Pro-Social I-Oâ€”Quo Vadis? January 2008

Organizations worldwide are focused on making social rather than financial capital. Key targets being addressed by these nonprofit organizations include reducing global poverty, counteracting global warming, abolishing sweatshop labor, fighting company-endorsed discrimination, reversing brain drain, promoting civil rights and human ethics, striking better work–life balances, and attaining gender equity. How well is industrial and organizational psychology coping with such challenges, and how can we raise the proverbial bar? This “new futures” column features overviews and interviews with eminent practitioners, researchers, and educators in I-O psychology, related disciplines, and professions, plus globally prominent leaders with organizations like the World Bank and the ILO. Interns and research graduates working in unusual pro-social domains—future leaders in pro-social I-O—are also featured. Because social change also stems from business development, we will of course meet leading figures in commercial business, including multinational organizations, global trade councils, and global think tanks like the OECD (Organisation for Economic Cooperation and Development). Conversations with these and other key organizational figures, working at the “sharp end” of social and global change, will enable I and O itself—our community of practice—to grow and develop.

Interview 1

Professor Louka T. Katseli is director of the OECD Development Centre, in Paris. Professor of Economics at the University of Athens, Louka received her doctorate in Development and International Economics from Princeton University in 1978 and has spent most of her academic career at Yale University (1977–1985) and the University of Athens (1988–present), where she was chair of the Economics Department from 1997 to 2001. She also has been associated with the Centre for Economic Policy Research in London as a Research Fellow since 1984. Her many publications have focused on issues such as the linkages between foreign investment and trade in developing countries, the economics of migration, public policy effectiveness and institution building in developing countries, and exchange-rate policy in emerging markets.

Prof. Katseli also has worked extensively with international organizations and her national government. She was a member of the United Nations Committee for Development Policy, where she has served as rapporteur and vice-chair, and served as Greece’s representative to the International Conference on Financing for Development in Monterrey in 2002. She has represented Greece at the European Union in a range of capacities, including as a member of the EU Monetary and Economic Policy Committees and on the “Comité des Sages” for the EU Social Charter. She has also worked as a consultant for the European Commission, United Nations, and UNCTAD.

From 1982 to 1986, Prof. Katseli served as the director general of the Center of Planning and Economic Research (KEPE), a Greek development think tank that provides economic development policy advice to the Greek government. She served as economic advisor to the Greek prime minister from 1993 to 1996 and as advisor to the Greek minister of education from 1996 to 1998. Prof. Katseli is married and has two children.

Tell us a little about your own background and the Centre.
The OECD Development Centre, which I have been directing for the past 4 years, is a unique organization. Created in 1962 to provide a bridge between developed and developing countries, it is viewed today as the OECD’s knowledge centre on development. With 28 countries on its governing board —including some of the major global emerging economies such as Brazil, India, and South Africa—it serves development policy makers through its evidence-based policy dialogue activities, comparative analyses of emerging policy issues and networking services among governments, think tanks, civil society, and business. The objective of its activities is to contribute to development and poverty reduction through improved policy making and the effective implementation of reforms. The politics and economics of managing structural change and promoting reforms have been at the center of my own interests for many years. Raised in Greece during the military dictatorship in the late 1960s, I soon became intrigued by the links between institutional change, participatory democracy, and the process of economic development. These interests guided my studies in public policy and economics in the United States as well as my professional career. As an academic economist and university professor at Yale and the University of Athens, I have tried to analyse and explore the determining factors that shape developing countries’ capacity to adjust to external and internal shocks and mobilize their available resources for development. As a policy practitioner while serving as director of the Centre for Planning and Economic Research in Greece or as economic advisor to the prime minister of Greece, I have experienced the difficulties of effective communication and policy implementation and have come to appreciate not only the need for setting up participatory processes in decision making and providing for monitoring and evaluation mechanisms but also the importance of managing people’s expectations and providing sustained leadership throughout a reform process. It is these experiences that have spurred my interest in organizational psychology.

Does the psychology of work play a role in these activities?
Industrial and organizational psychology, including what has come to be known as the psychology of work, lies at the heart of the political economy of reforms and of development. Its focus on motivation and leadership, group and organizational behavior, as well as managed change and organizational dynamics, provides invaluable insights into how “people factors” influence behavior, performance, and outcomes. The same policy instrument can have very different impact effects if introduced and managed appropriately, namely with due consideration of the aspirations, expectations, capacity, and incentives of the agents of change and the stakeholders of development. Unfortunately, such considerations more often than not lie outside the radar screen of policy advisers and policy makers.

