UNIT 3

Employee Training and Development

Training Meaning
Training is the process for providing required skills to the employee for doing the job
effectively, skillfully and qualitatively. Training of employees is not continuous, but it
is periodical and given in specified time. Generally training will be given by an expert
or professional in related field or job.

Training is an organized activity for increasing the technical skills of the employees to enable
them to do particular jobs efficiently. In other words, training provides the workers with
facility to gain technical knowledge and to learn new skills to do specific jobs. Training is
equally important for the existing as well as the new employees. It enables the new employees
to get acquainted with their jobs and also increase the job-related knowledge and skills.
Training provides the workers with facility to gain technical knowledge and to learn new skills
to do specific jobs. Training is equally important for the existing and as well as new employees.
It enables the new employees to get acquainted with their jobs and also increase the job-related
knowledge and skills.
Training means imparting the knowledge, skills and aptitudes necessary to undertake the
required jobs efficiently with a view to developing the worker to his fullest potential. As an
organized activity, training is designed to create a change in the thinking and behavior of people.
Training is a two-way and continuous process because there is no end to learning and secondly,
a person gets to learn new technology, new patterns etc.

Definition
“Training is the act of increasing the knowledge and skills of an employee for doing a
particular job.” — Edwin B. Flippo

In the words of Michael J. Jucius, "Training is a process by which the aptitudes, skills
and abilities of employees to perform specific jobs are increased."

Dale S. Beach defines training as ‘the organized procedure by which people learn knowledge
and/or skill for a definite purpose’
In the words of Michael J. Julius, “Training is a process by which the aptitudes, skills, and
abilities of employees perform specific jobs are increasing.”
According to Jack Halloran, “Training is the process of transmitting and receiving
information related to problem-solving.”
Objectives of Training
The overall objective of the training programme is designed to solve the problem. For example,
Wyeth, pharmaceutical company, focuses its training on separate sets of companies for sales
employees, and for managers. Training is the application of the knowledge. It makes people
aware of the rules and procedures for guiding their behaviour.
1-To Facilitate Organisational Changes:
Organisations need to be dynamic to cope with, adjust and adapt to the changes in technology
and other environmental forces. The personnel have to be conditioned to learn new skills and
capabilities to enable them to be receptive to required changes and to assimilate them.

2-To Prepare for Higher Responsibilities:

The personnel need to have opportunities for advancement in their careers. Concurrently, they
should also be striving for assuming higher responsibilities and performing more complex
tasks with competence. For this purpose, an organisation may design a system whereby
opportunities are made available to personnel for their career advancement and simultaneously
preparing them through training for higher positions.

3-To Develop Proper Job-Related Attitudes:

The employees have to be trained to develop positive and helpful attitudes towards their jobs,
superiors, colleagues and juniors, the goals, policies and procedures of the organisation and to
the environment of the work place.

4-To improve Job Related Skills:

Some employees are not able to perform their jobs well. They possess inadequate skills and
knowledge of their assignments with the result that they produce poor quality and volume of
output, waste resources, damage equipment and tools, respond insufficiently to the
supervisor’s instructions and so on. They need a training course for the purpose of removing
their deficiencies and fitting them to their jobs.

5-To Enhance Knowledge of Employees:

Organisations need to help their employees to keep up their knowledge in tune with the
contemporary trends. This is especially so in these days of explosive improvements and
innovations in science and technology. Organisations should support their personnel in the
battle against obsolescence. Personnel are to be exposed to refresher courses and
developmental programs with a view to improve their utility to the organisation .

Assessing need for training

1-Environmental changes:
Mechanization, computerization, and automation have resulted in many changes that require
trained staff possessing enough skills. The organization should train the employees to enrich
them with the latest technology and knowledge.
2-Organizational complexity:
With modern inventions, technological upgradation, and diversification most of the
organizations have become very complex. This has aggravated the problems of coordination.
So, in order to cope up with the complexities, training has become mandatory.
3. Human relations:
Every management has to maintain very good human relations, and this has made training as
one of the basic conditions to deal with human problems.

4. To match employee specifications with the job requirements and organizational

needs:
An employee’s specification may not exactly suit to the requirements of the job and the
organization, irrespective of past experience and skills. There is always a gap between an
employee’s present specifications and the organization’s requirements. For filling this gap
training is required.
5. Change in the job assignment:
Training is also necessary when the existing employee is promoted to the higher level or
transferred to another department. Training is also required to equip the old employees with
new techniques and technologies.

Nature and Importance of Training

1-Reduce Employee Turnover:

A well-trained employee will take more interest in his job and will be a more efficient worker.
He will get more job satisfaction. People who love their jobs are more loyal towards the
organization.

2-Better Managerial Skills:

Training and development programmes inspire the employees to think, plan, solve problems
and take important decisions. This hones up their managerial skills.

3-Improve Employee Morale:

When employees are trained to become better performers, they feel a sense of accomplishment.
They realize that they are effectively contributing towards organizational goals and thus get a
morale boost.

4-Healthy Work Environment:

Training and development programmes help to modify the thought and behavior process of the
employees in such a way that is conducive to building a healthy work environment.

5-Build Team Spirit:

Training often takes place in groups where the trainees are encouraged to interact with each
other and discuss organizational issues. This helps to create team spirit among the employees.
6-Increase Productivity:
Knowledge about usage of sophisticated machinery and new technology is imparted to
employees which will enable them to use the equipment more efficiently and thereby increase
productivity. It is essential to increase productivity and reduce cost of production for meeting
competition in the market. Effective training can help increase productivity of workers by
imparting the required skills.

7-Creating a Highly Skilled, Motivated and Enthusiastic Workforce:

The existing workforce is trained to increase their productivity, and motivated to contribute
their best towards the organization. The employees will be more confident about themselves
and enthusiastic about their job. They will adapt to technological changes and innovations
more readily.

8-Quality Improvement
The customers have become quality conscious and their requirement keep on changing. To
satisfy the customers, quality of products must be continuously improved through training of
workers.

9-Reduction of Learning Time

Systematic training through trained instructors is essential to reduce the training period. If the
workers learn through trial and error, they will take a longer time and even may not be able
to learn right methods of doing work Industrial Safety
Trained workers can handle the machines safely. They also know the use ofvarious safety
devices in the factory. Thus, they are less prone to industrial accidents.

10-Reduction of Turnover and Absenteeism

Training creates a feeling of confidence in the minds of the workers. It gives thema security
at the workplace. As a result, labor turnover and absenteeism rates are reduced.

11-Effective Management
Training can be used as an effective tool of planning and control. It develops skills among
workers and prepares them for handling present and future jobs. It helps in reducing the costs
of supervision, wastages and industrial accidents. It also helps increase productivity and
quality which are the cherished goals of any modern organization.

Methods Of Training Programme.

