Psychology plays a part in almost every aspect of business. From helping target and refine your marketing message to gaining a deeper understanding of human behavior—both internally among your staff and externally with your customers and competitors—psychology is an area of study business leaders need to be tuned into if they want to run successful companies.
Just how useful can it be to dig deeper into this subject? Quite a bit, experts say. A number of areas of psychology directly relate to business leadership, including organizational psychology and leadership psychology, which study the ability of individuals to effectively lead groups of their peers.
“Industrial and organizational psychology, or I-O psychology, applies psychological theories to an organization," says Sandra Powers, a human resources manager at LawyerReviews.com. By studying I-O psychology, you may be able to help improve employee behavior and attitudes through training programs, management systems and employee feedback.
“Classes that teach about I-O psychology help explain the ability of an organization to learn and transform,” Powers points out. As small businesses grow, entrepreneurs must evolve from being on their own and independent into transformational leaders who can effectively manage and inspire teams. For some entrepreneurs, these abilities are innate, but for others, adapting from a solo mentality to group-think can be challenging. Studying I-O psychology can help ease the transition.
Influencing Consumer Behavior
Every small business needs to market its products or services to its target audience, and principles of psychology play heavily not only into who your target audience is but how to best reach your target consumers in an impactful way. “I'm a big believer that courses around human behavior are extremely important for marketers,” says Adria Saracino, head of content strategy at Distilled, an online marketing agency.
“At the end of the day, our job is about influencing purchasing decisions and figuring out how to persuade consumers to go further down our conversion—and hopefully retention—funnel,” Saracino explains. Predicting what influences one consumer over another and identifying the triggers that are a catalyst for action are both psychological concepts.
Ready to Sign Up?
There are dozens of areas of specialization within the broader field of psychology, but it’s probably not practical to sign up for a full-blown undergraduate program. In addition to the industrial and organizational psychology concentration suggested by Powers, Saracino recommends a few practical areas of study that are of particular importance to the business community:
- Consumer behavior. “A lot of business schools are starting to teach courses on the intersection of business and psychology,” Saracino notes, which further strengthens the idea that psychology has a legitimate place in the business world.
- Humanistic psychology. Saracino points to Abraham Maslow’s hierarchy of needs, a psychological theory that's widely used in the world of marketing to focus and refine marketing messages to appeal directly to consumers’ basic needs. Maslow is recognized as a humanistic psychologist, and his hierarchy of needs, along with similar theories of human behavior, are a key focus of study in this area of specialization.
- Cognitive psychology. “Cognitive psychology is the scientific study of mind and mental function, including learning, memory, attention, perception, reasoning, language, conceptual development and decision making,” according to Rutgers University's class description. Clearly, understanding how your audience might perceive your products, services or marketing messages is a skill that will come in handy in many applications.
- Cultural psychology. If your business serves a global market, understanding key differences in attitudes and perceptions between cultures is critical.
- Social psychology. Similar to sociology, social psychology is the study of how people interact and respond in group environments. This is valuable for leaders to help them understand how group dynamics may impact performance, and also in marketing applications for taking advantage of group-think and similar influences to further a company's marketing goals. Even Copyblogger, a provider of content marketing solutions, has touched on social psychology in relation to persuasion.
In realistic terms, taking a college-level psychology course probably isn't something that will easily fit into your schedule. But there are alternatives to attending in-class lectures. From long-distance education courses to self-study options, the days of trekking across a college campus can remain a distant memory for college-goers.
“You can also learn a ton by going to therapy yourself,” suggests Saracino. “[This is] particularly true if you go to a cognitive psychologist, whose goal it to give you more tactics for changing the way you think and thus is more proactive than the listening type of psychologist.”
Perhaps the simplest option is to read up on relevant topics and dig into articles and resources online that apply psychological principles to your most pressing business and marketing issues in practical terms. While you may not have the time for school, you should always make time to learn in order to improve your business.
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