Methods of Job Evaluation
Various methods of job Evaluation may be grouped as under
1. Non-quantitative methods
(i) Ranking or job comparison
(ii) Grading or job classification
2. Quantitative methods
(i) Factor comparison.
(ii) Point rating
1. Non-quantitative methods
(i) Ranking Method
It is the simplest method of job evaluation. According to this method, jobs are arranged from highest to lowest, in order of their value or merit to the organization. Jobs can also be arranged according to the relative difficulty in performing them. The following table is a hypothetical illustration of ranking of jobs.
| Rank | Monthly salaries |
| 1. Accountant | Rs. 35000 |
| 2. Accounts clerk | Rs. 28000 |
| 3. Purchase assistant | Rs. 21000 |
| 4. Machine- operator | Rs. 18000 |
| 5. Typist | Rs. 12000 |
The variation in payment of salaries depends on the variation of the nature of the job performed by the employees.
Three techniques can be used for ranking jobs. These techniques are as follows:
a) Job Description
In this technique. a written jobs description is prepared for every job. The job descriptions are then studied and analysed. the differences between them in terms of duties, responsibilities, skill requirements, etc. are noted. Each job is assigned a rank depending upon its relative significance. Several raters may independently rank each job. The average of these ratings is calculated to determine the final ranking. The following table illustrates the procedure:
| Job | Rater-X | Rater- Y | Rater-Z | Average |
| A | ||||
| B | ||||
| C | ||||
| D |
In this method, the rater is required to keep in mind all the jobs being ranked. This may not be possible when the number of jobs is large. The rater may overlook significant differences among jobs. As a result accuracy of ranking may be low. Paired comparisons can be used to overcome this problem.
(b) Pair Comparisons.
In this technique each job is paired with every other job in the series. The more difficult job in each pair is identified. Rank is then assigned on the basis of the number of times a job is rated more difficult. For example, the pairs and ratings in an organisation may be as follows :
| Pair | More Difficult Job | Rank |
| Assistant – Upper Division Clerk | Assistant | 1 |
| Upper Division Clerk – Lower Clerk | Upper Division Clerk | 2 |
| Lower Division Clerk – Peon | Lower Division Clerk | 3 |
| Assistant – Lower Division Clerk | Assistant | |
| Assistant – Peon | Assistant | |
| Upper Division Clerk – Peon | Upper Division Clerk Peon | 4 |
(c) Ranking Along a Number Line
In this technique, ranks obtained through job descriptions and paired comparisons are spread along a number line. Each job is then placed along the line on the basis of its closeness to the highest ranked job. For example, in the following number line, A is the highest ranked job, E is the lowest ranked job. Other jobs are spaced according to their closeness to the highest ranked job.
Advantages of Ranking Method
(i) It is the simplest and the oldest method.
(ii) It is very economical and less time consuming.
(iii) It involves little paper work.
Disadvantages of Ranking Method
(i) It does not indicate the degree of difference between different jobs. It merely reveals that one job is more important than others.
(ii) It involves subjective judgment because a job is not analyzed and key factors are not compared. Therefore, it is less accurate and is not fully reliable.
(iii) The rater is required to be thoroughly familiar with all jobs to be rated.
2. Grading Method
(i) Job classes or grades are established. A job grade is a group of different jobs of Similar difficulty or requiring Similar knowledge and skills to perform.
(ii) Each job grade is defined in the form of a written description.
(iii) Each job is classified into an appropriate grade depending on how well its characteristics match the grade definitions. For this purpose job descriptions are carefully analysed. In this way, a series of job grades in developed and a different wage rate is fixed for each job grade.
Advantages
(i)This method is easy to understand and simple to operate.
(ii) It is more accurate and systematic than the ranking method.
(iii) It is economical and therefore suitable for small concerns.
(iv) It provides an opportunity to develop a systematic organisation structure.
(v) Pay grades can be compared with those of other concerns. Grouping of jobs into grade simplifies wage administration.
(vi) This method is used in Government offices.
Disadvantages
(i) It is very difficult to write accurate and precise descriptions of job grades.
(ii) Some jobs may involve tasks which overlap more than one grade. It is difficult to classify such jobs in a particular grade.
(iii)The system is rigid and personal judgement is involved in deciding job classes and assigning jobs to specific classes.
