APPENDIX: CHAPTER 11
Quantitative Job Evaluation Methods
THE FACTOR COMPARISON JOB
EVALUATION METHOD
The factor comparison technique has many variations and appears to be the most accurate, the most
complex, and one of the most widely used job evaluation methods.
It entails deciding which jobs have more of certain compensable factors than others. With the ranking method, you generally look at each job as an
entity and rank the jobs. With the factor comparison
method, you rank each job several times—once for
each compensable factor you choose. For example, jobs
might be ranked first in terms of the factor “skill.”
Then they are ranked according to their “mental
requirements.” Next, they are ranked according to
their “responsibility,” and so forth. Then these rankings are combined for each job into an overall
numerical rating. Here are the required steps.
Step 1. Obtain Job Information This method requires a
careful, complete job analysis. First, job descriptions
are written. Then job specifications are developed,
preferably in terms of the compensable factors the
job evaluation committee has decided to use. For the
factor comparison method, these compensable factors are usually (1) mental requirements, (2) physical
requirements, (3) skill requirements, (4) responsibility, and (5) working conditions. Typical definitions
of each of these five factors are presented in Figure
11A-1.
Step 2. Select Key Benchmark Jobs Next, 15 to 25 key
jobs are selected by the job evaluation committee.
These jobs will have to be representative benchmark
jobs.
Step 3. Rank Key Jobs by Factor Here, evaluators are
asked to rank the key jobs on each of the five factors
(mental requirements, physical requirements, skill
requirements, responsibility, and working conditions). This ranking procedure is based on job
descriptions and job specifications. Each committee
member usually makes this ranking individually, and
then a meeting is held to develop a consensus on
each job. The result of this process is a table, as in
Table 11A-1. It shows how each key job ranks on
each of the five compensable factors.
Step 4. Distribute Wage Rates by Factors This is where
the factor comparison method gets a bit more complicated. In this step, the committee members have
to divide up the present wage now being paid for
each key job, and distribute it among the five compensable factors. They do this according to their
judgments about the importance to the job of each
factor. For example, if the present wage for the job of
common laborer is $4.26, our evaluators might distribute this wage as follows:
Mental requirements
$0.36
Physical requirements $2.20
Skill requirements
$0.42
11-1
11-2
Appendix Quantitative Job Evaluation Methods
Responsibility
$0.28
Working conditions
$1.00
Total
$4.26
They make such a distribution for all key jobs.
Step 5. Rank Key Jobs According to Wages Assigned to
Each Factor Here, you again rank each job, factor by
factor, but the ranking is based on the wages assigned
to each factor. As shown in Table 11A-2, for example,
FIGURE 11A-1
Sample Definitions
of Five Factors
Typically Used in
Factor Comparison
Method
for the “mental requirements” factor, the welder job
ranks first, whereas the security guard job ranks last.
Each member of the committee first makes this distribution working independently. Then the committee
meets and arrives at a consensus concerning the
money to be assigned to each factor for each key job.
Step 6. Compare the Two Sets of Rankings to Screen
Out Unusable Key Jobs You now have two sets of
rankings for each key job. One was your original
1. Mental Requirements
Either the possession of and/or the active application of the following:
A. (inherent) Mental traits, such as intelligence, memory, reasoning, facility in verbal expression,
ability to get along with people and imagination.
B. (acquired) General education, such as grammar and arithmetic; or general information as to
sports, world events, etc.
C. (acquired) Specialized knowledge such as chemistry, engineering, accounting, advertising,
etc.
2. Skill
A. (acquired) Facility in muscular coordination, as in operating machines, repetitive movements,
careful coordinations, dexterity, assembling, sorting, etc.
B. (acquired) Specific job knowledge necessary to the muscular coordination only; acquired by
performance of the work and not to be confused with general education or specialized knowledge. It is very largely training in the interpretation of sensory impressions.
Examples
(1) In operating an adding machine, the knowledge of which key to depress for a
subtotal would be skill.
(2) In automobile repair, the ability to determine the significance of a certain knock
in the motor would be skill.
(3) In hand-firing a boiler, the ability to determine from the appearance of the
firebed how coal should be shoveled over the surface would be skill.
3. Physical Requirements
A. Physical effort, as sitting, standing, walking, climbing, pulling, lifting, etc.; both the amount
exercised and the degree of the continuity should be taken into account.
