Module 6: Quantitative Job Evaluation Methods Flashcards
Two major objectives of job evaluation
- Develop internal standards of comparison
- Measure relative job values within the organization
Why is Job Component method and Point Factor method quantitative (or Factor)?
Job Component and Point Factor are quantitative because they use points or monetary units to determine a numerical score for each job.
What are Nonquantitative or Whole job evaluation methods?
Ranking
Classification
Compensable Factors
A compensable factor is any criterion used to provide a basis for judging value in order to create a job worth hierarchy. The elements used to measure job worth. Intrinsic elements in jobs that add value to the organization and for which it wants to pay.
The generic compensable factors are skill, effort, responsibility, and working conditions.
Generic Factor Group definitions - SKILL FACTORS
Skill factors: require a short description when used in a job evaluation plan.
Examples: experience. knowledge. manual dexterity. analytical ability. creativity/ingenuity. interpersonal communications. job complexity.
Generic Factor Group definitions - EFFORT FACTORS
Physical demands (lifting, etc) Mental exertion (concentration, etc)
Generic Factor Group definitions - RESPONSIBILITY FACTORS
- impact on the organization
- directing the work of others
- independent action/decision making
Generic Factor Group definitions - WORKING CONDITIONS FACTORS
- hazardous or dangerous environment (working with chemicals)
- adverse conditions (temperature extremes)
- unpleasant environment (strong or unpleasant odors)
Factors definition
Factors are individual component aspects of job content within generic factor groups (the components within the factor group “skill” include experience and knowledge, among others)
Degrees definition
Degrees are measurement scales or yardsticks which identify specific levels of a factor
Examples of Terms
Generic factor group: skill
Specific factor name: experience
specific factor description: this factor measures the time normally required on related work and on the job training for the job being evaluated for an individual to attain satisfactory performance standards under normal supervision.
Degrees
1st degree - less than three months
2nd degree - three months up to and including 12 months
3rd degree - more than one year up to and including three years
4th degree - more than three years up to an including 5 years
5th degree - more than five years
Selecting Compensable Factors
Identify the organizations internal values
- formal documentation: mission statement, business strategy, HR philosophy.
- discussions with senior management
Review the job content of the work group to be covered by the plan
- common characteristics
- diverse characteristics
- industry specific considerations
- unique aspects
Identify 5-12 potential factors for consideration by management
- committee process
- individual interviews with key managers or employees
- statistical analysis
- combination of the above
Obtain key managements support and stakeholder acceptance
Determine factors to be used
- select effective factors - factors should:
- differentiate job value, avoid measuring the same or similar job characteristics more than once
- have a logical relationship to overall job value
- be common to all jobs being evaluated
- cover all major aspects of job requirements for which the organization is willing to pay
- be manageable, limit factors used to a reasonable number
- **failure to do the above increases administrative time without adding meaningful information and may create systematic bias for or against certain jobs
Include all important factors
-failure to do this may inadvertently discriminate for or against certain jobs, or may produce a job worth hierarchy inconsistent with internal values
Defining compensable factors
- develop a clear and comprehensive definition for each factor
- define the highest and lowest levels of each factor present in the work group to be covered by the plan
- create intermediate levels from lowest to highest by defining a logical progression that reflects reasonable differences
What to consider when defining compensable factors
- create a job worth hierarchy consistent with managements perception of relative job worth
- establish proper number of levels
- too many levels
- forces artificial distinctions between degree levels
- requires highly detailed job documentation
- increases administrative time
- encourages requests for re-evaluation which results in grade creep
- too few levels
- does not adequately differentiate important aspects of job value
- may not fully cover the range of work performed
- overlapping levels
- difficult to select the appropriate level
- adjacent level descriptions are too similar
Weighting compensable factors
- consider the nature of the work performed by the job groups covered under the plan
- rank the factors selected in order of priority for the organization
- develop initial factor weights as a percentage, derived by statistical analysis, management judgment, or a combination of the two
- review with key management and other stakeholders, as appropriate
Job Component method
a statistical job evaluation that uses multiple factor regression analysis.
statistically developed: as opposed to the simpler ranking methods described earlier, the job component method uses statistical analysis to determine job value.
identifies factors/factor weights that explain market levels: the job component method is used to identify the specific factors and factor weights that help to explain the market pay levels of benchmark jobs
may be used to evaluate nonbenchmark jobs: once a statistical model has been developed under the job component method, nonbenchmark jobs can then be evaluated using the model.
