Part - I
Job analysis and job evaluation, two of the most important issues for the HR Department of any organization, despite being identical are NOT the same.
“Job analysis is a process of defining a job based on its content i.e. the duties and responsibilities along with the knowledge, skills, educational qualifications, physical and mental demands as well as the working conditions required to perform it. It involves gathering all information about the job and NOT the job holder, that would be required to successfully create a job description, job specification and job evaluation” (Olivia, 2011).
“Job evaluation, on the other hand, is a process of assessing the relative worth of all the jobs within an organization with a view to determine their appropriate compensation levels” (Job Analysis and Job Evaluation, 2005). It is one of the outcomes of job analysis.
Steps in Job Analysis
1. Determine a Job Analysis Program - “Based on cost and utility considerations, a company may choose either an existing job analysis system being followed by the industry or develop a tailor-made one for its own use from scratch. Each uses varying data collection methods such as questionnaires, interviews etc.”(the book).
2. Select and Train the Analysts - It is equally important to select the key individuals to be entrusted with this critical task. Some companies depend on their HR departments for this exercise, whereas, others prefer to seek external professional help to do the same. Once selected, these analysts are trained in carrying out the entire process including the data collection methods to be employed as well as ways to analyze and interpret the results. “They are also guided on reducing the probability of conducting ineffective job analyses. For example, job analysts should try interviewing as many job incumbents as possible, battling staff time constraints to obtain representative samples of their opinions and perceptions” (the book).
3. Direct Job Analyst Orientation - Thorough understanding of the workplace environment including the nature of the job incumbents’ work and a host of other contextual factors in which they operate, like “organizational charts, titles, pay scales etc., help the job analyst in sketching a broad picture of the influencing factors” (the book), thus, increasing both the efficiency and effectiveness of the entire exercise.
4. Conduct the Study: Data Collection Methods and Sources of Data - After gathering this preliminary data, the analyst collects job-related data, from the employees and their supervisors through administering questionnaires or making plain observations about their job behaviors as they perform their jobs. Information normally sought deals with “educational qualifications, skills and abilities to perform the job, working conditions, reporting hierarchy, duties and responsibilities and employee job behavior” (Job Analysis Process, 2012). “A typical questionnaire has questions like describe the task you perform most frequently? How frequently do you perform it? List any permits, licenses or certifications required to perform duties associated with your position etc.” (the book).
5. Summarize the Results: Writing Job Descriptions - The information obtained is used to write both job descriptions and job specifications, separately. “Job description summarizes the job’s core tasks, duties and responsibilities along with the minimum level of knowledge, skills and abilities required to perform it. A typical job description has the following four sections” (the book):
a) Job Title
b) Job Summary
c) Job Duties; and
d) Worker or Employee Specifications
Steps in Job Evaluation
1. Choosing Between Single and Multiple Job Evaluation Techniques - “The diversity of jobs in an organization call for using not one, but multiple job evaluation techniques to arrive at the most appropriate and comparable pay levels compensating different job profiles. For example, a manager’s job is incomparable to that of a man-friday due to sharp variations in the knowledge and skill-sets required to perform them, thus, making it highly unreasonable to decide their compensation levels using the same job evaluation technique” (the book).
2. Choosing the Job Evaluation Committee - “It is a multi-member committee comprising of senior HR professionals appointed as watchdog over the entire job evaluation process and results. However, their actual duties and responsibilities vary for different companies. For example, in larger companies, they evaluate different job classifications such as managerial, non-managerial, executive, supervisory etc.” (the book)
3. Training Employees to conduct Job Evaluations - “Employees need to be empowered to carry out job evaluations themselves, through regular training, by making them understand both the company and exercise objectives along with the criteria for choosing the most suitable job evaluation technique. In addition, those responsible for conducting it should also ensure strict regulatory compliance of both the methods used and their decisions taken” (the book).
4. Documenting the Job Evaluation Plan - “The entire evaluation plan & procedure should be carefully documented to not clearly highlight the specific business-related criteria or standards against which jobs can be assessed, but also as a defense against litigation battles or appeals made by the employees on account of any ambiguities or perceived discrimination in the procedure” (the book).
