Creating a Job Hierarchy

Creating a Job Hierarchy

Job Hierarchy Definition:
The process of listing and/or grouping jobs in a continuum from entry-level through the most senior level job in the organization. This may be done informally by listing jobs from low to high based on current pay, or through a formal process known as job evaluation, or by marketing pricing, or by using a combination of these two approaches.

As much as we might want to believe otherwise, we know that all jobs are not created equally. While it’s obvious that you wouldn’t pay an entry level employee as much as the boss, there are also a lot of jobs in between. Where do they fit in and how can you make distinctions in pay among jobs that are similar but require different knowledge, skills, and abilities? This is where having a formal job hierarchy makes life a lot easier. But what is a job hierarchy and how do you go about creating one?

A Job Hierarchy is simply a progression of jobs from low to high that is based on their overall level of responsibility and value to the organization, beginning with the most entry-level job and proceeding job by job to the highest-level job which is the CEO in most organizations. Ideally, the job hierarchy should also reflect and coincide with the organization’s job title hierarchy that we’ll talk about later.

Although you may not think of it this way, you already have an informal job hierarchy. If you arrayed the salaries of your workforce from high to low, you’ll find that you’re not paying everyone the same and there may even be a fairly consistent progression from one job to the next. Your decisions about your current pay were probably based on what each individual brought to the job: their knowledge, experience, skill level and other tangible and intangible qualities, as well as how the job was “valued” by the marketplace. Once the individual began to work for your organization, decisions around pay may have been influenced by job tenure, performance, market adjustments or a combination of these factors.

It’s possible to manage with an informal hierarchy of jobs/pay when your organization is small, but when you grow to more than about 50 employees, you’ll need to put some structure around your jobs and pay. If your organization has far more than 50 employees, the process may take longer but it’s not too late to get started.

The first step is to think about how jobs relate to one another. In our previous article on Job Descriptions, we discussed the importance of job titles, and why it’s critical to apply them consistently throughout the organization. Job titles are typically made up of two parts: a department designation (i.e. Human Resources, Marketing, Finance, etc.) and a descriptive noun (i.e. Manager, Supervisor, Assistant, etc.). One way to bring the two concepts of job titles and pay together is to look at your list of job titles and develop a brief definition for each descriptive noun or “job label” that you’re using. such as: a manager: manages the work of others and is responsible for HR decisions such as hiring, firing, training and development, and compensation, and may also manage through others, including supervisors. Whereas a supervisor: supervises the work of others, provides input into HR decisions, and may do similar work to the individuals supervised. And a coordinator: coordinates work flow and activities of others and may perform similar duties to those individuals but at a higher level.

The job label examples above are fairly straight-forward, but there will be others that may require some thought. For example, how do you define the difference between a Manager and a Senior Manager? What’s the difference between a Senior Manager and a Director, or a Director and a Senior Director? It is likely that the differences will be based on a combination of responsibility, scope and experience. For jobs that may not be on the supervisory/management continuum, how would you define an Administrator, Specialist, Assistant, Technician, or Analyst? The good news is that there are only so many titles that can be used to describe jobs, which is also the bad news. Sometimes it seems like we don’t have enough unique labels to describe the differences that we need. This is why the process of defining, implementing and monitoring the consistent use of your job titles is so important to maintaining the integrity of your organization’s job structure. In order to be truly useful, job titles need to mean something both inside the organization, and externally to clients, vendors, suppliers and others.

Once you have your initial title definitions, the second step is to overlay your current job title hierarchy on your pay hierarchy and look for consistencies and outliers. What you find may surprise you. Ideally, what you’re striving for is a progression where job titles group themselves around a pay band, and that you see a clear progression of titles and pay.

