What is Business Psychology?
“Business Psychology is the study and practice of
improving working life. It combines an understanding
of the science of human behaviour with experience
of the world of work to attain effective and sustainable
performance for both individuals and organisations”
Business Psychology is an applied science that investigates how to make people and organisations more effective. It uses social scientific research methods to study people, workplaces and organisations in order to better align their multiple and sometimes competing needs. Its goal is to create healthy, productive and mutually beneficial relationships between people and organisations.
As an applied science, Business Psychology can inform organisations about what constitutes effective organisational practice. It has a reciprocal relationship with business, drawing insights from those with experience of what works at work to enable psychological research to be applied pragmatically in ways that are appropriate to the situation. It also allows a cross fertilisation of experience: from business into psychology, and of academic knowledge and rigour from psychology into business.
Business Psychology employs a wide range of research methods to investigate and identify best organisational practice. It combines qualitative and quantitative methods, and considers both types of evidence equally legitimate. Common data collection methods include questionnaires, surveys, focus groups, interviews and case studies. Common analytical techniques include descriptive and inferential statistics, thematic and content analysis.
Practitioners of Business Psychology typically work in the following ways:
- Advise - as independent professionals who can be trusted to offer an unbiased, scientifically credible perspective, practitioners can advise on a wide range of people issues at work – from careers to large scale organisational change.
- Diagnosis – helping organisations to better understand issues and challenges (e.g. high turnover and low engagement), using social scientific research methods to investigate human behaviour at work
- Design – creating solutions to organisational challenges (e.g. designing a psychometric tools or assessment exercises to improve employee selection)
- Delivery – implementing solutions to organisational problems through facilitation rather than by taking ownership of the problem for the client
- Evaluation – demonstrating evidence of the individual and organisational benefits of interventions is a core principle of Business Psychology.
Areas of Business Psychology
Business Psychology can be applied to almost any people issue at work. Nonetheless, there are several well established domains of Business Psychology, which include:
- Selection and assessment
- Organisational development
- Leadership development
- Learning and development
- Talent management
- Employee engagement
- Safe and user-friendly work environments
- Performance management and appraisal
- Health and well-being at work
- Psychometric testing