1. PERFORMANCE AND COMPENSATION MANAGEMENT
(HRM 751)
JOB EVALUATION
NUR ATIQAH BINTI A. RAHMAN
(2012889288)
Prepared for:
Assoc. Prof. Dr Roshidi Hassan

5. OUTLINE
1. STEPS IN DEVELOPING TOTAL COMPENSATION STRATEGY
 Assess total compensation implications
 Map a total compensation strategy
 Implement strategy
 Reassess
2. MAP A TOTAL COMPENSATION STRATEGY
 Objectives
 Internal alignment
 External competitiveness
 Employee contributions
 Management
3. INTERNAL ALIGNMENT
 Job Analysis
 Job Description
 Job Evaluation

6. 4.
JOB ANALYSIS
 What is Job Analysis
 Why performing Job Analysis?
 What information do we need?
 How should we collect it?
 Who should be involved?
 How useful are the results?
5. JOB DESCRIPTION
 What is Job Evaluation?
 General Guidelines?
 Job Descriptions Form
 Basic Considerations
 Common Misconceptions
6. JOB EVALUATION
 What is Job Evaluation
 Objectives of JE
 Job Evaluation vs Performance Appraisal
 Benefits of JE
 Job Evaluation Methods

7. 7.




JOB EVALUATION METHODS
Ranking Method
Classification Method
Factor Comparison Method
Point Method
8.







POINT METHOD
Steps in Point Method
conduct Job Analysis
Determine Compensable Factor
Scale the factors
Weight the factors according importance
Communicate the plan and train users
Apply to non-benchmark jobs

8. STEPS IN DEVELOPING A TOTAL COMPENSATION
STRATEGY

9. STEP 1: ASSESS TOTAL COMPENSATION IMPLICATIONS
• Competitive Dynamics – Understand the
Business
–
–
–
–
–
Changing customer needs
Competitors’ actions
Changing labor market conditions
Changing Laws
Globalization
• Culture/values
– A pay system reflects the values that guide an
employer's behavior and underlie its treatment of
employees

10. Cont..
• Employee preferences
– How to better satisfy individual needs and
preferences
• E.g., text notes that 75% of employees report
satisfaction with compensation, yet over 40% say they
would change mix of cash or benefits if given chance
• Choice
– Examples: Flexible benefits and choices
• Union preferences
– Compensation deals with unions can be costly to
change

11. STEP 2: MAP A TOTAL COMPENSATION STRATEGY
• Mapping is used in marketing to clarify and
communicate a product's identity
• Offers picture of a company’s compensation strategy
based on the five choices in the pay model
• Clarifies the message the company is trying to
establish with its compensation system
• Maps do not tell which strategy is the “best,”
providing rather framework and guidance

12. Exhibit 2.8: Contrasting Maps Of Microsoft And SAS
Microsoft’s ‘pay
brand’:
Total
compensation
prominent; strong
emphasis on
market
competitiveness,
individual
accomplishments,
performancebased
strategy
SAS’s ‘pay
brand’:
total
compensation
supports
work/life
balance;
competitive
market
position,
co-wide
successsharing,
egalitarianism

13. STEPS 3 AND 4: IMPLEMENT AND REASSESS
• Step 3
– Involves implementing strategy through the
design and execution of compensation system
• Step 4
– Reassess and realign, closes the loop and
recognizes that the strategy must be changing to
fit changing conditions
– Involves periodic reassessment

15. COMPENSATION PAY MODEL
POLICIES
TECHNIQUES
OBJECTIVES
INTERNAL
ALIGNMENT
INTERNAL
STRUCTURE
(JA, JD, JE,JS)
•EFFICIENY
COMPETITIVENESS
PAY STRUCTURE
• FAIRNESS
•COMPLIANCE
CONTRIBUTIONS
PAY FOR
PERFORMANCE
MANAGEMENT
•ETHICS
EVALUATIONS
(Milkovich, Newman & Gerhart (2011)

16. POLICIES: INTERNAL ALIGNMENT
DEFINITION
Refers to comparisons among jobs or skill levels
inside a single organization
(Milkovich, Newman, Gerhart. 2011)
Internal alignment, often called internal
equity, refers to the pay relationships among
different jobs, skills, competencies within a
single organization (Vandae. 2010)