B. Physical status, as age, height, weight, sex, strength, and eyesight.
4. Responsibilities
A. For raw materials, processed materials, tools, equipment, and property.
B. For money or negotiable securities.
C. For profits or loss, savings or methods’ improvement.
D. For public contact.
E. For records.
F. For supervision.
(1) Primarily the complexity of supervision given to subordinates; the number of
subordinates is a secondary feature. Planning, direction, coordination, instruction, control, and approval characterize this kind of supervision.
(2) Also, the degree of supervision received. If Jobs A and B gave no supervision to
subordinates, but A received much closer immediate supervision than B, then B
would be entitled to a higher rating than A in the supervision factor.
To summarize the four degrees of supervision:
Highest degree—gives much—gets little
High degree—gives much—gets much
Low degree—gives none—gets little
Lowest degree—gives none—gets much
5. Working Conditions
A. Environmental influences such as atmosphere, ventilation, illumination, noise, congestion, fellow workers, etc.
B. Hazards—from the work or its surroundings.
C. Hours.
Source: Jay L. Otis and Richard H. Leukart, Job Evaluation: A Basis for Sound Wage Administration, p. 181. © 1954,
revised 1983. Reprinted by permission of Prentice Hall, Upper Saddle River, NJ.
Appendix Quantitative Job Evaluation Methods
Mental
Physical
Skill
Working
Requirements Requirements Requirements Responsibility Conditions
Welder
Crane operator
Punch press operator
Security guard
a1
1
3
2
4
4
1
3
2
1
3
2
4
1
4
2
3
TABLE 11A-1
Ranking Key Jobs
by Factorsa
2
4
3
1
is high, 4 is low.
ranking (from step 3). This shows how each job ranks
on each of the five compensable factors. The second
ranking reflects for each job the wages assigned to
each factor. You can now draw up a table like the one
in Table 11A-3.
For each factor, this shows both rankings for each
key job. On the left is the ranking from step 3. On
the right is the ranking based on wages paid. For each
factor, the ranking based on the amount of the factor
(from step 3) should be about the same as the ranking based on the wages assigned to the job (step 5).
(In this case they are.) If there’s much of a discrepancy, it suggests that the key job might be a fluke.
From this point on, such jobs are no longer used as
key jobs. (Many managers don’t bother to screen out
unusable key jobs. To simplify things, they skip over
our steps 5 and 6, going instead from step 4 to step 7;
this is an acceptable alternative.)
Step 7. Construct the Job Comparison Scale Once
you’ve identified the usable, true key jobs, the next
step is to set up the job comparison scale (Table 11A-4.
Note that there’s a separate column for each of the
five comparable factors.) To develop it, you’ll need
the assigned wage table from step 4.
For each of the factors for all key jobs, you write
the job next to the appropriate wage rate. Thus, in
the assigned wage rate table (Table 11A-2), the welder
job has $4.00 assigned to the factor “mental requirements.” Therefore, on the job comparison scale
(Table 11A-4) write “welder” in the “mental require-
ments” factor column, next to the “$4.00” row. Do
the same for all factors for all key jobs.
Step 8. Use the Job Comparison Scale Now all the
other jobs to be evaluated can be slotted, factor by
factor, into the job comparison scale. For example,
suppose you have a job of plater that you want to
slot in. You decide where the “mental requirements” of the plater job would fit as compared with
the “mental requirements” of all the other jobs
listed. It might, for example, fit between punch
press operator and inspector. Similarly, you would
ask where the “physical requirements” of the
plater’s job fit as compared with the other jobs listed.
Here, you might find that it fits just below crane
operator. You would do the same for each of the
remaining three factors.
An Example Let us work through an example to clarify the factor comparison method. We’ll just use four
key jobs to simplify the presentation—you’d usually
start with 15 to 25 key jobs.
Step 1. First, we do a job analysis.
Step 2. Here we select our four key jobs: welder, crane
operator, punch press operator, and security guard.
Step 3. Based on the job descriptions and specifications, here we rank key jobs by factor, as in Table
11A-1.
Step 4. Here, we distribute wage rates by factor, as in
Table 11A-2.
