What is a Job

1
What is a Job?

• Several definitions are possible
• A set of tasks that a person performs or skills
  required
• A pay level, as a venue for training
• A set of decisions that the person is allowed to
  make

2
As a set of tasks or skills

• In small firms, jobs will be more general
• Jobs will be more narrowly defined the more
  specialized is the labor force.
• Advantages to multiskilling (job enrichment)
• Flexibility of workers
• Improved communication between workers
• More important in team settings

3
As a set of tasks or skills

• Advantages to multiskilling (job enrichment)
• Enhanced innovation
• Workers less likely to oppose technological
  change
• Workers more likely to make useful suggestions
• Improved ability of firm to adapt to change
• Disadvantage to multiskilling
• Lost specialization. Gains in productivity from
  specialization can be large.

4
As a set of tasks or skills

• Which tasks go together?
• Require similar skills
• Complementary in production
• Similar monitoring costs

5
As a Pay Level

• Appropriate groupings defined using tournament
  model considerations.
• Can also indicate training slots.
• OJT is an important consideration in valuing a job

6
As an Authority Level

• Authority levels define the organization
  structure. Extremes are very hierarchical and
  very flat.

HIERARCHICAL
FLAT
7
Types of Errors in decisions

• There are two types of errors that a decision
  maker can make
• False positive The decision maker decides that
  a project is worthwhile, but it turns out to be a
  bust. (TYPE I ERROR)
• False negative The decision maker decides to
  maintain the status quo, even though accepting
  the project could have made a large profit. (TYPE
  II ERROR)

8
Decision Results
H0 Innocent
9
Type I and Type II Error Tradeoff
You cant reduce both errors simultaneously!
?
?
10
Structure and Errors

• Hierarchical
• Reduce false positive and increase false negative
• Approve fewer projects overall
• Good where careful consideration is needed. Good
  with traditional industry regulated industry.
  Bad for rapid change
• Second Opinion - symmetrical upside and downside
• Flat
• Reduce fall negative and increase false positive
• Creative people not attracted to hierarchical
  firm
• Good when unprofitable projects are not too
  costly or when profitable projects are likely to
  be very profitable

11
Errors and Decision Types
12
Fit person to job or job to person?

• Job to person
• If difficult to evaluate skills before employment
• Large company with many jobs
• Person to job
• Applicant pool is very heterogeneous
• Employees do not possess multiple skills