17. Structures vary among organizations, internal pay
structure can be defined:

18. TECHNIQUE: INTERNAL JOB STRUCTURE

20. JOB ANALYSIS
JOB ANALYSIS
JOB EVALUATION
JOB EVALUATION
COMPENSATION
JOB DESCRIPTION
JOB DESCRIPTION
• CRITERION
DEVELOPMENT
• PERFORMANCE
APPRAISAL
• JOB DESIGN/REDESIGN
• TRAINING
JOB SPECIFICATIONS
JOB SPECIFICATIONS
SELECTION
PLACEMENT

21. INTERNAL WORK RELATIONSHIPS WITHIN THE
ORGANIZATION

22. JOB ANALYSIS

23. JOB ANALYSIS
OVERVIEW
WHAT is job analysis?
WHAT is job analysis?
WHY performing JA?
WHY performing JA?
WHAT information do we need?
WHAT information do we need?
HOW should we collect it?
HOW should we collect it?
WHO should be involved?
WHO should be involved?
HOW useful are the results?
HOW useful are the results?

24. JOB ANALYSIS
WHAT is job analysis?
WHAT is job analysis?
• Process of defining a job in terms of its component tasks or
duties and the knowledge or skills required to perform them.
• Job analysis produces information used for writing job
descriptions (a list of what the job entails) and job
specifications (what kind of people to hire for the job).
WHY performing Job Analysis?
WHY performing Job Analysis?
Two critical uses of JOB ANALYSIS:
•It establishes similarities and differences in the work contents of
the job
•It helps establish an internally fair and aligned job structure

25. DATA RELATED TO JOB
JOB IDENTIFICATION
JOB CONTENT
Title
Tasks
Department in which job is located
Activities
Number of people who hold job
Constraints on actions
Performance criteria
Critical incidents
Conflicting demands
Working conditions
Roles (e.g., negotiator, monitor, leader)
WHAT information do we need?
WHAT information do we need?
DATA RELATED TO EMPLOYEE
EMPLOYEE CHARACTERISTICS
INTERNAL RELATIONSHIPS
EXTERNAL RELATIONSHIPS
Professional/Technical knowledge
Boss and other
Suppliers
Manual skills
Superiors
Customers
Verbal skills
Peers
Regulatory
Written skills
Subordinates
Professional industry
Quantitative skills
community
Mechanical skills
Union/employee groups
Conceptual skills
Managerial skills
Leadership skills
Interpersonal skills

26. HOW should we collect the information?
HOW should we collect the information?
CONVENTIONAL METHODS
•Interview
•Questionnaire
QUANTITATIVE METHODS
•Questionnaire via web-site
WHO should be involved?
WHO should be involved?
JOBHOLDERS
SUPERVISORS
ANALYSTS

27. The supervisor or HR specialist normally collects one or more of the following
types of information via the job analysis:

28. HOW useful are the results?
HOW useful are the results?
DISCREPANCIES
CASE IN 3M COMPANY
3M had an interesting
problem when it
collected job
information from a
group of engineers
The engineers listed a
number of responsibilities
that they might viewed as
part of their jobs.(using
other ways to do job
efficiently)
Therefore, 3M looked for
additional ways to reward these
engineers rather than
bureaucratize them.
However, the
manager realized
that those
responsibilities
actually belonged to
a higher level of
work. The engineers
had enlarged their
jobs beyond what
they were being paid
to do. So, no one
wanted to tell these
highly productive
engineers to slack
off.