Hourly
Wage
Mental
Requirements
Physical
Requirements
Skill
Requirements
Responsibility
Working
Conditions
Welder
$9.80
Crane operator
5.60
Punch press operator
6.00
Security guard
4.00
4.00(1)
1.40(3)
1.60(2)
1.20(4)
0.40(4)
2.00(1)
1.30(3)
1.40(2)
3.00(1)
1.80(3)
2.00(2)
0.40(4)
2.00(1)
0.20(4)
0.80(2)
0.40(3)
0.40(2)
0.20(4)
0.30(3)
0.60(1)
a1
11-3
is high, 4 is low.
TABLE 11A-2
Ranking Key Jobs by
Wage Ratesa
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Appendix Quantitative Job Evaluation Methods
TABLE 11A-3
Comparison of Factor
and Wage Rankings
Mental
Physical
Skill
Working
Requirements Requirements Requirements Responsibility Conditions
Welder
Crane operator
Punch press operator
Security guard
aAmount
bRatings
Aa
1
3
2
4
$b
1
3
2
4
Aa
4
1
3
2
$b
4
1
3
2
Aa
1
3
2
4
$b
1
3
2
4
Aa
1
4
2
3
$b
1
4
2
3
Aa
2
4
3
1
$b
2
4
3
1
of each factor based on step 3.
based on distribution of wages to each factor from step 4.
TABLE 11A-4 Job (Factor) Comparison Scale
Mental
Requirements
Physical
Requirements
Skill
Requirements
Responsibility
Working
Conditions
.20
.30
……….
……….
……….
……….
……….
……….
Crane operator
……….
.40
.50
.60
.70
.80
.90
1.00
1.10
1.20
1.30
1.40
1.50
1.60
1.70
1.80
1.90
2.00
2.20
2.40
2.60
2.80
3.00
3.20
3.40
3.60
3.80
4.00
4.20
4.40
4.60
4.80
……….
Welder……
Sec. Guard……
Sec. Guard……
Crane Operator
Punch Press
Operator
Welder
……….
……….
……….
……….
Sec. Guard
Punch Press Operator
(Plater)
Sec. Guard
……….
Crane Operator
……….
Punch Press Operator
(Plater)
……….
Punch Press Operator
Sec. Guard……
(Inspector)……
(Inspector)……
…….….
(Plater)
……….
……….
Crane Operator
(Inspector)
……….
….….
(Inspector)……
Crane Operator……
(Plater)
……….
Punch Press Operator
Welder
……….
……….
……….
……….
Welder
Welder
(Inspector)
(Plater)
Appendix Quantitative Job Evaluation Methods
Step 5. Then we rank our key jobs according to wage
rates assigned to each key factor. These rankings are
shown in parentheses in Table 11A-2.
Step 6. Next, compare your two sets of rankings. In
each left-hand column (marked A) is the job’s ranking from step 3 based on the amount of the compensable factor. In each right-hand column (marked
$) is the job’s ranking from step 5 based on the wage
assigned to that factor, as in Table 11A-3.
In this case, there are no differences between any
of the pairs of A (amount) and $ (wage) rankings, so
all our key jobs are usable. If there had been any differences (for example, between the A and $ rankings
for the welder job’s “mental requirements” factor) we
would have dropped that job as a key job.
Step 7. Now we construct our job comparison scale as
in Table 11A-4. For this, we use the wage distributions from step 4. For example, let us say that in steps
4 and 5 we assigned $4.00 to the “mental requirements” factor of the welder’s job. Therefore, we now
write “welder” on the $4.00 row under the “mental
requirements” column as in Table 11A-4.
Step 8. Now all our other jobs can be slotted, factor by
factor, into our job comparison scale. We do not distribute wages to each of the factors for our other jobs
to do this. We just decide where, factor by factor,
each of our other jobs should be slotted. We’ve done
this for two other jobs in the factor comparison scale:
They’re shown in parentheses. Now we also know
what the wages for these two jobs should be, and we
can also do the same for all our jobs.
A Variation There are several variations on this basic
factor comparison method. One converts the dollar
values on the factor comparison chart (Table 11A-4)
to points. (You can do this by multiplying each of the
dollar values by 100, for example.) The main advantage in making this change is that your system would
no longer be “locked in” to your present wage rates.
