Salary and wage ranges are also fixed for each class. how can I recover my password now! FACTOR COMPARISON METHOD Copyright :: Sneha Husaina & Jugnoo Raja The importance of each job is generally decided by a committee consisting of persons familiar with all the jobs. Job evaluation is a method for comparing different jobs to provide a basis for grading and pay structure. The four major methods of job evaluations are job ranking, job classification, factor comparison, and the point method. Burk. The points for each factor are summed to form a total point score for the job. Advantages of Job Evaluation. There are four factors common to point method of job rating. This is the most popular method of job evaluation. Especially, it is more suitable for rating supervisory and executive job positions where intangible factors are to be taken into account for purpose of evaluation. The merits of point system are as follows: 1. This system, though claims accuracy, is never accurate in fact. Under this method, rather than ranking complete jobs, each of jobs is ranked according to a series of factors. Each job’s factors are ranked against each other job’s factors. Of the various methods of job evaluation, the point method is more popular all over the world. Selection of the factors common to all jobs. A method of job evaluation in which jobs are compared with each other in terms of compensable job factors. Since expert raters are assigned with the rating process, the rating under this system is bound to be realistic and accurate. The mental bias of the analyst may also affect the validity of the findings of job evaluation. The point method is an extension of the factor comparison method. It is a sophisticated and quantitative … These evaluations are extremely important to companies because they provide the basis for pay rates. Methods of Job Evaluation – With Advantages and Disadvantages: Ranking, Job Classification, Factor Comparison and Point Method. Several methods such as job ranking, job grading, and factor comparison are employed in job evaluation. The ranking is done in the order of importance of each job. This system does not tell how much one job differs from another. Hence, it has the same merits and subject to the same limitations. This system gives a deep analysis of all the factors in the job and the points assigned to each job constitutes an accurate and realistic appraisal of each job. All of other jobs are measure up to with the list of key jobs and wage rates are determined. The market pay rate for each job is then allocated among the factors based upon a market pay rate scale. A method of job evaluation in which jobs are compared with each other in terms of compensable job factors. Mental effort, physical effort, skills required supervisory responsibilities, working conditions, and other relevant factors. Ranking method. Even though Occupations vary in duties, operations, routine, equipment and materials, the basic nature of all jobs can be expressed in terms of attributes such as skill, efforts, responsibility etc. Each job should be considered in its entirety. Under this method, rather than ranking complete jobs, each of jobs is ranked according to a series of factors. Research indicates, however, that each method is nearly as accurate and reliable as the other in ranking and pricing different jobs. JOB EVALUATION Presented by- Sandeep Singh 2. Factor Comparison Method. This system is also subject to severe limitations. Factor Comparison Method The human management and senior management team incorporates one the methods that is geared to managing the evaluation … Point System: This is the most widely used technique of job evaluation. The factor-comparison method is yet another approach for job evaluation in the analytical group. The points for individual factors are added up to get a point value for the whole job. It attempts to make a methodical comparison between jobs to assess their relative worth for the purpose of establishing a … It is often used in evaluating, the managing administrative and white-collared jobs. This is essentially an expert’s method and so its adoption calls for rich experience and knowledge. The factor comparison method of job evaluation entails both the rating and point allocation methods. Four basic methods have traditionally been used: ranking, classification, factor comparison, and point-rating. Job Evaluation 1. This method is highly suitable and less expensive in case of small organization or where the jobs are few in number. The job factors are separated into groups (i.e., skill, responsibility, effort) and assigned a numerical or weighted point value. A more systematic & scientific method of job evaluation is the factor comparison method. The key factors generally used under this method are 1. The objective of job evaluation is to determine which jobs should get more pay than others. This system is laborious, because it requires that a single factor for one job is to be compared with the same factor in a large number of different jobs. Factor-Comparison Method. The procedure for factor comparison method of job evaluation is as follows: At the initial stage, some key jobs which are well recognized are selected. Don't have an account? Job Evaluation by Point Method. Job Evaluation by Factor Comparison Method. Factor Comparison System. The ranking and classification methods provide the evaluation of jobs in non-quantitative terms, whereas