[2] It is the field of study that concentrates on the selection and evaluation of employees; this area of psychology deals with job analysis and defines and measures job performance, performance appraisal, employment testing, employment interviews, personnel selection and employee training, and human factors and ergonomics.
[3] One influential figure in the beginning of this new area was Hugo Munsterberg, a German psychologist who was trained by Wilhelm Wundt and who also worked with William James.
[3][4] Munsterberg studied selection and fit in the workplace, and he proposed experimental methods as solutions to business problems in his text, Psychology and Industrial Efficiency (1913).
Some of the most important functions it serves range from analyzing corporate culture and individual and group interactions to developing and evaluating employee selection and appraisal techniques.
Other areas of use are assessing corporate leadership and employee motivation strategies, identifying causes and resolutions to internal conflicts, advising management of the potential psychological and social impact of corporate policies, and researching ways organizations can effectively manage cultural differences and leadership styles.
Personnel psychologists use psychological measurement and research findings related to human abilities, motivation, perception, and learning in seeking to improve the fit between the needs of the work organization and those of the people who populate it.
Those aspects may range from the tasks and duties of the position, to an examination of the desirable qualities of an employee, to the conditions of employment including pay, promotion opportunities, vacations, etc.".
[11] Today, increases in technology have allowed for a much easier administration of such online tests as measures of aptitude, achievement, and personality.
[15] In contrast, other research has also shown though that such pay systems can actual provide motivation, satisfaction, or desired challenge levels to the job, instead of individuals perceiving it is inequality, unfair, or stressful.
[16] It has also been found that individuals who perceive a strong connection between their effort and reward are evaluated more highly and in turn have higher work satisfaction.
[19] Such an environment is created by an employee's direct supervisors and includes the quality and frequency of coaching and informal feedback delivery.