5-1

Chapter

Evaluating Work: Job Evaluation

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After discussing Chapter 5, students should be able to:

Learning Objectives

5-2

1.
2. 3. 4. 5. 6.

Discuss the relationship between internal alignment, job analysis, job evaluation, and job structure. Identify the major decisions involved in job evaluation. Compare the advantages and disadvantages of the most common job evaluation methods. Explain the six (6) steps in a point plan, the most commonly used job evaluation method. Describe the key roles of managers, employees, and committees in the job evaluation process. Understand the necessity of balancing tight control versus flexibility related to the use of techniques to achieve internal alignment.
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5-3

Chapter Topics
Job-Based Defining

Structures: Job Evaluation

Job Evaluation: Content, Value, and External Market Links Ranking Classification Point Method Who Should be Involved? The Final Result: Structure Balancing Chaos and Control.
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Exhibit 5.1: Many Ways to Create Internal Structure

5-4

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5-5

What Is Job Evaluation?

Process of systematically determining the relative worth of jobs to create a job structure for the organization. Evaluation is based on a combination of job content, skills required, value to the organization, organizational culture and the external market.
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5-6

Defining Job Evaluation

Content

and value content with the external market

Linking

Measure

for measure vs. Much ado about nothing

Exhibit

5.2: Assumptions Underlying Different Views of Job Evaluation

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Exhibit 5.2: Assumptions Underlying Different Views of Job Evaluation

Aspect of Job Evaluation
Assessment of job content Assessment of relative value External market link Measurement Negotiation

5-7

Assumption
Content has intrinsic value outside external market. Stakeholders can reach consensus on relative value. Value cannot be specified without external market. Honing instruments will provide objective measures. Puts face of rationality to a social / political process; establishes rules of the game and invites participation.

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Exhibit 5.3: Determining an Internally Aligned Job Structure

5-8

Internal alignment

Job analysis

Job description

Job evaluation

Job structure

Work relationships within organization Some Major Decisions in Job Evaluation Establish purpose of evaluation Decide whether to use single or multiple plans Choose among alternative approaches Obtain involvement of relevant stakeholders Evaluate plans usefulness
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5-9

Major Decisions
Establish

purpose

Supports

organization strategy Supports work flow Fair to employees Motivates behavior toward organization objectives
Single

vs. multiple plans Choose among methods

Exhibit
Obtain

5.4: Comparison of Job Evaluation Methods

involvement of relevant stakeholders Evaluate plans usefulness

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5-10

Exhibit 5.4: Benchmark Job

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5-11

Characteristics of Benchmark Job

Contents

are well-known and relatively stable over time is common across several different employers proportion of work force employed in job
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Job

Sizable

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Exhibit 5.5: Comparison of Job Evaluation Methods

Advantage Disadvantage

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Ranking

Fast, simple, easy to explain.

Cumbersome as number of jobs increases. Basis for comparisons is not called out.

Classification

Can group a wide range of work together in one system.

Descriptions may leave too much room for manipulation.

Point

Compensable factors call out basis for comparisons. Compensable factors communicate what is valued.

Can become bureaucratic and rule-bound.

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5-13

Ranking Method
Orders

job descriptions from highest to lowest based on a global definition of relative value or contribution to the organizations success approaches
ranking

Two

Alternation Paired
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comparison method
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5-14

Exhibit 5.6: Paired Comparison Ranking

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5-15

Classification Method
Uses

class descriptions that serve as the standard for comparing job descriptions
include benchmark jobs
of classes with a number of jobs in each

Classes

Outcome
Series

Examples

Exhibit
Exhibit

5.7: Classifications for Engineering Work

5.8: General Schedule Descriptions for Federal Government
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5-16

Point Method
Three

common characteristics of point methods

Compensable
Factor Weights

factors

degrees numerically scaled

reflect relative importance of each factor

Most

commonly used approach to establish pay structures in U.S.

Differ

from other methods by making explicit the criteria for evaluating jobs -compensable factors
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Designing a Point Plan: Six Steps

1. Conduct job analysis
2. Determine compensable factors.

5-17

3. Scale the factors.

4. Weight the factors according to
importance.

5. Communicate the plan, train users,

prepare manual.