5. Communicating to the Employees - “Companies should formally communicate job evaluation results to the employees, since it is their right. This will not only increase more employee buy-in regarding the process, but also to invite participation from them in the form of suggestions to make any improvements or voice their concerns regarding any specific aspect of the exercise” (the book).
6. Setting up the Appeals Process - “Companies should have in place proper appeals process that allow employees to challenge any aspect of the evaluation process, and subject it to scrutiny by the job evaluation committee to create an environment of mutual trust amongst the employees and management” (the book).
Part - II
As mentioned earlier, because of the diverse nature of jobs across different levels in an organization, different approaches are used to conducting job evaluation, so as to facilitate arriving at a fair and impartial figure to compensate all jobs. All these approaches along with their advantages and disadvantages are as follows (Effective Compensation Inc., 2011):
Job Evaluation Approach
Description
Advantages
Disadvantages
Ranking
You arrange the jobs from the highest to the lowest based on the value they provide to organization. For example:
Rank Monthly Pay ($)
Manager 5000
Accountant 3500
Accounts Clerk 2000
Foreman 1000
Man-friday 800
Simplest, quickest and cheapest
Job-to-job comparison is possible
Evaluators are not properly trained
Difficult to determine basis of comparison and justify results to the employees
How much value difference is assigned to jobs is unknown
Classification
You categorize all jobs into fixed or predetermined number of classes. For example:
Relatively simple and cheap
Provides a predetermined scale of values that easily identify skills measurement as a criteria to assess job worth
Unable to define overall job worth
Each work needs a different class definition
Basis for assigning grades may be irrelevant to the true compensable job worth
Factor Comparison
Here we rank each job against a series of factors like mental/physical effort needed, working conditions; supervisory responsibility etc., with each assigned a weight based on its importance in the total job. Pay is decided based on comparison of weights against each factor of the job. One with the highest rank on each job factor gets highly paid.
Job-to-job comparison due to limited number of factors
No internal inconsistencies occur even if criteria differ
Complex and time consuming
“Halo effect” may impact overall ranking judgment
Point Factor
Here also the jobs are ranked in terms of key factors, with points awarded to them on a priority basis i.e. their importance in overall job performance. The points are then summed up to determine wage rates for the job.
“factor definition” provides consistency despite different evaluators
Shows relative worth of jobs
Extremely complex and difficult to explain
Marketing Pricing
You conduct extensive survey of the labor market to determine the relative worth of jobs industry-wise and their pay levels accordingly. This survey is usually conducted by consulting firms like Deloitte, Kelly Services etc.
Easy to understand and communicate
Based on reliable and objective market data
Minimum development and maintenance time
Market data may not correspond with perceived internal values
Influenced by unusual or temporary market conditions
Job evaluation exists due to the concept of pay inequity. All the employees bring certain inputs into the job such as their qualifications, experience & skill levels etc., and also expect certain desirable outputs in return such as good pay, favorable working conditions, promotional opportunities etc. Further, human nature always considers oneself as putting in more effort or hard work and getting back less. The icing on the cake is the interaction amongst people from both within and outside the company that do influence the thought process and perceptions. Such a scenario makes it very easy to develop a feeling of being compensated unfairly by the company, especially, if one of your friends, who is working in the same industry, and possesses equivalent qualifications and expertise level, has a higher package. To iron out such mental anomalies from the thought process, it is imperative that a fair and transparent job evaluation system be used to clearly explain to every employee, his/her job’s worth in the organization.
The actual choice of a job evaluation system depends on a number of factors including its ease of execution and understanding, reliability of results as well as communicating the same to the employees. However, the most important factor dictating its usage is the diversity of jobs in the organization across all levels that are directly linked to the size and nature of business. For example, a large company would employ massive workforce numbers, than a smaller one, calling for usage of many different job evaluation techniques for both inter and intra-job pay determination.