Training Methods-There are two types of training methods are used for developing skill and
imparting knowledge to human resource (employee).

1. On-the-job training Methods

2. Off-the-job Training Methods
Methods Of Training Programme.

1-On-the-job techniques
On-the-job methods are most popular for developing executive talent. Here, both the trainee
executive and trainer are not free from their daily chores and the pressure of their executive
routine jobs. Some of the most commonly techniques of executive development which fall
under the category of on-the-job techniques are as follows: -

(a) Coaching method: Coaching is again on-the-job training of individual by the supervisor
in the area of specifically defined tasks. This technique is more appropriate for orientation of
new employee and for helping disadvantaged employees to learn specific jobs. The supervisor
must have interpersonal competence and be able to establish helping relationship with the
trainee. Solving the real problem in the organization. JIT is unstructured programmer it is
useful for only shall ground of trainees.

(b) Understudy Method: Also known as attachment method, under this system, a person is
picked up and subjected to training so that he in future, assumes the full duties and
responsibilities of the position currently held by is superior. It is necessary to ensure a fully-
trained person to replace a manager (superior) during his long absence or illness or on his
retirement, transfer or promotion. ‘Understudy’ method is aimed at providing a person who is
going to replace the existing superior.

(c) Job rotation method: ‘Job rotation’ is also known as the Channel Method. Under the job
rotation method, the specialists are translated into generalizes’ or all-rounder’s because the
executives are moved from one job to another on some planned basis in order to learn and
develop all-round knowledge. As pointed out by H. Bedrossian, “Job rotation is designed for
beginning level managers while planned progression is more likely to occur at higher
managerial levels.”

(d) Special projects: Under this method, a trainee executive is assigned a special project
involving heavy responsibility. The trainee is supposed to study the project, understand the
problem issues, and prescribe appropriate solutions, and make a recommendation on the
viability of the project.
(e) Committee assignments: This is similar to the special project method. Here the trainee
executives become members of special committees designed to solve specific problems.
Through committee assignments solve different problems; they may now be effective in
bringing rapid executive development.

(f) Selective readings: Some organizations maintain huge libraries involving a large collection
of useful material on the subjects of interest to the enterprise. The executives go through the
books, journals, articles, notes, and magazines and assimilate knowledge. The executives,
during their leisure hours, try to exchange their views with others and in this process learn new
ways to looking at things.

2-Off-the-job Methods

On-the-job methods of executive development just discussed above may not be adequate
because of the complexities of management process and inadequate facilities, environment and
teaching experience, calling for more sophisticated and comprehensive methods of
development.
Off-the-job training methods aim at placing the executives in a highly maneuverer and
stimulated atmosphere so that they are exposed to new ideas, new ways of analysis and are in
a position to introspect themselves by studying their own behaviour. There is a wealth of off-
the- job executive development techniques and let us discuss some of the most important of
these techniques here under: -

(a) Case study: The case study method involves diagnostic and problem-solving study of
usually a written description of some event or set of circumstances on organizational problems
providing relevant details.
The method is appropriate for developing analytical and problem-solving orientation and skill,
providing practice in applying management concepts, tools and techniques and enhancing
awareness of the management concepts and processes. The method is relevant for developing
o- generational, conceptual and functional skills among top and senior level executives.

(b) Role playing: Role playing is used in helping trainees to diagnose human relations
problems, to develop insight through in-depth analysis of problems relating to human
interaction and to acquire skills in interpersonal communication with particular emphasis on
empathy and listening.
A simulated situation is created in which trainees act out the thoughts and behaviour of persons
in particular roles in the organization. Roles are often played spontaneously and unrehearsed.

(c) In-basket method: In-Basket on In-Tray technique involves simulation of a series of

decisions a trainee might have to make in real life. The trainee is presented with pack of papers
and files in a tray containing administrative problems and is asked to take decisions within
specified time limit.
The decisions taken by several trainees are recorded and compared with one another.
Learning occurs as trainees reflect and evaluate the decisions taken on priorities, customer’s
complaint, superior’s demand, irrelevant information and the like.

(d) Business games: Also termed as ‘management games’, these games refer to the classroom
simulation exercises in which different teams consisting of individual executives are required
to compete with one another in order to achieve a given objective. Here, an artificial
atmosphere close to the real-life situation is created in which the participant executives play a
dynamic role and enrich their skills through involvement and simulated experience.
The teams usually consist of two to six members and each team takes decisions on production,
prices, research expenditure, advertisement expenditure, marketing, and the number of
expected profits under hypothetical conditions.
Management games are aimed at teaching the executives how to take useful and profitable
managerial decisions and make the executives aware of the existence of various group
processes, conflicts, leadership problems, and ways of maintaining ties of friendship with
peers in other departments or functional areas.

(e) Sensitivity training: Originally developed by a behavioral scientist Kurt Lewin and
popularized by the National Training Laboratories, U.S.A., sensitivity training (also known as
T-group training) is a “group experience designed to provide maximum possible opportunity
for the individuals to expose their behavior, give and receive feedback, experiment with new
behavior and develop awareness of self and of others,” (Chris Argyris).

(f) Simulation: Simulation is a special training technique conducted one a duplicate

environment which is a mock-up of a real-life environment. Under the simulation method a
single hour may be equated for a month, or a quarter of a month in real life. Like this, several
events may be experienced in a relatively short span of time. Simulation is a useful technique
of executive development because the decisions taken are reversible (if wrong decisions are
taken) and less costly o the enterprise. One long-standing deficiency of the simulation
technique is that it is difficult to duplicate the reality (specially the presses and problems) of
actual decision-making on jobs. Quite truly, individuals might act differently in real life
situations than the, actions m simulation exercises.

(g) Incident method: This method combines intellectual ability practical judgment, and social
awareness of the executives. The group members are required to address questions to the
discussion leader. The procedure is to ask general questions like what, when, where and how
of the situation in which an incident developed and who was present at that time.
Finally, the executives react because of the behavior. After having subjected through this
method, the executives would be in a position to increase their power to think clearly, incisively
and reasonably about specific facts and also about abstractions.

(h) Conference: The conference method is used to help employees develop problem- solving
skills. Group discussions and Meetings are the two common techniques often made use of in
organizations. The chairman or the t trainer leads discussion, involves trainees in attempting
to solve problems and in arriving at decisions. The conference leader must have the necessary
skill to lead the discussion in a meaningful way without losing sight of the topic or theme. The
conference method or group discussion effects changes in the participants through
modification of their experiences due to sharing and reshaping of their views, thinking and
attitudes.

(i) Programmed Learning: A form of individual study, the programmed learning is more
suited to meeting the behavioral objectives and when non-motor skill or knowledge is to be
learned by a large number of trainees. The trainer monitors trainees’ independent progress
through the programmer. This method is governed by the principle of positive reinforcement
developed by B F Skinner and allows the trainee to learn through a series of small steps in
phases and at his own pace.

