Take the Time to Establish a Job Hierarchy

While technology has changed the very nature of human resource management, some concepts continue to be the foundation on which everything else is built.

The concept of a “job” may seem outdated in the day of combined roles and all-hands-on-deck style management, but still, the "job" is the critical reference point for most HR organizations. But while the job concept is generally understood and broadly applied, a job hierarchy, also known as a job-leveling framework, is applied less consistently, with many organizations not having formally defined or documented their job hierarchy.

A job hierarchy provides the framework for grouping jobs and relating jobs to one another. The hierarchy is defined by levels or bands with defining criteria for jobs. The levels and bands are often created based on jobs within the organization, but an industry-benchmark structure or generalized structure can also be used as a starting point. Once defined, the job hierarchy can serve many purposes, including defining the internal levels of management and governance and providing reference points for compensation surveys and competency models.

Defining a job hierarchy may feel uber-tactical, especially when compared to putting together salary structures or implementing a talent management system. Yet the job hierarchy is a critical and necessary prerequisite to both. It should sit high on your to-do list if you are thinking about compensation planning, salary structures or integrated talent management, yet job hierarchies sometimes only get attention well after these projects get underway.

Is there a “right” number of levels or “right” job hierarchy for your organization? Well, that depends on what you want to do. Levels provide opportunities for movement, but if the distinctions among levels and jobs are not justified, then additional levels lead to inconsistencies and inequities. Fewer is generally better, but considering industry benchmarks helps to ensure that your levels and titles will be competitive for external candidates.

To get started, jobs can be slotted into a hierarchy using a simple management survey. Once defined, occasional additions and periodic review is usually sufficient to ensure that jobs continue to be aligned correctly.

So before you embrace the next wave of compensation or talent management, be sure to start with a good foundation. A relatively small investment of time upfront will certainly save you time and effort down the road.