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.
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