1. Job Evaluation
Chapter 6

2. Major decisions in job evaluation
Job evaluation methods –
Ranking –
Classification-
Point method-
Who should be involved?

3. Job evaluation ???
It is the process of systematically determining the relative worth of jobs to create a job structure for the organization.
It is based on a combination of job content, skills required, value to the organization, organizational culture, and the external market.
The potential to blend organizational forces and external market forces is both a strength and a challenge of job evaluation.

4. Major decisions in Job evaluation
Establish the purpose
Decide on single versus multiple plans
Choose among alternative methods
Obtain involvement of relevant stakeholders
Evaluate the usefulness of results

5. Establish the purpose Supports organization strategy
Answers --- How does this job add value?
Supports work flow
Integrates each job’s pay with its relative contributions to the organization, and it helps set pay for new, unique or changing jobs
Is fair to employees
Reduces disputes and grievances over pay differences among jobs by establishing a workable, agreed upon structure
Motivates behavior towards organization objectives
What does the organization value? What supports the organization strategy and its success?

6. Single versus Multiple plans
Benchmark jobs
To be sure that all relevant aspects of work are included in the evaluation, an organization may start with a sample of benchmark jobs.
Benchmark jobs would be identified for the levels in the structure and groups of related jobs
Characteristics of benchmark jobs:
Its contents are well known and relatively stable over time
Job is common across a number of different employers
A reasonable proportion of the workforce is employee in this job.

7. Benchmark jobs Managerial group Technical group Manufacturing group
Administrative group
Assembler I
Inspector I
Packer
Material handler
Inspector II
Assembler II
Drill Press Operator
Rough Grinder
Machinist I
Coremaker
Administrative Assistant
Principal Administrative Secretary
Administrative Secretary
Word Processor
Clerk/Messenger
Vice President
Division General managers
Managers
Project Leaders
Supervisors
Head chief scientist
Senior Associate Scientist
Associate Scientist
Scientist
Technician
White shaded jobs are benchmark jobs

8. Methods of job evaluation
Ranking method
Classification method
Point method

9. Ranking method
Orders the job description from highest to lowest based on a global definition of relative value or contribution to the organization’s success.
Methods:
Alternation ranking method and
Job descriptions are ordered alternately at each extreme.
Agreement is reached among evaluators on which jobs are the most valuable and least valuable (10…….1), (9…….2), (8……3) etc.
Paired comparison method
Compares all possible pairs of jobs
When all comparisons have been completed, the job most frequently judged “more valuable” becomes the highest-ranked job

10. PAIRED COMPARISON RANKING
Press operator
Master welder
Receiving clerk
Electrician
Total Favorable comparisons:
Shear Operator: 3
Electrician: 4
Press Operator: 2
Master Welder: 5
Grinder: 1
Receiving clerk: 0
Resulting rank:
Master Welder
Electrician
Shear Operator
Press Operator
Grinder
Receiving clerk
Grinder
Shear operator E S M S S
Electrician E M E E
Press operator M P P
Master Welder M M
Grinder G

11. Classification method (job grading)
Compares the whole job with a pre-determined grade/class
Government services 18 grades
Grade I-Grade IV – clerical and non-supervisory personnel
Grade V-Grade X – Management Trainees and lower level managers
Grade XI-Grade XV- General management – highly specialized jobs
Grade XVI-Grade XVIII – Senior Executives
Job descriptions are not only compared to the class descriptions and benchmark jobs but also can be compared to each other to be sure that jobs within each class are more similar to each other than to jobs in adjacent classes.

12. Point method Common characteristics Compensable factors
Factor degrees numerically scaled
Weights reflecting the relative importance of each factor

13. Steps in designing point plan
Conduct job analysis
Determine compensable factors
Scale the factors
Weight the factors according to the importance
Communicate the plan and train users
Apply to non-benchmark jobs

14. Compensable factors
Compensable factors are those characteristics in the work that the organization values, that help it pursue its strategy and achieve its objectives
It should be
Based on the strategy and values of the organization
Based on the work performed
Acceptable to the stakeholders affected by the resulting pay structure.

