therefore, these psychologists must uncover in-depth knowledge of organizational development, attitudes, career development, decision theory, human performance and human factors, consumer behavior, small group theory and process, criterion theory and development, job and task analysis, and individual assessment.
The Bureau of Labor Statistics projects a 3.8% employment growth for IO psychologists between 2021 and 2031. In that period, an estimated 100 jobs may open up.
IO psychology is the dominant influence on hiring in organizations, but in recent years, it has begun to play a more prominent role in college admissions.
To learn more about IO psychologists in higher education, visit Student Select and read through our interview with Michael Campion, Ph.D., Herman C. Krannert, Distinguished Professor of Management.
IO Psychologists in the Hiring Process
Businesses realize they must choose good employees from the outset to build a highly productive and competent team environment. But IO psychologists know that personal perceptions and opinions often shade these critical decisions.
Most job interviews are unstructured, unreliable, and ineffective. Many studies have shown that the interview process is the most unreliable form of employee selection, failing to predict employee performance.
In most job interviews, the questions are open-ended and not standardized so each candidate may be given a list of entirely different and randomly chosen questions.
This is where IO psychologists come in to help. They study a company’s culture and work processes to pinpoint an employee type who would fit into the business’s current framework. IO psychologists help with many aspects of the hiring process, including creating interview questions that help managers identify the best candidates for specific positions.
IO psychologists are especially vital as companies look to build more diversity, equity, and inclusion (DEI) into their hiring practices. Workforce inclusivity is essential for companies to compete and grow. They should proactively work on developing a diverse workforce and prepare to make their work environment, products, and services equitably accessible to all.
A March 2022 Forbes press release discussed how IO psychology could help organizations deliver fairer and more effective results.
For example, one of the best practices from an IO psychology standpoint is conducting a job analysis. A job analysis is a scientific approach to measuring and understanding the responsibilities required for a given role at an organization.
When companies leverage science rather than gut instinct or opinion, teams can help reduce bias from job descriptions and ensure qualified candidates aren’t deterred from applying.
Additionally, pre-employment assessments can help a DEI strategy. When assessments replace a phone screen or human resume review, human bias is much less likely to exist.
And finally, IO psychologists can help structure a team’s interviews and design interviewer training material, including creating and reviewing an approved set of questions and explaining how they tie back to important aspects of the role, showing how to create and use rating scales for each question, and uncovering common biases and strategies for removing them from the interview and scoring process.
Important Steps to Embed IO Psychology into Your Hiring Process
The money adds up when considering the costs of making bad hiring decisions. For example, there’s the time lost on recruiting and training another employee, the negative impact on employee morale, fewer sales, and lower productivity.
Poor work ethic and customer service can also hurt your company’s reputation.
IO psychology uses behavioral science to assess candidates’ knowledge, skills, and abilities (KSAs). This method can help you more reliably select a candidate who will be an excellent fit for the role you’re trying to fill while at the same time helping your hiring process be more compliant.
The following are three critical steps to take when looking to embed IO psychology into your hiring process.
Step 1: Align job descriptions with what’s required
The skills employers value and rely upon are changing. In turn, a “skills gap” has developed in which employers struggle to hire appropriately trained workers.
The term “skills gap” describes a fundamental mismatch between the skills that employers rely upon in their employees and the skills that job seekers possess. This mismatch makes it difficult for individuals to find jobs and for employers to find appropriately trained workers.
A 2018 Deloitte report illustrated the breadth of this problem in the context of manufacturing alone. Overall, the skills gap may leave an estimated 2.4 million positions unfilled between 2018 and 2028, with a potential economic impact of $2.5 trillion.
Personnel selection has been, and continues to be, one of the central functions of industrial, work, and organizational (IWO) psychology.
Personnel selection is the systematic process of hiring and promoting personnel. These systems employ evidence-based practices to determine the most qualified candidates. The assessment tools they use include interviews, personality inventories, psychomotor and physical ability tests, and work samples.
IO psychologists must evaluate the validity of these measures to determine how well their assessment and selection tools predict job performance. This evaluation includes an examination of content validity, construct validity, and criterion validity.
Then, IO psychologists accurately describe the task or job to a candidate.
Step 2: Be specific
Vague job descriptions are major pitfalls companies face. A candidate or hiring manager’s idea of “good people skills” can mean numerous things. Someone may think “good people skills” means a person who is outgoing, talkative, or smiley. On the other hand, some may interpret this as a person who effectively communicates with others.
Because industrial psychologists are both researchers and practitioners, most people in this field conduct and apply research.
IO psychologists draw conclusions that allow them to help businesses better achieve their goals. Some examples include: developing personality assessments that enable companies to select the most suitable employees or evaluating employee training programs to ensure they meet company objectives.
Cynthia A. Hedricks, Ph.D., Chief Analytics Office, hiring manager, and IO psychologist, recommended that recruiters work closely with hiring managers to create job descriptions, emphasizing what is needed to succeed. Furthermore, they should regularly touch base with the hiring manager to update the description as needed.
Step 3: Bring specificity and consistency to the interview process
A candidate’s job is to present the best version of themselves. Your job is to distinguish fact from fiction. IO psychologists study and assess the workplace's individual, group, and organizational dynamics and identify solutions to problems that improve the well-being and performance of businesses and employees.
Consistency shows that you’re reliable and allows candidates and customers to know what they can expect. Consistency also helps you analyze your efforts and build your brand.
Therefore, you should create interview questions based on the soft and hard skills correlated with job success while delving deeper into specific areas identified as potential concerns. Ask a candidate about explicit behaviors, such as precisely what they did to resolve a complaint from an angry customer.
But be sure to ask every candidate the same questions in the same format. This structured and consistent approach yields the best results and provides the best data for when it’s time to make a decision.
Additionally, establish systems and processes. The more you can systematize your business’s day-to-day operations, the more consistent you will be. For example, creating a daily or weekly checklist can ensure that specific tasks and actions will always get done no matter how busy you get.
Embedding these IO best practices into your hiring process will help you find solid employees with the skills and abilities that better match the position that you are trying to fill.
Ready to learn more?
Watch a recent interview with Talent Select AI senior advisors Michael Camion, PhD, and Emily Campion, PhD, for a deep dive into IO, AI, and the future of hiring.
