360 Degree Performance Appraisal

The meaning of the word “appraisal” is “to fix a price or value for something”. This is used in finance in terms such as project appraisal or financial appraisal where a value is attached to a project. Similarly performance appraisal is a process in which one values the employee contribution and worth to the organisation.
 
Employees across the entire organisation are appraised of their performance. This could be done annually, twice a year, periodically depending the need of the organisation. Performance appraisal is a systematic and orderly evaluation of performance of employees at work by their superiors or others who are familiar with the techniques of performance appraisal. A performance appraisal is a formal review of employee performance. At a performance appraisal, objectives or targets are agreed between manager and employee. At each subsequent appraisal, current and past performance is compared and targets are reviewed.
 
Performance appraisals are essential for the effective management and evaluation of staff. Appraisals help develop individuals, improve organizational performance, and feed into business planning. Formal performance appraisals are generally conducted annually for all staff in the organization. Each staff member is appraised by their line manager. Performance appraisals are also essential for career and succession planning. Performance appraisals are important for staff motivation, attitude and behaviour development, communicating organizational aims, and fostering positive relationships between management and staff. Performance appraisals provide a formal, recorded, regular review of an individual’s performance, and a plan for future development. In short, performance and job appraisals are vital for managing the performance of people and organizations.
 
 

360 DEGREEE PERFORMANCE APPRAISAL
 
In 360-degree performance reviews, many different types of people are consulted about an employee’s performance. This includes customers, suppliers, peers and direct reports. In the case of a manager, employees are often asked to give “upward feedback” on how well they are being managed. If 360-degree performance reviews are performed, a Human Resources manager should coordinate the process, so that subordinate reviewers (i.e., employees) are assured that their performance reviews are kept anonymous.
 

360 DEGREE PERFORMANCE APPRAISAL
 
The aim is to find the gap between one’s own appraisal and the perceptions of others. This will in turn enable a professional to analyse his strengths and shortcomings and accordingly improve his performance. While it is true that the system serves as an excellent process since it reduces biases, it is not always successful. It is necessary to create the right culture in the company before introducing the system. If many people are unhappy or their morale is low, the situation can turn disastrous as some staffers will become obvious targets.
 
ADVANTAGES OF 360 DEGREE APPRAISAL

  • Provides a more comprehensive view of employee performance. 
  •  Increases credibility of performance appraisal. 
  • Feedback from peers enhances employee self-development. 
  • Increases accountability of employees to their customers. 
  • The combination of opinions can approximate to an ‘accurate’ view 
  • Comments expressed by several colleagues tend to carry weight 
  • Some skills are best judged by peers and staff, not by manager alone
  • Feedback may be motivating for people who undervalue themselves
  • The wider involvement help to engender a more honest organizational culture

DISADVANTAGES OF 360 DEGREE APPRAISAL

  • Time consuming and more administratively complex. 
  • Extensive giving and receiving feedback can be intimidating to some employees. 
  • Requires training and significant change effort to work effectively. 
  • Results can be difficult to interpret  
  • Feedback can be damaging unless handled carefully and sensitively 
  • Can generate an environment of suspicion if not managed openly and honestly

 

The 360-degree appraisal significantly differs from the traditional supervisor-subordinate performance evaluation. Rather than having a single person play judge, a 360-degree appraisal acts more like a jury. The people who actually deal with the employee each day create a pool of information and perspectives on which the supervisor may act. This group of individuals is made up of both internal and external customers.

Using 360-degree appraisals provides a broader view of the employee’s performance. The most obvious benefit of the 360-degree appraisal is its ability to corral a range of customer feedback. Because each customer offers a new, unique view, it produces a more complete picture of an employee’s performance. Unlike with supervisors, employees can’t hide as easily in 360-degree appraisals because peers know their behaviors best and insist on giving more valid ratings. In addition to providing broader perspectives, the 360-degree appraisal facilitates greater employee self-development. It enables an employee to compare his or her own perceptions with the perception of others on the employee’s skills, styles, and performance.

 
PEER-TO-PEER EMPLOYEE PERFORMANCE EVALUATIONS
 
Peer-to-peer employee performance evaluations require employees at the same level to review each other. The thinking behind peer-to-peer employee performance evaluations is that nobody knows a worker’s ability better than his or her co-workers. While this can be an effective review format for some groups of workers (for example, a team of doctors working on a research project together, where specific content knowledge is required), it can also cause controversy because of the way it affects future group dynamics. When evaluating the use of these types of employee performance evaluations, consider the maturity level of the employees involved and the long-term effects that could result from the source of negative reviews getting back to the team members.
 

SELF-ASSESSMENT PERFORMANCE REVIEWS
 
Self-Assessment performance reviews are effective when combined with any of the other three types of performance reviews. With this type of review, employees are asked to rate themselves, often using the same form that a manager will use to review them. Self-assessment performance reviews help make the employees an active part of the process and provide a vehicle for them to reflect on their own performance prior to the formal review.
Studies have shown that employees are usually harder on themselves in self-assessment performance reviews, than their managers and generally give themselves lower ratings. Having employees do self assessment performance reviews prior to a manager’s review can set a positive tone for the meeting, as the manager will often have better things to say than the employee has said about him or herself.
 