Here are a few examples of jobs arrayed from high to low according to their base salary:

TitleBase SalaryTitleBase Salary
Senior Manager of Finance$150kAccounting Supervisor$85k
Senior Manager of HR$147kOperations Supervisor$84k
Senior Manager of Operations$145kHelp Desk Coordinator$82k
Manager of Accounting$120kHR Supervisor$65k
Manager of Recruiting$118kFacilities Coordinator$55k
Manager of Facilities$115kOffice Support Supervisor$45k

On the left, there is a consistent use of titles and pay and you can actually draw a line between the Senior Managers and the Managers based on title and pay. If you were creating a salary structure (see article on Salary Range Development), these two groups of jobs could be easily accommodated by salary ranges or bands as they are only $5k apart from highest to lowest paid.

On the right however there is a mixture of job titles and pay with the Supervisor and Coordinator titles being used throughout the structure. While all Supervisors may not be the same or might end up in different job levels, you would want to look into why the lowest and highest paid are $40k apart in salary. It could be that the Office Support Supervisor is actually a coordinator, and that the Help Desk Coordinator is actually a supervisor. While you shouldn’t change any titles just yet, you should compare what these jobs are actually doing to your job label definitions for coordinator and supervisor and mark any outliers for further review. Being aware of your organization’s informal job hierarchy can help prepare you for creating a more formal job hierarchy structure.

There are two primary methods of creating a formal job hierarchy. The first is by using an internal system such as a point factor job evaluation method, and the second is by allowing the market to determine the value of your organization’s jobs. These two methods are covered in separate articles: Internal Job Evaluation and Market Pricing & Paired Comparison. There are also combinations of the two systems which can be the most cost effective and efficient. Choosing a method to create a formal job hierarchy is a matter of personal preference and there is no right or wrong method. Be guided by your organization’s culture and precedents, as well as by the very real demands upon your time and budget. These systems are an investment in your organization’s future and since they form the foundation for other HR programs, they will be around for years to come. Like all of your organization’s HR programs, they will need to be reviewed regularly and kept up to date in order to maintain their effectiveness over time as your organization changes and grows.

Sample Job Descriptions/Formats

Sample Job Descriptions/Formats

Job Description Format Definition:
The template used as the basis for creating a job description. Important sections that the job description format should include are: 1) Identifying Information, 2) Job Summary, 3) Job Responsibilities, 4) Job Requirements, 5) Approvals, and 6) Disclaimer Statement.

If you are creating a job description format from scratch, an online search will turn up numerous samples to choose from. There is no right, or wrong format and it is largely a matter of personal preference. However, when developing a job description format, keep in mind the ease of use and updating, as job descriptions will change frequently, and you will want to have the ability to make individual and/or global changes easily.

Job descriptions may be written in two ways: as generic descriptions that can be used in a number of departments and for multiple job incumbents, and as specific descriptions that may have only one job incumbent at a time.
The example below is a generic job description for an Administrative Assistant that could be used in multiple departments throughout the organization.

Job Description:
generic job description for an Administrative Assistant
Job Summary:

Performs a variety of administrative functions to maintain the smooth daily operations of the assigned department/office. Supports management and staff by processing a variety of paperwork and assisting in the administration of department/office processes.  Maintains assigned department/office records and files.

Essential Job Functions:

  1. Provides administrative support to management and staff. Answers phones and takes and relays messages.  Opens, sorts and distributes mail. Prepares a variety of confidential correspondence as requested.  Coordinates travel schedules, meetings, meals and office events.
  2. Acts as a backup for other administrative positions within the department/office to assist with office workflow, or in the absence of other administrative staff members.
  3. May provide assistance with administrative procedures such as time and attendance tracking, monitor time and attendance program for accuracy, and track requests for time away from the office.
  4. Compiles and processes expense reports. Monitors membership to professional organizations; prepares check requests for meeting/seminars.
  5. Compiles and processes vendor invoices and troubleshoots vendor concerns/complaints.
  6. Establishes and maintains confidential employee files and records and maintains departmental lists.
  7. Assists with the preparation of materials for meetings/seminars and in the preparation of budget materials/spreadsheets.
  8. Maintains thorough knowledge of the office’s/department’s policies and procedures and current knowledge company rules and regulations.
  9. Assumes additional responsibilities as requested.