(j)Vestibule Training: The Vestibule Training is one of the methods of training, where the
technical staff, especially those who deal with the tools and machinery, are given the job
education training in the workplace other than the main production plant. In other words, the
Vestibule training is called, “near the job training”, which means the simulated setup is
established, proximate to the main production plant, wherein the technical staff learns how to
operate the tools and machinery, that may be exactly similar, to what they will be using at the
actual work floor.
There are special trainers or the specialists, who impart this training to the technical staff,
thereby reducing the burden on the line supervisor, who has to supervise the entire production
process.the vestibules training can be conducted in classrooms or the workstations; that can be
within the main production plant or in close proximity to it. Under this training, the emphasis
is on learning rather than production.

Types of Training
Various types of training can be given to the employees such as induction training, refresher
training, on the job training, vestibule training, and training for promotions.
Some of the commonly used training programs are listed below.
There are different types of training that are conducted depending upon the
requirements of the trainee and the organization.

1. Orientation Training
2. Promotional Training
3. Refresher Training
4. Skills Training
5. Internship Training
6. Cross-functional Training
7. Team Training
8. Creativity Training
9. Diversity Training
1-Orientation Training
Just after the recruitment and selection of a new employee, a new employee is made to undergo
induction and orientation training.
2-Promotional Training
Employees who have the potential to grow and handle larger roles are identified and selected.
They are further trained in various areas that they might need to cover when they would have
to handle larger roles after promotion.

3-Refresher Training
In today’s dynamic world there is a constant change in technology, procedures and policies.
The traditional way of working may become obsolete very soon. Under Refresher Training,
the existing employees are trained to follow new and improved procedures and techniques
to stay abreast with the competition. They are made to undergo short term courses so that they
can adopt the latest developments in a particular field and are able to confidently face the
upcoming challenges.

4-Skills Training
If there is a gap between the skills required for successful completion of a job and the
skills possessed by the employees, there arises a need for training.
A training program is planned and the content is developed to meet the training objectives. An
effective method of training is selected which could be a lecture, coaching, special courses etc.
These skills could be as basic as reading, writing, communication skills, interpersonal skills
etc.

5--Internship Training
Under this types of training professional colleges like management schools or engineering
institutes approach organizations, companies and corporate setups and place their students
under them. This helps to enhance the knowledge of the students as it gives a practical
experience on the job to the theoretical knowledge gained in the college.

6-Cross-functional Training
Under this types of training, the aim is to educate and train the employee in area of work
other than their assigned jobs. This gives them a broader perspective of the business on a
whole, helps them gain diverse knowledge, enhances their career path and chances of
promotion.
Cross-functional training can be done by job rotation i.e placing the employees under
different roles after a suitable period of time. It can also be done where the departments can
exchange their personnel for a certain period that gives an insight to the employees on how
other departments are working.

7-Team Training
Team training generally covers two areas:
content tasks and group processes.
1-Content tasks specify the team’s goals such as cost control and problem-solving.
2-Group processes reflect the way members function as a team – for example how they
interact with each other, how they sort out differences, how they participate etc
Companies are investing heavy amounts, nowadays, in training new employees to listen to
each other and to cooperate. They are using outdoor experiential training techniques to
develop teamwork and team spirit among their employees (such as scaling a mountain,
preparing recipes for colleagues at a restaurant, sailing through uncharted waters, crossing a
jungle, etc.).

8-Creativity Training

In creativity training, trainers often focus on three things:

i-Breaking away ii-Generate new ideas iii-Delaying judgement

i-Breaking away: In order to break away from restrictions, the trainee is expected to:
(i) identify the dominant ideas influencing his own thinking,
(ii) define the boundaries within which he is working,
(iii) bring the assumptions out into the open and challenge everything

ii-Generate new ideas: To generate new ideas,

(i) the trainee should open up his mind;
(ii) look at the problem from all possible angles and list as many alternative approaches as
possible.
(iii) The trainee should allow his mind to wander over alternatives freely,
(iv) switch over from one perspective to another

iii-Delaying judgement: To promote creative thinking,

(i) the trainee should not try to kill off ideas too quickly;
(ii) they should be held back until he is able to generate as many ideas as possible.
(i) Brainstorming often helps in generating as many ideas as possible without pausing to
evaluate them’

9-Diversity Training
Diversity training considers all of the diverse dimensions in the workplace – race, gender, age,
disabilities, lifestyles, culture, education, ideas and backgrounds – while designing a training
programme.
It aims to create better cross-cultural sensitivity with the aim of fostering more harmonious
and fruitful working relationships among a firm’s employees.
The programme covers two things:

(i) Awareness building, which helps employees appreciate the key benefits of diversity,
and
(ii) (ii) Skill building, which offers the knowledge, skills and abilities required for
working with people having varied backgrounds.
Difference between training and development

Basis for Training Development

Comparison
Meaning Training is a learning process in which Development is an educational
employees get an opportunity to develop process which is concerned with
skill, competency and knowledge as per the overall growth of the
the job requirement. employees.
Term Short Term Long Term
Focus on Present Future
Orientation Job oriented Career oriented
Motivation Trainer Self
Objective To improve the work performances of the To prepare employees for future
employees. challenges.
Aim Specific job related Conceptual and general
knowledge

Training Process
1. Decide If Training is Needed.
2. Determine What Type of Training is Needed.
3. Identifying Goals and Objectives.
4. Implementing Training.
5. Evaluation of the Training Program.
Step 1: Decide If Training is Needed

To compete effectively, firms must keep their employees well trained. The first step in the
training process is a basic one, to determine whether a problem can be solved by training. The
first step in the training process is to determine Training needs. The overall purpose of the
assessment phase is to determine if training is needed and, if so, to provide the information
required to design the training program.

Training is conducted for one or more of these reasons:

• required legally or by order or regulation,

• to improve job skills or move into a different position,
• for an organization to remain competitive and profitable.

If employees are not performing their jobs properly, it is often assumed that training will bring
them up to standard. This may not always be the case. Ideally, training should be provided
before problems or accidents occur and should be maintained as part of quality control.

The assessment consists of three levels of analysis: organizational, task, and person.

1. Organizational Analysis: It examines the kinds of problems that an organization is

experiencing and where they are located within an organization.
2. Task/Operational Analysis: An operational analysis identifies the kinds of skills and
behaviors required of the incumbents for a given job and the standards of performance
that must be met.
3. Personnel Analysis: The objective of the personnel analysis is to examine how well
individual employees are performing their jobs.

