Job evaluation as evident from the word itself aims at evaluating the job and not the person.

It is a
process of evaluating and determining the value of the job for an organisation. The evaluation is
always in relative and not absolute terms. The idea is evaluate a certain job against other jobs in the
organisation so that a fair compensation system against various bands or levels can be established.
Organisations use various ways to evaluate jobs for arriving upon a compensation scheme. They vary
with the size of the organisation and the kind of industry they operate in.
Job evaluation is a process of determining the relative worth of a job. It is a process which is helpful
even for framing compensation plans by the personnel manager. Job evaluation represents an effort
to determine the relative value of every job in a plant and to determine what the fair basic wage for
such a job should be. Thus, job evaluation is different from performance appraisal. In job evaluation,
worth of a job is calculated while in performance appraisal, the worth of employee is rated.
The various ways of evaluation are:
1. Job ranking :
The simpler or the easiest to perform is the job ranking method. In this method the jobs are
taken as a whole and ranked against each other. The jobs are ordered according to perceived
seniority. Such method is easier to apply in a small organisation but gets complicated once
used for large corporations.
2. Paired comparison :
The other method is the pair comparison method where jobs are compared in pairs. It is more
structured approach to comparing jobs. Yet another method is benchmarking where certain
jobs are slotted and then examined in detail. These are then used as benchmarks in
evaluating various jobs.
3. Factor comparison:
In this method jobs are broken down into various factors such as skills required, experience,
education required. A set of questions is framed against each factor and the response
determines the score. Each factor is allotted a certain weight. These scores are then totalled
to rank the jobs.
4. Points rating :
Different levels are accorded to the various elements of jobs and then the points allocated to
different levels are totalled to get point score of the jobs which forms the basis of pay
structure.

With organisations changing continuously in every sphere of operations, be it the way they conduct
their business, the way they hire and manage people, there is a huge change in the processes that
drive this change. Job evaluation and its technique are not immune to it. The techniques are changing
very fast. There are organisations still that stick to existing schemes of j+ob evaluation. Evaluations
based upon old existent standards are time consuming in many cases. Organisations do not want to
spend time on writing new jobs and making evaluations afresh. Those that do this may need to
rethink!

Job evaluation as a process is advantageous to a company in many ways:

1. Reduction in inequalities in salary structure - It is found that people and their motivation is
dependent upon how well they are being paid. Therefore the main objective of job evaluation
is to have external and internal consistency in salary structure so that inequalities in salaries
are reduced.

2. Specialization - Because of division of labour and thereby specialization, a large number of

enterprises have got hundred jobs and many employees to perform them. Therefore, an
attempt should be made to define a job and thereby fix salaries for it. This is possible only
through job evaluation.
3. Helps in selection of employees - The job evaluation information can be helpful at the time
of selection of candidates. The factors that are determined for job evaluation can be taken
into account while selecting the employees.
4. Harmonious relationship between employees and manager - Through job evaluation,
harmonious and congenial relations can be maintained between employees and
management, so that all kinds of salaries controversies can be minimized.
5. Standardization - The process of determining the salary differentials for different jobs
become standardized through job evaluation. This helps in bringing uniformity into salary
structure.
6. Relevance of new jobs - Through job evaluation, one can understand the relative value of
new jobs in a concern.