Minimum Job Qualifications:

  1. Associate’s Degree in a related field such as business management.
  2. 2-3 years of related administrative experience.
  3. Excellent communication and interpersonal skills in order to respond to requests and exchange information (verbal and written) to and from all levels of company personnel and others.
  4. Proficient personal computer skills and knowledge of office software applications.
  5. Ability to organize, prioritize and manage multiple tasks and projects simultaneously.

This job description is intended to describe the general nature and level of the work being performed by employees in this job. It is not intended to be a complete list of all responsibilities, duties, and skills required for this job classification.


generic job description for an Administrative Assistant approvals

Please note that for generic job descriptions, some of the identifying information fields may initially be labeled “as assigned”. This allows flexibility to use the job description throughout the organization. Since the individual responsibilities can vary from department to department, you might see a statement begin with “May do…” as in #4 above. Note the use of boilerplate statements (#8 and 9), with the last statement being the disclaimer statement indicating that the job description is not all-inclusive.

In general, you may find that job descriptions for nonexempt jobs such as the Administrative Assistant will include 6-10 primary duties and may be captured in 1-2 pages. Since exempt jobs are more complex, they may have 8-12+ principal responsibilities as in the sample below for the Marketing Manager which utilizes a slightly modified job description format. While it’s important to provide a complete overview of the job’s function, it’s best not to go over two pages in length unless absolutely necessary.

Job Description:

generic job description for an marketing-manger

Job Summary:

Assists the Director of Marketing to develop and execute high quality marketing campaigns, initiatives and events to promote the company’s products and services, and boost the company’s recognition, brand and reputation in the marketplace.
Principal Responsibilities:
  1. Human Resources Management. Manages assigned marketing personnel. Plans, allocates and monitors work and provides input to decisions regarding employment, training and development, performance appraisals and related human resources actions.
  2. Marketing Campaign Management: Brainstorms with senior marketing management to create fresh advertising ideas. Creates and executes successful marketing campaigns from conception through their final conclusion. Analyzes and presents results to management including recommendations to enhance marketing campaign effectiveness.
  3. New Client Presentation Materials. Works closely with company departments to prepare presentation materials for prospective clients including off-the-shelf and custom-designed materials. Oversees periodic updates of marketing materials, including current descriptions of the company’s areas of expertise, products and services.
  4. Marketing Channel Management. Manages and maintains marketing information and produces engaging materials including descriptions of products and services, newsletters, and articles about the company for print and online publication. Experiments with various organic and paid advertising campaigns and analyzes results to determine the most effective marketing channels.
  5. Key relationship Management: Identifies and builds strategic relationships with key industry players, agencies and vendors.
  6. Event/Seminar Management. Manages all details of events including planning meetings, selecting seminar/event site locations, assembling mailing lists, developing invitations, coordinating mailings/RSVPs, collecting and assembling program materials, managing event activities, and providing follow-up recommendations and support to department staff.
  7. Entertainment Management. Manages all details of company’s annual golf tournament for clients. Coordinates scheduling of baseball box including coordinating list of invitees, distributing tickets and making food and beverage arrangements. Obtains tickets to major sporting events and coordinates scheduling. Coordinates client theatre tickets/dinner arrangements.
  8. Budget Responsibility. Assists in developing the budget and works with Director of Marketing and Accounting Department to track marketing expenditures and maintain department budget.
  9. Research & Analysis. Maintains current knowledge of trends and developments having an impact upon Marketing and other areas of the company’s operations. Researches and recommends new policies, procedures, and systems to enhance marketing productivity and operating results.
  10.  Additional Responsibilities. Assumes additional responsibilities as requested.
Job Requirements:
  1. Bachelor’s Degree, or equivalent, in Marketing or related field. Advanced Degree preferred.
  2. 6-8 years of related marketing/client service experience in a professional services firm.
  3. Excellent communications and interpersonal skills and ability to interact effectively with all levels of company personnel and a variety of external entities.
  4. Excellent organizational skills and ability to manage multiple assignments simultaneously.
  5. Excellent writing skills including grammar, editing and proof-reading skills and attention to detail and accuracy.