Training should be given to those who need it. Assigning all employees to a training program,
regardless of their skill levels, is a waste of organizational resources and creates an unpleasant
situation for employees who do not need training. The training objectives must be clarified,
related to the areas identified in the task analysis, and should be challenging, precise,
achievable, and understood by all.

Step 2: Determine What Type of Training is Needed

The employees themselves can provide valuable information on the training they need. They
know what they need/want to make them better at their jobs. Just ask them!

Also, regulatory considerations may require certain training in certain industries and/or job
classifications. Once the kind of training needed has been determined, it is equally important
to determine what kind of training is not needed. Training should focus on those steps on which
improved performance is needed. This avoids unnecessary time lost and focuses the training
to meet the needs of the employees.
Step 3: Identifying Goals and Objectives

Once the employees’ training needs have been identified, employers can then prepare for the
training. Clearly stated training objectives would help employers communicate what they want
their employees to do better or stop doing! Learning objectives do not necessarily have to be
written, but they should be clear and thought out before the training begins for the training to
be as successful as possible.

Step 4: Implementing Training

Professionals should conduct training with knowledge and expertise in the given subject area.
Nothing is worse than being in a classroom with an instructor who does not know what they
are supposed to be teaching! Use in-house, experienced talent, or an outside professional best
option. The training should be presented so that its organization and meaning are clear to
employees. An effective training program allows employees to participate in the training
process and practice their skills and/or knowledge.

Employees should be encouraged to become involved in the training process by participating

in discussions, asking questions, contributing their knowledge and expertise, learning through
hands-on experiences, and even though role-playing exercises. Actually, for making the
training program effective, the targeted group of employees and the use of methods such as
On-the-job or Off-the-job training should select first. The capacity and knowledge of trainers
and their acceptance by the participants are of secondary importance.

1. On the job: Training is administered at the actual work site using the actual work
equipment
2. Off the job: Training is administered away from the actual work site. It may be any
prominent hall room or auditorium, but the required training environment equipment
and materials should be available or arranged.

The training program that results from the assessment should directly respond to an
organizational problem or need. Approaches vary by location, presentation, and type.

Step 5: Evaluation of the Training Program

One way to make sure that the training program is accomplishing its goals is by evaluating the
training by both the trainees and the instructors Training should have, as one of its critical
components, a method of measuring the effectiveness of the training. Evaluations of the
training program will help employers or supervisors determine the amount of learning
achieved and whether or not an employee’s performance has improved on the job as a result.
Assess the program’s success or failures. The credibility of training is greatly enhanced when
it can be shown that the organization has benefited tangibly from such programs. Organizations
have taken several approaches in attempting to determine the worth of specific programs. In
this phase, the effectiveness of the training is assessed. Effectiveness can be measured in
monetary or non-monetary terms. It is important that the training is assessed on how well it
addresses the needs it was designed to address.
 • Participants Opinions: Evaluating a training program by asking the participants’
opinions is an inexpensive approach that provides immediate response and suggestions
for improvements. The basic problem with this type of evaluation is that it is based on
opinion rather than fact. In reality, the trainee may have learned nothing but perceived
that learning experiences have occurred.
•
• The extent of Learning: Some organizations administer tests to determine what the
participants in the training program have learned. The protest, posttest, control group
design is one evaluation procedure that may be used.
•
• Behavioural Change: Tests may accurately indicate what has been learned, but they
give little insight into desired behavioural changes.
•
• The accomplishment of Training Objectives: Still another approach to evaluating
training programs involves determining the extent to which stated objectives have been
achieved.
• Benchmarking: Benchmarking utilizes exemplary practices of other organizations
to evaluate and improve training programs. It is estimated that up to 70 percent of
American and recently European and Indian firms engage in benchmarking.
• A Case for Simplicity: Value is the measure of impact and positive change elicited by
the training.

CAREER PLANNING
Career Planning encourages individuals to explore and gather information, which enables them
to synthesize, gain competencies, make decisions, set goals and take action. It is a crucial phase
of human resource development that helps the employees in making strategy for work-life
balance. Career planning is an ongoing process through which an individual sets career goals
and identifies the means to achieve them. The process by which individuals plan their life's
work is referred to as career planning.
Career planning is the process of enhancing an employee’s future value. A career plan is an
individual’s choice of occupation, organization and career path. Career planning encourages
individuals to explore and gather information, which enables them to synthesize, gain
competencies, make decisions, set goals and take action. It is a crucial phase of human resource
development that helps the employees in making strategy for work-life balance.

According to Schermerborn, Hunt, and Osborn, ‘Career planning is a process of

systematically matching career goals and individual capabilities with opportunities for their
fulfillment’.

Features of Career Planning

1. It is an ongoing process.
2. It helps individuals develop skills required to fulfill different career roles.
3. It strengthens work-related activities in the organization.
4. It defines life, career, abilities, and interests of the employees.
5. It can also give professional directions, as they relate to career goals.

Objectives of Career Planning

1. To identify positive characteristics of the employees.

2. To develop awareness about each employee’s uniqueness.
3. To respect feelings of other employees.
4. To attract talented employees to the organization.
5. To train employees towards team-building skills.
6. To create healthy ways of dealing with conflicts, emotions, and stress.
7. To attract, develop and retain the competent manpower in the organization.
8. To provide adequate development and promotional opportunities.
9. To develop the potential of employees for future assignments.
10. To utilize the manpower and other resources more effectively in the organization.
11. To provide proper job placement to employees.
12. To improve the level of job satisfaction of employees at workplace.
13. To reduce the labor problems and turnover to minimum level.
14. To improve motivation and morale of employees.

Benefits of Career Planning

1. Career planning ensures a constant supply of promotable employees.
2. It helps in improving the loyalty of employees.
3. Career planning encourages an employee’s growth and development.
4. It discourages the negative attitude of superiors who are interested in suppressingthe
growth of the subordinates.
5. It ensures that senior management knows about the caliber and capacity of theemps
who can move upwards. It can always create a team of employees prepared enough
to meet anycontingency.
6. Career planning reduces labor turnover.
7. Every organization prepares succession planning towards which career planning isthe
first step.

PROMOTION

Promotion is vertical movement of an employee within the organization. In other words,

promotion refers to the upward movement of an employee from one job to another higher
one, with increase in salary, status and responsibilities. Promotion may be temporary or
permanent, depending upon the needs of the organization.
Promotion has an in-built motivational value as it elevates the authority, power and status of
an employee within an organization. It is considered good personnel policy to fill vacancies
in a higher job through promotions from within because such promotions provide an
inducement and motivation to the employees and also remove feelings of stagnation-and
frustration.

Promotion means the advancement of an employee to a higher job involving more work,
greater responsibility and higher status. It may or may not be associated with the increment
in salary.

Strauss and Sayles (1976) define promotion as a movement to a position in which

responsibility and prestige are increased. It is a job with more prestige and income.
Edwin B. Flippo, “A promotion involves a change from one job to another that is better in
terms of status and responsibilities.”

