Evaluating Work: Job Evaluation Chapter 5

Job-Based Structures: Job Evaluation Job evaluation – process of systematically determining the relative worth of jobs to create a job structure for the organization The evaluation is based on a combination of: Job content Skills required Value to the organization Organizational culture External market Note: focus is the job, not the person doing a job

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

Exhibit 5.2: Assumptions Underlying Different Views of Job Evaluation

Exhibit 5.3: Determining an Internally Aligned Job Structure

Defining Job Evaluation: Content, Value, and External Market Links (cont.) “How-To”: Major decisions Establish the purpose Supports organization strategy Supports work flow Is fair to employees Motivates behavior toward organization objectives

Defining Job Evaluation: Content, Value, and External Market Links (cont.) “How-To”: Major decisions (cont.) Single versus multiple plans Characteristics of a benchmark job: Contents are well-known and relatively stable over time Job not unique to one employer A reasonable number of employees are involved in the job Refer to Exhibit 5.4 Choose among methods Refer to Exhibit 5.5

Exhibit 5.4: Benchmark Jobs

Exhibit 5.5: Comparison of Job Evaluation Methods

Ranking Orders job descriptions from highest to lowest based on a global definition of relative value or contribution to the organization’s success Simple, fast, and easy to understand and explain Initially, the least expensive method Can be misleading Two approaches Alternation ranking Paired comparison method See Exhibit 5.6

Classification 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 See Exhibit 5.7, 5.8 (Federal GS)

Point Method Three common characteristics of point methods: Compensable factors Factor degrees numerically scaled Weights 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

Designing a Point Plan: Six Steps Conduct job analysis (note Occupational Information Network) Determine compensable factors Scale the factors (define factor degrees) Weight the factors according to importance (and then assign points to degrees within factors or subfactors) Communicate the plan, train users, prepare manual Apply to nonbenchmark jobs (note issue of interrater reliability)

Generic Compensable Factors Skill Effort Responsibility Working conditions

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

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

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

Generic Factor – Working Conditions 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

Exhibit 5.9: Compensable Factor Definition: Decision Making

Step 3: Scale the Factors Construct scales reflecting different degrees within each factor Most factor scales consist of four to eight degrees See Exhibit 5.13: Factor Scaling -- NMTA Issue Whether to make each degree equidistant from adjacent degrees (interval scaling)

Exhibit 5.13: Factor Scaling – National Metal Trades Association

Step 4: Weight the Factors According to Importance Different weights reflect differences in importance attached to each factor by the employer

Exhibit 5.14: Job Evaluation Form Note that the only reason this form works as it does is that each factor has same number of degrees!!!

Overview of the Point System Job Factor Weight 1 2 3 4 5 1. Education 50% 100 200 300 400 500 2. Respon s- ibility 30% 75 150 225 3. Physical effort 12% 24 48 72 96 120 4. Working conditions 8% 25 51 80 Degree of Factor

Step 5: Communicate the 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 Includes appeals process for employees

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

The Final Result: Structure The final result of the job analysis – job description – job evaluation process is a structure, a hierarchy of work Ordered list of jobs based on value to organization Relative amount of difference between jobs Note that job hierarchy resulting from job evaluation process that mirrors pay hierarchy of key jobs in external labor market may in fact be problematic – may be perpetuating historical discrimination

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

Balancing Chaos and Control Job evaluation changed the legacy of decentralization and uncoordinated wage-setting practices left from the 1930s and ’40s It must afford flexibility to adapt to changing conditions Avoid bureaucracy and increase freedom to manage Reduces control and guidelines, making enforcement of fairness difficult