The 360 Degree Feedback debate rages on.....
In a recent blog post, 4 Risks of Linking 360-Degree Feedback to Performance Appraisal and/or Compensation, the author makes the argument that 360 degree feedback cannot be used for performance appraisals or compensation. She makes several points, including:
- 360 degree feedback is a risky source of feedback that contains discrepancies both within (i.e. two different direct reports) and between (i.e. direct reports vs. peers) rater groups.
- Such discrepancies and outliers combined with the possibility that some raters may manipulate ratings call the reliability of the data into question.
- Finally, the author contends that the performance criteria and/or response scales are inappropriate for performance evaluation as they often focus on competencies/behaviors and performance potential.
Unfortunately, this perspective is limited at best and misleading at worst. In fact, I maintain that organizations that do so correctly should absolutely incorporate 360 as part of a performance management process.
First, I think that it is helpful to make a distinction in terminology. There are both 360 degree feedback for development programs and multi-rater appraisals incorporated into Performance Management and Evaluation. In the former, 360 degree feedback is strictly used for developmental purposes and is communicated as such at the outset. Performance criteria are typically leadership competencies that allow raters to help an individual receive valuable feedback on strengths and opportunities for improvement. Individuals receiving feedback can utilize the information to aid in development planning for future leadership roles.
Using 360 degree appraisal as part of performance evaluation that will inform various decisions, including compensation, is an entirely different initiative. Ultimately, 360 Degree Appraisal conveys a strong message that employee feedback is valued by the organization. Employees will likely take the process very seriously and will consequently, strive to improve performance and develop skills.
The concept of 360 has come a long way since it was first introduced over decades. It stands to reason that these processes would have evolved over such a long time span. While organizations are still using 360 degree feedback programs for their training and development needs, the process has been effectively adapted by countless organizations to provide more comprehensive performance appraisals. Savvy HR leaders understand that the advantages of traditional 360 feedback can be applied, although slightly differently, to provide a better performance management program.
Your thoughts: How have you implemented 360 degree feedback in your company? Share your success stories, please.