Types of Promotion
Promotion given to employees in an organization can be classified into three types:

1. Horizontal promotion
When an employee is shifted in the same category, it is called ‘horizontal promotion’. A
junior clerk promoted to senior clerk is such an example. It is important to note that such
promotion may take place when an employee shifts within the same department, from
one department to other or from one plant to another plant.

2. Vertical Promotion
This is the kind of promotion when an employee is promoted from a lower category to
lower category involving increase in salary, status, authority and responsibility.
Generally, promotion means ‘vertical promotion’.

3. Dry Promotion
When promotion is made without increase in salary, it is called ‘dry promotion’. For
example, a lower-level manager is promoted to senior level manager without increase in
salary or pay. Such promotion is made either there is resource/fund crunch in the
organization or some employees hanker more for status or authority than money.

Purpose of Promotion
The following are the purposes or objectives of promotion:

1. To recognize an employee’s skill and knowledge and utilize it to improve the

organizational effectiveness.
2. To reward and motivate employees to higher productivity.
3. To develop competitive spirit and inculcate the zeal in the employees to acquireskill,
 knowledge etc.
4. To promote employee’s satisfaction and boost their morale.
5. To build loyalty among the employees toward organization.
6. To promote good human relations.
7. To increase sense of belongingness.
8. To retain skilled and talented people.
9. To attract trained, competent and hardw orking people.10. To impress the other
employees that opportunities are available to them too if they also perform well

TRANSFER

A transfer is a change in job assignment. It is the movement of an employee from one job to
another without involving any substantial change in his duties, responsibilities, required skill,
status and compensation. A transfer does not imply any ascending (promotion) or descending
(demotion) change in status or responsibility.

A transfer is a horizontal or lateral movement of an employee from one job, section,

department, shift, plant or position to another at the same or another place where his salary,
status and responsibility are the same.
According to Edwin B. Flippo, “Transfer is a change in job where the new job is
substantially equal to the old in terms of pay, status and responsibilities.”

According to Dale Yoder, “A transfer involves the shifting of an employee from one job to
another without special reference to changing responsibility or compensation. Transfer may
involve promotion, demotion or no change in status and responsibility.”

Purpose Of Transfer
Transfers are generally resorted to with a view to attain the following:

1-To Meet the Organizational Requirements

Organizational changes may demand the shift in job assignments with a view to place the
right man on the right job.
Such changes may be changes in technology, changes in the volume of production, production
schedule, product line, quality of products, change in the job pattern, fluctuations in the
market conditions, reallocation of or reduction in the workforce due to a shortage or a surplus
in same section so that layoffs may be avoided, filling in of the vacancies which may occur
because of separations or because ofthe need for suitable adjustments in business operations.
In short, the purpose of transfers is to stabilize employment in an organization.

2-To Meet Employees’ Requests

Sometimes, transfer is done at the request of the employer himself. Employee may need
transfer in order to satisfy their desire to work under a different superior in a
department/region where opportunities for advancement are bright, in or near their native
place or place of interest, doing a job where the work itself is challenging etc.
3-To Ensure Better Utilization of the Employees
An employee may be transferred because the management feels that he is not performing
satisfactorily and adequately and when the management feels that he may be more useful or
suitable elsewhere, where his capacities would be better utilized.

4-To Make the Employees More Versatile

Employees may be shifted from one job to another to expand their capabilities. Job rotation
may prepare the employee for more challenging assignments in future.

5-To Adjust the Workforce

Workforce may be transferred from a plant where there is less work to a plant where there is
more work. Thus, the employees who have been in service of an organization are not thrown
out of employment but adjusted elsewhere.
6-To Provide Relief to the Employee
Transfers may be made to give relief to employees who are overburdened or doing hazardous
jobs for long periods. Transfer may also be made to break the monopoly of the employee. The
climate of a place may be unsatisfactory for an employee’s health. He may request a transfer
to another place, where his health may not be affected by the climate.

7-To Reduce Conflicts and Incompatibilities

Where employees find it difficult to get along with colleagues in a particular section or
department, they could be shifted to another place to reduce conflicts.

8-To Penalize the Employees

Transfers may be affected as disciplinary measures to shift employees indulging in
undesirable activities to remote, far-flung areas.

9-To Maintain a Tenure System

In senior administrative services of the Government and also in industries or where there is a
system of annual intake of management trainees, the employee holds a certain job for a fixed
tenure but is made to move from job to job with a view to enable him to acquire variety of
experience and skills and also to ensure that he does not get involved in politicizing informal
groups.

10-To Accommodate Family Related Issues

Family related issues cause transfers, especially among female employees. When they get
married, the female employees want to join their husbands and this fact necessitates transfers
or resignations.

Types of Transfer of employee

Transfers may be classified on the basis of purpose or unit

(A) On the Basis of Purpose
(B) On the Basis of Unit
1-Production Transfers
A shortage or surplus of the workforce is common in different departments in a plant or
several plants in an organization. Surplus employees in a department have to be laid off,
unless they are transferred to another department. Transfers affected to avoid such inevitable
layoffs are called production transfers.2-Replacement Transfers
A replacement transfer is the transfer of a senior employee to replace the junior employee or a
new employee, when the latter is laid off or shifted to another job. Sometimes, it is a temporary
arrangement to make use of the services of die senior personnel.

3-Versatility Transfers
Versatility transfers are affected to make employees versatile and competent in more than one
skill. It aims at giving training to the employees of various jobs of similar nature having
different operations. It helps the employees to get themselves prepared for promotions and
also helps the employer in developing the effective manpower prepared to handle the higher
openings.

4-Shift Transfers
When the unit runs in shifts, employees are transferred from one shift to another on similar
jobs. In some undertakings, where shifts are operated regularly, employees may be recruited
permanently for the shift, but in some cases, they are rotated from one shift to another as a
matter of practice, because many employees dislike second or third shift assignment as it
interferes with their social or family engagements.

5-Remedial Transfers
Remedial transfers are done at the request of the employees and are, therefore, called personal
transfers. Personal transfers take place because the initial placement of an employee may
have been faulty or the worker may not get along with his supervisor or with other workers
in the department. He may be getting too old to continue his regular job or working conditions
may not be well adapted to his personal health. If the job is repetitive, the employee may
stagnate and would benefit by transfer to a different kind of work.

6-Precautionary Transfers
Such transfers are made as a precautionary measure to avoid the misuse of office or
misappropriation of funds by the employees. In some undertakings, there are more chances
of misuse of office or misappropriation of funds than others.
Generally, it is mentioned in the transfer policy of the organization that an employee cannot
stay at one post for more than 3 years or so.

