4 - Job Evaluation - 23 - 29 Jan2024

Job Evaluation
MDI Gurgaon
23 & 29 Jan 2024
Lecture#3 Summary
• Organization Structure- Job & People based
• Creating Job structure – 4 Steps
• Job Analysis – Procedure
• Job Descriptions – Key Elements
Job Structure
A systematic
process of
collecting
information that
determines the Determining &
similarities & comparison of the
differences of a worth/ value of
job each job
2. Job Documentation- 4. Job Worth
1. Job Analysis Descriptions & 3. Job Evaluation Hierarchy/ Job
Specifications Structure
A summary report An ordering of jobs

to identify, define based on their
& describe the relative value
job as it is
actually
performed
Job Evaluation
Job Evaluation is a systematic method
and process for determining and
comparing the RELATIVE VALUE of
one job to other. Level 1
OUTCOME - enables the creation of a Level 2 Level 2

job-worth hierarchy within the Dept A Dept B
organization.
Level 3 Level 3 Level 3
Job Evaluation- Outcome
Determines
1. intrinsic value of a job
2. the worth of a job in an organization relative to other jobs within an
organization
INTRINSIC Value RELATIVE Value

1. 2.
Outcome - Jobs are ranked to reflect the most to least valued, or the most to
least complex.
Job Evaluation – What can it achieve?
Role clarification
• Why does this job exist? Career planning
• Why it is being performed? • Provides a roadmap for
• What I am supposed to do in growth
• Identifies training and
this role? Employee development needs
• What are the responsibilities &
accountabilities?
• What are its essential
requirements?
Pay Management
Employer • Communicates
job-value hence pay
Grading Structure value
• Delineates number of levels in • Lends transparency in
the organization the determination of
Reinforce Organization’s rewards
• Allocates roles to levels Value System
• Recognizes differences in • Lends objectivity in
• Focuses on critical determining rewards
business size and complexities success factors of the
and arrays jobs appropriately organization
Job Evaluation - Approaches
• Informal
• flexible •Formal
Point
• qualitative Grading •Structured
Factor
• Classification •Quantitative
•greater
internal
Factor focus
Ranking
Comparison
Paired
Comparison
Job Evaluation
1. Ranking method
• This non-analytical method of job evaluation ranks jobs based on how valuable the
job evaluation committee perceives them to be, specifically when compared to other
jobs. The ranking method does not consider the market valuation of the jobs. This
approach is more effective for smaller enterprises.
2. Grading or classification method

• Job evaluation committees or auditors may categorize jobs based on specific traits or
predetermined criteria.
– One such aspect is the level of expertise necessary for performing the task.
– Another important factor is the responsibility of the individual while performing
their duty.
The auditor develops a list of qualities for the job. After that, they typically
assign
grading or classifications. Despite this method's apparent simplicity, some
positions inside an organization might not fit the predefined standards.
Job Evaluation
3. Factor-comparison method
• With this approach, auditors often assess the job and assign ranks based on several
variables, including
– required skills
– supervisory responsibilities
– workplace conditions
– mental and physical exertion
– other pertinent variables.
These variables remain constant for each set of jobs. They can then compare each
job to the others based on these variables and then determine the rankings. This
approach is helpful, as it is more objective and consistent, which makes it more
widely accepted. But it is also the most time-consuming and expensive method.
4. Point-factor method
• This type of job evaluation looks at a specific job's particular aspects to assess how
much value they provide to a job function.
• Job evaluation committees may subdivide these elements into other categories, such
as abilities, obligations and necessary work and then ascribe a numerical value to
these factors. Auditors then add the contributing elements or points for a certain job
and compare them to other jobs to determine its value. This approach clarifies a
job's internal value without considering its market value. This method is relatively
error free and is less subjective.
Job Evaluation
5. Competitive market analysis method
• This type of job evaluation depends on outside data regarding a position's worth within
a business. It considers comparable jobs on the market based on job advertisements.
This approach reviews the job positions, roles and responsibilities and compares them
to the job in question. Next, auditors examine the financial worth of such positions and
establish their value.
Determining what a company offers in terms of compensation determines the job's
worth. This is because different companies within an industry may give varying salaries
for the same role. Employers may often utilise an overlay to see how rankings change
and fit within the company's hierarchy. This type of job appraisal compares the internal
value to data from the public market.
Job Evaluation tools offered by a few Consulting
Firms*
1. Aon JobLink
JobLink™ is 5 points-factor analysis tool.
2. Hay Group Guide Chart-Profile

The system works on an integration of 3 factors.
3. Mercer IPE (International Position Evaluation) based on 5 business-related

factors and dimensions.
* Based on information available on internet.

Presented in alphabetical order
Firms*
• All have consistent factors/criteria in establishing the relative worth of
different jobs in an organization.
• In all types of organizations, the value of jobs depend on a fixed number of
common elements.
• Consistency implies using the same elements against which all jobs are
measured, however much they may differ.
* Based on information available on internet

What common factors can
apply to jobs at all levels
across functions?
Firms*
Aon JobLink Hay Group Guide Mercer IPE
Chart-Profile
1. Impact Impact
2. Knowledge & Know how Knowledge
Application
3. Problem Solving & Problem solving Innovation
Innovation
4. Interaction Communication
5. Accountability Accountability
6. Risk
*Based on information available on internet

Guidelines when evaluating jobs
• Look at the ROLE not the person
• Base judgments on FULLY ACCEPTABLE PERFORMANCE
• DISREGARD CURRENT PAY AND STATUS
• Evaluate the JOB AS IT IS NOW
• Aim for CONSENSUS
• NO UNDERSTANDING = NO EVALUATION
If the evaluator understands and applies the principles and factors, the
evaluation panel will work more effectively and with better results.
Guidelines when grading
It is important that the definition of grades
1. suits the business context, structures and jobs

2. reflects the value or worth of roles to the organization (in terms of total
points) and the importance of their impact on the core business
3. has clear & easy to articulate differences between various grades
4. clusters jobs that are similar in the same grade
5. separates jobs that are felt to be different
Challenges of implementing job evaluation
results
• People who are currently placed up the hierarchy wrongly, are now pegged
at a lower level
• People at lower grades may currently be doing roles higher in the
hierarchy
• Fitment of people into the higher role and its challenges.
• Junior employees may have been allotted roles which are stacked up/
higher in the hierarchy
• People with lower than minimum qualifications are managing jobs which
require higher minimum education
• Functions with high grade gap between boss and subordinate level
• Perception of value of experience and pegging with junior profiles
Questions?

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Job Evaluation

A summary report An ordering of jobs

OUTCOME - enables the creation of a Level 2 Level 2

INTRINSIC Value RELATIVE Value

2. Grading or classification method

2. Hay Group Guide Chart-Profile

3. Mercer IPE (International Position Evaluation) based on 5 business-related

* Based on information available on internet.

* Based on information available on internet

*Based on information available on internet

1. suits the business context, structures and jobs

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