How prominent is “I-O psychology” in your field?
I think it is accurate to say that I-O psychology is not prominent in the study of economics. The same can be said for law and public policy studies. However, the issues tackled by I-O psychology are gaining ground in the context of institutional economics and certainly in business and management. As a public policy analyst and practitioner in development economics, I wish I had received such additional training.

How could it be more so?
I am sure it could in academia, in international organizations, and in public-policy making. It would involve setting up programs of study, teams, mechanisms, and fora promoting more interdisciplinary approaches to development issues, development cooperation, and public policy. To give only two examples, I am sure that the delivery of development assistance would become more efficient and effective if aid professionals addressed systematically the psychology of aid and the interpersonal dynamics that shape the donor–recipient relationship. The same can be said for the management of migration flows where the psychology of the migrant and the family left behind and the incentives provided to them are important drivers of success or failure.

From your perspective, and with your experience, how could the profession help, do you think?
Successful interdisciplinary collaboration in tackling policy issues and effective dissemination of the positive results of such collaboration is probably the best practice in raising awareness and demonstrating the value added of such an approach. The profession can also help by addressing a number of standard development policy questions from an I-O psychology perspective and highlight the insights and gains of such an outlook for practitioners and policy makers. It is not an easy task, but I think that the time is ripe for a more innovative approach to analyzing what works and what does not work in developing and emerging economies.

Thank you for a most illuminating, thought-provoking, and insightful set of reflections. I feel sure that TIP readers will find an abundance of food for thought in these high-level perspectives and experiences kindly given.

Interview 2

David McKenzie is a senior economist with the World Bank, Development Research Group, Finance and Private Sector Development Unit. He received his BCom (Honors)/BA from the University of Auckland, New Zealand in 1997 and his PhD in Economics from Yale University in 2001. Prior to joining the World Bank, Washington DC, in July 2005, he spent 4 years as an assistant professor of Economics at Stanford University. He recently was a core team member on the 2007 World Development Report. His current research interests include international migration, micro-enterprises, poverty traps, responses of households to aggregate shocks, and the development of econometric methods useful for working with data from developing countries. Contact information: David McKenzie, research@worldbank.org.

Tell us a little about your work.
My research work most closely linked to the interests of your readers is on micro-enterprise owners in developing countries, and on migration. In both cases I have recently been involved in detailed surveys of small firm owners in Sri Lanka, Mexico and Bolivia; of migrants from the Pacific Islands going to New Zealand: and of Japanese–Brazilians migrating back to Japan. In each case the surveys are being used to help understand the choices of individuals: how much to invest in a business or whether or not to migrate, and the economic consequences of these choices. Included are the effects of migration on incomes and health among migrants and their families, plus the effects of entrepreneurial decisions on business profitability and growth. Several of these surveys are tied closely to the use of an experiment to help identify outcomes of interest.

For example, I survey Tongans who apply to migrate to New Zealand through a specific quota. A random ballot is used to select among applicants, and the group of Tongans who applied to migrate and lost in this random draw can then participate as a comparison group for the group who applied and won (these are the migrants). An illustrative finding from the research is that compared to nonapplicants, Tongan applicants who migrate to New Zealand appear to be self-selected in terms of both observable qualities like education and more difficult to measure, psychological concepts like perhaps drive and ability (McKenzie, Gibson, & Stillman, 2006). We find that applicants who later migrate earn more in Tonga than nonmigrating applicants of the same gender, age, and educational level. And in a conceivably related vein, we find improvements in mental health with migration, compared to nonmigrating applicants and nonapplicants.

Does the psychology of work play a role?
Some aspects of psychology of work have long played a role in the study of economic decision making. Examples include risk aversion and the degree to which individuals discount the future in making decisions. The rise of behavioral economics has seen more attention paid to other psychological elements of behavior, but the subject is still in its infancy. I have recently been trying to incorporate questions on entrepreneurial traits and skills into my micro-enterprise surveys and questions on psychological determinants of migration into the migration surveys.

How prominent is I-O psychology in your field?
The term “I-O psychology” is never used by economists, but, as mentioned, aspects of it are starting to play a more prominent role.

Could it be more so? How?
It could certainly play more of a role. In particular, as an economist delving into the I-O psychology literature in order to obtain questions for surveys going into the field, several challenges have presented themselves and limited to some degree the ease of including I-O psychology.