Part - III
Methods of Performance Evaluation
a. Self-Evaluation - “Here the employee evaluates himself by filling up a form full of multiple-choice and essay type answers, thereby, allowing his manager to compare the self-evaluation and his own evaluation about him to open up free two-way communication channels, in case of discrepancies that might arise” (Anderson, 2012).
b. 3600 Evaluation - Seeks input about the employee’s job behavior and performance not only from his own department, but also from rest of the departments in the company, with whom he/she works on a day-to-day basis” (Anderson, 2012).
c. Graphic Rating Scale - “Allows multiple employees to be evaluated simultaneously by grading their performance against their areas of job duties on a scale of 1-10 or poor to excellent” (Anderson, 2012).
d. Checklists - “A simple method requiring the employees to answer a plain ‘yes’ or ‘no’ against each of their performance questions listed in a form. Increased numbers of negative responses often identify increased training needs in the employees by pin-pointing towards severe performance deficiencies” (Anderson, 2012).
e. Critical Incident Method - “Involves discussing in the annual performance review, good and bad incidents of employee performance recorded in a regularly maintained log by the manager. For example, breaking down of plant and machinery one day would be a critical incident that could invite multiple employee responses such as going back home, trying to fix it on their own or trying calling up the repair shop etc.” (Anderson, 2012)
f. Behaviorally Anchored Rating Scales (BARS) - “Combines both graphic rating scales and critical incident method by measuring job performance against a set of behavioral statements describing good and bad job performance traits using BARS” (Modern Methods of Performance Appraisal, 2007).
g. Human Resource Accounting Method - “Here the difference between the cost incurred on the employees (hiring, training, induction etc.) and the contribution made by them (total monetary value added) is taken as their performance, with the former expected to be less than the latter” (Modern Methods of Performance Appraisal, 2007).
h. Management By Objectives (MBO) - “MBO was introduced by Peter F. Drucker in 1954. It involves making the employees set performance goals for themselves and identify their courses of action to attain the same in consensus with their supervisors. Hence, their performance is then assessed against their self-chosen goals” (Modern Methods of Performance Appraisal, 2007).
i. Assessment Centers - “Consists of administering tests and exercises to groups of employees in social or informal settings to assess their capabilities to take up higher responsibilities in the future. Usually, thee employee may be given a job similar to the one he would do once promoted. The evaluators then scrutinize his performance against desired job performance characteristics” (Modern Methods of Performance Appraisal, 2007).
Finally, performance evaluation though important across all levels in the organization, but its relevance becomes all the more pronounced as we move higher up the organizational chart, encountering more job role complexity. At the bottom the performance deals with basically non-managerial shop floor activities such running of machines, manufacturing of product units, etc. which is primarily concerned with lower level motor skills that can easily be quantified and therefore, assessed also. Some of the tools that can be used to do so would be simple checklist method. However, climbing up the corporate ladder exposes us to managerial level job roles that has the biggest complexity of being qualitative in nature, in the sense that a manager’s job entails leading, training and motivating his team, which cannot be expressed in metrics or figures, thereby, posing the challenge of using sophisticated tools like BARS or 3600 Degree Evaluation to assess it.
References
Job Analysis and Job Evaluation. (2005). Retrieved from The University of Western Ontario: http://psychology.uwo.ca/undergraduate/psych266a/lectureslides/Lectures%202005/Psych%20266%20Job%20Analysis.2005.pdf
Modern Methods of Performance Appraisal. (2007). Retrieved from http://appraisals.naukrihub.com/modern-method.html
Job Analysis Process. (2012). Retrieved from ManagementStudy Guide.com: http://www.managementstudyguide.com/job-analysis-process.htm
Anderson, A. (2012). Methods of Performance Evaluation. Retrieved from http://smallbusiness.chron.com/methods-performance-evaluation-1869.html
Effective Compensation Inc. (2011). Alternative Job Evaluation Approaches. Retrieved from http://www.effectivecompensation.com/AlternativeJobEvaluationApproaches.html
Olivia. (2011). Difference Between Job Analysis and Job Evaluation. Retrieved from http://www.differencebetween.com/difference-between-job-analysis-and-vs-job-evaluation/
