What are the benefits of job evaluation and its limitations?

Job evaluations are performed for several reasons, most commonly to determine the monetary value of a job with a company. A second common reason is to discover overlapping jobs that cause two or more workers to perform the same duty. Thirdly, evaluations can uncover work flow gaps that can slow production. Two of the most common job evaluation methods are job ranking and the points method.

Job Ranking

Job ranking is the simplest and easiest job evaluation method. Jobs and employees who perform those jobs are ranked from highest to lowest, depending on their quality and value to the organization. This method entails the comparison of jobs against other positions within the organization. Jobs are evaluated based on content and value. Job content refers to the type of work performed, and the skills and knowledge needed to perform the work. Job value refers to how well the job meets the organization's goals and the difficulty in filling the job.

Ranking Advantages

Job ranking is the easiest and least expensive method of evaluation. It is very effective in small organizations, where there are few job classifications. This method is easy for employees to understand.

Ranking Limitations

The main disadvantage to job ranking is that it's based on judgment and isn't scientific. Rankings are based on the opinions of evaluators and can seem unfair to those performing the jobs. A major limitation is that evaluators have to redo the ranking system for every new job or position that's created.

Point Method

According to Microsoft, point evaluation is the most widely used method. This method is based on certain compensable factors within a company. Depending on the industry, job evaluators may assess jobs based on one or more of these factors: training level, qualification requirements, knowledge and skills requirements, complexity of tasks, interaction with other areas in the organization, problem-solving tasks that require independent judgment, accountability, responsibility, decision-making authority, degree of supervision required, cross-training requirements, working conditions and degree of difficulty. Points are then assigned to each factor. The number of points each position is worth equals an assigned monetary value.

Point Advantages

This method may be considered less biased by employees because evaluators assign a job’s total points before assessing compensable factors.

Point Limitations

The evaluator must be familiar with each job to accurately assign a point value to each compensable factor. The process of assessing and assigning points to compensable factors is a time-consuming and expensive method to implement.

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What are the limitations of Job Evaluation?

The limitations of job evaluation are summarised as under:
(1) Not a scientific technique—Job evaluation is a systematic technique and not the scientific technique of rewarding the job. Job evaluation lacks scientific precision because all factors cannot be measured accurately.
(2) Problem of adjustment—Though many ways of applying the job evaluation techniques are available rapid changes in technology and in the supply and demand of particular spills have given rise to problems of adjustment.
(3) Unrealistic—Substantial differences exist between job factors and the factors emphasised in the market. These differences are wider in cases in which the average pay offered by a company is lower than that prevalent in other companies in the same industry or in the same geographical area.
(4) Organisational Limitations—A job evaluation scheme takes a long time to instal. Il requires specialised personnel and it is costly.
(5) Opposition by workers—Job evaluation is regarded by the trade unions with suspicion because it is made on certain principles and results are generally ignored. Some of the methods of job evaluation are not easily understood by workers. Workers fear that job evaluation will do away with collective bargaining.
(6) Subjective—Too many factors are used in job evaluation and moreover there is no standard list of factors to be considered. Definitions of factors vary from organinsation to organisation. Many researches show that the factors used are not independently be valued at all. It gives more reliance on internal standards and evaluation for fixing wage rates.
Conclusion—Inspite of these limitations, job evaluation is very useful in evaluating the relative worth of the job. Job evaluation provides a systematic study and assessment of the job and many complaints about disparity in existing wage structures are removed by this technique. Although job evaluation not an exact science, it is a systematic way of avoiding several anomalies in wages. Hence it can be concluded that job evaluation is not an exact science. It is a technique which can help avoid several anomalies in wages that causes so much heart burns and disgust today—provided it is used sensibly and is not pressed beyond its proper limits. While using this technique, its limitations should also be considered.

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