Importance Of Job Description With Refrence To Compensation

Dear all,
could you please help me out regarding this query why job description is important to design good compensation plan.
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Regards,
Shahid

Greetings,

The Job Description explains every tasks and responsibilities an individual needs to. Each ingredient is weighed in terms of money. This is aligned with the market standards. It is then matched to the skills and education required to deliver the role. An Expected Monetary Value is calculated. This necessitates the action to match the employee's service with employer's offering, i.e, delivery requirement with compensation.

Suppose you are hiring an HR Executive. This role would include all the generalist responsibilities with an added requirement to work on SAP. Ideally, you may list the tasks and develop it into a format, i.e, Job description. You would match each task with the level of education and experience required to deliver it. Here, you would allocate a monetary value to each task and calculate a CTC. You would have to align it with the market standards. Now , your requirement includes an extra skills set , which may not be there in every one. Depending on how much you can spend on training, and what level of SAP PA tasks would the talent have to deliver, you would decide on the final compensation.

There are different techniques involved to design them. You may consider reading few of these documents shared below

Basis of compensation management
Compensation guidelines

Please do share your queries.

Regards,
(Cite Contribution)

Hi!

Looks like some of our moderators are trying to play smart, by making an immediate comment/ reaction to querries. Unfortunately, some of them have very shallow or even ignorant of the subject matter at hand.

The response to this question by one of our "super moderators" explains my statement above.

The Job Description (JD) of a certain "role/ function/ job" in a company has nothing to do with the company's compensation plan. A compensation plan is being designed using the FOUR (4) basic compensation principles of: internal equity, external competitiveness, affordability, and sustainability". These are the only things (plus the market survey) that are used in the design of a company "salary structure".

The JD, esp a good JD (one with contents, context, and requirements), is important only in mapping the "right place" or "job grade" of a certain job within the designed salary struture or compensation plan. This is due to the fact that the JD tells management about the actual "size" of the job compared with others. When a JD or job is evaluated using a certain methodology (e.g. Hay), then the JD is critical (for the evaluator) to be able to determine the appropriate/ correct hay points rating score (per compensable factor). The total score that the job will get will qualify the job in a particular job grade within the structure/ compensation plan of the company.

Hope this helps.

Best regards.



Ed Llarena, Jr.

Managing Partner

Emilla Consulting

Tel: 00966-54-223-7804 (ksa cp)

Dear fellow members,
With my raw HR knowledge, my understading is that JD is a crutial tool to develop Key Performance Indicators (KPI) for each individual which can be measured and given weight hence use it in the performance evaluation for employee acheivments/ deliverables. Where designed properly can be used as tool to give comensations/ promotions/ increments.

Dear All,
The Job Description and over all what is a person is doing within the firm its reflection of his financial issue in the market so the right job descriptions can have the best person with the effective compensation package.
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