(B) On the Basis of Unit

1-Sectional Transfers
These transfers are made within the department from one section to another. The main
purpose of such transfers may be to train the workers and prepare them to handle the
operations of different sections of the department.
 2-Departmental Transfers
Transfers from one department to another department within the plant are called departmental
transfer. Such transfers are made if the nature of work is same or substantially the same in
both the departments such as clerical or routine jobs.

3-Inter-Plant Transfers
If there are more than one plants under the control of same management, transfer may be
made from one plant to another on varied reasons. Such transfers are called inter-plant
transfers.

DEMOTION OF EMPLOYEE

Demotion is just opposite to promotion. In demotion, the employee is shifted to a job lower
in status, grade and responsibilities. “Demotion refers to the lowering down of the status,
salary and responsibilities of an employee.”

In the words of Dale Yoder, “Demotion is a shift to a position in which responsibilities are
decreased. Promotion is, in a sense, an increase in rank and demotion is decrease in rank.”

When an employee is demoted, his pride suffers a more severe jolt than it does when he is
suspended by his junior. Some managers hesitate to demote a man. They prefer to discharge
him rather than to demote him on the lower job because he will not accept the lower job and
will turn to be a disgruntled employee and his position will not be good for better industrial
relations. Causes of Demotion
There are several reasons for demoting a man from his present position.

1. Inadequacy on the part of the employees in terms of job performance, attitude and
capability. It happens when an employee finds it difficult to meet job requirement
standards, following his promotion.

2. Demotion may result from organizational staff reductions. Due to adverse business
conditions, organizations may decide to lay off some and downgrade some jobs.
3. Demotions may be used as disciplinary tools against errant employees.
4. If there is a mistake in staffing i.e., a person is promoted wrongly.
5. When, because of a change in technology, methods and practices, old hands are unable
to adjust or when employees because of ill health or personal reasons, cannot do their job
properly.
SEPARATION OF EMPLOYEE

Employee Separation is the discontinuation of his employment contract with the

company. The termination of employee’s services can be voluntary or involuntary. This can
take the form of Retirement, Resignation, Discharge, Layoff, etc. The companies and
employees must specify valid reasons behind separation. It occurs when employees cease to
be members of the organization, the service agreement ends and the employee leaves the
organization.
The companies and employees must specify valid reasons behind separation. The process may
be upsetting for both, company and its employees. Hence, the employee separations should
be planned and reasonable.
The employer should provide the required guidance to employees. The firms may conduct
discussions and counselling sessions during separation.
Exit Interviews of the separated employee are conducted. It helps to gather in-depth
information about companies’ strengths and weaknesses.
Types of Employee Separation
Either employer or employee may propose separation due to several reasons. The employee
separation can be classified into:

1-Voluntary Separations.
2-Involuntary Separations.

1-Voluntary Separations
Here, the employee discontinues his services on his own consent in the organization. The most
common forms of voluntary separation are:
1-Resign or Quit
2-Retirement

1-Resign or Quit
The employee may quit his job due to personal or professional reasons. It may affect the
goodwill of the company when it occurs often. The employee may leave because of reasons
like:
• Better Career Opportunities
• Company Policy
• Health
• Relocation
• Job Dissatisfaction, etc.

2-Retirements
Retirement is the completion of employee’s occupational tenure. This involves discontinuation
of service as the employee reaches the age of retirement. The employees themselves take
retirement from the organization through voluntary retirement. Generally, the age of retirement
is 60 years. Unlike resignation in retirement, employees gain certain benefits like: -
• Lump-Sum Payment
• Pension
• Leave Encashment
• Gratuity, etc.
Retirement can be of two types:

i-Compulsory Retirement
When employees reach the age of superannuation, they have to retire compulsorily. The
retirement age varies in different sectors. In the government sector, the retirement age
is 58 or 60 years. Whereas there is no fixed age of retirement in the private sector. It depends
on the person capabilities of working.

ii-Voluntary Retirement Scheme (VRS)

The employees can opt for retirement before reaching retirement age. It is also known as
the Golden Handshake Scheme. The organization offers VRS to its employees. The
companies offer VRS to cut costs, get a manageable workforce or face business losses.

2-Involuntary Separations

Here, the employer terminates the services of their employees due to organizational reasons.
The organizations may opt for employee separation because:

• They may face ups and downs in the business cycle

• Difficulty in handling the workforce
• Unprofessional behaviour of the employees

The different types of involuntary separation are:

1. Discharges and Dismiss

2. Layoffs
3. Retrenchment
4. Downsizing and Rightsizing
5. Compulsory Resignation

1-Discharges and Dismiss

Discharge is an involuntary separation in which the organization ceases employee services.

The discharge of the employee might be due to his non-productivity. While discharging, an
employee may get offended. It must be a thoughtful decision and adopted in only extreme
cases. It may be a product of:

• Job Misfit
• Bad Organizational Behavior
• Absenteeism
Dismissal is the termination of the employee resulting from his non-performance or
misconduct. It is the last step the management take as a punishment to the employee. It may
impose adverse effects on employee’s career opportunities in future.
2-Layoffs

A Layoff is when an organization separates their employees for a short stretch of time. The
organization recalls the employees after the layoff period is over. The objective of laying off
the workforce is to make the firm lean in shape and remain competitive. The organization carry
out layoff of employees based on their excellence or seniority. The reasons behind layoffs can
be:

• Merger
• Acquisition
• Competitive Environment
• Changes in Technology
• Downsizing, etc.
The management must specify and communicate the reasons and basis of layoff. It has a
negative impact on the victims, survivors and managers involved in the layoff process.

• The employee must receive compensation during the tenure of layoff. It can be
half the remuneration paid to the employee.
• Organizations might follow the Last-In-First-Out approach.
• The employer should convey the period of layoff if possible.
• Management should recall productive employees first.

3-Retrenchment
In this, organizations need to separate employees permanently due to economic reasons. The
organizations may not recall employees. But they can prefer retrenched workers at the time of
vacancies. The following can be the economic reasons behind retrenchment:

• Surplus Staff
• Machinery Installation
• Rationalization
• Department Closure
• Decreasing Demand for Products
• Economic Slowdown

The firm has to seek approval from the government. Along with that, it provides a notice to
the employees beforehand.
Like layoff, the organization must pay compensation to its workforce. An average of 15 days
for a year of regular employment will be paid as compensation.

4-Downsizing and Rightsizing

The organizations restructure themselves by downsizing and rightsizing their workforce.

Rightsizing includes cost-saving and adjusting the crew to exact fit. The organization may cut
costs by part-time work, reduced wages, reduced workweeks, etc.
Downsizing refers to making the organization lean by reducing the force. Layoffs are
mandatory in Downsizing, whereas Rightsizing may adjust the existing workforce.

