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The Difference Between Industrial and Organizational Psychology

2016 September 14


The logo for the Society for Industrial and Organizational Psychology. The swoosh indicates change, probably?

So, what’s the difference between industrial and organizational psychology?

The difference these days is quite fuzzy, but it used to be much clearer. Let me tell you a little story.

In the old and ancient times for the field of psychology – which of course means the end of the 19th and first half of the 20th century – there was only one field: industrial psychology. It did not always formally have this name (e.g., people calling themselves “industrial psychologists” were often found in “counseling psychology” or “applied psychology” organizations), but it was what now think of as historical “industrial psychology.” Industrial psychology was for the most part (although not entirely) focused on improving production in manufacturing and other manual labor sorts of jobs, as well as improving soldier performance on the battlefield (which at that time was also often manual labor).

In manufacturing, managers noticed that employees seemed to work harder sometimes and less hard other times, and they were not sure why. A bunch of researchers with names you’ll recognize if you have studied I/O – Hugo Munsterberg, Walter Dill Scott, James Cattell, and Edward Titchener in particular – promoted the idea that the fledgling field of psychology might be able to shed some light on this. They would of course believe this as they were all students of Wilhelm Wundt, the grandfather of modern psychology.

The growth of industrial psychology was also heavily influenced by and contributed to a movement in the early 1900s called Taylorism, reflecting the viewpoint of Frederick Taylor, a mechanical engineer by training who was inspired by Munsterberg and others. His view was that the American worker was slow, stupid, and unwilling to do any work except by force or threat. However, he also viewed science as the only way to fix the problem he perceived. The popularity of Taylorism (sometimes called “scientific management”) in the US and around the world (Stalin reportedly loved the idea) paved the way for our field to grow, for better or worse.

As a result, industrial psychology at that time had a lot of overlap with what we now call “human factors psychology.” Studies were often conducted like the famous ones by Elton Mayo at the Hawthorne plant of Western Electric, where key elements of the environment – such as lighting – were varied systematically and the effects on worker behavior observed using the scientific method. In fact, if you poke into the history of specific I/O graduate programs, you’ll often find a split between I/O and HF somewhere in their past. The goal of many studies of that era could be described as trying to trick the worker into working harder. The interesting thing about such techniques: they do work… at least to a certain degree.

In addition to trying to change performance while people were at work, other industrial psychologists became interested in hiring. Specifically, many believed that if they could design the “perfect test,” they could find the absolute most productive workers for these businesses. These tests were typically intended to be assessments of intelligence, early versions of what we now conceptualize as latent “general cognitive ability.” One of the earliest and most well known examples of these efforts were the Army Alpha and Army Beta, tests used by the US Army in World War I given to more than a million soldiers for the purposes of assessing readiness to become a soldier, place them into specific military positions, and also – the first hint of a later shift – to identify high-potential leaders. These tests are early versions of the current test, which is still maintained and studied by I/O psychologists: the ASVAB.

As industrial psychology grew, so did the feeling that our field was missing something. The Hawthorne studies I referenced earlier are often credited as being the trigger point for this, but Hawthorne better serves as an example of this shift rather than thecause. As early as the 1930s, people became aware that industrial psychology’s focus on predicting and improving performance often ignored other aspects of the worker, specifically those involving people’s feelings. Motivation, satisfaction, how people get along with others – these topics were not of much concern among industrial psychologists, and a number of studies, including those at Hawthorne, increased interest in the application of psychology to the broader workplace. They also wondered if performance could be increased further by looking beyond hiring and worker manipulation – perhaps there is more we could do?

Thus, in 1937, the first organization devoted to I/O was created: Section D of the American Association for Applied Psychology, Industrial and Business. The AAAP merged into the American Psychological Association in 1945, rebirthing our field as APA Division 14: Industrial and Business Psychology.  The shift from “Business” to “Organization” reflected changing priorities over several decades. Dissatisfaction with the explicit ties to Business (and not, for example, the military, government, etc.) resulted in the division being renamed simply “Industrial Psychology” in 1962. With the shift away from an industrial economy in the 1960s, dissatisfaction with the term “Industrial” led to the name we have today as of 1973: Industrial and Organizational Psychology.

So the short version of this answer is that: the distinction between industrial and organizational psychology these days is not a particularly strong one. It is instead based on historical shifts in priorities among the founding and early members of the professional organizations in our field. If I had to split them, I’d say people on the industrial side tend to focus more on things like employee selection, training and development, performance assessment and appraisal, and legal issues associated with all of those. People on the organizational side tend to focus more on things like motivation, teamwork, and leadership. But even with that distinction, people on both sides tend to borrow liberally from the other.

There was also a historical association of industrial psychology with more rigorous experimentation and statistics, largely because the focus on hiring could only be improved with those methods. The topics common to org psych were much broader with much more unexplored territory for a lot longer. But that has changed too – there aren’t many org psych papers published anymore without multilevel or structural equation modeling, as contributions on both the I and O sides have become smaller and more incremental than in the past. The old days of I/O were practically a Wild West! You could essentially just go into an organization, change something systematically, write it up, and you’d have added to knowledge. These days, it’s a lot harder.

Behind the scenes of all these theoretical/stance changes was also a huge ongoing battle against the American Psychological Association with where our field should fit as a professional organization (did you ever think it strange that SIOP incorporated as a non-profit while still a part of APA?), a problem that continues to this day. But that’s a different story!

A Brief History of the Society for Industrial and Organizational Psychology, Inc.-
Update of Landy’s I-O Trees
A Brief History of Industrial Psychology
Frederick W. Taylor, father of scientific management : Copley, Frank Barkley : Free Download & Streaming : Internet Archive
History of Industrial and Organizational Psychology – Oxford Handbooks
SIOP Timeline

“The Difference Between Industrial and Organizational Psychology” originally appeared in an answer I wrote on Quora.

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  1. October 20, 2016

    Lovely read. It’s interesting to know the history and I really liked the way you have differentiated between the two. One thing though, industrial psychology uses psychometrics and quantitative tools to design systems that are unbiased. It focuses on measuring and analysis. On the other hand, organizational psychology has more to do with interpersonal relationships with co-workers. It focuses on group dynamics and change.

    • October 20, 2016

      Like I say in the article, that is historically true, but I don’t think it’s particularly true anymore. For one, industrial psych includes job analysis, which is a somewhat subjective technique in practice and traditionally involves a lot of qualitative tools, like interviews and focus groups. Training and development research tends to focus more on evaluation than design, and bias rarely even comes up in that literature. On the org side, consider this article ( which explores the various approaches employees take, both affectively and behaviorally, once they have made up their mind to resign from their jobs but haven’t actually left yet, which only marginally has anything to do with interpersonal relationships and does not cover group dynamics or change.

      Both areas are quite broad with significant overlap – which is why I wouldn’t really try to pin either down, these days!

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