This job description is intended to describe the general nature and level of the work being performed by employees in this job. It is not intended to be a complete list of all responsibilities, duties, and skills required for this job classification.


generic job description for an Administrative Assistant approvals
Job descriptions for exempt level jobs will typically require more information than nonexempt jobs and the need to be as concise as possible is important. The use of boilerplate statements for management as in Principal Responsibility #1 above is a handy shortcut to the job description writing process. This standard statement may be used for the organization’s other Manager positions, assuming it applies. You may also want to create boilerplate statements for other exempt responsibilities such as financial management, communication with other departments, keeping up dated with industry trends and technologies, etc. such as # 8 & 9 above.

Job Descriptions: Format & Critical Elements

Job Descriptions: Format & Critical Elements

Job Description Definition:
A document that summarizes the primary purpose of the job and lists its reporting relationships, principal responsibilities, job qualifications, specific working conditions, and other relevant information that is a direct outcome of the job analysis process.

Job descriptions are important documents in themselves as well as critical building blocks for numerous other HR programs including recruitment and selection, compensation administration, training and development, performance appraisal and career planning. Since they are foundational documents with broad use and impact within the organization, it is important to invest the time to do them right, ensure that they include the necessary information for the many HR programs that they support, and to keep them up to date.

Job descriptions are typically broken down into several sections. The first section includes identifying information such as the job title, reporting relationship(s), department, location (particularly helpful for global companies), FLSA status (exempt or nonexempt), full time/part time status, and the date that the job description created/revised.

Job titles should be descriptive of the job’s responsibilities. They should identify the relative position of the job within the organizational hierarchy, i.e. Payroll Manager, Accounting Supervisor, Operations Assistant, etc. In addition to reflecting the job’s level of responsibility, they should not exaggerate importance (Global Marketing Guru), or be demeaning (Junior Clerk). If possible, they should be similar to a standard or benchmark job title as this will make it easier to match the job to market data later on.

Do job titles matter? You bet they do! In a typical hierarchical organization, job titles are the primary means of communicating a person’s role to others both inside and outside of the organization. As such, employees often think of their job titles as an extension of themselves and as “who they are” within the organization. Keep in mind that once a job title is given, it is difficult to take it away. Likewise, once a job title comes into use within a department, other departments may want to use it as well. For these reasons, organizations should give careful thought to their selection, use and hierarchy of job titles and if possible, establish criteria for each job title (i.e. what does a “Coordinator” mean in our organization?)

Reporting Relationships should indicate the title of the individual the job reports to rather than the individual’s name. While jobs typically have one position to which they report, in matrix organizations there may be a secondary reporting relationship. These dual reporting relationships are sometimes referred to as solid lines and dotted lines, or functional and administrative reports. While organizations apply these differently, an example might be an HR Business Partner who has a solid line reporting relationship to an HR Director and a dotted line reporting relationship to a director in the department that it serves, in each case, the reporting relationship listed on the job description should be to an exempt manager, i.e. the person who exercises full management control over the job and has the authority to hire/fire, promote, manage performance and rewards, and determine training and development needs, rather than to a nonexempt supervisor who may give only input into these processes.

The next section of the job description is a summary statement that describes why the job exists. The Job Summary should be a short paragraph that captures the essence of the job in a few sentences. By reading the job summary, you should have a fairly good idea of the purpose that the job fulfills within the organization and a general sense of where it fits into the company’s job hierarchy. Tip: Sometimes it is easier to write the job summary after you have written the main portion of the job description and have already given some thought to synthesizing detailed job analysis information.

The main body of the job description will include the job’s essential functions. Sometimes referred to as the job’s primary responsibilities, this section should provide a numbered or bulleted list of the job’s principal responsibilities or tasks. Individual responsibility statements should be limited to one to two sentences and be listed in order of importance or in sequential order if job’s activities follow a specific procedure. The individual job responsibility statements should be clear and concise and avoid unnecessary verbiage. Typically, responsibility statements are short declarative sentences that use action verbs, i.e. manages, coordinates, organizes, oversees, etc. rather than “the purpose of the job is to manage…”. Special emphasis should be placed on what is done rather than how it is done. In other words, the statement should describe the outcome of the responsibility rather than all the specific steps that are needed along the way to accomplish the task.

