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Dubrin (2004) defines business psychology as the application of psychological knowledge in the understanding of human behavior with an aim of attaining individual satisfaction and improving the overall performance. The origin of business can be traced back to 1892 during which American Psychological Association was formed (Dubrin, 2004). Hawthorne Effect is very essential for contemporary managers since it helps in understanding the circumstances that enhances productivity among employees. Work diversity helps in enhancing the performance of employees which in turn improves the quality of the goods and services offered as well as improving the programs of an organization. Behaviorism is a learning theory that utilizes psychological principle just business psychology. This theory asserts that external environment plays a major role in influencing and controlling behavior rather than internal thoughts. This same notion is applicable in business psychology. Constructivism theory postulates that people learn by constructing personal knowledge. This theory employs both cognitive and behaviorist ideals. The post modern theory of learning helps in understanding the individual differences at work place.
The performance of each employee is pegged on divergent personal characteristics. Different experts have categorized these differences in diverse ways. It is worth noting that performance requirements vary with the kind of job. For instance, an employee who works as a non-skilled manual labor needs to be endowed with physical abilities such as fortitude and potency which may be irrelevant for an accountant. Similar, cognitive abilities are much more important for a designer of process plant rather than a manual laborer. The individual traits that influences a person can be grouped in seven categories as mentioned below
Physical abilities: This involves physical traits such as strength, height, vision, and endurance.
Innovative abilities: This entails the ability to solve various problems and come up with new products and methods of production.
Leadership abilities: This refers to the ability to offers guidance a group of people so as to achieve a set of goals
Mental abilities: This involves cognitive abilities such as intelligence and other skills such problem solving skills.