This research paper will show the major steps in evaluating positions within organization. Further, the paper will distinguish between the arithmetic means, the median, Stoddard deviation, percentile and quartile. Finally, the paper will examine considerations why to transfer from pay-for-skills to pay-for-knowledge system.
Human resource management is not an easy task and job evaluation plays crucial role in it when it is required to estimate particular organizational position. Job evaluation is defined as a systematic process used for determining the importance, value, complexity and relative level of each job in company. Jon evaluation is usually performed after work analysis and it helps to perform better job description in broader and more flexible form. Job evaluation usually focuses on the following factors: knowledge and skills requirements, training level, qualification requirements, complexity of duties and tasks, responsibility, accountability, interaction with other organizational levels, decision-making authority, working conditions, cross-training requirements, etc. (Sims, 2002)
The steps in job evaluation process are the following:
· to introduce the concept;
· to obtain approval of the concept;
· to train selection team;
· to review and select necessary method;
· to gather data on internal jobs;
· to expand job description; to rank job hierarchically;
· to link position with compensation system;
· to implement job evaluation;
· to review evaluation system. (Sims, 2002)
When performing accounting operations for some non-professionals it is rather difficult to distinguish between the arithmetic mean, the median, standard deviation, percentile and quartile. The arithmetic mean is defined a sum of all members divided by the number of list items. It is used when it is necessary to calculate the average. In statistics it is uses to be distinguished from mode, the median and other averages. In contrast to the arithmetic mean, the median shows how the item deviates from the average. It is usually used in medical screening tests. Further, standard deviation is graphical representation of statistical dispersion of the values. Actually, standard deviation is defined as the square root of the variance. In other words, standard deviation is “is the average of the squared differences between data points and the mean”. (Spring 1998, p.145) Quartile is used to divide any of the three values into four equal parts. It means that each of the three parts will represent 1/4th of the sampled item. The median is a part of quartile. One of the rules claims that it is possible to use median when dividing the data set into two halves. Further, the value of lower quartile is the median of the lower data half. Therefore, when it is necessary to calculate quartile it is possible to use the rule of the median. Finally, percentile can be defined as variable value representing a certain percent of observation fall. Percentile is related to the median and the first quartile. For example, the 50th percentile is known as the median, whereas the 25th percentile is known as the first quartile. (Spring, 1998)
Nowadays many organizations are transferring from pay-for-skills to pay-for-knowledge systems as today is the ear of knowledge-based economy and pay-for-knowledge systems are gaining more and more attention from researchers and practitioners. However, it is not an easy process and it requires thoughtful considerations. It is necessary to remember that this system is not suitable for all organizations. It is radical departure from traditional skills-based payment system. Pay-for-knowledge system suggests that workers are compensated for their abilities to perform specific tasks, whereas pay-for-knowledge suggests that workers are compensated for the range of jobs they are able to perform in organization when it is necessary. It is associated with increase in production output. However, it is necessary to consider the following disadvantages: increased training costs, increased labor hours, increased administrative costs, legal concerns about equal payment, topping out and holding-ups. (Gupta et al., p.40-43)
Gupta, N., Schweizer, T.P., & Jenkins, D.G. (1987). Pay-for-Knowledge compensation Plans: Hypothesis and Survey Results. Monthly Labour Review, 110, 10, 40-43.
Iii, Edward E. Lawler. 2003. Creating a Strategic Human Resources Organization: An Assessment of Trends and New Directions. Stanford, CA: Stanford University Press.
Sims, Ronald R 2002. Organizational Success through Effective Human Resources Management. Westport, CT: Quorum Books.
Spring, Joel. 1998. Education and the Rise of the Global Economy. Albany, NY: State University of New York Press.