2. Quantitative methods
(i) Factor Comparison Method
A more systematic and scientific method of job evaluation is the factor comparison method. Though it is the most complex method of all, it is consistent and appreciate. Under this method, instead of ranking complete jobs, each job is ranked according to a series of factors. These factors include mental effort, physical effort, skill needed, responsibility, supervisory responsibility, working conditions and other such factors. Pay will be assigned in this method by comparing the weights of the factors required for each job, i.e. the present wages paid for key jobs may be divided among the factors weighted by importance. In other words, wages are assigned to the job in comparison to its ranking on each job factor.
Advantages of Factor Comparison Method
i. It is a relatively more analytical and objective method.
ii. As few factors are utilized the chances of overlap are
iii. The procedure involved is logical.
iv. The method is flexible as there is no upper limit on the rating of a factor.
v. It is more reliable and valid as each job is compared with all other jobs in terms of key factors.
vi. Money values are assigned in a fair and objective manner depending on factor ranking.
Disadvantages of Factor Comparison Method
i. It is difficult to understand and operate.
ii. It is a time consuming and expensive method.
iii. The use of present wage rates for key jobs may lead to error in the beginning.
(ii) Point Method
It is the most widely used method of job evaluation. Under it, jobs are divided component factors. Points or weights are assigned to each factor depending on degree of its importance in a particular job. the total points for a job indicate it. relative worth or value. The procedure involved is as follows:
(i) Determine the Job to be Evaluated
In a large organisation, there are several jobs involving different skills, efforts, working conditions, etc. Therefore, a few benchmark or representative jobs are selected from each job category.
(ii) Select the Factors
The selected jobs are analysed and factors common to all these jobs are identified. The factors choosen for evaluation should be measurable, significant, mutually exclusive and acceptable to both management and workers. The selected factors may be divided into sub-factors as given below:
| Factor | Sub-factors |
| Skill | Education, experience, training, judgement |
| Efforts | Physical and mental |
| Responsibility | Quality of output, raw materials, machinery and equipment, safety of others. |
| Working Conditions | Working environment, accidents, hazards, discomfort etc. |
(iii) Define the Factors
The selected factors and sub-factors are defined clearly in writing. This is necessary to ensure that different raters interpret a particular factor in the same way.
(iv) Determine the Degrees
Different degrees of each factor are decided and defined clearly. The same number of degree should be used for each factor so as to ensure consistency. For example, the degrees of ‘education’ may be defined as follows:
| Degree | Definition |
| 1 | Should be able to do ordinary counting and to understand verbal instructions. |
| 2 | Should be able to read and write. |
| 3 | Should be able to carry out mathematical calculations. |
| 4 | Requires ability to compare written material and to make advanced calculations. |
(v) Determine Relative values of Job Factors
The relative value of various factors depends upon their significance to the job. Maximum points for each factor may be as follows:
| Factor | Maximum Points |
| Skill | 400 |
| Effort | 175 |
| Responsibility | 300 |
| Working Conditions | 125 |
| Total | 1,000 |
The total points for a particular factor should be allocated among its subfactors. For instance, the total points for ‘skill’ may be allocated as education 75, experience 125, training 100 and judgement 100.
(vi) Assign Point Values to Degrees
Point values for different degrees of a factor may be decided on the basis of arithmetic progression as shown in the Table.
(vii) Find Point Value of the Job
The various points assigned to different factors in a job are added up to find out the total points which indicate the relative worth of the job.
(viii) Assign Money Values
Once the worth of a job in terms of total points is known these are connected to money values keeping in view the prevailing wage rates. A standard unit of money may be assigned to each point so as to convert point scores into monetary values. This is illustrated in the Table.
Advantages of Point Method
(i) Paint method is the most comprehensive and accurate method of job evaluation. Factors are divided into subfactors and different degrees of a factor are considered.
(ii) Assignment of point scores and money values is consistent thereby minimizing bias and human judgement.
(iii) Systematic wage differentials according to content of the job can be determined.
Disadvantages of Point method
(i) Point method is complicated and an average worker cannot understand it easily.
(ii) It is time-consuming and expensive.
(iii) Errors may occur if assigned point value are not realistic. It is difficult to determine factor levels and assign point values.
(iii) It is difficult to apply this method to managerial jobs wherein the work content is not measurable in quantitative terms.