Ch8 _ 9 - 71-342: Compensation Management Chapters 8 & 9...

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71-342: Compensation Management 1 The Point Method of Job Evaluation Evaluating the Market
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71-342: Compensation Management 2 1. 2. Determine compensable factors. 3. Scale the factors. 4. Weight the factors according to importance & assign point values to each factor 5. Communicate the plan, train users, prepare manual. 6. Apply to non-benchmark jobs. Designing a Point Plan: Six Steps
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71-342: Compensation Management 3 Step 1: Conduct Job Analysis & Determine Benchmark Jobs Point plans begin with job analysis A representative sample of jobs - benchmark jobs - is drawn for analysis Content of these jobs is basis for Defining compensable factors Scaling compensable factors Weighting compensable factors
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71-342: Compensation Management 4 Characteristics of Benchmark Job Contents are well-known and relatively stable over time Job is common across several different employers
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71-342: Compensation Management 5 Example of Benchmark Jobs
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71-342: Compensation Management 6 Step 2: Determine Compensable Factors Compensable factors play a pivotal role Reflect how work adds value to organization Characteristics of compensable factors Based on strategy and values of organization Based on work performed Acceptable to stakeholders affected by resulting pay structure
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71-342: Compensation Management 7 Generic Compensable Factors Skill Education Experience Effort Physical Mental Creativity of thinking Analytical problem solving
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71-342: Compensation Management 8 Generic Compensable Factors Responsibility Consequences of errors Impact on the organization Working Conditions Degree of discomfort or hazard involved Other types of compensable factors Hay guide chart Mercer IPE
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71-342: Compensation Management 9 Step 3: Scale the Factors Construct scales reflecting different degrees within each factor Most factor scales consist of 4 to 8 degrees Criteria for scaling factors Limit to number necessary to distinguish among jobs Use understandable terminology Anchor degree definitions with benchmark job titles Make it apparent how degree applies to job
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71-342: Compensation Management 10 Example of Factor Scaling Writing Ability: Factor definition and degree statements Definition
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This note was uploaded on 11/28/2011 for the course FINANCE 101 taught by Professor Chan during the Spring '11 term at Aarhus Universitet.

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Ch8 _ 9 - 71-342: Compensation Management Chapters 8 & 9...

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