the point method and factor comparison method furnish the result in quantitative job values. Enter right registered email to receive password! The time gap between two rankings should be at least one week. Analytical Job Evaluation Methods. It examines the job by carrying out a comparative study. By breaking down each job into factors, required number of attributes can be ascertained. Thomas E. Hitten was the first to originate factor comparison method of job evaluation. Job Evaluation by Job Classification Method, 4. The total of these points establishes the point value of each job. For purpose of ascertaining the common factors, the job manual is used. The job evaluation committee or job analyst, then allocate each and every job to the approximate predetermined class. Identifiable factors for the benchmark jobs are ranked during factor analysis and then are compared to market rates in order to assign a monetary value to each compensable factor. The primary factor in determining compensation is an evaluation of work performed. Methods of Job Evaluation Job-evaluation methods are of two categories:- a) Analytical Methods Point Ranking Methods Factor Comparison Method b) Non-analytical Methods Ranking Method Job-grading Method Non-analytical Methods Ranking and job-classification methods come under this category because they make no use of detailed job factors. Factor comparison is systematic and scientific method designed to carry out job evaluation which instead of ranking job as a whole, ranks according to a series of factors. The Point Factor or Factor Comparison Method. Factor Comparison Method: This method is a combination of both ranking and point methods in the sense that it rates jobs by comparing them and makes analysis by breaking jobs into compensable factors. Factor comparison method. Each job is rated using the job evaluation instrument. A number of important factor to be considered in each job are identified. We ensure premium quality solution document along with free turntin report! Under this method, each job is given a rank. The job factors are assumed to be independent. This practice tends to under value the jobs that are high in the skill factor and to over value jobs that receive many points for the working conditional factor. These factors are enumerated below: 1) Skill. No points or weights are used. Assign money value to each of factor and decide the wage rates for each key job. The major classes can also be divided into various sub-classes. 4. They are: i. In this method, each job is given a rank on the basis of a number of factors. This method works by identifying key job factors and then assigning points based on importance. 4. This job evaluation process helps to determine the true qualities and efficiency of work in the given work field. The multiplicity of factors creates confusion and acts against precision in decision. Thomas E. Hitten was the first to originate factor comparison method of job evaluation. Perhaps the simplest method of job evaluation is the ranking method. 2. Unlike the first two methods, this method makes a quantitative evaluation of different jobs in terms of certain factors common to all jobs. Determines the factors in terms of which the jobs are evaluated (like, mental effort, skill, physical effort, responsibility ,working conditions, etc.). The next step in the job evaluation process is to select or design a method of evaluating jobs. Factor comparison is a complex quantitative method. Installation of this system is highly expensive and unjustifiable. The human management and senior management team incorporates one the methods that is geared to managing the evaluation processing (George and Jones, 2005). Every job evaluation method requires at least some basic job analysis in order to provide factual information about the jobs concerned. 2. This method determines the relative rank of the jobs is evaluated in relation to the monetary scale. Job evaluation has a certain advantages over other techniques of pay fixation. This system usually gives equal weight to all factors. In rating jobs on this factor consideration is given to the ratings of benchmark descriptors and the position’s Job Evaluation is a process to determine the value of a particular job to the organization based on the importance of duties and tasks performed on the given job. 3. Thus, job evaluation begins with job analysis and ends at that point where the worth of a job is ascertained for achieving pay-equity between jobs. A list beginning with the most important job and ending with the least important is then prepared. The factor comparison method represents a combination of ranking and points factor methods. 3. In performance appraisal, it is not of much use because the designing of scale is a very difficult task. Job Evaluation by Ranking Method or Grading Method, 2. Factor-Comparison Method: Under this method, the job is evaluated, and the ranks are given on the basis of a series of factors Viz. viz. Job Evaluation by Factor Comparison Method. In the rating process, each job should be compared with others (one factor at a time), and point values to each job should be assigned. The four methods available are ranking, classification, factor comparison, and point method to choose in utilizing the aspects to assist in job evaluation. To ensure proper understanding of the job, the factors of a job should be properly defined. Experts should be appointed for rating the job factors. Job evaluation is the process of figuring out how much a job is worth to create a job structure for a business. This procedure adds accuracy to the rating process. Select key jobs (say 15 to 20), representing wage/salary standard across the organisation. 