4 - Job Evaluation: Measuring Content, Value and External Market Links

Question 1

__________is the process of systematically determining the relative worth of jobs to create a job structure for the organization. It is based on a combination of job content, skills required, value to the organization, organizational culture and the external market. this potential to blend organizational forces and external market forces is both a strength of and a challenge.

Answer 1

Job evaluation

Question 2

There are differing perspectives on whether job evaluation is based on job content or job value.

A structure based on job content refers to _____ required for the job, its duties and responsibilities.

A structure based on job value refers to the relative contribution of the job to the organization’s ______.

The internal alignment is just one of the building blocks of the pay model. While job characteristics matter, they are not the only basis for pay. Job value may also include its value in the external markets and/or to some other set of rates that have been agreed upon through collective bargaining or other negotiation process, or even by government regulations such as the minimum wage.

Not only may the content be described and valued differently by different observers, but the _______ added by the same work may be more or less in one organization than in another. So while the focus is on internal job value, external market value may differ. There is not a one-to-one correspondence with pay rates.

Another perspective sees job evaluation as a process that links job content with external market ______. For example, if some aspect of job content demanded high wages in the market, then that aspect would be a useful way to distinguish between jobs in the evaluation. In this perspective, the value of job content is based on what it can demand in the external market. It has no intrinsic value. But there is not universal agreement among the people who advocate this.

Answer 2

skills

goals

pay rates

value

Question 3

The issue is whether job evaluation should be viewed as a measurement device, and therefore be valued according to _______ standards, or as an administrative procedure that invites discussion and consensus. Some researchers say that if job value can be quantified, then job evaluation takes on the trappings of measurements and can be judged according to technical standards.

Those involved in actually making pay decisions have a different view. They see job evaluation also as a _______ to gain acceptance of pay differences among the jobs—an administrative procedure with which the parties become involved and committed. Employees, union representatives and managers discuss the rules of the game for determining the relative work. If all participants agree that skills, responsibilities and working conditions are important, then work is evaluated based on these factors.

Answer 3

technical

process

Question 4

The assumptions that underlie aspects of job evaluation are:

1. (a) Job evaluation is a measure of job ______—The assumption is that job _____ has intrinsic value outside of the external market.
2. (b) Job evaluation is a measure of relative ______—The assumption is that relevant groups can reach consensus on relative _____.
3. (c) Job evaluation is linked with the external ______—The assumption is that job worth cannot be specified without reference to this information
4. (d) Job evaluation is a _______ device
5. (e) Job evaluation is ________—The assumption instills rationality to a social/political process, establishes rules of the game and invites participation.

Answer 4

1. content / content
2. value / value
3. market
4. measurement
5. negotiation

Question 5

The first major decision that a job analyst must make is to establish the ________ of the evaluation. Establishing this helps to ensure that the evaluation is a rational, systematic tool to achieve an equitable, work-related pay structure rather than a useless bureaucracy. Job evaluation should be tied to internal ______ because it can support work flow by integrating pay with relative contribution. It can reduce disputes and grievances over pay differences among jobs by establishing a workable, agreed-upon structure that reduces the role that chance, favoritism and bias may play in setting pay. It can also help motivate behavior toward organizational objectives by explaining what it is about a particular job that the organization values. What supports the organization’s strategy and its success can also be pointed out.

The second major job evaluation decision that must be made is related to single versus multiple plans. A single plan is one that uses the same factors to evaluate all job families across the organization. Multiple plans use different plans and different factors for different job families. An example of this would be using different factors for clerical, managerial and production jobs. This approach allows the plan to be _______ to what is important in each type of work. Many say that jobs are too varied to be accurately evaluated by a single plan.

Answer 5

purpose

alignment

tailored

Question 6

Job ________ simply orders the job descriptions from highest to lowest based on a global definition of relative value or contribution to the organization’s success. it is the simplest, fastest and easiest to understand and to explain to employees, and the least expensive method, at least initially. However, it can create problems that require difficult and potentially expensive solutions because it doesn’t tell employees and managers what it is about their jobs that is ________.

Answer 6

ranking

important

Question 7

two common methods of ranking are the ______ ranking and ______ comparison.

• the first method orders job descriptions alternatively at each extreme. Agreement is reached among evaluators on which jobs are the most and least valuable, then the next most and least valuable, and so on, until all jobs have been ordered.
• the second method uses a matrix to compare all possible ____ of jobs. the higher ranked job is entered in the cell of the matrix. When all comparisons have been completed, the job most frequently judged “more valuable” becomes the highest ranked job, and so on.

Answer 7

alternation

paired

pairs

Question 8

the alternation ranking and paired comparison methods may be more _______ than simple ranking. nevertheless, ranking has drawbacks. the criteria on which jobs are ranked are usually so poorly defined, if they are specified at all, that the evaluations become subjective ______ that are impossible to justify in strategic and work- related terms. Furthermore, an evaluator using this method must be knowledgeable about every single job under study.

