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Evaluating Work:Evaluating Work:Job EvaluationJob Evaluation

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Many Ways to Create Internal StructureMany Ways to Create Internal StructureBusiness and Work-Business and Work-

Related Internal StructureRelated Internal Structure

Person-based

Skill CompetenciesJob-based

Job analysisJob descriptions

Job evaluation: classes or compensable factors

Factor degrees and weighting

Job-based structure

PURPOSEPURPOSE

Collect, summarize work information

Determine what to value

Assess value

Translate into structure

(Chapter 6)(Chapter 6) (Chapter 6)(Chapter 6)

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Job EvaluationJob Evaluation

Process of systematically determining the relative Process of systematically determining the relative worth of jobs to create a job structure for the worth of jobs to create a job structure for the organization.organization.

The evaluation is based on a combination of job The evaluation is based on a combination of job content, skills required, value to the organization, content, skills required, value to the organization, organizational culture, and the external market.organizational culture, and the external market.

This potential to blend internal forces and This potential to blend internal forces and external market forces is both a strength and a external market forces is both a strength and a challenge to job evaluation.challenge to job evaluation.

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Determining an Internally Aligned Job StructureDetermining an Internally Aligned Job Structure

Internal alignment Job analysis Job description Job evaluation Job structure

Some Major Decisions in Job EvaluationSome Major Decisions in Job Evaluation• Establish purpose of evaluationEstablish purpose of evaluation• Decide whether to use single or multiple plansDecide whether to use single or multiple plans• Choose among alternative approachesChoose among alternative approaches• Obtain involvement of relevant stakeholdersObtain involvement of relevant stakeholders• Evaluate plan’s usefulnessEvaluate plan’s usefulness

Some Major Decisions in Job EvaluationSome Major Decisions in Job Evaluation• Establish purpose of evaluationEstablish purpose of evaluation• Decide whether to use single or multiple plansDecide whether to use single or multiple plans• Choose among alternative approachesChoose among alternative approaches• Obtain involvement of relevant stakeholdersObtain involvement of relevant stakeholders• Evaluate plan’s usefulnessEvaluate plan’s usefulness

Work relationships within the Work relationships within the organizationorganization

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Aspects of Job EvaluationAspects of Job Evaluation

Job Evaluation is: AssumptionJob Evaluation is: Assumption

A measure of job Content has an innate value outside of external market. content

A measure of relative Relevant groups can reach consensus on relative value value.

Link with external Job worth cannot be specified without external market market information.

Measurement device Honing instruments will provide objective measures.Negotiation Puts face of rationality to a social / political process. Establishes rules of the game.

Invites participation.

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Job Content Approach: Key DecisionsJob Content Approach: Key Decisions

Single Vs. Multiple PlansSingle Vs. Multiple Plans Which Job Evaluation MethodWhich Job Evaluation Method Which Compensable FactorsWhich Compensable Factors How Many FactorsHow Many Factors Number and Definition of DegreesNumber and Definition of Degrees How Many Points to AllowHow Many Points to Allow Relative Weight of the FactorsRelative Weight of the Factors How to Allocate Points Across Factors and DegreesHow to Allocate Points Across Factors and Degrees Benchmarks to EvaluateBenchmarks to Evaluate Who EvaluatesWho Evaluates

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Job Evaluation MethodsJob Evaluation MethodsJob Ranking Job Ranking

Raters examine job description and arrange jobs Raters examine job description and arrange jobs according to value to companyaccording to value to company

Job ClassificationJob ClassificationClasses or grades are defined to describe a group of Classes or grades are defined to describe a group of

jobs.jobs.Point MethodPoint Method

Numerical values are assigned to specific job Numerical values are assigned to specific job components; sum of values provides quantitative components; sum of values provides quantitative assessment of job’s worth (Hay Guide Chart-Profile assessment of job’s worth (Hay Guide Chart-Profile Method)Method)

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Comparison of Job Evaluation MethodsComparison of Job Evaluation Methods

Advantage Disadvantage

RankingRanking Fast, simple, easy to Fast, simple, easy to explain.explain.

