1.

Rank Method

The ranking method is a process of organizing items, individuals, or entities in a specific order based
on certain criteria or attributes. It's commonly used in various fields such as sports, education,
business, and search engines to determine the relative importance or performance of each item
within a set. Ranking methods can vary depending on the context and can involve numerical scoring,
subjective evaluations, or a combination of both.

The following steps are involved in ranking jobs.

Obtain job information – The first step of ranking method of job evaluation is the job analysis. Job
descriptions for each job are prepared and these are the basis on which the rankings are made. The
job ranking method usually ranks jobs according to ‘the whole job’ rather than a number of
compensable factors.

Select raters and jobs to be rated – Ranking all the jobs, at a time, is usually not possible. The more
usual procedure involves ranking jobs by department or in ‘clusters’ i.e. factory workers, clerical
workers and so on. This eliminates the need for having to compare directly, say, factory jobs and
clerical jobs.

Select compensable factors — In the ranking method, it is common to use just one factor, for
instance job difficulty, and to rank jobs on the basis of ‘the whole job’. Regardless of the number of
factors you choose, it is advisable to carefully explain the definition of the factor(s) to the evaluators
so that they evaluate the jobs consistently.

Rank jobs – Next, the jobs are ranked. The simplest way to do this involves giving each rater a set of
index cards, each of which contains a brief descript of a job. These cards are then ranked from
lowest to highest.

Combine rating – It is usually to have several raters rank the jobs independently. Finally, divide all the
ranked jobs into appropriate groups or classifications by considering the common features of jobs
such as similar duties, skills, or knowledge required. All the jobs within a particular group or
classification receive the same wage or range of raters. Then, once this is accomplished, the rating
committee can simply average the ranking.

When Do We Use Ranks?

When the data occur in rank form, we use rank methods. If the data occur in other form, we note
that continuous measurements contain more information than do ranks, and ranks more information
than counts. When the user can rank events but cannot measure them on a scale, rank-order
statistical methods will give the best results. When the sampling distribution of continuous data is
skewed or otherwise poorly behaved, the assumptions underlying continuous-based methods may
be violated, giving rise to spurious results. Ranks do not violate these assumptions. When sample
sizes are too small to verify the satisfaction of these assumptions, rank-order methods are safer.

2. Point Factor Method

The Point factor method or point system of job evaluation quantifies the value of the elements of a
job by allocating points to each factor and the sum of those values provides a quantitative
assessment of a job’s relative worth or pay. The system requires a few steps to end-up with pay of a
job. The steps are stated below:
Step 1: Determine cluster of jobs to be evaluated. The job evaluation starts with determining cluster
of jobs to be evaluated for setting pay. Job All jobs will not be selected for evaluation, only a sample
jobs with homogeneous characteristics will be chosen for this purpose.

Step 2: Collect job information. Job information regarding activities to be done in each job,
responsibilities to be undertaken, working conditions of the job etc information are needed for job
evaluation.

Step 3 : Determine critical factors with their definitions. At his stage, the job factors and its subfactors
will be determined and the definition of each factor will be made clearly. These are critical factors for
which compensation will be given to the employees. The factors may be skill, responsibility, effort,
and working conditions.

Step 4: Determine factor degrees/levels. The depth of each factor varies over jobs. So, the point
system creates several levels /degrees associated with each factor. Each degree/level will have
definite description so that it could be identified distinctively. Suppose, education may have 4 (four)
different levels-MBA.

Step 5: Determine relative value of factors. Each critical factor now should be given relative value in
percentage denoting the weight of each factor. It will reflect the relative significance of factors to the
overall job performance.

Step 6: Assign point value to factors and degrees/levels. Now, each critical factor will be assigned
total point value. The job evaluation committee subjectively assigns the maximum possible points to
each factor, its sub factors and degrees. Such as skill assigns 500 points. Then, these 500 points will
be assigned to each sub factors.

Step 7: Develop the point manual. Job evaluation analyst will now develop a point manual that
contains a written explanation of each job element. It also defines what is expected for the four
levels of each sub factor. This information is needed to assign jobs to the appropriate level.

Step 8: Determine the rank of each job. The points assigned to each critical factor and its associated
levels would be set for a particular job now. Then the all points assigned to each factor are added to
find out the total number of points for the job. After the total points of each job are known, the jobs
are ranked on that basis of descending order- from highest to lowest.

Step 9: Determine the money value of job. Now, money value of each point in each critical factor
would be assigned to determine the total money value of each critical factor. Then, money value of
all factors would be sum up. The result would be the total worth of the job. That amount would be
the pay/compensation /remuneration/salary of that particular job.

3. Job Classification

Job classification is a system in which jobs are grouped together based on similarities in terms of the
work they involve and the skills and knowledge needed to do them. This system can be used to help
employers match the right employees with the right jobs, to identify training needs, and to plan
compensation and benefits.

Why is Job Classification important?

Classifying jobs is important because it allows organizations to identify the specific skills and
knowledge required for a particular position, as well as the level of responsibility and authority
associated with the job. It also helps to ensure that employees are compensated fairly for the work
they perform. By evaluating each position and assigning it to a specific job classification,
organizations can develop a pay scale that is equitable and fair. Additionally, job classification can be
used to identify training and development needs, as well as to create a career path for employees.

What are the steps in Job Classification?

The steps in job classification are:

1) Determining the job’s purpose and the essential functions of the position;

2) Determining the qualifications required for the position;

3) Determining the wage or salary for the position;

4) Determining the classifications and levels for the position;

5) Updating the job classification system.

Who do you need to involve in Job Classification?

The people who need to be involved in job classification are usually the people who are doing the
job. They are the best people to determine what the job duties are and what the job requirements
are. They are also the best people to determine how the job should be classified. Management
should also be involved in job classification. They are responsible for ensuring that the classification
is accurate and that the job duties and requirements match the classification. The human resources
department should also be involved in job classification. They are responsible for ensuring that the
classification is accurate and that the job duties and requirements match the classification.

4. Factor Comparison Method

Factor comparison is a systematic method designed to conduct job evaluations based on different
factors like skills, physical efforts, mental efforts, responsibilities, and working conditions. Thoman E
Hitten was the first who founded this method, which is very useful for determining the worth of jobs.
In this method, instead of ranking the role as a whole, it is broken down into different factors. The
next stage is identifying benchmark jobs and roles that are consistent across different companies. A
salary is assigned to each position, and the wage is further broken down for each factor.

How to make a factor comparison?

 Around 20-25 jobs are selected across the company. The jobs must be spread across different
departments.
 Different parameters like skills, education, and experience are selected in each job for
evaluation.
 A rank is given to each parameter independently, in the order of their importance. This can
be done by consulting the field experts and conducting a survey among the employees.
 A monetary value is assigned to each parameter. This is done by researching the salaries of
similar positions in the industry.
 Then the individual values of the parameters are combined to create a monetary value for
each job. This serves as the base salary of a job position.

Why is factor comparison required?

Factor comparison is used to reduce the unnecessary individual items and form a proper and
organized criteria which helps in deciding the compensation for the employees for a particular job
role.