Instead, each of your jobs would be compared with
one another, factor by factor, in terms of a more constant point system.
Pros and Cons The factor comparison method is (in
one form or another) a very widely used job evaluation method. It has several advantages: First, it is an
accurate, systematic, quantifiable method for which
detailed step-by-step instructions are available.
Second, jobs are compared to other jobs to determine
a relative value. Thus, in the job comparison scale
you not only see that a welder requires more mental
ability than a plater; you also can determine about
how much more mental ability is required—apparently about twice as much ($4.00 versus $1.70). (This
11-5
type of calibration is not possible with the ranking or
classification methods.) Third, this is also a fairly
easy job evaluation system to explain to employees.
Complexity is probably the most serious disadvantage of this method. Although it is fairly easy to
explain the factor comparison scale and its rationale
to employees, it is difficult to show them how to
build one. In addition, the use of the five factors is an
outgrowth of the technique developed by its originators. Using the same five factors for all organizations
and for all jobs in an organization may not always be
appropriate.
THE POINT METHOD OF JOB EVALUATION
The point method requires identifying several compensable factors (like skills and responsibility), each
with several degrees, and also the degree to which
each of these factors is present in the job. A different
number of points is usually assigned for each degree
of each factor. So once you determine the degree to
which each factor is present in the job, you need
only add up the corresponding number of points for
each factor and arrive at an overall point value for
the job.1 Here are the steps.
Step 1. Determine Clusters of Jobs to Be Evaluated
Because jobs vary widely by department, you usually
will not use one point-rating plan for all jobs in the
organization. Therefore, the first step is usually to
cluster jobs, for example, into shop jobs, clerical jobs,
sales jobs, and so forth. Then the committee will generally develop a point plan for one group or cluster at
a time.
Step 2. Collect Job Information This means performing a job analysis and writing job descriptions and
job specifications.
Step 3. Select Compensable Factors Here, select compensable factors, like education, physical requirements, or skills. Often each cluster of jobs may
require its own compensable factors.
Step 4. Define Compensable Factors Next, carefully
define each compensable factor. This is done to
ensure that the evaluation committee members will
each apply the factors with consistency. Examples of
definitions are presented in Figure 11A-2.
Step 5. Define Factor Degrees Next, define each of
several degrees for each factor so that raters may
judge the amount or degree of a factor existing in a
11-6
Appendix Quantitative Job Evaluation Methods
job. Thus, for the factor “complexity” you might
choose to have six degrees, ranging from “job is
repetitive” through “requires initiative.” (Definitions
for each degree are shown in Figure 11A-2.) The
number of degrees usually does not exceed five or
six, and the actual number depends mostly on judgment. Thus, if all employees either work in a quiet,
air-conditioned office or in a noisy, hot factory, two
degrees would probably suffice for the factor “working conditions.” You need not have the same number of degrees for each factor, and you should limit
degrees to the number necessary to distinguish
among jobs.
Step 6. Determine Relative Values of Factors The next
step is to decide how much weight (or how many
total points) to assign to each factor. This is important because for each cluster of jobs, some factors are
bound to be more important than others. Thus, for
FIGURE 11A-2
Example of One
Factor in a Point
Factor System
executives the “mental requirements” factor would
carry far more weight than would “physical requirements.” The opposite might be true of factory jobs.
The process of determining the relative values or
weights that should be assigned to each of the factors
is generally done by the evaluation committee. The
committee members carefully study factor and
degree definitions and then determine the relative
value of the factors for the cluster of jobs under consideration. Here is one method for doing this:
First, assign a value of 100% to the highest-ranking factor. Then assign a value to the next highest
factor as a percentage of its importance to the first
factor, and so forth. For example,
Decision making
100%
Problem solving
85%
Knowledge
60%
Example of One Factor in a Point Factor System (Complexity/Problem Solving)
The mental capacity required to perform the given job as expressed in resourcefulness in dealing with unfamiliar problems, interpretation of data, initiation of new ideas, complex data analysis, creative or developmental work.
Level
Point Value
Description of Characteristics and Measures
0
0
Seldom confronts problems not covered by job routine or
organizational policy; analysis of data is negligible. Benchmark:
General secretary, switchboard/receptionist.
1
40
Follows clearly prescribed standard practice and demonstrates
straightforward application of readily understood rules and
procedures. Analyzes noncomplicated data by established routine.