29. USES OF JOB ANALYSIS INFORMATION

30. B

31. JOB DESCRIPTIONS

32. JOB DESCRIPTION
OVERVIEW
WHAT is job description?
WHAT is job description?
General guidelines
General guidelines
Job Description Form
Job Description Form
Basic considerations
Basic considerations
Common Misconceptions
Common Misconceptions

33. WHAT is job description?
WHAT is job description?
• Job Description is necessarily based on the information obtain through the job
analysis interview.
• It is prepared primarily for defining duties and responsibilities and for job
evaluation.
• It also useful for such purposes as organization analysis, recruitment,
employee placement, performance appraisal, and training development.
General guidelines
General guidelines

34. JOB TITLE: Computer Programmer
DEPARTMENT: IT
REPORTS TO: Director of Computer Services
POSITION SUMMARY: Responsible for the application of basic knowledge of programming, logic, and
mathematics in the preparation of computer programs.
ESSENTIAL FUNCTIONS:
1) Analyses, reviews, and rewrites programs, using workflow chart and diagram, applying knowledge of
computer capabilities, subject matter, and symbolic logic. (10%)
2) Converts detailed logical flow chart to language processible by computer. (10%)
3) Resolves symbolic formulations, prepares flow charts and block diagrams, and encodes resultant
equations for processing. (10%)
4) Develops programs from workflow charts or diagrams, considering computer storage capacity, speed,
and intended use of output data. (10%)
5) Assists computer operators or system analysts to resolve problems. (10%)
6) Assigns, coordinates, and reviews work and activities of programming personnel. (10%)
7) Compiles and writes documentation of program development and revisions. (8%)
8) Prepares or receives detailed workflow chart and diagram to illustrate sequence of steps to describe
input, output, and logical operation. (7%)
9) Revises or directs revision of existing programs to increase operating efficiency or adapt to new
requirements. (7%)
10) Collaborates with computer manufacturers and other users to develop new programming methods.
(5%)
11) Trains subordinates in programming and program coding. (5%)
12) Consults with managerial and engineering and technical personnel to clarify program intent, identify
problems, and suggest changes. (4%)
13) Writes instructions to guide operating personnel during production runs. (4%)
EXAMPLE JOB DESCRIPTION FORM

35. Basic considerations
Basic considerations
Common Misconceptions
Common Misconceptions

37. JOB EVALUATION

38. JOB EVALUATION
OVERVIEW
What is Job evaluation?
What is Job evaluation?
Objectives Job Evaluation
Objectives Job Evaluation
Job Evaluation vs Performance Appraisal
Job Evaluation vs Performance Appraisal
Job Evaluation Process
Job Evaluation Process
Benefit Job Evaluation
Benefit Job Evaluation
Job Evaluation Methods
Job Evaluation Methods

39. What is job evaluation?
What is job evaluation?
“Job evaluation is a
systematic way of
determining the
value/worth of a job
in relation to other
jobs in
organization”
It is a systematic
process of analysing
and evaluating jobs to
determine the relative
worth of each job in an
organization. It forms
the basis for designing
the compensation
management system in
an organization.
(Mehta, 2013)

40. Features
•Tries to assess jobs ,not people
•The standards of job evaluation are relative not absolute
•The basic information is obtained from job analysis
•Carried out by groups, not by individuals
•Provides a basis for a rational wage-structure
SOME MAJOR DECISIONS IN JOB EVALUATION
• Establish the purpose of evaluation
• Decide whether to use single or multiple plans
• Choose among alternative approaches
• Obtain involvement of relevant stakeholders
• Evaluate plan’s usefulness

41. OBJECTIVES IN SETTING COMPENSATION RATES

43. JOB EVALUATION VS PERFORMANCE
APPRAISAL
JOB EVALUATION
PERFORMANCE APPRAISAL
DEFINE
Find the selective worth of a job
Find the worth of a job holder
AIM
Determine wage rates
for different jobs
Determine incentives and
rewards for superior
performance
SHOWS
How much a job is worth
How well an individual is doing
on assigned jobs
COMPULSION
Not compulsory
Compulsory
BASIS OF RATING
Responsibility, qualification,
experience, working condition, etc.
Performance
TIME
Before employee is hired
After the employee is hired
PURPOSE
To establish satisfactory wage
differentials
To effect promotions, offers,
awards, punishments, assess
training needs resorts to lay
offs, transfers, etc.