How then could our profession help, do you think?
It could help in a number of ways:

(A) There is a lack of guidance as to standardized measures of different traits, difficulty getting the exact questions used to measure different aspects of personality, and frustration at the long length and repetitiveness of some of the survey instruments. It is difficult for someone outside the field to know where to start in accessing the literature. It would be nice to have an officially sanctioned Web page, which puts together the different aspects of personality, describes each, and provides the questions used in measuring each. Instead there seem to be a plethora of interrelated concepts, with articles often referring to difficult-to-access papers for the exact questions. In some cases where questions are available, I was surprised by them having 10 or 12 or 30 very similar questions to provide a measure of one trait. It is not clear to me the utility of having so many highly correlated questions—we experience problems with questionnaire length and with interviewee annoyance at receiving many almost identical questions. Indeed, rather than viewing a Cronbach’s alpha of 0.86 as a measure of validity in a 10-item measure, it appears to this economist as a measure of redundant questions.

(B) Resolving uncertainty as to which psychological attributes are inherent and which change over time, through learning. Many of the surveys we use are one-off or of relatively short duration. Thus, we may have to compare, for example, profiles of business owners to nonbusiness owners (known groups). It is uncertain to us the extent to which particular attributes measured now are also predictive at the time of deciding whether or not to go into business. For example, do individuals who are good at managing people start businesses, or does working in a business lead you to become better at managing people? Having well-documented evidence of which attributes are probably trait-like versus learned would help guide our survey work. This is important because key agencies need to know in advance who to support directly and who might instead need preparatory training. A related issue is the degree to which preparatory training can substitute for inherent entrepreneurial ability versus the extent to which the two are complementary.

(C) Validity across countries. It seems that relatively little of the measures are tested or used in developing country contexts, let alone specifically designed for use with these populations. It would be useful to learn more about how transferable different concepts are across populations.

(D) One of the concerns economists typically have with self-reported attitudes are the types of bias people have when answering such questions, and whether or not people answer truthfully. A good example comes from questions such as “how would you evaluate your health? 1 = v. good, 2 = good, and so forth.” It is usually found that comparatively better-off people will report themselves in worse health than poor people, despite being in better health according to objective measures. One could think of similar concerns with some of the attitude/trait type questions. For example, Baum and Locke (2004) use as a measure of tenacity, “I can think of many times when I persisted with work when others quit.” Such a question seems likely to be answered differently according to the type of job one has and the types of friends/colleagues with whom one associates. The question is whether one can obtain more objective measures of some of these traits by, for example, playing games where real money is at stake. An example is having people play lottery games to measure risk aversion rather than ask them how risk averse they are. One can then validate hypothetical questions in part by comparing how well they predict performance in these games. A key question therefore is to what extent are I-O psychologists moving towards this mode of measuring traits?

Thank you. Readers will no doubt write to address some of the fascinating and relevant questions you have raised.

References

Baum, J. R., & Locke, E. A. (2004). The relationship of entrepreneurial traits, skill and motivation to subsequent venture growth. Journal of Applied Psychology, 89, 587–98.
McKenzie, D., Gibson, J., & Stillman, S. (2006, April). How important is selection? Experimental vs. non-experimental measures of the income gains from migration. Bonn: Institute for the Study of Labor, Discussion Paper No. 2087.

Interview 3

Ishbel McWha is a former volunteer and current manager of Project ADDUP (Are Development Discrepancies Undermining Performance?), a multicountry study focusing on the impact of extreme pay diversity on poverty-reduction work, funded by the UK’s Economic and Social Research Council and Department for International Development. Ishbel’s interest in poverty issues was triggered in the course of her studies majoring in psychology and international relations. Later postgraduate work, with industrial psychology as a main focus, finally took her into the voluntary workplace. Her thesis covered aspects of how to “market poverty” in order for understanding and awareness to develop and for genuine capacity building to result. So her first workplace was appropriate: For 9 months she was a program officer with a local nongovernmental organization (NGO) in Jaipur, India. At the time of this interview, Ishbel was about to carry out her last assignments for a capacity-building position with an NGO in Cambodia, founded through Australian Volunteers International. She has since joined ADDUP.

Please tell us a little about your work
I am currently based in Phnom Penh working as a program advisor for a local Cambodian NGO called Development and Partnership in Action (DPA). (www.dpacambodia.org). My role is to improve the effectiveness of program activities by working closely with staff on program management, including proposal development, project implementation, report writing, and the monitoring and evaluation of project outcomes and budgets.

DPA transitioned from an international organization (CIDSE Cambodia) in January 2006 to be a local Cambodian-managed NGO. CIDSE started working in Cambodia in 1979 following the fall of the Khmer Rouge regime. I work within the Integrated Community Development Department, which involves working with local communities in four different and remote provinces of Cambodia. Activities include supporting and strengthening the capacity of communities to address food security, gender in development, natural resource management, primary health care (including HIV/AIDS), and education.

