Job evaluation is a systematic way of determining the value of a specific job compared to other jobs in the organization. Evaluating a certain job helps the organization to make a systematic analysis of all jobs to assess their relative value for the purpose of creating a relation pay structure (Elizur, 2010). The various techniques applied in job evaluation include job ranking, job grading as well as factor comparison. The process is necessary for every new position in order to ensure the company recruits the best employees based on the expected tasks, necessary qualification and responsibilities of the job. Additionally, it is necessary to conduct job evaluation when a specific job has changed significantly in order to reflect the current nature of the job.
The process of job evaluation varies from one organization to another depending on the nature of the organization. In this case, the job evaluation will involve the following steps. The first step involves gaining acceptance. The aim of job evaluation is made clear to all the stakeholders involved in job evaluation. The benefits that would be gained from evaluating a specific job are clearly outlined to make the process effective (Lytle, 2012). Employees and various unions may be consulted, depending on the legal and employee relations environment and the culture of the company. All the necessary requirements are identified to make the evaluation process successful. For example, in evaluating the sales and marketing position in the company, I would ensure that I understand the tasks that are involved in the job position to ensure that I have all the necessary information about the nature of the job. Additionally, it is important to identify the type of product marketed as well as the nature of the market. Identifying the nature of market would help to estimate the amount of sale that would be expected from each salesman.
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The second steps are the planning stage. In this stage, the evaluation program is drawn up and all the stakeholders that would be affected by the process are informed. The necessary arrangement is made and the necessary committee is established as well as identifying the samples of jobs that would be evaluated (Lytle, 2012). For example, in evaluating the position of an operational manager, I would ensure that I have formed an evaluation committee that would help to identify the specific roles and duties of an operational manager. Additionally, I would ensure that the management is aware of the benefits of job evaluation so that they can provide the necessary information that the committee would require.
The third step is the analysis stage. At this stage, all the information required for the sample job is collected. The information serves as a basis for the internal and external evaluation of jobs. For example, in evaluating the accounting position, I would require to have the information about the principles of accounting applied in performing the accounting job. Moreover, the sales volume as well other transaction would be identified and this would help to know the bulkiness of accounting job.
The fourth step is the internal evaluation stage. In this stage, the sample of benchmarked jobs is ranked by means of the chosen evaluation scheme as outlined in the first stage. The jobs are graded on the basis of data pending. The relative value of jobs is ascertained by comparing grades between the jobs (Lytle, 2012. For example, when comparing the value of procurement and the operational manager, I would rank the benched marked position of an operational manager and the procurement officer position. This would help to identify the most valuable positions among the jobs that I would evaluate.
The fifth step is the external evaluation stage. In this stage, information is collected on market rates at the time of job evaluation. The external evaluation help to make a comparison of employee performance in an organization compared to other organization. Additionally, the result would help to identify whether the company is gaining competitive advantage in the competitive market. For example, in evaluating the sales and marketing position, I would conduct external evaluation to identify the target on which the salesperson is supposed to have attained.
The other step is the design and grading stage. Under this stage, jobs grades are ascertained and the salary structure is designed. Additionally, different jobs are slotted into the salary structure designed to ensure that the salary is paid according to the individual contribution to the company as well as the qualification attained. For example, in evaluating the procurement and accounting position in the organization, I would shortlist all the other positions to identify the salary that is appropriate for a specific position.
The final stage is developing and maintaining stage. In this stage strategies and procedures for maintaining the salary structure are developed which intends to accommodate inflationary pressures in the salary levels (Lytle, 2012).The new jobs are also easily graded into the structure and the existing jobs are adjusted in regard to the changes in their responsibilities and market rates.
Question 2
Pay-for knowledge is a payment scheme where employees are compensated according to their skills as well as the individual level of education. Therefore, the employee rewards are based on reaching certain goals in education, training and skill development. Additionally, the typical employee starts at a base rate and the payment level increases as the individual learns different jobs in the organization (Milkovich & Milkovich, 2014).The organization that applies the pay –for knowledge compensation plan experience a greater workforce flexibility, greater workforce stability, high workforce productivity as well as less employee turnover. Additionally, employees of an organization benefit from higher motivation, higher pay satisfaction, increased job security as well as increased opportunities for knowledge development.
On the other hand, incentive pay plan is a payment scheme that compensates employees on the basis of performance rather than payment on the basis of hours worked. Similarly, the payment scheme may act as a motivating factor to the employees. Employees are encouraged to increase their performance and at the same increase the chances of productive employees to work for a long time in the company. The payment scheme is appropriate where the company wants to show appreciation to the employees and enables them to participate in the company’s well being. Employees participation in the company well being is one way of motivating employees and this would be appropriate for the use of incentive payment scheme (Lawler, 2010). For example, a company may implement a strategy of increasing payment to any salesman who would develop the best marketing message to market the company’s product. In this case, the payment scheme has appreciated the good work as well as enabled the employees to participate in the company’s well being.
Secondly, the incentive pay plan is appropriate for a company where employees are demanding more payment and nothing about the plan serves to increase the revenue of the company. The management of an organization may find necessary it necessary to reward more productive employees regardless of the increase in revenue of the company (Milkovich & Milkovich, 2014). For example in sales and marketing, the company would implement the incentives plan to reward the employee who makes more sales as compared to other salespeople.
Similarly, the incentive payment plan is appropriate to the company that would want to establish a strategy that good performance would lead to more pay. The incentive pay plans boost the belief that when employees put extra effort in their duties, there will be an extra payment and hence increase the employee’s productivity as well as the increase of organization performance. For example, an organization that sells its product in a highly competitive market would require the marketing team to put more effort to ensure that the company gains the competitive advantage in the competitive market. Therefore, there is the need for the organization to pay the marketing team an extra payment to maintain as well as increase the company’s profit margin (Lawler, 2010). The employees would feel that they benefit from their good performance and hence it becomes the norm of the marketing team to put more effort while expecting more payment for their good performance.
Reference
Elizur, D. (2010). Job evaluation: A systematic approach . London: Gower
Lawler III, E. E. (2010). Strategic pay: Aligning organizational strategies and pay systems . Jossey-Bass.
Lytle, C. W. (2012). Job evaluation methods.
Milanowski, A. (2013). The varieties of knowledge and skill-based pay.
Milkovich, G. T., Newman, J. M., & Milkovich, C. (2014). Compensation (Vol. 8). New York: McGraw-Hill.
