CONTEMPORARY ISSUE ON 360 DEGREE APPRAISAL SYSTEM AN HR ISSUE

PACIFIC BUSINESS SCHOOL

Pacific hills, airport road Udaipur Ph.029-2490604 #fax: 0294-2491339

Under supervision of: Mr. Shaurya Ranawat

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Submitted by: Hasan Dalal

INDEX
S. no a. b. c. d. History Concept Definition How does it work Timing What to focus on Sources of feedback Methodology e. f. g. h. i. j. K. How feedback is used Advantages Limitation Objective Purpose Problem 7 8, 9 9, 10 10, 11 12 12, 13 14 Content Page no. 2 3, 4 5 5, 6

Conclusion

360 DEGREE PERFORMANCE APPRAISALS

OVERVIEW:
In human resources or industrial psychology, 360 feedback is also known as multi-rater feedback, multi source feedback, or multi source assessment, Is feedback that comes from all around an employee. 360 refers to the 360 degree in a circle, with an individual figuratively in the centre of the circle. Feedback is provided by sub-ordinates, peers and supervisors. It is also include a self assessment and in some cases feedback from external sources such as customer and supplier or other interested stakeholder. It may be contrasted with upward feedback, where manager are given feedback by their direct reports or a traditional appraisal, where the employees are most often reviewed only by their managers. The results from 360 degree feedback are often used by the person receiving the feedback to plan their training and development. Results are also used by some organization in making administrative decision, such as pay r promotion. When this is the case, the assessment is for evaluation purposes, and is sometimes called a 360 degree review. However there is a great deal of controversy as to whether 360 degree feedback should be used exclusively for development purposes, or should be used for appraisal as well. There is also controversy regarding whether 360 degree feedback improves employee performance and it has even been suggested that it may decrease shareholder value.

HISTORY
The German Military first began gathering feedback from multiple sources in order to evaluate performance during World War II (Fleenor & Prince, 1997). Also during this time period, others explored the use of multi-rater feedback via the concept of T-groups. One of the earliest recorded uses of surveys to gather information about employees occurred in the 1950s at Esso Research and Engineering Company (Bracken, Dalton, Jako, McCauley, & Pollman, 1997). From there, the idea of 360-degree feedback gained momentum, and by the 1990s most human resources and organization development professionals understood the concept. The problem was that collecting and collating the feedback demanded a paper-based effort including either complex manual calculations or lengthy delays. The first led to despair on the part of practitioners; the second to a gradual erosion of commitment by recipients. Multi-rater feedback use steadily increased in popularity, due largely to the use of the Internet in conducting web-based surveys (Atkins & Wood, 2002). Today, studies suggest that over one-third of U.S. companies use some type of multisource feedback (Bracken, Timmereck, & Church, 2001a). Others claim that this estimate is closer to 90% of all Fortune 500 firms (Edwards & Ewen, 1996). In recent years, Internet-based services have become the norm, with a growing menu of useful features (e.g., multi languages, comparative reporting, and aggregate reporting) (Bracken, Summers, & Fleenor, 1998).

CONCEPT
Typically, performance appraisal has been limited to a feedback process between employees and supervisors. However, with the increased focus on teamwork, employee development, and customer service, the emphasis has shifted to employee feedback from the full circle of sources depicted in the diagram below. This multiple-input approach to performance feedback is sometimes called 360degree assessment to connote that full circle. There are no prohibitions in law or regulation against using a variety of rating sources, in addition to the employees supervisor, for assessing performance. Research has shown assessment approaches with multiple rating sources provide more accurate, reliable, and credible information. For this reason, the U.S. Office of Personnel Management supports the use of multiple rating sources as an effective method of assessing performance for formal appraisal and other evaluative and developmental purposes.

