5-1

Chapter

McGraw-Hill/Irwin

Evaluating
Work: Job
Evaluation

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5-2

Exhibit 5.1: Many Ways to Create

Internal Structure

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2005 The McGraw-Hill Companies, Inc. All rights reserved.

5-3

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.
(Note: focus is the job, not the person
doing a job.)
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2005 The McGraw-Hill Companies, Inc. All rights reserved.

Exhibit 5.2: Assumptions

Underlying
Different Views of Job Evaluation
Aspect of Job Evaluation

Assumption

Assessment of
job content

Content has intrinsic value outside external

market.

Assessment of
relative value

Stakeholders can reach consensus on

relative value.

External market
link

Value cannot be specified without external

market.

Measurement

Honing instruments will provide objective

measures.

Negotiation

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
Internal
alignment

Job analysis

Job description

Job evaluation

5-5

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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2005 The McGraw-Hill Companies, Inc. All rights reserved.

5-6

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

5.5: Comparison of Job Evaluation

Methods

Obtain

involvement of relevant stakeholders

Evaluate plans usefulness
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2005 The McGraw-Hill Companies, Inc. All rights reserved.

5-7

Exhibit 5.4: Benchmark Job

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Exhibit 5.5: Comparison of

Job Evaluation Methods
Advantage

Disadvantage

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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5-8

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5-9

Ranking Method
Orders

job descriptions from highest to

lowest based on a global definition of
relative value or contribution to the
organizations success

Two

approaches

Alternation
Paired
McGraw-Hill/Irwin

ranking

comparison method
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5-10

Classification Method
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: Classifications
for Engineering Work

Exhibit

5.8: General
Schedule Descriptions
for Federal Government

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2005 The McGraw-Hill Companies, Inc. All rights reserved.

5-11

Point Method
Three

common characteristics of point

methods
Compensable
Factor

factors

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

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2005 The McGraw-Hill Companies, Inc. All rights reserved.

Designing a Point Plan:

Six Steps
1.

Conduct job analysis

2.

Determine and define the compensable

factors.

3.

Scale the factors (define factor degrees).

4.

Weight the factors according to importance

(and then assign points to degrees within the
factors or subfactors).

5.

Communicate the plan, train users, prepare

manual.

6.

Apply to nonbenchmark jobs (note issue of

interrater reliability).

McGraw-Hill/Irwin

5-12

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Generic Compensable
Factors
Skill

Effort

Responsibility

Working
conditions

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5-13

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5-14

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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2005 The McGraw-Hill Companies, Inc. All rights reserved.

5-15

Generic Factor - Effort

Diversity

of tasks

Complexity

of tasks

Creativity

of thinking

Analytical

problem solving

Physical
Degree

McGraw-Hill/Irwin

application of skills

of assistance available
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Generic Factor Responsibility

Decision-making

5-16

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

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2005 The McGraw-Hill Companies, Inc. All rights reserved.

Generic Factor Working

Conditions
Potential

5-17

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

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2005 The McGraw-Hill Companies, Inc. All rights reserved.

5-18

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)

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2005 The McGraw-Hill Companies, Inc. All rights reserved.

5-19

Step 4: Weight the Factors

Different

weights reflect differences in

importance attached to each factor

Exhibit

McGraw-Hill/Irwin

5.14: Job Evaluation Form

2005 The McGraw-Hill Companies, Inc. All rights reserved.

Exhibit 5.14: Job Evaluation

Form

McGraw-Hill/Irwin

5-20

2005 The McGraw-Hill Companies, Inc. All rights reserved.

5-21

Overview of the Point

System
Degree of Factor
Job Factor

Weight

1. Education

50%

100

200

300

400

500

2. Responsibility

30%

75

150

225

300

3. Physical
effort

12%

24

48

72

96

4. Working
conditions

8%

25

51

80

McGraw-Hill/Irwin

120

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Step 5: Communicate Plan and

Train Users

5-22

Involves

development of manual
containing information to allow users to
apply plan
Describes
Defines

job evaluation method

compensable factors

Provides

information to permit users to

distinguish varying degrees of each factor

Include

McGraw-Hill/Irwin

appeals process for employees

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Step 6: Apply to
Nonbenchmark Jobs

5-23

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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5-24

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

provided by hierarchy
Which jobs are most
and least valued
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
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2005 The McGraw-Hill Companies, Inc. All rights reserved.

Exhibit 5.15: Resulting Internal

Structures -Job, Skill, and Competency Based
Managerial
Group

Technical Group

Manufacturing
Group

5-25

Administrative
Group

Assembler I
Inspector I
Vice Presidents

Head / Chief
Scientist

Packer

Administrative
Assistant

Division General
Managers

Senior Associate
Scientist

Materials Handler
Inspector II

Principal Administrative Secretary

Managers

Associate Scientist

Assembler II

Administrative
Secretary

Project Leaders

Scientist

Drill Press Operator

Rough Grinder

Word Processor

Supervisors

Technician

Machinist I
Coremaker

Clerk / Messenger

Job
Evaluation

CompetencyBased

Skill
Based

Job
Evaluation

McGraw-Hill/Irwin

2005 The McGraw-Hill Companies, Inc. All rights reserved.