6. Apply to nonbenchmark jobs.

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5-18

Step 1: Conduct Job Analysis

Point A

plans begin with job analysis

representative sample of jobs benchmark jobs - is drawn for analysis of these jobs is basis for
compensable factors

Content

Defining Scaling

compensable factors compensable factors

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Weighting
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5-19

Step 2: Determine Compensable Factors

Compensable
Reflect

factors play a pivotal role

how work adds value to organization

Example

- Exhibit 5.9
of compensable factors

Characteristics
Based

on strategy and values of organization

5.10

Exhibit

Based

on work performed

Acceptable

to stakeholders affected by resulting pay structure

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5-20

Generic Compensable Factors

Skill

Effort

Responsibility

Working conditions
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5-21

Generic Factor - Skill

Skill: Experience, training, ability, and education required to perform a job under consideration - not with skills an employee may possess

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5-22

Generic Factor - Skill

Technical know-how
Specialized knowledge Organizational awareness Educational levels Specialized training

Years of experience required

Interpersonal skills

Degree of supervisory skills

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5-23

Generic Factor - Effort

Effort:

Measurement of the physical or mental exertion needed for performance of a job

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5-24

Generic Factor - Effort

Diversity

of tasks

Complexity Creativity Analytical Physical Degree

of tasks

of thinking

problem solving

application of skills

of assistance available
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5-25

Generic Factor - Responsibility

Responsibility: Extent to which an employer depends on employee to perform job as expected, with emphasis on importance of job obligation

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5-26

Generic Factor - Responsibility

Decision-making Scope Scope

authority

of organization under control of organization impacted of integration of work with others of failure or risk of job

Degree Impact Ability

to perform tasks without supervision

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5-27

Generic Factor Working Conditions

Working Conditions:
Hazards Physical

surroundings of job

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5-28

Generic Factor Working Conditions

Potential
Degree

hazards inherent in job

of danger which can be exposed to others of specialized motor or concentration skills of discomfort, exposure, or dirtiness in doing job
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Impact

Degree

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5-29

Exhibit 5.11: The Hay System

Know-How Scope Depth Human relations skills Exhibit 5.12: Hay Guide Chart for Know-how Problem Solving Environment Challenge Accountability Freedom to Act Scope Impact
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5-30

Compensable Factors - How Many?

Illusion of validity - Belief that factors are capturing divergent aspects of a job Small numbers - If even one job has it, it must be a compensable factor Accepted and doing the job - 21, 7, 3

Research results

Skills explain 90% or more of variance

Three factors account for 98 - 99% of variance

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5-31

Step 3: Scale the Factors

Construct scales reflecting different degrees within each factor Most factor scales consist of 4 to 8 degrees Exhibit 5.13: Factor Scaling - NMTA Issue - Whether to make each degree equidistant from adjacent degrees (interval scaling) Criteria for scaling factors Limit to number necessary to distinguish among jobs Use understandable terminology Anchor degree definitions with benchmark job titles Make it apparent how degree applies to job
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5-32

Step 4: Weight the Factors

Different

weights reflect differences in importance attached to each factor of factor weights

Determination
Advisory/JE
Statistical

committee

analysis

Criterion

pay structure

Exhibit
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5.14: Job Evaluation Form

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5-33

Exhibit 5.14: Job Evaluation Form

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5-34

Overview of the Point System

Degree of Factor Job Factor 1. Education 2. Responsibility 3. Physical effort 4. Working conditions
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Weight
50% 30% 12% 8%

1
100 75 24 25

2
200 150 48 51

3
300 225 72 80

4
400 300 96

5
500

120

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5-35

Step 5: Communicate Plan and Train Users

Involves

development of manual containing information to allow users to apply plan

Describes Defines Provides

job evaluation method

compensable factors

information to permit users to distinguish varying degrees of each factor

Involves

training users on total pay appeals process for employees

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system
Include
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5-36

Step 6: Apply to Nonbenchmark Jobs

Final

step involves applying plan to remaining jobs

Benchmark

jobs were used to develop compensable factors and weights

Trained

evaluators will evaluate new jobs or reevaluate jobs whose work content has changed
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5-37

Who Should be Involved?

Committees, task forces, or teams of key representations

Design process matters Appeals/review procedures I know I speak for all of us when . . .
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5-38

Final Result: Structure

Outcome
Ordered

list of jobs based on their value to organization Hierarchy of work Structure supporting a policy of internal alignment
Information
Which

provided by hierarchy

jobs are most and least valued Relative amount of difference between jobs
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Exhibit 5.15: Resulting Internal Structures -Job, Skill, and Competency Based
Managerial Group Technical Group Manufacturing Group Assembler I Inspector I Vice Presidents Division General Managers Managers Project Leaders Supervisors Head / Chief Scientist Senior Associate Scientist Associate Scientist Scientist Technician Packer Materials Handler Inspector II Assembler II Drill Press Operator Rough Grinder Machinist I Coremaker Administrative Assistant Principal Administrative Secretary Administrative Secretary Word Processor Clerk / Messenger Administrative Group

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Job Evaluation
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CompetencyBased

Skill Based

Job Evaluation
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5-40

Balancing Chaos and Control

Control

Chaos

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