44. JOB EVALUATION PROCESS STEPS

45. JOB EVALUATION FLOWS

47. BENEFITS OF JOB EVALUATION

48. ESSENTIALS FOR SUCCESS OF A JOB
EVALUATION PROGRAM
•Compensable factors should represent all the major aspects of job
content
•Operating manager must be convinced about the techniques and
programs of job evaluation
•Al employees should be provided with complete information about the
evaluation techniques and program
•All groups and grades of employees should be covered by the job
evaluation program
• Program and technique of job evaluation should be understood by all
employees
•The union’s acceptance and support to the program should be
obtained

51. JOB EVALUATION METHODS

52. STANDARD METHODS FOR CONDUCTING JOB
EVALUATION
Unit of Comparison
Target of Comparison
Whole
Job
Other
Jobs
Common
Standard
Job
Components
JOB
RANKING
FACTOR
COMPARISON
JOB
CLASSIFICATION
POINT
SYSTEM

53. JOB EVALUATION QUALITITATIVE APPROACHES
1
2
3
4

54. 1
RANKING METHOD
• As per this method, jobs are arranged form highest to lowest, in order of
their values or merit to the organization
• Jobs can also be arranged according to the relative difficulty in performing
them.
• The job at the top has the highest value and job at the lowest has the
lowest value.
• Jobs are arranged in each department and then department ranking are
combined to develop an organization ranking
Eg; ranking of jobs in any department can be done as follows:
RANK
MONTHLY SALARIES (RM)
ACCOUNTANT
6000
ACCOUNT CLARK
3600
PURCHASE ASSISTANT
3400
MACHINE OPERATOR
2800
TYPIST
1800
OFFICE BOY
1200

55. CLASSIFICATION METHOD
2
• Job classification method general purpose is to create and maintain pay
grades for comparable work across your organization.
• It uses job classes or job groups to provide more customization in the
evaluation
• This method also uses scales to measure performance rather than
comparing and ranking employees
CLASS
RANK
EMPLOYEES
Class 1
Executives
Office manager, Deputy
Office manager, Office
Superintendent, etc.
Class 2
Skilled workers
Purchasing Assistant,
Cashier, Receipts Clerk,
etc.
Class 3
Semi-skilled workers
Steno typists, Machineoperators, etc.
Class 4
Less-skilled workers
File Clerks, Office boys,
etc.

56. 3
FACTOR COMPARISON METHOD
• Job evaluators rank jobs that have similar responsibilities and
tasks.
• The evaluators then analyse jobs in the external labour market.
• Jobs across the organization are then compared to the
benchmark jobs according to the market rate of each job’s
compensable factors to determine job salaries.
• Under this method, instead of ranking complete jobs, each job
is ranked according to a series of factors.
• These factors include mental effort, physical effort, skill needed,
responsibility, working conditions, etc.
• Pay will be assigned in this method by comparing the weights of
factors required for each job.
• Wages are assigned to the job in comparison to its ranking on
each job factor.

57. AN EXAMPLE OF FACTOR COMPARISON
METHOD
Suppose the job of a painter is found to be similar to
electrician in skill (15), filter in mental effort (10), welder in
physical effort (12), cleaner in responsibility (6), and
labourer in working conditions (4). The wage rate for this
job would be (15+10+12+6+4) is 47.

58. 4
POINT METHOD
• This is a commonly used job evaluation technique. It is an
analytical method which breaks down each job into a number of
factors; for example, skill, responsibility and effort, with the factors
sometimes being further broken down into sub-factors, for
example, education, decision making and dexterity.
• These sub-factors will be further divided into degrees or levels.
Points are awarded for each factor according to a predetermined
scale and the total points decide a job's place in the ranking order.
• The factors should reflect the varying degrees of importance
attached to them.
• Care must be taken to ensure that the weightings do not result in a
sex-biased scheme - for example, by attaching an unjustified
weighting to the physical strength factor at the expense of manual
dexterity.