The circle, or u more accurately the sphere, of feedback sources consists of supervisors, peers, subordinates, customers, and ones self. It is not necessary, or always appropriate, to include all of the feedback sources in a particular appraisal program. The organizational culture and mission must be considered, and the purpose of feedback will differ with each source. For example, subordinate
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assessments of a supervisors performance can provide valuable developmental guidance, peer feedback can be the heart of excellence in teamwork, and customer service feedback focuses on the quality of the teams or agencys results. The objectives of performance appraisal and the particular aspects of performance that are to be assessed must be established before determining which sources are appropriate.

DEFINITION
Traditionally, performance review processes have involved an employee receiving feedback from one source, the supervisor. As illustrated below, 360 degree feedback involves an employee receiving feedback from a variety of sources, which might include staff reporting to the position colleagues and clients. This information is used to identify strengths and development needs.

HOW DOES IT WORK?

1) Timing 360 degree feedback can be gathered at the end of the year as part of the annual planning and review discussion or at any time during the year. It may be appropriate to get some feedback at the end of a particular project or to coincide with a specific event.

2) What to focus on
The aim is to target feedback on what is most relevant to the manager given the particular context in which they are working, the managers goals, the priorities of the University and the work area, any particular matters the manager might be involved in, the managers career aspirations, anticipated career changes and the particular level of skill that is required in the current job.

a) Achievement of goals
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In the context of triennial plans, managers and their supervisors develop individual work plans which set out a range of specific goals for the year. It might be appropriate to focus feedback on these goals. Specifically, the extent to which and how they were achieved. In this case, feedback would be obtained from those people critical to the process and major stakeholders. Questions would be targeted to elicit feedback on priority areas. At other times, whilst not in a managers work plan, a manager might be given responsibility for a key initiative such as acting in a particular position, leading a University-wide project or review or chairing a key committee.

b) Aspects of the job

In other circumstances it may be timely to focus on a particular element of a job. For example, the managers relationship with senior management, the managers strategic contribution, capacity for policy development, external liaison. It might be appropriate to develop a tailored checklist or series of questions to elicit feedback.

c) Leadership attributes
A list of managers' skills and attributes has been drawn from existing documents and recent discussions with senior managers. These attributes are grouped into four critical job dimensions: - way of thinking and strategic focus - personal stance or effectiveness - managing people - achievement results

3) Sources of feedback
Feedback can be obtained from a variety of sources including clients, staff, colleagues, immediate supervisor etc (see diagram on p 2). Sources should be chosen on factors such as their knowledge of the managers performance, the importance of their relationship with the manager and their ability to provide objective feedback. It is also a good idea for managers to rate themselves and compare this to how others perceive them. Sources of feedback should be negotiated and agreed between the manager and supervisor.
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4) Methodology
There is no one best method that covers all circumstances. Rather, the particular methodology/s chosen by the manager and supervisor will be dependent upon the scope and breadth of the exercise, the sources of feedback and the context, eg preferences of the individuals involved, culture in the work place etc. It will also be influenced by whether the parties have already identified some areas of concern about performance and there may be some sensitivity in how the data is collected, or whether they are seeking general feedback. Please note that there may be occasions where the 360 feedback processes described here will clearly not be appropriate.

HOW IS THE FEEDBACK USED?

It is important that the process :- encourages reflection and self-assessment by the manager concerned - considers the feedback gained in this way as one part, but only one part, - of the available information on performance - looks at the broad implications of the feedback rather than focusing too heavily on any particular comment or rating - acknowledges both strengths and areas for development. In some circumstances it may be appropriate for the manager and supervisor to include other relevant parties in a discussion on the information obtained and how to pursue development opportunities. Confidentiality is critical and the process for any transfer of information must be understood by all participants and particularly by the individuals providing the feedback.

Information from the 360 degree process may form part of the performance review, but it is not expected that any of the 360 degree documentation be kept on the managers personal file.

This is format through which the feedback is being taken, but its not the only way to take feedback. There are even many more ways to take feedback.