5-Compulsory Resignation
The employer may ask its employee to leave the organization or resign. The organizations opt
for obligatory resignation in critical situations and avoid dismiss. Compulsory Resignation is
a better option than Dismissal or Discharge. The organization’s goodwill remains unaffected.
As well as it does not affect the employee’s career too.
Benefits of Employee Separation

To Organizations

• It enables a reduction in labor costs

• Replacement of the poor performers
• It increases opportunities for diversification and enhancement
• New recruits bring synergy within the organization
• Results in a disciplined work environment
• Reshape organization into the right size

To Employees

• Better career opportunities

• Get away from a troublesome workplace
• Enjoy benefits associated with retirement schemes

Employee Separation Procedure

1- Notification: Both the company and the employee may send a notification to the HR
department. The notification addresses the request or decisions about separation. It specifies
the following details:

o Identity of the employee

o A valid reason for separation
o The final day of work

2-Termination Checklist: The manager must collect data, documents, and properties from
the employee. He must complete and submit the termination checklist.
The manager handovers the collected stuff to the respective departments. This process takes
place on the employee’s final working day.
3-Final Payment: Employee submits no dues to the finance department, after completing the
necessary documentation.
The finance department will disburse the final payment to the employee.

Causes of employee separation

1-Resignation
A resignation refers to the termination of employment at the instance of the employees. A
resignation may be put voluntarily by the employee. An employee resigns when he secures
a better job elsewhere, in the case of a female employee when she marries and has to quit for
personal reasons or when an employee suffersfrom ill health or for any other reasons.

2-Dismissal or Discharge
Dismissal is the termination of the services of an employee as a punitive measure for some
misconduct. Discharge also means termination of the service of an employee, but not
necessarily as a punishment step. A discharge does not arise from a single irrational act.
Dismissal or discharge is a drastic step and should be taken after careful thought.
A dismissal needs to be supported by just and sufficient reasons. Before discharging or
dismissing the employee, advance notice of the impending danger must be given and the
reasons of discharge must be stated clearly. The employee must be given the opportunity to
defend himself.

3-Death
Some employees may die in service. When the death is caused by occupational hazards, the
employee gets compensation as per the provisions of the Workmen’s Compensation Act. On
compassionate grounds some organizations offer employment to the spouse/child/dependent
of the employee who dies in service.

4-Suspension
Suspension means prohibiting an employee from attending work and performs normal duties
assigned to him. This is a serious punishment and is generally awarded only after a proper
enquiry has been conducted. During suspension, the employee receives a subsistence
allowance. If the charges against the suspended employee are serious and are proved,
suspension may lead to termination also.

5-Retrenchment
Retrenchment results in the separation of an employee from his employer. Retrenchment is
generally on account of surplus staff, poor demand for products, general economic slowdown
etc. Termination of services on disciplinary grounds, illness, retirement, winding up of a
business does not constitute retrenchment.

6-Lay off
A lay off is a temporary separation of the employee from his employer at the instance of the
latter without any prejudice to the former.
“Lay off means the failure, refusal or inability of an employer on account of coal, power or
raw-materials or accumulation of stock, breakdown of machinery or by any other reason to
give employment to a workman whose name is borne on the muster roll.”

Thus, lay off is resorted to as a result of some Bonafede reasons as factors whichare beyond
the control of the employers. As the employees are laid off at the
instance of the employer, they have to be paid compensation for the period they are laid off.
Sec. 25 of the Industrial Disputes Act 1947 makes it mandatory on the part of the employer to
pay compensation for all the days of the layoff.
The compensation must be equal to half the normal wages the employee would have earned
if he had not been laid off. It goes without saying that employees with the shortest period of
service to their credit are first laid off and the older employees are retained as long as
conditions permit. Competence as the basis for lay off is not possible in unionized companies
because of the outright resistance shown by union leaders.

Because of the heavy costs involved in lay off, employers should take every possible step to
avoid the causes of lay off. A possible adjustment of placements of workers such as demotions,
transfers etc. should be made.

Performance Appraisal
Performance Appraisal is defined as a systematic process, in which the personality and
performance of an employee is assessed by the supervisor or manager, against predefined
standards, such as knowledge of the job, quality and quantity of output, leadership abilities,
attitude towards work, attendance, cooperation, judgment, versatility, health, initiative and so
forth.
It is also known as performance rating, performance evaluation, employee assessment,
performance review, merit rating, etc.
Performance Appraisal is carried out to identify the abilities and competencies of an
employee for future growth and development. It is aimed at ascertaining the worth of the
employee to the organization, in which he/she works. Different types of performance
appraisals help identify different aspects of employee success.

Performance is defined as the application of knowledge, skills, and abilities at one’s disposal
to finish off a particular work. The way an individual scores at the end on the basis of the job
responsibilities that s/he is into. Job performances are of two types: contextual and task. Task
performance relates to the sense of cognitive ability, while contextual performance is related
to personality. Williams and Krane identified certain features that define the state of ideal
performance.

• Risk-taking ability
• Not being performance-oriented
• Focusing on work
• A sense of self-confidence
• A sense of adapting to various situations
• A sense of time and space management without affecting the work
Types of Appraisals
Managers are not very much in favour of performance appraisal techniques, but still, it is
required to have the knowledge of various performance appraisal techniques so that we get to
choose the best possible option in the time of need. Here are a few different types of appraisal
methods

1-Rating Scale
A rating scale takes certain behaviors, goals and traits and scores them on a scale. Every
employee or team member is graded by the same standards giving insights about key team
players not just individuals. Rating scales are usually numerically based, for example using a
scale of one to five with five being the best possible performance. It is also possible that rating
scales simply rate things as “poor, standard, and excellent,” or even as simple as “acceptable
or unacceptable.”

2-Self-Assessment
You might not want to waste time on self-assessments if you buy into the false notion that
everyone will rate themselves with high scores. Employees are very aware of where they
excel and where they struggle. Getting a self-assessment gives you an insight to their
thinking. You might not see from a managerial standpoint that a person is struggling with
computer skills, but a self-assessment could show you a lack of confidence someone has in
this area.

It is useful to have employees rate themselves according to the same scale standards that
managers rate them. This helps both leadership and the employeesee gaps in performance
understanding. As part of the self-assessment, ask employees to set their own goals for the
next month or quarter. This helps managers get buy-in regarding goals from employees and
also see what employee motivation is for bigger success.

3-360-Degree Feedback
This assessment style is more time consuming than other assessment methods, because it
requires feedback from everyone an employee works with. The 360- degree feedback method
looks at performance by gaining reviews from managers, co-workers, subordinates and other
metrics conducted by sales data or customer feedback

It takes a holistic view of the employee from a performance and behavioral level. This
method of review is a good way to see if an employee is a good candidate for promotion and
leadership.

