There has been a marked increase in the application of psychological methods and techniques to the solution of many human problems in industrial units and business during the recent past. This increased reliance upon psychology in various organizations, probably, is the consequence of two major factors. The first is that the importance of human beings has received wider recognition in industry as well as business. secondly many developments have taken resulted in potential applications of this since to numerous human problems in industry and business.
Industrial psychology as the name indicates is that branch of psychology which deals with human behaviours under industrial circumstances.
According to Blum, psychologist, industrial psychology is simply the application or extension of psychological facts and principles to the problems concerning human relations in business and industry.
Smith has defined industrial psychology as the study of conduct of those do mental and physical labour for means to live.
In short it can be said that industrial psychology is that branch of psychology which deals with human behaviour under business and industrial conditions, and in which research is carried on concerning the behaviour problems that arise in an industrial environment.