15. Indicate the percentage of time spent on multinational issues
This factor concerns the multinational scope of the job. Multinational responsibilities are defined as line or functional managerial activities in one or several countries.
The multinational responsibilities of the job can be best described as:
Approving major policy and strategic plans
Formulating, proposing and monitoring implementation of policy and plans
Acting as a consultant in project design and implementation phases
Not applicable
Indicate the percentage of time spent on multinational issues
>50%
25-49%
10-24%
<10%
Compensable factors definition-----Multinational responsibilities

16. Compensable factors
Compensable Factors are based on the strategic direction of the business and how the work contributes to the objectives and strategy
Factors are scaled to reflect the degree to which they are present in each job and weighted to reflect their overall importance to the organization.
Points are then attached to each factor weight.
Total points for each job determine its position in the job structure

17. Adapting factors
National Electrical Manufacturers Association (NEMA), Equal Pay Act (1963), National Metal Trades Association (NMTA), uses four general groups of factors
Skills required
Effort required
Responsibility
Working conditions

18. Know – how ( the sum total of what a person must have the capability to do to be effective)
Technical, specialized depth and breadth
Managerial requirements to plan, organize, staff, direct and control resources for results
Human relations skills to influence, motivate, change behavior and build relationships
Hay Plan
Problem solving (the requirement for and ability to use know-how effectively to develop solutions that improve effectiveness)
Environment – the context of the job and its focus
Challenge – the availability of guides and complexity of analysis required
Accountability (the requirement for and ability to achieve desired results)
Freedom to act – focus on decision making authority vested in the position to achieve results
Scope – focus on the magnitude of the results expected relative to the enterprise
Impact – focus on the impact the position has on the relevant scope measure for the position

20. Scale the factors
After determining the factors, scales reflecting the degrees within each factor are constructed
Each degree may be anchored by the typical skills, tasks and behaviors taken from the benchmark jobs that illustrate each factor degree
Most factor scales consist of 4-8 degrees
Many evaluators use extra undefined degrees such as plus and minus around a scale number (-1, 1, 1+)
Whether each degree should be equidistant from the adjacent degrees?

22. Criteria for scaling factors
Ensure that the number of degrees is necessary to distinguish among jobs
Use understandable terminology
Anchor degree definitions with benchmark job titles or work behaviors
Make it apparent how the degree applies to the job.

23. Weight factors according to importance
Factor weights reflect the relative importance of each factor to the overall value of the job,
Different weights reflect differences in importance attached to each factor by the employer.
NEMA plans weighs education at 17.5 %, employers association weighs it at 10.4 %, consultants weighs it at 15% ……

25. Communicate the plan and train users
Apply to non-benchmark jobs
Develop on-line software support

26. Comparison of job evaluation methods
Advantages
Disadvantages
Ranking
Classification
Point
Fast, simple, easy to explain.
Can group a wide range of work together in one system.
Compensable factors communicate what is valued.
Cumbersome as number of jobs increases. Basis for comparison is not called out.
Descriptions may leave too much room for manipulation.
Can become bureaucratic and rule-bound.

27. Who should be involved?
The design process matters
Appeals / review procedures

28. The structure Administrative group Managerial group Technical group
Manufacturing group
Assembler I
Inspector I
Packer
Material handler
Inspector II
Assembler II
Drill Press Operator
Rough Grinder
Machinist I
Coremaker
Administrative Assistant
Principal Administrative Secretary
Administrative Secretary
Word Processor
Clerk/Messenger
Vice President
Division General managers
Managers
Project Leaders
Supervisors
Head chief scientist
Senior Associate Scientist
Associate Scientist
Scientist
Technician
Point Job evaluation
Competency based
Skill based
Point Job evaluation