Benchmark: Statistical clerk, billing clerk.
2
80
Frequently confronts problems not covered by job routine.
Independent judgment exercised in making minor decisions where alternatives are limited and standard policies established. Analysis of
standardized data for information of or use by others. Benchmark: Social worker, executive secretary.
3
120
Exercises independent judgment in making decisions involving
nonroutine problems with general guidance only from higher
supervision. Analyzes and evaluates data pertaining to nonroutine
problems for solution in conjunction with others. Benchmark: Nurse,
accountant, team leader.
4
160
Uses independent judgment in making decisions that are subject to review in the final stages only. Analyzes and solves nonroutine
problems involving evaluation of a wide variety of data as a regular
part of job duties. Makes decision involving procedures. Benchmark:
Associate director, business manager, park services director.
5
200
Uses independent judgment in making decisions that are not
subject to review. Regularly exercises developmental or creative
abilities in policy development. Benchmark: Executive director.
Source: Richard W. Beatty and James R. Beatty, “Job Evaluation,” Ronald A. Berk (ed.), Performance Assessment:
Methods and Applications (Baltimore: Johns Hopkins University Press, 1986), p. 322.
Appendix Quantitative Job Evaluation Methods
11-7
TABLE 11A-5 Evaluation Points Assigned to Factors and Degrees
Decision making
Problem solving
Knowledge
First-Degree
Points
Second-Degree
Points
Third-Degree
Points
Fourth-Degree
Points
Fifth-Degree
Points
41
35
24
82
70
48
123
105
72
164
140
96
204
174
123
Next, sum up the total percentage (in this case
100% + 85% + 60% = 245%). Then convert this 245%
to a 100% system as follows:
Decision making:
100 ÷ 245 = 40.82 = 40.8%
Problem solving:
85 ÷ 245 = 34.69 = 34.7%
Knowledge:
60 ÷ 245 = 24.49 = 24.5%
Totals
100.0%
Step 7. Assign Point Values to Factors and Degrees In
step 6, total weights were developed for each factor
in percentage terms. Now assign points to each factor
as in Table 11A-5. For example, suppose it is decided
to use a total number of 500 points in the point plan.
Because the factor “decision making” had a weight of
40.8%, it would be assigned a total of 40.8% × 500 =
204 points.
Thus, it was decided to assign 204 points to the
decision-making factor. This automatically means
that the highest degree for the decision-making factor would also carry 204 points. Then assign points
to the other degrees for this factor, usually in equal
amounts from the lowest to the highest degree. For
example, divide 204 by the number of degrees (say,
5); this equals 40.8. Then the lowest degree here
would carry about 41 points. The second degree
would carry 41 plus 41, or 82 points. The third
degree would carry 123 points. The fourth degree
would carry 164 points. Finally, the fifth and highest
degree would carry 204 points. Do this for each factor (as in Table 11A-5).
Step 8. Write the Job Evaluation Manual Developing a
point plan like this usually culminates in a point
manual or job evaluation manual. This simply consolidates the factor and degree definitions and point values into one convenient manual.
Step 9. Rate the Jobs Once the manual is complete,
the actual evaluations can begin. Raters (usually the
committee) use the manual to evaluate jobs. Each job
based on its job description and job specification is
evaluated factor by factor to determine the number of
points that should be assigned to it. First, committee
members determine the degree (first degree, second
degree, and so on) to which each factor is present in
the job. Then they note the corresponding points (see
Table 11A-5) that were previously assigned to each of
these degrees (in step 7). Finally, they add up the
points for all factors. Raters generally start with rating
key jobs and obtain consensus on these. Then they
rate the rest of the jobs in the cluster.
“Packaged” Point Plans Developing a point plan can
obviously be a time-consuming process. For this reason, a number of groups (such as the National
Electrical Manufacturer’s Association and the
National Trade Association) have developed standardized point plans that contain ready-made factor
and degree definitions and point assessments for a
wide range of jobs. They can often be used with little
or no modification.
Pros and Cons Point systems have their advantages,
as their wide use suggests. This is a quantitative technique that is easily explained to and used by employees. On the other hand, it can be difficult to develop
a point plan, and this is one reason many organizations have opted for ready-made plans.