59. POINT METHOD STEPS
CONDUCT JOB
ANALYSIS
DETERMINE
COMPENSABLE
FACTORS
SCALE THE
FACTORS
APPLY TO NON
BENCHMARK
JOBS
COMMUNICATE
THE PLAN &
TRAIN USERS
WEIGHT THE
FACTORS
ACCORDING THE
IMPORTANCE

60. 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

61. STEP 2: DETERMINE COMPENSABLE FACTORS
• Compensable factors – characteristics in the work that the
organization values, that help it pursue its strategy and
achieve its objectives
• Compensable factors play a pivotal role
– Reflect how work adds value to organization
– Decision making is three-dimensional:
• Risk and complexity
• Impact of decision
• Time that must pass before evidence of impact

62. UNIVERSAL COMPENSABLE FACTORS
COMPENSABLE
FACTORS
Can be defined as those
characteristics in the
work that the
organization values, that
help it pursue its
strategy and achieve its
objectives.
SKILLS
SKILLS
EFFORTS
EFFORTS
RESPONSIBILITY
RESPONSIBILITY
WORKING CONDITIONS
WORKING CONDITIONS

63. Exhibit 5.9: Compensable Factor Definition: Decision Making

64. STEP 2: DETERMINE COMPENSABLE FACTORS (CONT.)
• To be effective, compensable factors should be:
– Based on strategy and values of organization
– Based on work performed
• Documentation is important
– Acceptable to the stakeholders
– Adapting factors from existing plans
• Skills, and effort required; responsibility, and working
conditions
• NEMA, NMTA, Equal Pay Act (1963), and Steel plan

65. COMPENSABLE FACTORS - HOW MANY FACTORS?
– “Illusion of validity” - Belief that factors are capturing
divergent aspects of a job and are both important
– “Small numbers” - If even one job has a certain
characteristic, it must be a compensable factor
– “Accepted and doing the job” – 21 factor, 7 factors, 3
factors
– Research results
 Skills explain 90% or more of variance
 Three factors account for 98 - 99% of variance

66. Exhibit 5.10: Compensable Factor Definition: Multinational
Responsibilities

67. Exhibit 5.11: Factors in Hay Plan

68. Job Evaluation Manager (JEM)
A powerful solution for managing an organizations job structure
© 2008 Hay Group. All Rights Reserved
68

69. The facts and figures
88
2600
7000
$450m
Offices in 47 countries
Employees worldwide
International clients
Turnover
© 2008 Hay Group. All Rights Reserved
69

70. How we organize our business
Helping organizations work
Our purpose
Building effective
organizations
Leadership and
talent
Our service
lines
BEO solutions
Leadership
transformation
Performance
management
Capability
assessment
Talent
management
Reward services
Hay Group Transforming
Learning: online diagnostics
Our practice
clusters
Executive
rewards
Job
evaluation
Reward Information
Services
Reward
strategies
Hay Group Insight: employee and customer surveys
© 2008 Hay Group. All Rights Reserved
70

71. Who we work with
© 2008 Hay Group. All Rights Reserved
71

72. Introduction to Hay Group
Established in
Philadelphia in 1943
47 countries/88 cities
2,370 employees
10,000+ clients
Worldwide
72
© 2007 Hay Group. All rights reserved.
New Hampshire2007State of NH Report – Jan 2007.ppt

73. Introduction to Hay Group (cont’d)
 Hay Group understands the issues associated with the
development of a classification and compensation plan
through the experience gained in working with a wide range
of State Governments such as:


State of Mississippi

State of Idaho

State of New Mexico

State of Louisiana

State of Oklahoma

State of Minnesota

State of South Carolina

Comm. of Kentucky

State of Delaware

State of Maine

State of Kansas

Comm. of Pennsylvania

Comm. of Massachusetts

73
State of Alabama
State of South Dakota

State of Oregon
© 2007 Hay Group. All rights reserved.
New Hampshire2007State of NH Report – Jan 2007.ppt

74. About Hay Group
85
offices in
49 countries
2,600
10,000
$500M
10M
consulting
professionals
clients
working with
more than half
of the
Fortune 500
annual
revenue
leadership
assessments
around the
world
14M
and
reward survey
participants
Hay Group partners with clients to achieve competitive advantage
through talent.
© 2013 Hay Group. All Rights Reserved
74

75. HAY METHOD
The evaluation process
generally begins with
the highest valued
compensable factor and
proceeds in order to the
lowest weighted factor.