As program advisor my job responsibilities are:

Strengthen the capacity of the program manager and team leaders by advising on and assisting with program design, implementation, and management
Liaise with current and potential international donors
Provide advice to the executive director on strategic planning and policy issues
Advise on methods for improving workplace practices and communication
Provide formal and informal training on various aspects of program management

The key in this role is that I consider and advise on methods to make the organization work more efficiently and effectively both on a macro (organizational) level as well as on a micro (program and individual) level.

I have also spent a lot of time focusing on maintaining the momentum of the organization through the transition phase from international to local organization.

Does the psychology of work play a role?
The psychology of work plays a role in all work contexts. This does not exclude aid organizations; in fact there is a real need for the psychology of work to be applied to local NGOs in order to improve their effectiveness; for example, many organizations have become reliant on “expatriate consultants” who have come in to the organization for short periods of time to do work. As a result, many local staff members do not have the confidence in their own work, rather believing that there is a need to hire an expatriate to do important work for them. This is further reinforcing the lack of confidence in the staff of their abilities. There is a belief that locally recruited staff simply does not have good enough skills to do this work. This is where the psychology of work is so essential in development organizations. By building relationships with the staff I use I-O principles to find ways to build staff capacity and confidence through training, and over time by focusing on the value of the human resources of the organization, slowly the organization begins to function more efficiently and effectively. This in turn provides positive reinforcement to staff and improves their confidence in themselves and their buy-in/commitment to their organization.

Among my own KSAOs, having a knowledge of team dynamics and leadership development are essential for the role. So too is skill in:

Change management: helping to maintain the momentum of the organization as it transitions from international to local NGO.
Cross-cultural communication skills are also essential for working in aid work. As a psychologist I have the skills to relate to people from many different backgrounds and to help them within the working context.

How prominent is I-O psychology in your aid-related job(s)?
I make a point of utilizing I-O psychology tools in my work because I believe that these tools, which are most commonly utilized in a business/corporate context, can be easily and effectively applied to aid organizations. I take an external advisory role in my work, providing advice and support in the everyday activities of the organization rather than taking responsibility for tasks myself. However, even with this conscious focus on I-O psychology, I am still constantly surprised at how often I call upon my skills as an I-O psychologist in my work, whether it be facilitating meetings and trainings, working with local staff to develop organizational policies, evaluating the effectiveness of project activities, or simply talking informally with staff about strategic issues.

As a psychologist I recognize the importance of gathering data before, during, and after implementing activities, in order to evaluate the effectiveness of the work. My knowledge of how to use different quantitative and qualitative methodologies to gather the data has been invaluable in this work, and the results of which have shed new light on issues affecting the community and the effectiveness of the organization’s response to those issues. For example, through discussion with staff I can identify areas of training needs, stress, organizational development/strategic planning, and so forth.

Could I-O psychology be more prominent?
I have been lucky enough to work in an organization that is flexible and open-minded and has allowed me to use my skills as an I-O psychologist. However, this is not true for many development organizations, and I believe there is a real need for I-O psychologists to become more involved.

How? How could our profession help more, do you think?
I-O psychology tends to focus on the corporate sector, on assisting businesses to increase productivity and efficiency, have happier staff, and ultimately increase profit. The process is the same when applied to aid organizations. Aid organizations are in need of advice about how to be more effective, and how to have happier more productive staff. But although the process is the same, the end goal is different. Rather than aiming to increase profit they are aiming to help those less privileged, to reduce global poverty, and, in the case of local NGO staff, to help their country develop into a fair global player.

Aid organizations receive a lot of funding earmarked to program activities. Funding earmarked to program activities is essential for the development of the country; however, what often gets lost is the need to develop those organizations in-country who are undertaking those program activities. So often the focus is on using the funding for the community, with little focus on the tool through which the funding is implemented. Aid organizations are that tool, and it is essential to remember that developing local aid organizations also contribute to developing the country. The staff members at local aid organizations are extremely committed to the work being done, but there is a need for their own professional development that is not currently being met. Capacity building is a current buzzword in development circles, but many of those recruited, selected, and placed to undertake capacity building do not have the necessary skills to identify how to best build the capacity of the staff. They cannot identify training needs, and many end up doing the work for the staff rather than facilitating their capacity to do it themselves. I believe I-O psychology provides the tools that aid workers need for effective capacity building.

In Cambodia in particular, it is apparent that there is a need to take a interdisciplinary approach to development. By working together we can make the aid process more transparent, effective, and ultimately more sustainable. I-O psychology is an essential cog in the development wheel because building the capacity of local development organizations will result in empowerment of the local communities over their future and reduce reliance on external/foreign aid (both monetary aid and aid in the form of international people coming to do the work for them).

Thank you!