How job architecture is changing and what this means for reward strategy
A good job architecture provides a company and its employees with a framework by which to understand roles and align jobs and their pay according to the type of work being carried out. In defining a company’s roles, it also serves as a basis for making strategic decisions around pay, retention, career progression and the development of skills.
While job architecture frameworks can be put in place in a company of any size, it can be particularly valuable in larger companies. By grouping roles together by level or function, the process shows where workers are performing roles and activities of a similar level, and where they sit in the company’s broader value chain and hierarchy.
The recent trend has been to move away from more hierarchical approaches to a more flexible and agile way of working, often adopting the concept of job families.
What are job families?
The job family approach allows HR or business leaders to group or separate roles out as required, where more agility might be needed either internally or against the market.
For example, in-demand IT roles might be placed in a ‘technical’ job family, whose pay might need to be inflated in response to a tight market or skills shortage. By separating this group from other ‘head office’ roles, any market premium adjustments to their salaries can be made in isolation, without the need to inflate all pay ranges for head office roles, even if deemed to be at a similar level.
A clear architecture using job families can also help lay out an entire pay strategy based on required talent and business-critical roles.
For example, one of our clients needed to pay their business-critical commercial roles with premium skills at upper quartile in the market in order to retain and attract strong talent, while other contact centre operational roles were deemed important but less critical and easier to replace, so were paid below the market median. Job family pay ranges enabled this approach.
The challenge of numbers
One challenge in getting a job architecture to work is settling on the right number of levels. Grade hierarchies are often put in place to enable progression, but they can also become too rigid and drive status cultures. If there are too many levels, employees can also struggle to understand the difference between them.
We developed Evaluate based on work level theory, where every level has a clear description of the value a role brings. Having a good job evaluation methodology will support the distinction between levels but requires more than a simple grade descriptor of 1, 2, 3 or A, B, C if it is to mean anything to workers.
The same challenge applies to job families. You can overcomplicate things by creating too many and giving each a different approach to pay. HR and marketing roles, for example, have different skills sets but their pay is typically quite aligned in the market.
Evolution through a new approach to skills
Considering market pressures and the technology transformation we are seeing with AI, job architecture is now starting to evolve to become more skills-focused.
Instead of focusing on job titles, the theory is to group skills and focus on these as an enabler of progression in a talent marketplace where employees are empowered to recognise which skills they need to perform their job now, and which they need to add or grow to develop their careers.
The core principle behind this approach is that it enables both vertical and lateral movement and supports talent retention by experiencing and using skills in new ways.
Rather than sitting and waiting for their careers to move on through earned progression, employees are encouraged to see ‘career’ as a more holistic series of experiences, with skills learned along the way. We are currently working with a global airline to develop and implement an approach of this nature.
Tech tools and how they help
There is no question that specialist HR software and tech tools now have a greater role to play with this transition to skills-based job architectures, which require different ways of thinking.
Consequently, reward strategies also need to become as agile to support this change in approach, and in the same way that pay approaches have aligned to job families, we may now need to consider how we integrate skills-based pay too.
In partnership with Personal Group
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