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

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

Descriptions may leave Descriptions may leave too much room for too much room for manipulation.manipulation.

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

Can become Can become bureaucratic and rule-bureaucratic and rule-bound.bound.

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The Point Plan Process The Point Plan Process (1 of 2)(1 of 2)

Step One: Conduct Job AnalysisStep One: Conduct Job Analysis A representative sample of benchmark jobsA representative sample of benchmark jobs The content of these jobs is basis for compensable The content of these jobs is basis for compensable

factorsfactors

Step Two: Determine Compensable FactorsStep Two: Determine Compensable Factors Based on the work performed (what is done)Based on the work performed (what is done) Based on strategy and values of the organization (what is Based on strategy and values of the organization (what is

valued)valued) Acceptable to those affected by resulting pay structure Acceptable to those affected by resulting pay structure

(what is acceptable)(what is acceptable)

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The Point Plan Process The Point Plan Process (2 of 2)(2 of 2)

Step Three: Scale the FactorsStep Three: Scale the Factors Use examples to anchorUse examples to anchor

Step Four: Weight the FactorsStep Four: Weight the Factors Can reflect judgment of organization leaders, committeeCan reflect judgment of organization leaders, committee Can reflect a negotiated structureCan reflect a negotiated structure Can reflect a market-based structureCan reflect a market-based structure

Step Five: Apply to Non-benchmark JobsStep Five: Apply to Non-benchmark Jobs

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Characteristics of Benchmark JobsCharacteristics of Benchmark Jobs

The contents are well-known, relatively stable, The contents are well-known, relatively stable, and agreed upon by the employees involvedand agreed upon by the employees involved

The supply and demand for these jobs are The supply and demand for these jobs are relatively stable and not subject to recent shiftsrelatively stable and not subject to recent shifts

They represent the entire job structure under They represent the entire job structure under studystudy

A majority of the work force is employed in these A majority of the work force is employed in these jobsjobs

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Compensable Factors -Compensable Factors - A Definition A Definition (1 of 2)(1 of 2)

Compensable factorsCompensable factors are paid-for, measurable are paid-for, measurable qualities, features, requirements, or constructs qualities, features, requirements, or constructs that are common to many different kinds of jobs.that are common to many different kinds of jobs.

These factors are qualities intrinsic to the job and These factors are qualities intrinsic to the job and must be addressed in an acceptable manner if the must be addressed in an acceptable manner if the job is to be performed satisfactorily.job is to be performed satisfactorily.

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Compensable Factors -Compensable Factors -A Definition A Definition (2 of 2)(2 of 2)

In addition to being quantifiable, In addition to being quantifiable, compensable compensable factorsfactors should be relatively easy to describe and should be relatively easy to describe and document.document.

Those involved in using Those involved in using compensable factorscompensable factors to to measure job worth should consistently arrive at measure job worth should consistently arrive at similar results.similar results.

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Universal Compensable FactorsUniversal Compensable Factors Skill:Skill: the experience, training, ability, and education the experience, training, ability, and education

required to perform a job under consideration - required to perform a job under consideration - not not with the skills an employee may possesswith the skills an employee may possess

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Universal Factor - SkillUniversal Factor - Skill

Technical Know-howTechnical Know-howSpecialized KnowledgeSpecialized KnowledgeOrganizational AwarenessOrganizational AwarenessEducational LevelsEducational LevelsSpecialized TrainingSpecialized TrainingYears of Experience RequiredYears of Experience Required Interpersonal SkillsInterpersonal SkillsDegree of Supervisory SkillsDegree of Supervisory Skills

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Universal Compensable FactorsUniversal Compensable Factors

Effort:Effort: the the measurement of the measurement of the physical or mental physical or mental exertion needed for exertion needed for performance of a jobperformance of a job

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Universal Factor - EffortUniversal Factor - Effort