Answer 8

reliable

opinions

Question 9

In the _________ system of job evaluation, a series of classes covers the range of jobs. A job description is compared to the class descriptions to decide which class is the best fit for that job. Each class is described in such a way that it captures sufficient work detail, yet it is general enough to cause little difficulty in slotting a job description into the appropriate class. The classes may be described further by including titles of benchmark jobs that fall into each class.

Writing class descriptions can be troublesome when jobs from several different job families are covered by a _______. Although greater specificity of the job class definition improves the reliability of evaluation, it also limits the variety of jobs that can easily be classified.

Answer 9

classification

single plan

Question 10

When classifying jobs in a job evaluation, it is useful to make _______ comparisons of those jobs. With a classification method the job descriptions not only are compared to the class descriptions and benchmark jobs but also are compared to each other. This is done to be sure that jobs within each class are more similar to each other than to jobs in adjacent classes. This process should yield a job structure composed of a series of classes with multiple jobs in each class. The jobs within each class are considered to be equal (similar) work and will be paid equally. Jobs in different classes should be dissimilar and may have different pay rates.

Answer 10

intraclass

Question 11

________ are the most commonly used approach to establish pay structures in the United States and Europe. They represent a significant change from the ranking method and the classication method in that they make explicit the criteria for evaluating jobs, that is, compensable factors.

These methods have three common characteristics:

• (1) ______ factors, with
• (2) factor _____ numerically scaled and
• (3) _______ reflecting the relative importance of each factor.

Answer 11

Point plans

• compensable
• degrees
• weights

Question 12

(a) The advantage of the ranking method of job evaluation is that it is fast, simple and easy to ______. A disadvantage of the method is that it becomes cumbersome as the ________ increases. The basis for comparisons is not explained.
(b) An advantage of the classification method is that it can group a wide range of work together in one _____. A disadvantage is that descriptions may leave too much room for _______.
(c) One of the main advantages of the point method is that compensable factors explain the basis for _______. Compensable factors also may communicate what is _____. A prime disadvantage of the points method is that it can become bureaucratic and ______

Answer 12

explain

number of jobs

system

manipulation

comparisons

valued

rule- bound.

Question 13

The steps involved in the design of a point plan are:

(1) Step One: Conduct _______. A representative sample of benchmark jobs is selected. The content of these jobs is the basis for compensable factors.
(2) Step Two: Determine _______ factors. This step is based on the work performed or what is done, on the strategy and the values of the organization, and on what is acceptable to those affected by the resulting pay structure.
(3) Step Three: _______ the factors. This step involves using examples to anchor the factors.
(4) Step Four: ______ the factors. This step is where the judgment of organization leaders, a negotiated structure and a market-based structure can be re ected.
(5) Step Five: Select criterion ________. This step is where committee judgment is supplemented with statistical analysis.
(6) Step Six: ________ the plan. This step provides for communication of the plan and training of the users. At this time, the plan manual is prepared.
(7) Step Seven: Apply to nonbenchmark jobs. This step is where the point plan is applied to nonbenchmark jobs.
(8) Step Eight: Develop online software support. Large employers today use online job evaluation systems.

Answer 13

1. job analysis
2. compensable
3. Scale
4. Weight
5. pay structure
6. Communicate

Question 14

The first step in designing a point plan is job analysis. Typically, a representative sample of jobs—that is, benchmark jobs—is drawn for analysis. The content of these jobs serves as the basis for defining, scaling and weighting the compensable factors.

The second step in designing a point plan is to determine the compensable factors. Compensable factors play a pivotal role in the point plan. These factors reflect how work adds ____ to the organization. They flow from the work itself and the strategic direction of the business. Compensable factors are those characteristics in the work that the organization values, characteristics that help it pursue its strategy and achieve its objectives. To select compensable factors, an organization asks itself: “What is it about the work that adds value?”

To be useful, compensable factors should have three characteristics. They should be: (1) based on the ______ and the values of the organization, (2) based on the work ______ and (3) _______ to the stakeholders affected by the resulting pay structure.

Answer 14

value

1. strategy
2. performed
3. acceptable

Question 15

A wide variety of factors are used in standard existing plans, from which a plan can be adapted, but the factors tend to fall into four generic groups: (1) ____ required, (2) _____ required, (3) _____ and (4) ______ conditions.

the ________—Profile Method of Position, used by more than 8,000 employers worldwide—is perhaps the most widely used of the existing plans. the classic three factors of know-how, problem solving and accountability use guide charts to quantify the factors in more detail.

A remaining issue to consider is how many factors should be included in a plan. some factors may have overlapping definitions or may fail to account for anything _____ in the criterion chosen. Another problem is called small numbers. if even one job in a benchmark sample has a certain characteristic, that factor finds its way into the entire work domain. once a factor is part of the system, it is likely to have it apply to all jobs.

