Paired Comparison: Simple, Inexpensive, and It Works

Big companies use complex quantitative job evaluation systems, says Wudyka, who is managing principal of Westminster Associates in Wrentham, Massachusetts. However, smaller employers don’t need point count systems; they can use paired comparison.

Wudyka’s tips came during a recent webinar sponsored by BLR.

Paired Comparison

One very efficient, effective, and low-cost method of ranking jobs is the paired comparison, says Wudyka. As the name suggests, using this system, you compare each job to every other job.

Clients like this system, says Wudyka. It is a ranking style program, and is slightly quantitative, unlike “pure ranking.”

With paired comparison you end up ranking all jobs from high to low. You can use a committee, the HR manager, or a third party (e.g., consultant). Committees are great for avoiding “bias” by a “single rater” (like an HR manager or a compensation manager), Wudyka adds.

How Paired Comparison Works

As can be seen in the table below, each job in the left hand column is compared to each job across the top. If the job in the left hand column ranks higher than the job across the top, it gets a “1.” If it ranks lower, a zero. Then the numbers are totaled across for total points.

Paired comparison

(Note: If the jobs are equal, give .5.)

Job worth hierarchy is then given by the total points. In this case, Job D would be the highest ranking job with three points, and Job A the lowest ranking with no points.

As a basis for determining grade level, this works very, very well, says Wudyka. Once you have established the ranking, then you use external data to price the jobs and establish pay rates and ranges.

You may be able to find survey data from industry associations, HR associations,
Or the Bureau of Labor Statistics, Wudyka says. Of course, you can buy survey data from consulting firms. When evaluating survey data, look at weighted averages of pay, ranges, and also actual pay rates.

Organizing your pay program improves it, says Wudyka. You’ll make better decisions, maintain internal equity, and achieve fairness by establishing “market equity” (i.e. Pay fairness across the marketplace).

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Rates and ranges,just one of many issues comp and benefits managers must deal with. “Maintain internal equity and external competitiveness and control turnover, but still meet management’s demands for lowered costs.” Heard that one before?  Many of the professionals we serve find helpful answers to all their compensation questions at Compensation.BLR.com, BLR’s comprehensive compensation website.

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