DOWN TO TOP EMPLOYEE PERFORMANCE EVALUATIONS
 
Down-Top employee performance evaluations tend to be one of the most common and most effective method, because they involve the assessment of an employee by its subordinate. Down to top employee performance evaluations are most useful when given by an employee’s immediate subordinate – someone who works with that employee everyday and knows his or her strengths and weaknesses. The Down-Top employee performance evaluation becomes less effective when given by a Human Resources manager who has only second-hand knowledge of an employee’s performance.
 

TOP – DOWN EMPLOYEE PERFORMANCE EVALUATIONS
 
Top-down employee performance evaluations tend to be the most common and most effective, because they involve the assessment of an employee by a direct manager. Top-down employee performance evaluations are most useful when given by an employee’s immediate supervisor – someone who works with that employee everyday and knows his or her strengths and weaknesses. The top-down employee performance evaluation becomes less effective when given by a Human Resources manager who has only second-hand knowledge of an employee’s performance.

One offshoot of top-down employee performance evaluations are “matrix” employee performance evaluations, where multiple managers rate the same employee. This is a good choice when the employee works for multiple managers, or engages in various fixed-time length projects

About the author

Farhaan Panagar wrote 16 articles on this Website.

Senior Analyst with Deloitte. Writing posts on the side. Always trying to learn new things.

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29 Responses to “360 Degree Performance Appraisal”

  1. Jenna says:

    Pretty nice post. I just stumbled upon your site and wanted to say
    that I have really enjoyed reading your blog posts. Anyway
    I’ll be subscribing to your blog and I hope you post again soon!

  2. Konstantin Miller says:

    I have been looking looking around for this kind of information. Will you post some more in future? I’ll be grateful if you will keep up the good work in future too.

  3. Bharathi says:

    hi,
    i am doing project on 360 degree performance appraisal for pharmaceutical company, pls help me to frame questionnaire & objective.

  4. Geoff Arnold says:

    For anyone wishing to learn more about 360 feedback can I recommend that you try out a free tool (quick360)that we came across when planning to run a 360 for the managers in our organisation. There appears to be no catch, other than it is a fairly basic system, and you can run as many 360 appraisals as you like for no cost whatsoever. The tool can be found at Reactive360. If you need more features you can upgrade at very low cost.

  5. Jerudi Salem says:

    Thx for the wonderful write-up, I have emailed the link to my brother, totally sure he will become a subscriber soon as well.

  6. DIBYENDU says:

    great done, i got all answer of my questain from you now its my turn to thank you

  7. admin says:

    You are welcome Dibyendu…

  8. sakthi says:

    hi,
    i m going to do my project in 360 degree performance .can u plz send me a questionnaire and objective in this topic.i m very confused.it will be very useful if u send it .thanks for sending.bye…..

  9. Women Managers Face More Criticism says:

    [...] to achieve good results. In fact, I was one of only two executives at my company who conducted a 360-degree performance evaluation, not only because I wanted to improve, but also because I felt it would be a good team-building [...]

  10. suman says:

    wow buddy ,,gr8 post…. thnx a lotzz..i ws in much trouble doing my proj. bt nw al is well>>

  11. diya says:

    gr8 job.. thnxxxxxxxxx

  12. margaret wilson says:

    I’ve found recently that the blogging hype is true. Before I even released my blog to the public it helped me get a small consulting gig. If you aren’t blogging you should…and not just for the marketing. It is demanding to continue to post week after week, helping you to keep your skills sharp.

  13. Usama says:

    a really nice article thanks

  14. shekhar says:

    really supporting.
    thanks a lot.

  15. ukase johnson says:

    some one directed me your site and i was so impressed with what isaw please my project supervisor ask me to submit two artcles on performance apraissal,dont know if i can get it from you

    cheers

  16. pammo dubey says:

    hey……..
    it nice to read.
    thamks thanks a lot

  17. shweta says:

    ur information helped me lot…….
    thanxxxxxxxxxx

  18. MD KASHIF HASAN says:

    I am really very impressed.

  19. shivapratap says:

    hi its excellent information expressed very brief i like it. its good sorting for management meet.

  20. usman says:

    impressive articles. i want to conduct a survey about the impact of 360 degree performance appraisal on employee development, customer satisfaction and organizational development.can you recommend me already developed tools to collect data.

  21. JENNIFER JANET P.J. says:

    Hi I was looking articles on 360 degree feedback and found your’s very interesting.. I will be very helpful if you can post such articles in future..

  22. Madhvi says:

    Good work helped a lot in preparing assignment.

  23. suresh rao says:

    your information helped me to prepare my project

  24. Geekyard says:

    Well written :) I wrote your article for my MBA Assignments ;)

  25. RaditPriambodo says:

    can i know for the source you get the picure above sir ???

  26. Farhaan Panagar says:

    Thank you all for the encouragement. I am really sorry I cant help you with your questionnaires.

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  1. [...] to achieve good results. In fact, I was one of only two executives at my company who conducted a 360-degree performance evaluation, not only because I wanted to improve, but also because I felt it would be a good team-building [...]

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