Which of the following administrative tools is used by organizations to design job structures?
A. Job rotation
B. Job evaluation
C. Market pay survey
D. Job description
E. Job specification
The correct answer and explanation is :
Correct Answer: B. Job evaluation
Explanation:
Job evaluation is the correct administrative tool used by organizations to design job structures. Job structures refer to the hierarchy and relationships between different jobs within an organization, often defined in terms of relative value or worth. The goal of job evaluation is to ensure internal equity — that is, to make sure jobs that require similar skills, effort, responsibility, and working conditions are compensated fairly and consistently.
What is Job Evaluation?
Job evaluation is a systematic process for assessing the relative worth of jobs within an organization. It does not evaluate individual employees, but rather focuses on the job itself. There are several common methods used in job evaluation, including:
- Point-factor system (assigns points to factors like skill, effort, responsibility)
- Ranking method (orders jobs from highest to lowest in value)
- Classification method (categorizes jobs into pre-defined classes or grades)
- Factor comparison method (compares jobs using key compensable factors)
Once jobs are evaluated, a job hierarchy or structure is created, which helps in developing a fair and transparent pay system.
Why Other Options Are Incorrect:
- A. Job rotation: This is a developmental tool used to give employees experience in various roles, but it doesn’t help in designing job structures.
- C. Market pay survey: While important for external equity (i.e., comparing pay to similar jobs in the market), it doesn’t define the internal structure of jobs within an organization.
- D. Job description: This outlines the duties and responsibilities of a job, but doesn’t evaluate the relative value of that job compared to others.
- E. Job specification: This details the qualifications and skills needed for a job. It’s more focused on recruitment and selection than job structure.
Conclusion:
Job evaluation is essential for determining internal equity, creating pay grades, and developing compensation strategies. It allows organizations to fairly and consistently assign value to different roles, forming the foundation of a well-structured human resources system.