Download BUS-FP4043Pitfalls of Job Evaluation Methods Compensation an and more Lecture notes Accounting in PDF only on Docsity! BUS-FP4043 Pitfalls of Job Evaluation Methods Compensation and Benefits Management For any organization, job evaluations can be very important and beneficial to both employers and employees. These can be used to determine if the salary structure is set up properly and will assist in identifying high-achieving employees and help raise productivity. The results can help management determine where pay raises are necessary and where additional training and/or development is needed for employee performance [ CITATION Geo19 \l 1033 ]. The three methods that are commonly used for job evaluations and they include, ranking, classification and point method, also known as factor comparison. Different information is provided from each method, which makes it important for organizations to decide which method will align best for their structure. Ranking This method is considered be simple, fast, easy, and the least expensive of all the methods and is the easiest to explain to employees. Ranking will assist with placing the job descriptions in order from highest to lowest based on the value of the position to the organization. This method will place the jobs in a hierarchy based on their value to the organization. This method may be the simplest, however it is not appropriate for every organization [ CITATION SHR3 \l 1033 ]. An organization chart is an example of ranking, this is a diagram that visually displays the internal structure of an organization. The chart will typically place the most valued position(s) or high-ranking position(s) at the top and then transcend down through the different positions. Keep in mind, this is not always the best method to use with every organizations. According to an article on SHRM, this method is usually best suited to smaller organizations that have less than 100 positions that need to be reviewed [ CITATION SHR3 \l 1033 ]. This method would be ineffective if an organization is unable to have a team processing the ranking method and this mainly due to the nature of this method being highly subjective. A governmental agency is a perfect example where this method would not work due to the simple factor of being unable to evaluate the job/position(s). Classification “Job classifications group’s jobs into various grades, each grade having a certain specific class description and many times a pay scale that is used for job comparisons. Often the title is also assigned based on grade arrived at after the job classification” [ CITATION MSG \l 1033 ]. This method is commonly used with larger organizations, governmental institutions, and other public services like universities. This method is less subjective than the ranking method, which makes it easier to understand. When determining the class, this method will consider all the factors position, including responsibilities and duties. Because of the differences in duties, skills, knowledge, and other aspects of trades and labor jobs, job grading standards are developed mainly along occupational lines [ CITATION SHR3 \l 1033 ]. Organizations that have more unusual positions or types of positions unrelatable to one another, this method would not be effective. Point Method This method is used with larger organizations and can be expensive to establish, but after it is established, it is easier to implement. This method will define roles in a similar way to a ranking system but across various types of skill sets in a large organization [ CITATION Kim19 \l 1033 ]. According to the article on SHRM, using this type of method with force an organization to quantify total points for each unique job, determining its true value to the
