360-degree feedback is a process in which an employee’s supervisor, peers, direct reports, and sometimes customers and suppliers, provide input about the employee’s work behaviors. The most common format is a questionnaire about the employee’s demonstration of critical competencies. Feedback is summarized for the employee in the form of both numerical ratings and narrative comments. The information provided by the raters is usually anonymous except for the feedback provided by the employee’s direct supervisor.
The application of 360° feedback can be divided into two broad categories: (1) employee development and (2) employee evaluation. Employee development applications include individual development planning, coaching and career counseling. The objective is to help the employee understand both strengths and developmental needs from the varying perspectives of the raters and provide an impetus to improve personal performance. Employee evaluation applications include performance appraisal, succession planning, and selection. The objective is to assess employees’ performance for annual appraisal or to select employees for jobs or special opportunities.
Organizations need to carefully consider their goals and organizational culture, as well as legal and ethical issues, before deciding how to apply 360° feedback. The considerations summarized below are based on recognized 360° research in organizations.
Employee Development Applications
• Raters are assured of anonymity. No records are kept of individual ratings. When raters believe they are anonymous, they provide more accurate ratings.
• Raters provide more candid feedback than for evaluation-type applications.
• Raters distinguish between different behaviors of the target employee, allowing the employee to better identify areas for development.
• Employees focus on the overall developmental value of the feedback rather than on numerical ratings.
• Participants are more comfortable with the process, more satisfied with it, and more trusting of their coworkers than when 360s are used for evaluation.
Employee Evaluation Applications
• When a 360 instrument is intended for performance appraisal or selection, the organization must be able to prove that the ratings are a valid and reliable indicator of the employee’s performance, i.e., that high 360 ratings correlate with demonstrated high performance and low 360 ratings correlate with demonstrated low performance.
• If 360 ratings are used to make personnel decisions, specific raters and their ratings must be identifiable in the event of an investigation or law suit.
• Raters for 360 evaluation applications tend to distinguish less among specific behaviors, using an overall impression to color responses.
• Research shows that raters tend to inflate their ratings for evaluation-type applications.
• Disgruntled raters may negatively distort ratings to “get back” at someone for real or imagined slights.
• Conscious or unconscious discrimination may occur based on personal prejudices of gender, race, or other personal characteristics not related to performance.
• Employees often focus more on which rater might have said what and on the numerical ratings rather than on the developmental value of the input.
• Evaluative applications can damage morale, teamwork and employee trust.
• If 360 feedback is used to appraise performance for supervisors and managers, they may avoid managing people appropriately due to concerns about obtaining favorable ratings from direct reports.
Development or Evaluation, But Not Both
The same 360 feedback process should not be used for both development and evaluation. The decision about how the feedback will be applied must be made when it is designed. The behaviors of raters and ratees differ with each application, and the basic premise of the ratings differs. For development, raters need to consider only the relative strengths and development needs of the individual employee. When a 360 tool is used for evaluation, raters need to differentiate among all the employees rated because decisions are made in which some employees receive “more “ of something based on the raters’ input, such as a higher appraisal rating, more pay or an opportunity. Because of these factors, organizations must be prepared to provide a strong foundation for the process before implementing 360 feedback, particularly when used as part of the formal evaluation process. It is especially critical that organizations clearly identify what they are trying to achieve. ¯
Reprinted from Issues of Merit, a publication of the Office of Policy and Evaluation, U.S. Merit Systems Protection Board.