6.8 The result of the job evaluation is conveyed in writing to the Environment Head. Each factor is then divided into levels or degrees which are then assigned points. 6.7 Human Resources will compare the outcome of the job evaluation with other similar positions within SU’s organisational structure for the purpose of mutual comparison. Factor comparison is a complex quantitative method. Job evaluation is the output provided by job analysis. The factors and their sub-divisions are more in number. These are systematic and formalised systems for evaluating jobs. The merits of the Ranking method of job evaluation system are as follows: 1. Job Ranking: The job ranking method is the simplest and easiest job evaluation method; jobs and the employees who perform those jobs are ranked from highest to lowest depending on their quality and value to the organization. Factor Comparison definition A scientific method designed to rank job roles based on a breakdown of factors rather than the role as a whole. The job analyst should be familiar with all jobs. The point method is an extension of the factor comparison method. 6.9 If the job evaluation indicates a higher job level and the environment has sufficient They are: 1. It is essentially a combination of the ranking and point systems. • Factor comparison • Statistical/policy capturing ... Ranking/paired comparison job evaluation method define/pro/con: • Group of managers and/or HR specialists examine a set of job descriptions and then rank the jobs according to their overall worth to the organization 3. It is worthwhile noting which ones are used most commonly in your sector. Ideally, all factors should be present in all the jobs being evaluated to some degree, so that each job can be scored under each factor heading. Like ranking system, this system is also very simple. 2. The demerits of factor comparison system are given below: 1. The Factor Comparison Method - This method is a combination of the ranking and point system. It is a logical and to a certain extent an objective method of ranking and grading the jobs. For a job the wage rate is apportioned along the recognized factors. ii. FACTOR COMPARISON METHOD -A scientific method designed to rank job roles based on a breakdown of factors rather than the role as a whole. This system is usually used to evaluate white collar, professional and managerial positions. In his article “characteristics of factor comparison job evaluation”, (Hay (1), 1946), Hay had expressly shown his confidence and belief in the judgement of the skilled and well trained evaluators to present/produce equal intervals; usually geometrically increased, from lower to higher jobs. This method determines the relative rank of the jobs is evaluated in relation to the monetary scale. 2. A clear-cut definition enables the worker to understand the relative weight of each factor. Generally, fifteen to twenty key jobs are first selected. . The Factor Comparison Method This method is a combination of the ranking and point system. 3. The analyst, however, can combine two or more methods for counter checking the balance. After the wage rate for a job is spread along the ranked identified factors, in the department all other jobs are compared in terms of each of factor. The decided jobs must represent as various departments as possible. It evaluates the position, not the performance of employees. This is the most simplest method of job evaluation. Job Ranking: The job ranking method is the simplest and easiest job evaluation method; jobs and the employees who perform those jobs are ranked from highest to lowest depending on their quality and value to the organization. These factors should also be classified into two namely, major factors and minor factors. 2) Mental effort, 3) Physical effort, 4) Responsibility, and. The internal worth of a job is evaluated based upon factors like – Know-How, Problem Solving, Accountability, Education, Experience, Complexity involved in the job, Scope of job… This is another quantitative method of job evaluation. Though it is the most difficult method of all, it is appreciable & consistent. In this method, Pay will be assigned by comparing the weights of the factors needed for each job for example the present wages paid for key jobs might be divided amongst the factors weighted by significance (the most significant factor, for example, mental effort, receives the highest weight). These degrees determine the number of points to be credited to each job. Factor Comparison Method. Ranking method. Human Resource Management 4/6/16 10 Job Evaluation methods Job Evaluation methods Qualitative/ Quantitative/ Subjective Objective Job Ranking Factor Comparision Job Classification/ Point method Grading Human Resource Management 4/6/16 11 Job Ranking (1/2) 1. the amount of compensation offered for that part of the role. Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd, 1: An Example of Factor Comparison Method. Under this system, the jobs are just selected on the basis of the job analysis. Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! Weightages are given on the basis of prevailing wage and salary practices and hence cannot be held absolutely arbitrary. Methods (cont)
