Do You Really Know Your People?

Understanding the ins and outs of personality psychology could be the key to unlocking success up and down your organization.

By Robert Hogan, Ph.D., and Ryne A. Sherman

People are the deadliest invasive species in the history of Earth. They have the potential to kill every living thing, and in some cases have already done so. RIP passenger pigeons, western black rhinos, and great auks.

Given the frightful potential of people, then, it might be useful to know something about them. Personality psychology is the “go-to” discipline for understanding people. 

But what does it tell us about human nature? Well, the answer depends on who you ask. 

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Modern personality psychology began in Vienna in the late 19th century as a revolutionary new version of psychiatry; it argued that mental illness was caused by unconscious psychological conflicts. The pioneers of personality psychology included Sigmund Freud, Carl Jung, Alfred Adler, Otto Rank, and Erik Erikson.

Popular interest in personality theory began to decline in the early 1970s, when academic psychologists deemed it to be pointless. Because everything we do is based on our assumptions about human nature, the demise of personality psychology created a gap in our ability to understand people.

Theories of Personality

The first major theory of personality is psychodynamic theory, which primarily concerns understanding mental illness (e.g., Adolf Hitler was a paranoid psychopath). The second is interpersonal theory, which concerns understanding everyday life (e.g., why was Steve Jobs so successful?).  

Psychodynamic theory contains many useful insights. For example, childhood experience shapes adult personality, much social behavior is unconsciously motivated, and people are inherently irrational. Psychodynamic theory is based on two assumptions: (1) everyone is neurotic; and (2) the goal of life is to overcome one’s neurosis. 

The problem with psychodynamic theory is the first assumption. Although most people have issues that bother them from time to time, neurotics are continuously dysfunctional, and most people aren’t.

In addition, the absence of neurosis doesn’t guarantee happiness or success. Despite the compelling subject matter of psychodynamic theory, it sent personality psychology in the wrong direction for 70 years. 

Interpersonal theory is based on the writing of George Herbert Mead, Henry Stack Sullivan, and Timothy Leary, among others. It concerns how people interact with others and how past interactions influence future interactions. Interpersonal theory is based on two assumptions: (1) social interaction is the most important part of life; and (2) the goal of life is to optimize one’s place in one’s social network.

Interpersonal theory differs from psychodynamic theory in three important ways.

First, psychodynamic theory assumes that how we think about ourselves drives social interaction; in contrast, interpersonal theory assumes that how we interact with other people drives how we think about ourselves.

Second, psychodynamic theory defines maturity as self-understanding, whereas interpersonal theory defines maturity as the ability to deal productively with others.

Third, psychodynamic theory ignores reputation, whereas interpersonal theory assumes that success in life depends on maintaining a proper reputation.

Our own perspective links interpersonal theory to evolutionary biology. From interpersonal theory, we know that people are fundamentally motivated to: (1) get along with the other members of their group; (2) gain status within their group; and (3) make sense out of their lives. From evolutionary biology, we know that life is about competition.

There are large individual differences in peoples’ ability to get along, gain status, and find meaning, and being able to do so has important payoffs in terms of reproductive success.

For most species, there’s competition at the individual level for status, power, and social acceptance, and there’s competition at the group level for territory, political dominance, and ultimately survival.

Keeping Up with the Competition

People seem fascinated by individual competition (who is at the top of the charts this week?), but group competition is often more consequential. Success at the individual competition is a function of social skills; success in group competition is a function of leadership.

A third theory, socioanalytic theory, concerns understanding the effectiveness of both individuals and groups.

Individual competition. Individual competition takes place during social interaction. Interactions are organized in terms of agendas (let’s get together and discuss this problem) and roles for people to play (who called this meeting?). Overt agendas vary, but the agenda for most interactions concerns acceptance and status.

Our identities are the generic roles we play in each interaction; identities determine the roles we play and how we play them. Our reputations are the outcome of social interaction; that is, our reputations reflect the results of the accounting process that takes place after every interaction.

Reputations indicate our success at individual competition. Dysfunctional people choose maladaptive identities, create bad reputations for themselves, and lack the ability to change the cycle. Successful people create reputations that maximize their social and economic well-being.

Both psychoanalytic and socioanalytic theories think self-awareness is important for career success; Freud believed self-awareness comes from introspection, whereas we think introspection is pointless.

The difference lies in the definition of self-awareness: Highly successful people (e.g., Ronald Reagan, Margaret Thatcher, Donald Trump, Boris Johnson) are typically incapable of introspection, whereas neurotics are addicted to it. In our view, useful self-awareness is created by feedback from others regarding our performance.

The ancient Greeks valued self-awareness; the inscription over the tomb of the Cumaean Sybill was “Know Thyself.” But the Greeks defined self-knowledge as understanding one’s performance limitations, and this is how we define self-awareness. We use personality assessment to give people feedback on their performance during social interaction and create “strategic self-awareness,” which improves their chances of having successful careers.

Group competition. People are fascinated by the doings of celebrities, but every major accomplishment in human history is the result of a coordinated group effort directed by a leadership team.

Although the success (or failure) of armies, athletic teams, business enterprises, and religious organizations depends on leadership, from WWII until the early 1980s, psychologists advocated “situational theories” of leadership (leadership depends on the situation).

Modern research shows that situational leadership is wrong (e.g., the personalities of CEOs account for 17-30% of the variance in firm performance), but situationism nonetheless stymied progress for many years.

Most researchers define leadership in terms of the people at the tops of organizations. This, too, has hindered our ability to understand leadership effectiveness. Although the people at the tops of organizations are successful at the individual level of competition for status, they’re often ineffective leaders.

In our view, leadership effectiveness should be defined in terms of the group’s performance. And what do we know about leaders of high-performing groups? Recent research shows that effective leaders have six characteristics:

1. They have integrity. They keep their word, don’t play favorites, and put the group’s interest before their own.

2. They’re experts in the group’s activity. Sports coaches are usually former athletes, CFOs understand finance, and so on, and can, therefore, effectively coach their subordinates. 

3. They make good decisions quickly based on limited information, recognize when they’ve made bad decisions, and learn from their mistakes.

4. They articulate sensible visions for the future and inspire subordinates to work toward them.

5. They’re fiercely determined to outperform the groups against whom they compete.

6. They’re humble and modest. If they succeed, they give credit to their teams; if they fail, they blame themselves, not the group.

Life is about competition between individuals for status and between groups for resources. Personality psychology provides advice for both kinds of competition. For people who want to advance their careers, personality psychology offers feedback for self-awareness and career planning.

For groups that want to outperform their competitors, personality psychology offers advice for leadership selection and development. Thus, personality psychology provides answers to the most fundamental questions in human affairs.

Robert Hogan, Ph.D., is the founder and president of Hogan Assessments. The first psychologist to determine the link between personality and organizational effectiveness, today he is the leading authority on personality assessment and leadership. 

Ryne Sherman, Ph.D., is the chief science officer of Hogan Assessments. Prior to joining Hogan, he was an associate professor in the department of psychology at Texas Tech University, where he researched the importance of individual differences, the psychological properties of situations, and developing tools for data analysis.