Answer 15

skills

effort

responsibility

working

Hay Guide Chart

unique

Question 16

The third step in the point plan process is scaling the factors. Once the factors are chosen, scales reflecting the different degrees within each factor are constructed. Each degree may also be anchored by the typical skills, tasks and behaviors taken from the benchmark jobs that illustrate each factor degree. A major problem in determining degrees is whether to adopt _______, that is, making each degree equidistant from the adjacent degrees.

The following are criteria suggested for scaling factors:

(1) Limit the degrees to the number necessary to ______ among jobs.
(2) Use understandable ______.
(3) _______ degree definitions with benchmark job titles and/or work behaviors.
(4) Make it apparent how the degree ______ to the job.

Answer 16

interval scaling

1. distinguish
2. terminology
3. Anchor
4. applies

Question 17

The fourth step in job evaluation is weighting the factors according to importance.

Once the degrees have been assigned, the factor weights must be determined. Different weights re ect differences in importance attached to each factor by the employer. Weights are often determined through an ________ that allocates 100% of the value among the factors. A supplement to committee judgment to determine weights is the use of a _______ analysis. In this process, the committee chooses the criterion pay structure; that is, a pay structure they wish to duplicate with the point plan. The criterion structure may be the current rates paid for benchmark jobs, market rates for benchmark jobs, weights for predominantly male jobs (in an attempt to eliminate gender bias) or union-negotiated rates. Once a criterion structure is agreed on, statistical modeling techniques are used to determine what weight for each factor will reproduce, as closely as possible, the chosen structure. The statistical approach is often labeled policy capturing to differentiate it from the committee a priori judgment approach.

Answer 17

advisory committee

statistical

Question 18

A final step in the point plan process is to apply the plan to nonbenchmark jobs.

To do so, a _______ is usually written that describes the method, de nes the compensable factors and provides enough information to permit users to distinguish varying degrees of each factor. The purpose of this is to allow users who were not involved in its development to apply the plan. Users require training and background information on the total pay process. Finally, large organizations will also develop online _______ to support the job evaluation process.

Answer 18

manual

software systems

Question 19

Who should be involved in the job evaluation process?

If the internal structure’s purpose is to aid management, and if ensuring high involvement and commitment from employees is important, those managers and employees with a ______ in the results need to be involved in the process of designing it. A common approach is to use committees, task forces or teams that include representatives from key operating functions, including nonmanagerial employees. In some cases, the group’s role is only advisory. In others, it designs the evaluation approach, chooses compensable factors and approves all major changes. Organizations with unions often find it advantageous to include union representation as a source of ideas and to help promote acceptance of the results.

Research suggests that attending to the ______ of the design process and the approach chosen, rather than focusing solely on the ______, is likely to achieve employee and management commitment, trust and acceptance of the results. The absence of participation may make for employees and managers to imagine ways the structure might have been rearranged to their personal liking.

No matter the technique, no job evaluation plan anticipates all situations. It is inevitable that some jobs will be incorrectly evaluated, or at least employees and managers may suspect that they were. Consequently, ______ procedures to handle such cases and to help ensure procedural fairness are required. Historically, the compensation manager has handled reviews but, increasingly, peer or team reviews are being used. When the evaluations are completed, approval by higher levels of management usually is required. An approval process helps ensure that any changes that result from evaluating work are consistent with the organization’s operations and directions.

Answer 19

stake

fairness

results

review

Question 20

The final result of the job analysis—job description—job evaluation process is a _____ or of work. This hierarchy translates the employer’s internal alignment policy into practice. The job structures are obtained by different approaches to evaluating work.

Organizations commonly have multiple structures derived through multiple approaches that apply to different functional groups or units. Although some employees in one structure may wish to compare the procedures used in another structure with their own, the underlying premise in practice is that internal alignment is most in uenced by fair and equitable treatment of employees doing similar work in the same skill/knowledge group.

Answer 20

structure

Question 21

prior to the widespread use of job evaluation, employers in the 1930s and 1940s had irrational pay structures based on decentralized and uncoordinated wage-setting practices. pay differences were a major source of unrest among workers. employment and wage records were rarely kept, with only the ______ knowing how many workers were employed in the department and what rates they received. They often used this information to vary the rate of favored workers or assign them to jobs where piece rates were loose.

Job evaluation with its specified procedures and documentable results helped to change that. the technique provided work-related and business-related order and logic. However, over time, complex procedures and creeping bureaucracies can cause users to lose sight of the ______.

the world of work is changing. today the work of many requires that they identify problems and opportunities, make decisions, plan courses of action, marshal support and, in general, design their own work methods, techniques and tools. the challenge is to ensure that job evaluation plans afford exibility to adapt to changing conditions.

Answer 21

foremen

objectives