Paried comparison: the evaluator ranks each job in turn against all other jobs to be appraised, so that a series of paried ranking is produced. Under Job Classification method, all jobs are divided into various classes. The points for each factor are summed to form a total point score for the job. 4. This method is highly expensive because expert raters are to be employed. Method # 3. 4. Otherwise, misleading results will be produced. These may include skill, effort, decision making, working conditions, and responsibility for people, finance, or equipment. The system is usually applied when allocating managerial positions, white collar, and professional jobs. This will avoid overlapping. Job Evaluation by Factor Comparison System, Classification of Organization | Features | Merits | Demerits, Central Banking or Primary Functions of RBI, Concepts of Job Analysis | Meaning, Procedure, Merits, Demerits, Social Responsibility of Business | Meaning | Need, Weaknesses of Trade Union Movement in India and Suggestion to Strengthen, Audit Planning & Developing an Active Audit Plan – Considerations, Advantages, Good and evil effects of Inflation on Economy, Vouching of Cash Receipts | General Guidelines to Auditors, Audit of Clubs, Hotels & Cinemas in India | Guidelines to Auditors, Depreciation – Meaning, Characteristics, Causes, Objectives, Factors Affecting Depreciation Calculation, Inequality of Income – Causes, Evils or Consequences, Accountlearning | Contents for Management Studies |. Selecting a job evaluation method. There are primarily three methods of job evaluation: (1) ranking, (2) classification, (3) Factor comparison method or Point method. Create your account in less than a minutes. Job Ranking If you've been running your business long enough, you know how the jobs rank in importance to the overall goal and mission of the company. determining the relative importance of factors and describing their degrees. There are many different types of job evaluation systems to choose from. 1. There are a number of job evaluation methods to choose from. These jobs should be from a cross-section of departments. 2) Mental effort, 3) Physical effort, 4) Responsibility, and. However this system is suitable for smaller concerns, where jobs are few in number. 3. There are four methods of job evaluation. Job evaluation refers to the measurement of the value of a job relative to other jobs. Forgot password? Identifiable factors for the benchmark jobs are ranked during factor analysis and then are compared to market rates in order to assign a monetary value to each compensable factor. This system was first evolved by E.J.Benye and S.L.H. In this method, each job is given a rank on the basis of a number of factors. The four major methods of job evaluations are job ranking, job classification, factor comparison, and the point method. 1. When all factors are compared, the final rating is arrived at by adding the value r… The merits of factor comparison system are as follows: 1. They are: The ranking and classification methods provide the evaluation of jobs in non-quantitative terms, whereas the point method and factor comparison method furnish the result in quantitative job values. Mental require… Though it is the most difficult method of all, it is appreciable & consistent. Meaning of Job Evaluation Job evaluation : Systematic way of determining the value or worth of a job in relation to other jobs in an organization. These may include skill, effort, decision making, working conditions, and responsibility for people, finance, or equipment. Since this system is highly complex, it cannot be easily explained to the employees. Perhaps the simplest method of job evaluation is the ranking method. This is because all the factors contained in a single job are not of equal importance. The ranking should be made independently. Presentation on: “ Use of Point Method in Job Evaluation” Presented to: Prof. Ratnaparkhi Presented by: Rajeev Gupta(PGM07060582) It tries to make a systematic comparison b/w jobs to assess their relative worth for the purpose of establishing a rational pay structure. 1. Various types of jobs are performed by employees in an organization. Under this method, one begins with the selection of factors, usually five of them: mental requirements, skill requirements, physical exertion, responsibility, and job conditions. These factors comprise physical effort, mental effort, responsibility; skill needed supervisory responsibility, working conditions and other such kind of factors (for example, know-how, problem solving abilities, accountability, etc.). 5. The ultimate goal of factor comparison is to assign the relative parts of each job role a financial value i.e. The total points value is then used in setting up the monetary wage scale. Steps in Job Evaluation Programme | Various Methods, 1. Generates a hierarchy but does not have an external component. EXAMPLES OF COMPENSABLE FACTORS: * SKILLS * RESPONSIBILITIES * EFFORT * WORKING CONDITIONS STEPS IN COMPARING AND RANKING JOBS … degrees, and provides the scales by which each degree of each factor is to be valued. This is the duty of the job analyst to stipulate the limits of each factor. Then the key jobs or basic factors are ranked in order. The degree of each factor is also determined for assigning points. After making minor adjustments to arrive at uniform wage scales, the ratings are converted into a money scale with reference to the prevailing wage level. This is the simplest method of job evaluation. A more detailed description on these methods of job evaluation is presented in the next section. This method is also known as the Factor Comparison Method. In this way, Hay tries to apply Thus ,the steps involved in factor comparison method might be briefly stated as: An instance of how the factor comparison method works is given below: Box 1: An Example of Factor Comparison Method. They are: 1. 