Diversity of TasksDiversity of TasksComplexity of TasksComplexity of TasksCreativity of ThinkingCreativity of ThinkingAnalytical Problem SolvingAnalytical Problem SolvingPhysical Application of SkillsPhysical Application of SkillsDegree of Assistance AvailableDegree of Assistance Available

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Universal Compensable FactorsUniversal Compensable Factors

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

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Universal Factor - ResponsibilityUniversal Factor - Responsibility

Decision-making AuthorityDecision-making AuthorityScope of the organization under controlScope of the organization under controlScope of the organization impactedScope of the organization impactedDegree of integration of work with othersDegree of integration of work with othersImpact of failure or risk of jobImpact of failure or risk of jobAbility to perform tasks without supervisionAbility to perform tasks without supervision

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Universal Compensable FactorsUniversal Compensable Factors

Working Conditions:Working Conditions:hazardshazardsphysical surroundingsphysical surroundings

of the job.of the job.

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Universal Factor - Working ConditionsUniversal Factor - Working Conditions

Potential Hazards Inherent in JobPotential Hazards Inherent in JobDegree of Danger Which Can be Exposed to Degree of Danger Which Can be Exposed to

OthersOthersImpact of Specialized Motor or Concentration Impact of Specialized Motor or Concentration

SkillsSkillsDegree of Discomfort, Exposure, or Dirtiness in Degree of Discomfort, Exposure, or Dirtiness in

Doing JobDoing Job

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From the Abstract to the SpecificFrom the Abstract to the Specific

To facilitate the use of compensable factors To facilitate the use of compensable factors within a job evaluation method it is common within a job evaluation method it is common practice to classify the factors into three major practice to classify the factors into three major categories:categories:

1. Universal Factors

2. Sub-Factors

3. Degrees or Levels

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Example: The Hay SystemExample: The Hay System

Know-HowKnow-HowPractical, Specialized, & Technical BreadthPractical, Specialized, & Technical BreadthBreadth of ManagementBreadth of ManagementHuman RelationsHuman Relations

Problem SolvingProblem SolvingThinking EnvironmentThinking Environment Thinking ChallengeThinking Challenge

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Example: The Hay SystemExample: The Hay System

AccountabilityAccountability Freedom to ActFreedom to Act MagnitudeMagnitude ImpactImpacta)a) RemoteRemote

b)b) ContributoryContributory

c)c) SharedShared

d)d) PrimaryPrimary

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How Many Points to Allow?How Many Points to Allow?

Relative Weight of the Relative Weight of the FactorsFactors

How to Allocate Points How to Allocate Points Across Factors and Across Factors and DegreesDegrees

Overview of the Point SystemOverview of the Point System

Job Factor

Weight

1

2

3

4

5

1. Education 50% 100 200 300 400 500

2. Respon-sibility

30% 75 150 225 300

3. Physical effort

12% 24 48 72 96 120

4. Working conditions

8% 25 51 80

Degree of FactorDegree of Factor

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Who Should Be Involved?Who Should Be Involved?

The Design Process The Design Process MattersMatters

Appeals / Review Appeals / Review ProceduresProcedures

““I Know I Speak for All I Know I Speak for All of Us When I Say I Speak of Us When I Say I Speak for All of Us”for All of Us”

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Product: A Job HierarchyProduct: A Job Hierarchy

The key product is an ordered listing of jobs The key product is an ordered listing of jobs based on their based on their valuevalue to the organization. to the organization.

The hierarchy not only provides information The hierarchy not only provides information about which jobs are most and least valued, but it about which jobs are most and least valued, but it also provides information about the relative also provides information about the relative amount of difference between jobs.amount of difference between jobs.