76. KNOW-HOW
PROBLEM SOLVING
HAY
METHOD
ACCOUNTABILITY

77. KNOW-HOW
• To achieve the accountabilities of a job requires “Know-How”(or inputs), which is
the sum total of every capability or skill, however acquired, needed for fully
competent job performance.
• Know-How has three dimensions:
1. Technical/Specialized Skills:
Depth and breadth of technical or specialized knowledge needed to
achieve desired results.
2. Managerial Skills:
The requirement to undertake managerial functions, such as planning and
organizing staff or directing and controlling resources, to achieve business
results over time.
3. Human Relations Skills:
The interpersonal skills required for successful interaction with individuals and
groups, inside and outside the organization.

78. PROBLEM-SOLVING
• The value of Know-How is in its application to achieve results.
• “Problem Solving” (or throughputs) refers to the use of Know-How to identify,
delineate, and resolve problems.
• We “think with what we know,” so Problem Solving is viewed as utilization of
Know-How, and has two dimensions:
1. Thinking Environment:
The job’s context and the degree to which problems and solutions are
defined.
2. Thinking Challenge:
The nature of addressable problems and the difficulty in identifying
solutions that add value.
• Problem Solving measures the requirement to use Know-How conceptually,
analytically, and productively.

79. ACCOUNTABILITY
• Every job exists to add organizational value by delivering some set of
results (or outputs). Accountability measures the type and level of value a
job can add.
• In this sense, it is the job’s measured effect on an organization’s value
chain. It has three dimensions:
1. Freedom to Act:
The degree of empowerment to take action and the guidance
provided to focus decision-making.
2. Scope:
The business measure(s) the job is designed to positively impact.
3. Impact:
The nature of the job’s influence on business results.

80. Exhibit 5.12: Hay Guide Chart – Profile Method of Job
Evaluation

81. Job Evaluation
Two Point-Factor Methods
• Factor Evaluation
System
Developed in 1977 by the Office
of Personnel Management for
non-supervisory general
schedule employees. It
incorporates many of the
characteristics of the Lott,
Benge, and NEMA methods.
• Hay Method
Dates back to the early 50's and
is one of the most popular
methods in use today. It is
particularly popular for
evaluating executive,
managerial, and professional
positions as well as nonexempt
clerical, blue collar, and
technical jobs.

82. STEP 3: SCALE THE FACTORS
• Construct scales reflecting different degrees within each factor
– Most factor scales consist of four to eight degrees
• Issue
– Whether to make each degree equidistant from adjacent degrees
(interval scaling)
•
Criteria for scaling factors

Ensure number of degrees is necessary to distinguish among jobs

Use understandable terminology

Anchor degree definitions with benchmark-job titles and/or work
behaviors

Make it apparent how degree applies to job

83. Exhibit 5.13: Factor Scaling – National Metal Trades Association

84. STEP 4: WEIGHT THE FACTORS ACCORDING TO
IMPORTANCE
• Different weights reflect differences in importance attached to each
factor by the employer
• Determination of factor weights
₋ Advisory committee allocates 100 percent of the value among
factors
• Select criterion pay structure
– Committee members recommend the criterion pay structure
– Statistical approach is termed policy capturing to differentiate it
from the committee a priori judgment approach
– Weights also influence pay structure

85. Exhibit 5.14: Job Evaluation Form

86. 1000 POINTS METHOD
Point range
Daily range
Job grade of key bank
officials
500 - 600
300 – 400
1 Officer
600 – 700
400 – 500
2 Accountant
700 – 800
500 – 600
3 Manager I Scale
800 – 900
600 – 700
4 Manager II Scale
900 – 1000
700 – 800
5 Manager III Scale

87. AAIM National Position Evaluation Plan
Points Assigned to Factor Degrees
Factor
1st
2nd
3rd
4th
5th
Degree Degree Degree Degree Degree
Skill (40%)
1. Knowledge
2. Experience
3. Initiative and Ingenuity
Physical Effort (30%)
4. Physical Demand
5. Mental or Visual Demand
Responsibility (20%)
6. Equipment or Process
7. Material or Product
8. Safety of Others
9. Work of Others
Job Conditions (10%)
10. Working Conditions
11. Hazards
14
22
14
28
44
28
42
66
42
56
88
56
70
110
70
10
5
20
10
30
15
40
20
50
25
5
5
5
5
10
10
10
10
15
15
15
15
20
20
20
20
25
25
25
25
10
5
20
10
30
15
40
20
50
25