In order to maintain consistency between job descriptions, it may be helpful to develop a series of boilerplate statements to cover universal responsibilities such as human resource management, budgeting, planning, keeping up to date with trends and developments, etc. Not only will this save significant time in having to describe these duties time and again, but it will also help to ensure consistency of the descriptions across the organization.  Also, since it’s impossible to list all of the job’s responsibilities in detail and/or to foresee every possible new responsibility, it’s a good idea to include a catch all phrase as the final responsibility that says: “Assumes additional responsibilities as requested.”  This can save a lot of headaches when managers need to ask their employees to do something that may not be explicitly listed on the job description.  One caveat is that managers should not be allowed to confuse this occasional request to perform additional duties with ongoing added responsibilities that are not listed on the job description.  If this is the case, then the job description should be revised to include these other duties as part of the job’s primary responsibilities.

The next section of the description should contain specific job specifications or requirements. These include special knowledge, skills and abilities such as specific educational requirements, technical skills or certifications, special training or experience (i.e. management experience), and the number of years of experience required. Please note that job requirements should be expressed as the minimum amount of experience required in order to fulfill the job’s duties at a satisfactory level.  Requirements may also be expressed as preferred with the minimum requirement listed first, such as: Associate’s Degree (Bachelor’s Degree preferred). Job requirements should give a good sense of what is required to be successful in the job and will be used when posting the job internally and recruiting external candidates. They should relate directly to the job’s responsibilities and above all be accurate and defensible.

An approval section is often included with signature lines for the department manager and human resources representative. This helps ensure communication between HR and the functional area and to document that the job description has been approved by both parties.

Finally, a disclaimer statement is often included at the end of the job description to indicate that the document is representative of the types and level of job responsibilities but is not an exhaustive list. The disclaimer recognizes that the job description is finite and does not attempt to include every detail that the job may be responsible for on a regular or periodic basis. The disclaimer provides some leeway to all parties to exercise discretion and judgment when using the job description in a department setting.

Job Analysis

Job Analysis

Job Analysis Definition:
The process of analyzing the critical components of a job in order to identify and determine its appropriate title, principal responsibilities, other important responsibilities and the knowledge, skills and abilities required to perform the job at a satisfactory level.

Job Analysis is the process of researching and identifying the essential elements of the job and the role or function that the job plays within the organization. It seeks to answer the following questions: Why does the job exist? What critical functions does the job accomplish? And how does the job relate to other jobs within the greater context of the organization? In other words, what purpose does the job serve and where does it fit into the hierarchy of jobs within the organization.

The primary reason to analyze jobs is to obtain accurate and up-to-date information in order to document job responsibilities and job requirements in the form of a job description. Additionally, identifying job elements and requirements is essential to many other HR functions including recruitment, selection, training, compensation, performance appraisal and career planning and development programs.

The information needed for Job Analysis may come from primary or secondary sources. Primary sources include job questionnaires and interviews with the job incumbent and/or supervisor. Secondary sources include organizational charts, department or operations flow charts, and reference materials including job descriptions for the same or similar job from comparable organizations.

A Job Description Questionnaire (click here for sample questionnaire) that is completed by the job incumbent or supervisor is perhaps the most widely used technique to obtain job analysis information. The questionnaire asks for a brief description of the job’s responsibilities and other information pertaining to the job’s requirements. If job questionnaires are used in conjunction with interviews, they should be completed prior to the interview so that information may be verified, clarified and expanded upon during the interview process. Questionnaires completed by job incumbents and used as the sole source of job analysis information should be reviewed by the supervisor for accuracy. When a job has multiple incumbents, questionnaires should be given to as many job incumbents as feasible or a representative sample at a minimum.

