Psychology is the scientific study of the mind and behavior. The field encompasses concepts as narrow as child development and as broad as international politics. Whether working in a clinical, research or private sector setting, psychologists work to understand the inner workings of the human mind. According to the American Psychological Association (APA), these specialists are behavioral health professionals who’ve earned a doctorate’s degree in the field from an accredited college or university. Additionally, psychologists must comply with applicable state laws where they practice.
In the business setting, research has shown that the study of psychology yields improved organizational outcomes. One study revealed a 17-percent increase in sales and a 30-percent profit gain among a select group of small business owners who participated in psychological training. Participants also exhibited a marked increase in the development of innovative business ideas. Conversely, participants who received traditional business training, such as accounting and marketing, experienced no improvement in organizational performance. Researchers concluded, in part, that entrepreneurism is a teachable skill.
Adding Psychology to the Entrepreneurial Skill Set
Via market research, entrepreneurs collect and evaluate information to devise plans that allow them to make effective business decisions. This may encompass developing an overview of the ideal consumer or clearly defining the needs of a given market. The practice allows small business owners to identify growth opportunities. Part of this process involves gaining an understanding of the various types of consumers that the firm engages with in the marketplace. This kind of research is vital for connecting with consumers and identifying the kind of buyers that are most likely to want or need a particular service or product.
Behavioral Wellness and Business
Psychology is also important for internal business stakeholders. Financial concerns, isolation, long work days and personal issues can work in tandem to place a great deal of stress on entrepreneurs. While behavioral health is of growing importance in the business world, it’s normally large firms with many employees that implement initiatives designed to ensure the mental health of personnel. However, a small business is more likely to suffer performance issues when a key leader is experiencing behavioral health problems. In light of this, a growing number of entrepreneurs are simply learning when to say “no,” despite how difficult it is for this ambitious class of business professionals to turn down potentially prosperous opportunities.
Physical safety typically comes to mind when small business owners think of workplace safety. However, workman’s compensation claims due to behavioral health issues are on a slow, but steady, rise. Despite this, 35-percent of polled employees do not want their employers to know that they are struggling with mental health concerns. Respondents cited a perceived threat to job security, potentially minimalized career advancement opportunities and a perceived lack of peer support as reasons for keeping their mental health conditions under wraps. However, entrepreneurs can overcome this sentiment and improve on-site safety by promoting a workplace culture where employees feel comfortable sharing details about how they feel.
Psychology Training Promotes Innovation
Traditional business training teaches important concepts such as customer service, inventory management and recordkeeping. However, these basic concepts do little in the way of promoting improved outcomes and innovation. Case in point, a recent study exposed business owners to 36 hours of training. The training was broken into groups, with one group receiving training in traditional business concepts and another group receiving training that promoted proactive behavior. The group that received behavioral training went on to produce a 30-percent increase in profits, while the group that received traditional training only experienced an 11-percnet increase in profit. The business owners who received behavioral training also experienced a 17-percent increase in sales compared to a third control group that receive no training.
These kinds of studies reveal that merit exists for entrepreneurs to consider psychology training. This learning track teaches business leaders to understand how others think and feel. A psychology degree helps entrepreneurs solve intricate problems, manage emotional concerns among internal and external stakeholders and think in a way that leads to innovative strategizing. Whether applying this knowledge to marketing, human resources or client relations, business owners will find that an understanding of how people think leads to improved outcomes for consumers, employees and peers. By choosing to earn a degree in psychology, entrepreneurs can gain a competitive edge in the marketplace.
In the United States, small businesses employ 50-percent of all workers and create 65-percent of new jobs according to the Small Business Administration (SBA). Business leaders develop their instincts, in some measure, based on their training and experiences. A degree in psychology gives entrepreneurs an added edge in a complex marketplace that growing increasingly competitive by the day and creates and can them build a stronger American job market.
American Psychological Association – About APA
Maryville University Online – Going Back to School for Psychology
Northeastern University Online MBA – Guide to Market Research and Understanding Consumer Behavior
The Economist – Psychology Beats Business Training When It Comes to Entrepreneurship
The World Bank – A Better Way to Train Small Business Owners: Using Psychology to Teach Personal Initiative