88. Position:
Grade:
MAXIMUM
FACTOR
POINTS
250
250
500
500
250
250
125
125
125
125
2500
Engineering Manager
7
FACTOR
Communication & Interpersonal Skills
Education & Training
Problem Solving & Decision Making
Responsibility & Accountability
Specialized Knowledge & Application
Supervision & Leadership
Internal Impact
External Impact
Planning & Organizing
Innovation
JE Points
250
250
400
500
200
250
125
75
125
90
2265
DEGREE
LEVEL
FACTOR
WEIGHTS
4
5
4
4
4
4
3
1
4
2
10%
10%
20%
20%
10%
10%
5%
5%
5%
5%
100%

89. JOB EVALUATION
Example consulting company
ASSISTANT
REQUIREMENTS
Weight
Rating
Value
JUNIOR
CONSULTANT
SENIOR
CONSULTANT
PROJECT LEAD
Rating
Valu
e
Rating
Rating
Value
Value
MANAGER
Rating
Value
Knowledge
2
2
4
4
8
8
16
6
12
4
8
Leadership
3
0
0
0
0
2
6
4
12
8
24
1.5
0
0
0
0
0
0
4
6
10
15
Responsibility for
Results
3
2
6
2
6
4
12
6
18
10
30
Cognitive
Challenges
2
3
6
4
8
6
12
6
12
6
12
Mobility
1
2
2
7
7
7
7
8
8
5
5
Strategic Impact
2
2
4
1
2
2
4
3
6
8
16
Budget
Responsibility
JOB VALUE
22
31
57
74
110

90. 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
• Involves training users on total pay system
• Includes appeals process for employees
– Employee acceptance is imperative
• Communication

91. STEP 6: APPLY TO NON-BENCHMARK JOBS
• Final step involves applying plan to remaining jobs
– Could involve both designers and/or employees trained in
applying the plan
• Tool for managers and HR specialists once plan is developed
and accepted
• Trained evaluators will evaluate new jobs or reevaluate jobs
whose work content has changed
– May also be part of appeals process
STEP 7: DEVELOP ONLINE SOFTWARE SUPPORT
• Online job evaluation is widely used in larger organizations
• Becomes part of a Total Compensation Service Center for
managers and HR generalists to use

92. OVERALL ABOUT THE JOB
EVALUATION METHOD

93. MAJOR
ADVANTAG
E
MAJOR
DISADVANTAG
E
Nonquantitative
Relatively
quick and
expensive
Entirely
subjective
Whole job
Compare job
Nonto descriptions quantitative
Readily
available
and
expensive
Cumbersome
system
FACTOR
COMPARISON
Compensable
factors of job
Compare job
to key jobs on
scale of
compensable
factors
Quantitative Easy to use
Hard to
construct;
inaccurate
over time
POINT METHOD
Compensable
factors of job
Compare job
to
standardized
description
Quantitative Accurate
and
overtime
May be costly
METHOD
WHAT FACT
OF JOB IS
EVALUATED
HOW IS JOB
EVALUATED
TYPES OF
METHODS
RANKING
Whole job
(Compensable
factors are
implicit)
Jobs are
subjectively
ordered
according to
relative worth
CLASSIFICATION

94. METHODS
SIMPLE
RANKING
ADVANTAGES
• Simple and easy to understand
• Best suited for small organization
PAIRED
• Analytical and objective
COMPARISON • Relative and valid as each job is
compared
CLASSIFICATIO • Cooperatively less subjective
N METHOD
• Easy to understand
• Takes into account all the factors
• Effectively used for verity of jobs
POINT
METHOD
•
•
•
•
Superior and widely used
Systematic
Reliable
Minimum of rating error
DISADVANTAGES
• Not suitable for big
organization
• Difficult to understand
• Same criteria to assess
all the jobs is
questionable
• Time consuming and
costly
• Oversimplifies sharp
differences
• Job descriptions are
vague and are not
quantified
• Complex
• Time consuming
ADVANTAGES & DISADVANTAGES OF THE JOB EVALUATION METHODS