2. A) point method B) ranking method C) job description method D) factor comparison method Create an account to start this course today Used by over 30 million students worldwide Job Evaluation: Methods: Factor Comparison A set of compensable factors are identified as determining the worth of jobs. 4. Ideally, all factors should be present in all the jobs being evaluated to some degree, so that each job can be scored under each factor heading. This system was first evolved by E.J.Benye and S.L.H. Job evaluation refers to the measurement of the value of a job relative to other jobs. The objective of job evaluation is to determine which jobs should get more pay than others. In fact, it is only an extended idea of the simple ranking system. Each factor is then divided into levels or degrees which are then assigned points. 4. They are skill, effort, responsibility and job conditions, These factors can be again sub-divided into eleven characteristics. While many variations of these methods exist in practice, the three basic approaches are described here. All rights reserved! After ranking the key factors, weights are assigned to the factors. Job evaluation determines the value of one job in relation to others in the organization in order to ensure a fair job hierarchy and/or salary system is in place. The importance of each job should be determined with reference to the factors such as skill, experience, working conditions etc. This video explains methods of job evaluation Job evaluation Part 1 https://youtu.be/eb_1hPl196g The factor comparison method is a quantitative method of job evaluation which evaluates jobs according to several compensable factors. We can use this method in job evaluation. ... Job Evaluation: Methods: Factor Comparison A set of compensable factors are identified as determining the worth of jobs. May not reflect market values of jobs. For each of these classes, a general specification is prepared with reference to the nature of the work, responsibilities involved and skill required etc. 1. Assignment of weightages and monetary values may sometimes be colored by the bias of experts. respect of one factor at a time. This method provides record of the factors considered on the basis for rating and therefore it is not useful in explaining the employees and union representatives why one job is rated higher than the other. In spite of the serious limitations referred above, this system does provide an overall review of jobs at one time. The ranking should be made independently. The four major methods of job evaluations are: job ranking, job classification, factor comparison and the point method. No matter which The final job evaluation method is the point method, which measures performance through scales and job factors rather than focusing on entire job functions and ranking employees against each other. Factor Comparison Method. Several methods such as job ranking, job grading, and factor comparison are employed in job evaluation. The key factors generally used under this method are. Factor Comparison is similar to Points Rating job evaluation scheme, being based on an assessment of factors, though no points are allocated. Jobs with similar responsibilities within the organization are identified to set benchmarks. It involves quantitative and analytical approach to the measurement of job value. Under this method, rather than ranking complete jobs, each of jobs is ranked according to a series of factors. Factor Comparison Jobs are compared against other jobs on the basis of how much of some desired factor they possess. Burk. Discuss the job ranking, point-factor, classification and factor comparison methods of job evaluation To unlock this lesson you must be a Study.com Member. They are as follows: In order to measure one job in terms of other jobs or with reference to other jobs, it is necessary to select factors common to all occupations. A more systematic & scientific method of job evaluation is the factor comparison method. Job evaluation has been defined as a process of analysis and assessment of jobs to ascertain reliably the relative worth. The aim of factor comparison is to assign financial value to the relative parts of each job role. Factor Comparison: Factor comparison method is more scientific and complex than the qualitative methods of ranking and classification. Factor Comparison definition A scientific method designed to rank job roles based on a breakdown of factors rather than the role as a whole. For example, selecting functions, accounting, correspondence, engineering services etc. There are primarily three methods of job evaluation: (1) ranking, (2) classification, (3) Factor comparison method or Point method. 3. As originally developed this method involves ranking of jobs in respect of certain factors and usually involves the assigning of money wages to the job depending upon the ranking. 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