The job analysis interview provides an opportunity to obtain in-depth information pertaining to specific KSAs (knowledge, skills and abilities), training requirements including any special certifications, internal/external contacts, reporting relationships, amount of supervision given and received, decision-making authority, impact on others within and outside the organization, workplace environment and physical demands (i.e. lifting, moving, operating machinery, driving). These elements of the job are considered to be “compensable factors” and are important to capture during the job analysis process so that they may be documented in the job description. For further information on compensable factors, please see the article on Job Evaluation.

It is important to keep in mind that the purpose of job analysis is to describe the job, and not the person doing the job. If there is only one person in the job, you should look at the job objectively and describe it as you would expect a typical employee to perform the job’s responsibilities. If you have a multi-incumbent job where some individuals perform the job better than others, you may want to find the middle ground between the high and low performers and describe the job as the average incumbent would perform the job’s functions. In all cases, it is best for the job analyst to think of the job as if it were vacant and imagine what a successful candidate should bring to the job in the way of knowledge, skills, abilities and competencies in order to perform the job at a fully satisfactory level.

Job Analysis is a time-consuming process but the results have many benefits to the organization as they lay the groundwork for numerous other HR programs. The outcome of the job analysis process is an accurate, defensible and up-to-date job description, the elements of which will be covered in the article on Job Descriptions.

Organizational Analysis

Organizational Analysis

Organizational Analysis Definition:
The process of identifying and analyzing the basic components of an organization in order to understand it’s underlying structure and business performance.

Beginning a compensation program is a major proposition. Whether you are dealing with a large organization that has a multitude of jobs and functions, or a start-up company with only a few key players who wear multiple hats, you will need to find somewhere to begin. Given that the only constant is change, there is no “right time” to do this. Although sooner is probably better than later, the most important thing is to be prepared.

Internal External Business Environment Chart

Before diving in, you’ll need to do some research to determine the nature of the beast that you’re dealing with. In addition to understanding the company’s external environment (industry, competitors, regulatory environment, economic, financial, geographic, social, legal and technological influences), you should have a core knowledge of the company’s internal workings (its mission, goals, objectives, products, resources, culture, management, and overall departmental structure). Doing a SWOT analysis to identify the organization’s strengths, weaknesses, opportunities and threats will highlight current capabilities and help identify potential areas of concern. In order to be successful, the compensation program that you create should build upon and enhance the organization’s strengths and opportunities, while recognizing and taking into account any possible weaknesses or potential threats.

If this seems like a lot of work, that’s because it is. It may take a village. This is the time to think about who is going to be on your project team. As an aside, one of the prerequisites for a successful compensation program is buy-in from top management. Your project will need support from key department members and if the CEO/COO is not on board, you’re not likely to get this.

Assuming you have the backing of top management and that you’ve gained a foundational knowledge of your company, begin by analyzing the company’s organizational charts to understand the interrelationship of its departments and functions. If organizational charts don’t exist, and you don’t have the time or inclination to develop them, you can make an Organizational Outline that lists jobs in each department in a reporting structure. Every organization has a hierarchy, whether formal or informal, and it’s a lot easier to understand what that is if you have a visual representation.


A. Director of Marketing

1. Marketing Manager

a. Marketing Coordinator
b. Marketing Specialist

2. Marketing Communications Manager

a. Marketing  Communications Specialist
b. Marketing Writer

B. Director of Business Development

1. Business Development Manager

a. Business Development Coordinator
b. Business Development Specialist

2. Competitive Intelligence Manager

a. Competitive Intelligence Analyst
b. Market Research Analyst

C. Etc.

Please note that in the outline hierarchy above, the individual outline levels (A, B, 1, 2, a, b, etc.) may or may not have similar level titles. These designations identify reporting relationships and should translate directly into a traditional organizational chart like this:

Another way of identifying your organization’s hierarchy is to look at how it “values” its human resources through its pay structure. Arraying an organization’s pay from high to low will give you a fairly good idea of the current value hierarchy. For a small organization this can be relatively quick to do and can be enlightening. It will also point out potential issues that the new compensation program should take into consideration and possibly address.

Once you understand the existing hierarchy, you will be ready to delve deeper into each department through the process known as Job Analysis.