4-Management by Objectives (MBO)

This method of performance appraisal is common among sales staff but isn’t limited to
that department. MOB reviews performance based on how well the employee meets his
goals. Goals could include sales numbers, deadlinemeetings or new certifications. You can
look at goals and see very clearly if anemployee is meeting the goals or not. This is a
very black and white methodof evaluation.
5- General Performance Appraisal
This method involves continuous interaction between the employee and his manager,
continuous setting of goals and achieving them. Whether the employee has been able to do
justice the entire process or not is evaluated at the end of the year.

6-Technological/Administrative Performance Appraisal

This appraisal technique concentrates on technical more than any other aspect of performance
on the job as the employees involved have specialized skills. They’re judged on the skills they
possess and the activity they complete.

7-Manager Performance Appraisal

A manager’s performance should also be appraised, and this includes not just his/her
performance on the job but also relationship management with clients at his/her disposal.
Generally, anonymous feedback forms are received, which are then considered for appraisal.

8- Employee Self-Assessment
This method is very unpopular among employees as nobody can deal with rating himself or
herself. The self-assessment sheet is compared with the one filled up by the manager and the
differences are discussed.
9. Project Evaluation Review
This method involves performance appraisal of the team members involved at the end of every
project and not at the end of every year. This helps the team and its members develop with
each passing project.

10. Sales Performance Appraisal

A salesperson is evaluated on the basis of his/her sales skills and accomplishment of financial
goals set previously. Goals set in case of sales should be realistic and ways of achieving them
should be decided by the employee and the manager concerned.

JOB EVALUATION

A job evaluation is a systematic way of determining the value/worth of a job in relation to

other jobs in an organization. It tries to make a systematic comparison between jobs to assess
their relative worth for the purpose of establishing a rational pay structure. Job evaluation
needs to be differentiated from job analysis. Job analysis is a systematic way of gathering
information about a job.

Every job evaluation method requires at least some basic job analysis in order to provide
factual information about the jobs concerned. Thus, job evaluation begins with job analysis
and ends at that point where the worth of a job is ascertained for achievingpay equity between
jobs and different roles.

Definition
In the words of Edwin B. Flippo. "Job evaluation is a systematic and orderly process
of determining the worth of a job in relation to other jobs."
According to Kimball and Kimball Jr., “Job Evaluation represents an effort to determine the
relative value of every job in a plant and to determine what the fair basic wage for such a job
should be.”

In the words of Maurice B. Cumming, “Job Evaluation is a technique of assessing the worth
of a job in comparison with all other jobs throughout an organisation”.

International Labour Organization (ILO) has defined a job evaluation as: “Job
evaluation is an attempt to determine and compare demands which the normal performance
of a particular job makes on normal workers without taking into account the individual
performance of the workers concerned”.

METHODS OF JOB EVALUATION

1-Qualitative Methods
i- Ranking or Job Comparison
ii-Grading or Job Classification

2-Quantitative Methods
i-Point Rating
ii-Factor Comparison

i-Ranking Method
The ranking method is the simplest form of job evaluation. In this method, each job as a
whole is compared with other and this comparison of jobs goes on until all the jobs have
been evaluated and ranked. All jobs are ranked in the order of their importance from the
simplest to the hardest or from the highest to the lowest.
Ranking method is appropriate for small-size organizations where jobs are simple and few. It
is also suitable for evaluating managerial jobs wherein job contents cannot be measured in
quantitative terms. Ranking method being simple one canbe used in the initial stages of job
evaluation in an organization.

Merits of Ranking Method

(i) It is the simplest method.
(ii) It is quite economical to put it into effect.
(iii) It is less time consuming and involves little paper work.
Demerits of Ranking Method
(i) The main demerit of the ranking method is that there are no definite standards
of judgment and also there is no way of measuring the differences between jobs.
(ii) It suffers from its sheer unmanageability when there are a large number of jobs.

ii-Grading Method
Grading method is also known as ‘classification method’. This method of job evaluation was
made popular by the U.S. Civil Service Commission. Under this method, job grades or classes
are established by an authorized body or committee appointed for this purpose. A job grade
is defined as a group of different jobs of similar difficulty or requiring similar skills to perform
them. Job grades are determined on the basis of information derived from job analysis.
The grades or classes are created by identifying some common denominator suchas skills,
knowledge and responsibilities. The example of job grades may include, depending on the
type of jobs the organization offers, skilled, unskilled, account clerk, clerk-cum-typist, steno
typist, office superintendent, laboratory assistant and so on.

Merits of Grading Method

(i) This method is easy to understand and simple to operate.

(ii) It is economical and, therefore, suitable for small organizations.
(iii) The grouping of jobs into classifications makes pay determination problemseasy
to administer.
(iv) This method is useful for Government jobs.

Demerits of Grading Method

(i) The method suffers from personal bias of the committee members.
(ii) It cannot deal with complex jobs which will not fit neatly into one grade.
(iii) This method is rarely used in an industry.

2-Quantitative Methods

i-Points Rating
This is the most widely used method of job evaluation. Under this method, jobs are breaking
down based on various identifiable factors such as skill, effort, training, knowledge, hazards,
responsibility, etc. Thereafter, points are allocated to each of these factors.
Weights are given to factors depending on their importance to perform the job. Points so
allocated to various factors of a job are then summed. Then, the jobs with similar total of points
are placed in similar pay grades. The sum of points gives an index of the relative significance
of the jobs that are rated.
Merits of Points Rating

(i) It is the most comprehensive and accurate method of job evaluation.

(ii) Prejudice and human judgment are minimized, i.e., the system cannot be easily
manipulated.
(iii) Being the systematic method, workers of the organization favor this method.
(iv) The scales developed in this method can be used for long time.
(v) Jobs can be easily placed in distinct categories.
Demerits of Points Rating

(i) It is both time-consuming and expensive method.

(ii) It is difficult to understand for an average worker.
(iii) A lot of clerical work is involved in recording rating scales.
(iv) It is not suitable for managerial jobs wherein the work content is notmeasurable
in quantitative terms.
ii-Factor Comparison Method
This method is a combination of both ranking and point methods in the sense that it rates jobs
by comparing them and makes analysis by breaking jobs into compensable factors. This
system is usually used to evaluate white collar, professional and managerial positions.

Merits of Factor Comparison Method

(i) It is more objective method of job evaluation.
(ii) The method is flexible as there is no upper limit on the rating of a factor.
(iii) It is fairly easy method to explain to employees.
(iv) The use of limited number of factors (usually five) ensures less chances of
overlapping and over-weighting of factors.
(v) It facilitates determining the relative worth of different jobs.

Demerits of Factor Comparison Method

(i) It is expensive and time-consuming method.

(ii) Using the same five factors for evaluating jobs may not always be appropriate
because jobs differ across and within organizations.
(iii) It is difficult to understand and operate.