ADVANTAGES OF 360 DEGREE

1. It provides a more comprehensive view of employee performance than other appraisal method.
As the procedure of carry out the 360-degree appraisal need to have a lot of people to do the evaluation for the staff, it may include the staff in the company, from the top (manager) to the bottom (colleagues), even some external sources such as the customers. If it is conducted well, this can give the employee a more comprehensive and accurate view for the evaluation and also it is good for the staffs self-development. It is more comprehensive than other appraisal methods since they may only need the manager to do the evaluation.

2. It increases the credibility of the appraisal result.

Since the 360-degree appraisal methods need a lot of people to finish it, as mentioned before it may include of the manager also other staff, it can reduce the unfair of the result. It is because it contain everyones point of view, not only the manager or any single staff, then they cannot give some comments that show the evaluated employee is very good or not, then help the staff easily get to promote to higher position or make the staff lose the job. It can show that this appraisal can help to increase the credibility of the appraisal result.

3. The feedback from the peers can help to enhance the staffs selfdevelopment.
Not every appraisal methods will also include the feedback from the peers, that may only judge by the manager, so it is not easily show the real performance of the staff since the manager may not observe the performance of the staff in every single minutes and they may only have a blurred impression of the staff. By the way, if there also include the feedback from the peers as they have more communication and cooperate experience with the evaluated staff, they must know more than the manager about what the staff can improve, also help to motivate people who are undervalue themselves, so the feedback from the peers can help the staff to have a better self-development than other appraisal methods.

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4. A chance to complain their manager without following the normal complaint procedures.
Though the 360-degree method, if the manager does not do well in his job and make the staff feel discontent, they can compliant the manager during the appraisal without following the normal complaint procedures. This can help the staff a chance to voice out their discontent and what they want.

LIMITATION OF 360 DEGREE APPRAISAL

1. Time consuming and more complex on administration
It is no doubt that include more people to do the evaluation can give a more comprehensive view of the result, but it also very time consuming since everyone need to do the evaluation, after that the company need to find more staff to help to find out the result, it will increase the complex on the administration, so the company cannot have the appraisal frequently on the same people. It is very important to choose a right timing to conduct this method that can minimize the impact of the organization.

2. May generate the environment of suspicion and cynicism

This method can be threatening both the staff is being assessed and the people doing the evaluation. From the management level, the manager may feel this method could undermine their authority and so they will not cooperate well when they do the appraisal. About the staff, if they do not have a good result of the appraisal, they may suspicious that who give them some bad comments and may things that other staff will cynics them because they cannot get a good result. As the result, it will generate a worse atmosphere in the working environment. So it is very important that the 360-degree appraisal should conduct in an open and honest environment.

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3. Risk of confidentiality.
It is the biggest risk of the 360-degree appraisal because many company may outsource the 360-degree process to other company that can used to make the staff who are being evaluated feels more comfortable that the information they give and receive will in a confidential environment. However, some information is very sensitive but the company discloses the information to others carelessly, that will affect the whole company.

PROCESS
Process for 360 degree performance appraisal are: create awareness about the 360 degree appraisal. Inform the people about importance of 360 degree feedback. Create survey question Create the technical environment to capture and report the scores. Communicate the steps to be followed for giving the responses Close the survey on the agreed date Collect reports and send to the recipient Meet with employees to discuss results and plan future development Provide feedback Conduct a survey again a year or so later, using the same model to determine the amount of change.
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OBJECTIVE Three common objectives for 360-Degree Feedback

360-degree feedback is a vital part of performance, growth, and development. Understanding ourselves and how we interact with others helps us understand the impact we have on those around us. The perceptions of others within our circle of influence, whether those perceptions are accurate or inaccurate, often impact our level of success. This is where 360-degree feedback comes in. The first step in improving individual or organizational performance is gaining an awareness of our level of performance. Many of us have an incomplete perception of how others see us, which then leads to ineffective interaction and reduced overall effectiveness. After all, without feedback, we tend to invent our own "reality." It is not until we are aware of these behaviors, as well as how others perceive them, that we can begin to do anything about them. Most organizations today use multi-rater assessments (360s) in some form or another, although the purpose varies. 360-degree feedback can be used in a number of ways. Based on the needs any organization, we align the 360-degree feedback process to reach objectives:

1. Targeted Development

Focuses on personal and career development Discovers where you are and where you need to grow or improve Results in the creation of a personalized action plan

2. Team Effectiveness

Focuses on team-effectiveness skills, along with strengths and areas for improvement Allows groups to come together on goals and work better as a team Promotes a safe environment to share "the undiscussables"

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3. Performance Assessment

Creates a multi-rater perspective of job performance and behaviors Provides a more objective and accurate view of individual contributions and effectiveness Results can be factored into administrative actions

PURPOSE OF 360 DEGREE

360 feedback is a tool that provides leaders with constructive, specifc feedback on their skills(strengths and development opportunities) as perceived by themselves and the person they report to, their peers and customers, and their direct reports. The feedback focuses on specifc leadership competencies.

360 feedback has a variety of purposes:1. As part of overall team leadership development, it can serve as the basis for
development planning to identify training needs and other activities.

2. It is

used for specifc individuals, to pinpoint strengths to leverage and to

identify barriers to success as a leader.

3. As an organizational strategy during change, a 360 feedback process can

help establish goals and metrics for new desired behaviors.

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PROBLEMS
With the advantage, some problem is also associated with 360 degree feedback, they are :1. It is very costly and time consuming type of appraisal. 2. These programs tend to be somewhat shocking to managers at first. Amoco's Bill Clover described this as the "SARAH reaction: Shock, Anger, Rejection, Acceptance, Help". 3. The problems may arise with subordinate assessments where employees desire to get the boss or may alternatively scratch the back of a manager for expected future favors. 4. The organization implementing this type of performance appraisal must clearly define the mission and the scope of the appraisal. Otherwise it might prove counter product. 5. organizations attempt to assimilate the 360-degree method within a traditional survey research scheme. 6. Organizations must consider other issues like safeguarding the process from unintentional respondent rating errors. 7. culture shock.

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CONCLUSION
Obviously the performance of the employee affects the production directly. Outstanding employee is certainly an important property of the company, but the worse performance staff causes the company running inefficiency. Because of this problem, company need to evaluate their staff to differentiate good and bad. There are different types of performance appraisal methods to rate the staff performance, for example, rating scales, critical incidents, forced distribution, 360-degree appraisal, etc. Though the above research, we can find that 360-degree appraisal is an all-around appraisal method to evaluate the employee performance. Although time consuming and more administratively complex are a serious problem of ther 360-degree appraisal, this method really gives a more comprehensive view of employee performance than other appraisal methods. As it is a believable performance feedback that considered by managers, peers, subordinates and staff. After the evaluation, the company can get more detailed information about the employee, so that human resource department can establish corresponding strategy, such as on job training, or providing jobs vacancies. The result of evaluate can also use for making decisions on promotions and payments. Under this appraisal, employee are encouraged to have a better self-development because of the feedback from the peers can help the staff to know more about themselves. Also, this evaluation allows the staff voice out their discontent and what they want. Comparing with other methods, 360-degree appraisal have more scarce advantages. Most of the companies which are using 360-degree appraisal have a better environment for staff and management, the case of Homeland Hotel we illustrate is a good example. Homeland Hotel said that 360 degree performance appraisal give a chance for each employees to receive fair, accurate and creditable information results in working harder and self development. Also, this system facilitates a comprehensive supervision to management. And every staff is willing to motivate each other trying their best.

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REFERENCES
www.custominsight.com/360-degree en.wikipedia.org/wiki/360-degree_feedback www.360degreeperformanceappraisal.org/ www.humanresources.hrvinet.com/360-degree-performance-appraisal/ www.mbaarticles.com/360-degree-performance-appraisal

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