Dear Suchi,
Referring to your query, grading system for any company is not really an easy task to get it done. There are many companies with very few position titles available. Employees are always looking out for career growth, but many times employers are not able to promote the employee to the next level due to the unavailability of vacancies. I have seen many employees leaving some of these companies in search of career growth.
This is where a grading system will come to the help of the company. However, getting it done is not an easy task. A grading system commands a lot of prerequisites to be completed. For instance, job profiling is very important. Preparing, analyzing, and fixing the correct job description and obtaining the correct output are the most important tasks that you should do when starting a grading system. Once the job descriptions are complete, they should be weighted according to the performance requirements. Also, fixing the requirements for the experience required for the title, minimum-max education, additional certifications, trainings received, etc., will also need to be determined along with the job description. The mix and match of the factors affecting the ready job description will aid you in correctly preparing a grading system, through which your organization can maintain numerous subclasses within the same grade and motivate employees by promoting within the grade from one subclass to another or compensating through remuneration.
Sabu.