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Resulting Internal Structures:Resulting Internal Structures:Job, Skill, and Competency BasedJob, Skill, and Competency Based

SupervisorsSupervisorsSupervisorsSupervisors

Project LeadersProject LeadersProject LeadersProject Leaders

ManagersManagersManagersManagers

Division GeneralDivision GeneralManagersManagers

Division GeneralDivision GeneralManagersManagers

Vice PresidentsVice PresidentsVice PresidentsVice Presidents

Job Job EvaluationEvaluation

TechnicianTechnicianTechnicianTechnician Machinist IMachinist ICoremakerCoremakerMachinist IMachinist ICoremakerCoremaker Clerk / MessengerClerk / MessengerClerk / MessengerClerk / Messenger

ScientistScientistScientistScientist

Associate ScientistAssociate ScientistAssociate ScientistAssociate Scientist

Senior AssociateSenior AssociateScientistScientist

Senior AssociateSenior AssociateScientistScientist

Head / ChiefHead / ChiefScientistScientist

Head / ChiefHead / ChiefScientistScientist

Drill Press OperatorDrill Press OperatorRough GrinderRough Grinder

Drill Press OperatorDrill Press OperatorRough GrinderRough Grinder

Assembler IIAssembler IIAssembler IIAssembler II

Materials HandlerMaterials HandlerInspector IIInspector II

Materials HandlerMaterials HandlerInspector IIInspector II

PackerPackerPackerPacker

Assembler IAssembler IInspector IInspector I

Assembler IAssembler IInspector IInspector I

Word ProcessorWord ProcessorWord ProcessorWord Processor

AdministrativeAdministrativeSecretarySecretary

AdministrativeAdministrativeSecretarySecretary

Principal Adminis-Principal Adminis-trative Secretarytrative Secretary

Principal Adminis-Principal Adminis-trative Secretarytrative Secretary

AdministrativeAdministrativeAssistantAssistant

AdministrativeAdministrativeAssistantAssistant

Job Job EvaluationEvaluation

Competency- Competency- BasedBased

Skill– Skill– BasedBased

Manufacturing Manufacturing GroupGroup

Administrative Administrative GroupGroup

Technical Technical GroupGroup

Managerial Managerial GroupGroup

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SummarySummary The differences in the rates paid for different jobs The differences in the rates paid for different jobs

and skills affect the ability of managers to achieve and skills affect the ability of managers to achieve their business objectives.their business objectives.

Differences in pay matter.Differences in pay matter. They matter to employees, because their willingness They matter to employees, because their willingness

to take on more responsibility and training, to focus to take on more responsibility and training, to focus on adding value for customers and improving quality on adding value for customers and improving quality of products, and to be flexible enough to adapt to of products, and to be flexible enough to adapt to change all depend at least in part on how pay is change all depend at least in part on how pay is structured for different levels of work.structured for different levels of work.

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SummarySummary (continued)(continued)

Differences in the rates paid for different jobs and Differences in the rates paid for different jobs and skills also influences how fairly employees believe skills also influences how fairly employees believe they are being treated. Unfair treatment is ultimately they are being treated. Unfair treatment is ultimately counterproductive.counterproductive.

Job evaluation has evolved into many different forms Job evaluation has evolved into many different forms and methods. Consequently, wide variations exist in and methods. Consequently, wide variations exist in its use and how it is perceived.its use and how it is perceived.

No matter how job evaluation is designed, its No matter how job evaluation is designed, its ultimate use is to help design and manage work-ultimate use is to help design and manage work-related, business-focused, and agreed-upon pay related, business-focused, and agreed-upon pay structure.structure.

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Review QuestionsReview Questions

1. How does job evaluation translate internal alignment policies in practice? What does (a) flow of work, (b) fairness, and (c) directing people’s behaviors toward organization objectives have to do with job evaluation?

2. Why are there different approaches to job evaluation? Think of several employers in your area. What approach would you expect them to use? Why?

3. What are the advantages and disadvantages of using more than one job evaluation plan in any single organization?

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Review Questions Review Questions (continued)(continued)

4. Why bother with job evaluation? Why not simply market price? How can job evaluation link internal alignment and external market pressure?

5. Consider your college or school. What are the compensable factors required for your college to evaluate jobs? How would you go about identifying these factors? Should the school’s educational mission be reflected in your factors? Or are generic factors okay? Discuss.

6. As the manager of a 10 person workgroup, how do you reassure the group when they learn their jobs are going to be evaluated?