Chapter FivePerformance management5.0Pay structure stepsHuman professionals might create the pay structure for their organization, or they might work with an external compensation consultant. There are several steps to design a pay structure: job analysis, job evaluation, pay survey analysis, pay policy and development and pay structure information ( Milkovish, G., & Newman, J. 2008).Milkovich, G. & Newman, J. (2008) explaines that the pay structure steps include as below:Step one : Job analysis is the process of studying jobs in an organization. The outcome of this process is a job description that includes the job title, a summary of the job tasks, asjust of the essential tasks and responsibilities and a description that includes the knowledge, skills and abilities needed to perform the job. Step two: Job evaluation is the process of judging the relative worth of jobs in an organization. The outcome of job evaluation is the development of an internal structure or hierarchial ranking of jobs. Job-based evaluation is used more often than person-based evaluation and so the former will be the focus in this case. There are three methods of job-based evaluation: The point method, ranking and classification. The job evaluation helps to ensure that pay is internally worth perceived to be fair by employees. Step three : Pay policy identification is the process of determining whether the organization wants to lead or meet the market in compensation. The pay policy or strategy will likely influence employee attraction. Pay policies can vary across families , i.e. groups of similiar jobs, and job level of the top management feels that different areas of the organization. Step four: Pay survey analysis is the process of analysising compensation data gathered from other employers in a survey of the relevant labor market. Gathering enternal data , e.g. base pay, bonuses , stock or share options and benefits is the essential to kep the organization's compensation externally competitive within the industry. Employee attraction can be improved by maintaining externally pay structures. Step five: Pay structure creation is the final step, in which the internal structure ( step two of job evaluation) is combined with the external market pay rates . Step four: Pay survey analysis in a simple regression to develop a market pay line. Depending on whether the organization wants to lead or meet the market, the market pay line can be adjusted top or down. To complete the pay structure , pay grades and pay ranges are developed.In this organization's job analysis, it can infleuce these positions or job titles. For example, office support department has the lower level, front line receptionist, middle level, admin. assistant and top level, assistant to the director of operatons. Operations department has the lower level, operations trainee, operations trainess, middle level , operations analyst, top level, director of regional opertions, top level, director of regional opertions. Human resource department has the lower level, payroll assistant, the middle level, benefits counselor and benefits manager, the top level, HR director.In this organization, the administrative assistatns, perform similiar administrative tasks across departments and do not handle function-specific tasks , e.g. HR. Thus, this organization's administrative assiatant ought be suggested grouping the front-line administrative jobs in a separate job family called office support. However, in some organizations, administrative assistant has possible to need to handle function-specific tasks, e.g. HR. Hence, in these organizations administrative assitant can be the low level group to HR department.