95. LIMITATIONS OF JOB EVALUATION
•Rapid changes in demand, supply and technology
•Substantial differences between job factors and market
factors
•Difficult to change initial stage wage fixation
•Doubts and fears
•Financial limitations
•Not exactly scientific difficulty in selecting
compensable factors

96. THE FINAL RESULT: STRUCTURE
• The final result of the job analysis – job
description – job evaluation process is a
structure, a hierarchy of work
• Managerial, technical, manufacturing, and
administrative

97. Exhibit 5.15: Resulting Internal Structures – Job, Skill, and
Competency Based

98. SALARY INCREASE BUDGETS SHOW FEW
SURPRISES FOR 2014

99. TOP 10 HIGHEST PAYING JOBS IN THE WORLD
1
SURGEONS
2
CHIEF EXECUTIVE OFFICERS
3
ENGINEERING MANAGERS
4
AIRLINE PILOTS
5
DENTISTS
(Kunad, 2013)

100. Cont..
6
LAWYERS
7
AIR TRAFFIC CONTROLLERS
8
COMPUTER & INFORMATION SYSTEMS’ MANAGERS
9
MARKETING MANAGERS
10
NATURAL SCIENCES
(Kunad, 2013)

101. TOP 5 BEST JOBS
RANK
BUSINESS
JOBS
HEALTHCARE
JOBS
SOCIAL
SERVICE JOBS
TECHNOLOGY
JOBS
CONSTRUCTION
JOBS
CREATIVE
JOBS
1
Mkt
Research
Analyst
Dentist
School
Psychologist
Computer
Systems
Analyst
Cost Estimator
Public
Relations
Specialist
2
Financial
Advisor
Registered
Nurse
Interpreter &
Translator
Database
Administrator
Construction
Manager
Architect
3
Accountant
Pharmacist
Substance
Abuse
Pathologist
Software
Developer
Plumber
Art
Director
4
Compliance
Officer
Physician
Speechlanguage
Pathologist
Web
Developer
Glazier
-
5
Audit Clerk
Physical
Therapist
Landscaper &
Groundskeeper
Computer
Programmer
Cement Mason
-
(US news, 2013)

103. AVERAGE AUSTRALIAN SALARY
Source: MyCareer job listings inclusive of wage

104. BEST PAYING SECTORS IN AUSTRALIA
RANK
SECTOR
AVG.
MIN
AVG.
MAX
AVERAGE
$85,415
AVERAGE AUSTRALIAN SALARY
1
ACCOUNTING
$48,781
$156,30
7
$83,273
2
ADMIN/OFFICE SUPPORT
$32,891
$96,180
$54,987
3
AUTOMOTIVE
$31,946
$138,75
0
$64,905
4
BANKING & FINANCIAL SERVICES
$45,263
$188,58
8
$86,602
5
COMMUNITY, SPORT & LEISURE
$34,842
$120,56
2
$68,619

105. RISKS AND CONSIDERATIONS OF
JOB EVALUATION

106. POSSIBLE RISKS
Fears that salary costs will rise
Administrative/process costs rise
There is no fit with the strategic agenda
There are no positive benefits for stakeholders
The organization takes on too much

107. IMPLEMENTATION CONSIDERATIONS

108. CONCLUSION
Job evaluation is alive
and well. Leading
Job evaluation is not
organization use job
only about maintaining
evaluation as a source
internal equity in the
of competitive
compensation program.
advantage by improving
It facilitate
the organization’s
organizational clarity,
ability to manage its
building capability, and
investment in human
establishing
resources with greater commitment through
credibility, discipline,
culture and rewards.
and fairness.
It is a critical
management tool,
extremely useful in
ensuring an
organization’s
proper integration
of strategy, culture,
structure, process,
people, and
rewards.

109. QUESTIONS