1 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Job Evaluation Chapter 13

2 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Job Evaluation Is used by organizations to provide information about the relative worth of jobs. In, turn, this helps determine the monetary worth of jobs. Job evaluation uses information collected through job analysis.

3 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Benefits of Job Evaluation (1 of 2) Benefits of Job Evaluation (1 of 2) It provides an objective determination of the value of each job. Employees are more likely to accept the relative values of their jobs when job worth is determined by job evaluation. It provides employees greater appreciation and understanding of the relationships between the demands of their jobs and their compensation.

4 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Benefits of Job Evaluation (2 of 2) Benefits of Job Evaluation (2 of 2) It reduces the number of complaints about wage inequities. It helps identify the lines of authority and patterns of advancement. It helps identify areas appropriate for new employee orientation and training as well as to facilitate employee transfer.

5 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Job Evaluation Methods Nonquantitative Quantitative Involves evaluating jobs as whole jobs rather than on the basis of their parts. Involves evaluating jobs on the basis of their parts.

6 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Compensable Factors Are often used in the evaluation process. These are factors that jobs share in common. Examples Working Conditions Physical Effort Skill Requirements

7 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Ranking Technique Is the simplest and oldest of the job evaluation methods. Uses the job description and the job specification for each job. Involves determining relative importance of each job and then assigning each job to a specific job level.

8 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Steps in Using the Ranking Technique 1. Determine the number of different levels to be used in the job evaluation process. 2. By means of a ranking device, rank the various jobs from the most important to the least important. 3. Assign each job to one of the predetermined levels.

9 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Situations in which the Ranking Technique is Used 1. When the number of jobs to be evaluated is fairly small jobs are maximum. 2. When the process needs to be completed fairly quickly and economically.

10 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Advantages of the Ranking Technique 1. It is readily understood by employees. 2. It is fairly quick and simple to use. 3. It is inexpensive to install.

11 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Disadvantages of the Ranking Technique 1. It does not provide a highly refined index of job worth because comparisons are made on the basis of whole jobs rather than on the basis of its parts. 2. Importance of job may be influenced by job holder. 3. It may be influenced by going wage and salary rates rather than by actual importance.

12 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Job Grading Is also known as job classification. Is used in the federal civil service system. Involves evaluating jobs on the basis of a number of predetermined classes or grades. Uses standard job descriptions.

13 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Steps in Using the Job Grading Technique 1. Predetermined classes of jobs are designated. 2. Standard job description is prepared for each of the predetermined classes. 3. Jobs are placed into the various predetermined classes. 4. Each job is compared with the various levels outlined on the standard job description to determine the level into which the job should be placed.

14 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Situations in which the Job Grading Technique is Used 1. When the organization has too many jobs for the ranking method to be used. 2. When the organization consists of several different family groupings of jobs. 3. When time and cost are of some consideration.

15 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Advantages of the Job Grading Technique 1. It is rather inexpensive to use. 2. It is an easy method to explain to employees. 3. Employees tend to accept the results quite readily.

16 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Disadvantages of the Job Grading Technique 1. Possibility exists for overlap between two levels in the standard job description. 2. Importance of a particular job may be somewhat biased by current rates of pay for certain job holders. 3. Requires the use of standard job descriptions to facilitate the process.

17 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Factor Comparison Determines the relative worth of jobs on the basis of their parts (compensable factors) rather than on the basis of whole jobs. Compensable Factors 1. Skill Requirements 2. Mental Requirements 3. Physical Requirements 4. Responsibility Requirements 5. Environmental Requirements

18 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Steps in Using the Factor Comparison Technique 1. Key jobs are identified. 2. Key jobs are ranked compensable factor by compensable factor. 3. Salary is apportioned among each compensable factor, and key jobs are ranked accordingly. 4. Factor ranking of each job is compared with its monetary ranking. 5. Monetary comparison scale is developed. 6. Non-key jobs are evaluated using the monetary comparison scale as a basis.

19 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Situations in which the Factor Comparison Technique is Used 1. Job factors vary too much to use one of the whole-job evaluation methods. 2. Is appropriately used in organizations with a large variety of jobs to be evaluated.

20 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Advantages of the Factor Comparison Technique 1. Provides more accurate results than either the ranking or job grading techniques. 2. Factors to be evaluated can be tailored to meet the needs of the organization. 3. Actual worth of each compensable factor is easily determined. 4. Evaluation of non-key jobs is simplified greatly by using the monetary comparison scale.

21 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Disadvantages of the Factor Comparison Technique 1. Periodic adjustment of salary rates may result in the development of inequities in the organization’s salary structure. 2. Inequities in salary rates of key jobs will affect the evaluated worth of non-key jobs. 3. An incorrect interpretation of the importance of any one of the factors can cause a serious error in the evaluated worth of a job. 4. Because of the complicated nature of the method, employees may not understand the system.

22 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Point Evaluation Technique Is the most commonly used technique. Jobs are evaluated on the basis of compensable factors. Compensable factors are divided into degrees. Degrees are assigned a specific number of points. Requires the use of a point manual, which lists the number of points allocated to each of the degrees.

23 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Steps in Using the Point Evaluation Technique 1. Compensable factors and their relative worth are determined. 2. Factors are then divided into subfactors. 3. Point manual is developed, specifying the number of points assigned to each degree. 4. Job specification is compared subfactor by subfactor with the degree descriptions in the point manual. 5. Job worth is determined by adding the number of points for each subfactor.

24 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Advantages of the Point Evaluation Technique 1. Is a difficult technique to manipulate. 2. Provides a high degree of objectivity and consistency of results. 3. Salary increases do not affect evaluated worth of jobs as they do with other techniques. 4. Provides a significant amount of flexibility in selecting subfactors, degrees, and points.

25 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Disadvantages of the Point Evaluation Technique 1. Developing a manual can be a difficult, time- consuming process. 2. Hiring specially trained personnel to install the system may be necessary. 3. Selecting and writing definitions is not an easy process. 4. Allocating points among each of the subfactors may be somewhat arbitrary.

26 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Computer-Aided Job Evaluation Employees being evaluated complete a computerized questionnaire regarding their job duties. The technique facilitates the preparation of a variety of statistical reports.

27 Administrative Office Management, 8/e by Zane Quible ©2005 Pearson Education, Inc. Pearson Prentice Hall Upper Saddle River, NJ Job Evaluation Often uses the services of a committee. Benefits 1. Results of the program are likely to be more objective. 2. Employees are more likely to accept the program developed by broad-based representation. 3. Results tend to be more accurate.