Evaluating Work: Job Evaluation

3. 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. Learning ObjectivesAfter discussing Chapter 5, students should be able to:

4. Chapter Topics Job-Based Structures: Job Evaluation Defining Job Evaluation: Content, Value, and External Market Links Ranking Classification Point Method Who Should be Involved? The Final Result: Structure Balancing Chaos and Control.

5. Exhibit 5.1: Many Ways to Create Internal Structure See Exhibit 5.1, text page 121See Exhibit 5.1, text page 121

6. What Is Job Evaluation?

7. Defining Job Evaluation Content and value Linking content with the external market �Measure for measure� vs. �Much ado about nothing� Exhibit 5.2: Assumptions Underlying Different Views of Job Evaluation

8. Exhibit 5.2: Assumptions UnderlyingDifferent Views of Job Evaluation

9. Exhibit 5.3: Determining an InternallyAligned Job Structure

10. Major Decisions Establish purpose Supports organization strategy Supports work flow Fair to employees Motivates behavior towardorganization objectives Single vs. multiple plans Choose among methods Exhibit 5.4: Comparison of Job Evaluation Methods Obtain involvement of relevant stakeholders Evaluate plan�s usefulness

11. Exhibit 5.4: Benchmark Job

12. Characteristics of Benchmark Job Contents are well-known andrelatively stable over time Job is common across severaldifferent employers Sizable proportion of workforce employed in job

13. Exhibit 5.5: Comparison ofJob Evaluation Methods

14. Ranking Method Orders job descriptions from highest to lowest based on a global definition of relative value or contribution to the organization�s success Two approaches Alternation ranking Paired comparison method

15. Exhibit 5.6: Paired Comparison Ranking

16. Uses class descriptions that serve as the standard for comparing job descriptions Classes include benchmark jobs Outcome Series of classes with a number of jobs in each Examples Exhibit 5.7: Classificationsfor Engineering Work Exhibit 5.8: GeneralSchedule Descriptionsfor Federal Government Classification Method

17. Point Method Three common characteristics of point methods Compensable factors Factor degrees numerically scaled Weights reflect relativeimportance of each factor Most commonly used approachto establish pay structures in U.S. Differ from other methods by making explicit the criteria for evaluating jobs -- compensable factors

18. Conduct job analysis Determine compensable factors. Scale the factors. Weight the factors according to importance. Communicate the plan, train users, prepare manual. Apply to nonbenchmark jobs. Designing a Point Plan:Six Steps

19. Step 1: Conduct Job Analysis Point plans begin with job analysis A representative sample of jobs - benchmark jobs - is drawn for analysis Content of these jobs is basis for Defining compensable factors Scaling compensable factors Weighting compensable factors

20. Step 2: Determine Compensable Factors Compensable factors play a pivotal role Reflect how work adds value to organization Example - Exhibit 5.9 Characteristics of compensable factors Based on strategy and values of organization Exhibit 5.10 Based on work performed Acceptable to stakeholders affected by resulting pay structure

21. Generic Compensable Factors

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

23. Generic Factor - Skill Technical know-how Specialized knowledge Organizational awareness Educational levels Specialized training Years of experience required Interpersonal skills Degree of supervisory skills

24. Generic Factor - Effort Effort: Measurement of the physical or mental exertion needed for performance of a job

25. Generic Factor - Effort Diversity of tasks Complexity of tasks Creativity of thinking Analytical problem solving Physical application of skills Degree of assistance available

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

27. Generic Factor - Responsibility Decision-making authority Scope of organization under control Scope of organization impacted Degree of integration of work with others Impact of failure or risk of job Ability to perform tasks without supervision

28. Working Conditions: Hazards Physical surroundingsof job Generic Factor � Working Conditions

29. Potential hazards inherent in job Degree of danger which can be exposed to others Impact of specialized motor or concentration skills Degree of discomfort, exposure, or dirtiness in doing job Generic Factor � Working Conditions

30. 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

31. 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

32. 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 todistinguish among jobs Use understandable terminology Anchor degree definitions with benchmark job titles Make it apparent how degree applies to job

33. Step 4: Weight the Factors Different weights reflect differences in importance attached to each factor Determination of factor weights Advisory/JE committee Statistical analysis Criterion pay structure Exhibit 5.14: Job Evaluation Form

34. Exhibit 5.14: Job Evaluation Form

35. Overview of the Point System

36. Step 5: Communicate Plan and Train Users Involves development of manual containing information to allow users to apply plan Describes job evaluation method Defines compensable factors Provides information to permit users to distinguish varying degrees of each factor Involves training users on total pay system Include appeals process for employees

37. Step 6: Apply to Nonbenchmark Jobs Final step involves applying plan to remaining jobs Benchmark jobs were usedto develop compensablefactors and weights Trained evaluators will evaluatenew jobs or reevaluate jobswhose work content has changed

38. Who Should be Involved? Committees, task forces, or teams of key representations Design process matters Appeals/review procedures �I know I speak forall of us when . . .�

39. Final Result: Structure Outcome Ordered list of jobs based ontheir value to organization Hierarchy of work Structure supporting apolicy of internal alignment Information provided by hierarchy Which jobs are mostand least valued Relative amount ofdifference between jobs

40. Exhibit 5.15: Resulting Internal Structures --Job, Skill, and Competency Based See Exhibit 5.15 on page 144See Exhibit 5.15 on page 144

41. Balancing Chaos and Control