Why You Should Think Twice About 360 Degree Performance Appraisal
Dr. Robert H. (Bob) Kent

The basic concept in 360 Performance Appraisal of soliciting performance feedback not only from our supervisor but also from our customers, employees, peers and all whom we interrelate with in the course of doing our job, makes obvious sense. We all should do this as a matter of course to ensure that we're living up to the expectations others have of us (the psychological contract) and to see that we are playing the right role in the minds of our associates. There is much to be learned from the opinions of those we serve and work with. This "full circle" of feedback results in the 360 (degree) name.

But I have concerns about the 360 feedback concept in the context of a performance appraisal. Many people have jumped on this bandwagon without sufficient consideration. In no particular order my concerns are:

[1] Performance "appraisal" is better called performance "review" since it is the closing stage of a performance management process which begins with the clarification of performance direction and expectations. A Performance Review is a review or comparison of actual performance during the review period, with the past direction, and an opportunity to set future direction (reviews are also used for formal documentation and for use in employee development, promotion and compensation decisions). A Performance Review is never the occasion for the employee to discover how well he's performed or to find out what was expected of him during the review period. The employee should be aware of that (his individual performance related to the performance expectations) continually throughout the review period.

A Performance Review is principally between the employee and whomever the employee is responsible and accountable to. Realistically, in most organizations this is the "boss." At the review it would be insightful, and for some jobs essential, to review how the employee met client and/or peer expectations.

But, the degree to which an employee meets client, supplier, peer or subordinate expectations is not what an employee comes to a Performance Review to discover. It's too late to learn that information at the end of the review period. That feedback should be solicited continually by the employee throughout the review period, and then the results of this feedback activity reviewed at Performance Review time.

If knowing how others perceive you is important for the performance of your job, then measuring that and taking appropriate action on that feedback should be part of your job and included in your job's performance requirements. It seems irresponsible to abdicate that to a third party, like an HR department or a survey company to do for you. Do effective salespeople rely on someone else to tell them, at year's end, whether their customers were pleased with the service? And if relationships are so horrid that management can't get honest feedback directly from its employees, then the real problem won't be solved by implementing a 360 Appraisal process.

[2] A common approach to 360 Appraisal is to administer confidential surveys, especially so people can rate their peers and supervisor. Anonymity is ensured and employees can comment in confidence about the performance of another employee or the boss. Aggregate data is then given to the employee in question and used as input to the appraisal and eventual rating of that employee. Notwithstanding the substantial research evidence warning of the dangers associated with peer evaluations and their low validity, my basic concern about this process can be summed up with these questions. Do you really want to have a company with a culture that promotes the use of secret reports to assess and judge its employees? How can your organization pretend to be open, honest and forthright when it uses secrecy and anonymity to measure the value of employees? Is this the way you want your business to run?

I have met many employees who resent being asked to judge their peers anonymously, wondering all the while, who is writing things about them, and is it any of their business. Supervisors are also frustrated not knowing the actual source of employee concerns so that they can attend to the problem effectively. When we set up a system which assumes it must protect against deceit and retribution, it can become self fulfilling. And as with suggestion boxes, the anonymous survey unfortunately symbolizes that not only do employees take a risk if they raise problems or concerns directly with the supervisor; but also that it's not the supervisor's job to solicit such information. Essentially, any employee feedback process which requires secrecy risks damaging healthy working relationships, especially between employees and their supervisors

[3] The most common rationale used to justify the use of the 360 Appraisal process is that everyone else is doing it! There isn't much research showing the usefulness and validity of the concept as part of performance appraisal. Sales literature from many 360 Appraisal vendors essentially promotes the idea as the thing to do. I would hope potential users of the concept do a little deeper analysis, especially since for many, the process becomes an administrative nightmare and an unnecessary expense.

[4] If you really want your employees to get performance feedback from the circle of people they work with, including their customers, peers and subordinates, try the following simple process:

(a) make "soliciting performance feedback from significant others" a part of all employee jobs and therefore a performance requirement;

(b) determine what sort of feedback is required, and if possible develop tools to capture this information;

(c) teach employees how to use the tools (or questions) to get feedback from their subordinates, customers, peers, etc.;

(d) teach employees how to give performance feedback to their supervisors, peers or suppliers, etc.

(e) teach employees how to make use of the feedback they receive, and, for example how to follow-up on their subordinates and customer concerns;

(f) require employees to regularly review (perhaps monthly) the results of getting feedback from others, with their own supervisor, so that the process becomes a priority and so that employees are held accountable for doing so.

Many organizations that go out shopping for performance appraisals, 360 or other versions, have already taken a step in the wrong direction. They typically have forgotten to diagnose their real needs. If your business has a desire for the 360 Appraisal process make sure you ask yourself "Why?" What is your organization's or management's real need? Don't do it because everyone else seems to be doing it. Make sure the process and philosophy are appropriate to your organization and its values.