PROJECT REPORT ON

360-DEGREE PERFORMANCE APPRAISAL

_________________________________
UNIVERSITY OF MUMBAI

MASTER OF COMMERCE
(Business Management)
SEMESTER-II
2015-16

SUBMITTED BY
Name: Anita Hatnolkar

Roll No.: 29

PROJECT GUIDE:
PROF: SEEMA SAWANT

K.P.B HINDUJA COLLEGE OF COMMERCE

315, NEW CHARNI ROAD, MUMBAI-400 004
M.Com (BUSINESS MANAGEMENT)

2st SEMESTER

360-DEGREE PERFORMANCE APPRAISAL

SUBMITTED BY-

ANITA HATNOLKAR
Roll No.: 29
Smt. P.D. Hinduja Trusts

K.P.B. HINDUJA COLLEGE OF COMMERCE

315, New Charni Road, Mumbai 400 004 Tel.: 022- 40989000 Fax: 2385 93 97. Email:

NAAC Re-Accredited A

001:2008THE BEST COLLEGE OF UNIVERSITY OF MUMBAI FOR THE ACADEMIC YEAR 2010
Prin. Dr. Minu Madlani (M. Com., Ph. D.)

CERTIFICATE
This is to certify that Mrs. ANITA HATNOLKAR of M.Com (BUSINESS
MANAGEMENT) Semester 2nd [2015-2016] has successfully completed the
Project on 360-DEGREE PERFORMANCE APPRAISAL
under the guidance of Prof. SEEMA SAWANT.

________________
Project Guide

________________
Internal Examiner

________________
Co-coordinator

________________
External Examiner

________________

________________

Principal

College Seal

DECLARATION

I Mrs. ANITA HATNOLKAR student of M.Com-BUSINESS

MANAGEMENT, 2nd Semester (2015-2016), hereby declare
that I have completed the project on 360-DEGREE

PERFORMANCE APPRAISAL

The information submitted is true and original copy to the best

of our knowledge.

(Signature)
Student

CHAPTERS
1

INDEX
CONTENTS

Page

INTRODUCTION

6-9

360 DEGREE APPRAISALS

10-15
16-19

OBJECTIVES AND TRAITS, MANAGEMENT OR

APPROVAL AUTHORITY EXPECT
DIFFERENT WAY OF 360 DEGREE APPRAISALS

FORM

20-26

ASSESS PROS AND CONS OF 360-DEGREE

5
6

PERFORMANCE APPRAISAL
360-DEGREE PERFORMANCE EVALUATION

27-35
36-39

360 DEGREES FEEDBACK & INDIAN SCENARIO

7
8

CONCLUSION

40-41
42

BIBLIOGRAPHY

43

CHAPTER 1
INTRODUCTION

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 paperbased 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).

How is Performance managed?

Good performance by the employees creates a culture of excellence, which
benefits the organization in the long run. The activity includes evaluation

of jobs and people both, managing gender bias, career planning, and
devising methods of employee satisfaction etc. The efforts are to make to
generate the individuals aspirations with the objectives of the organization.
Organization has to clear the way of career advancements for talented and
hardworking people. Fear of any kind from the minds of the employees
should be removed so that they give best to their organization. Allow free
flow of information. Communication network should be designed in such a
way no one should be allowed to become a hurdle. This enables the
managers to take correct decisions and too quickly.

Why Performance Appraisal?????

Todays working climate demands a great deal of commitment and effort
from employees, who in turn naturally expect a great deal more from their
employers. Performance appraisal is designed to maximize effectiveness by
bringing participation to more individual level in that it provides a forum
for consultation about standards of work, potential, aspirations and
concerns. It is an opportunity for employees to have significantly greater
influence upon the quality of their working lives. In these times of
emphasis on quality, there is a natural equation: better quality goods and
services
fromemployeeswho enjoy better quality goods and services from their e
mployers.Performance appraisal must be seen as an intrinsic part of a
managers responsibility and not an unwelcome and time-consuming
addition to them. It is about improving performance and ultimate
effectiveness. Performance appraisal is a systematic means of ensuring that
managers and their staff meet regularly to discuss post and present
performance issues and to agree what future is appropriate on both sides.
This meeting should be based on clear and mutual understanding of the job
in question and the standards and outcomes, which are a part of it.
In normal circumstances, employees should be appraised by their
immediate managers on one to one basis. Often the distinction between
performance and appraising is not made. Assessment concerns itself only

with the past and the present. The staff is being appraised when they are
encouraged to look ahead to improve effectiveness, utilize strengths,
redress, weaknesses and examine how potentials and aspirations should
match up. It should also be understood that pushing a previously prepared
report across and desk cursorily inviting comments, and expecting it to be
neatly signed by the employee is not appraisal - this is merely a form filling
exercise which achieves little in terms of giving staff any positive guidance
and motivation.
MEANING:

Performance appraisal: The performance appraisal is

the process of assessing employee performance by way of
comparing present performance with already established
standards which have been already communicated to
employees, subsequently providing feedback to employees
about their performance level for the purpose of improving
their performance as needed by the organisation. As said
above the very purpose of performance uprising is to know
performance of employee, subsequently to decide whether
training is needed to particular employee or to give
promotion with additional pay hike. Performance appraisal
is the tool for determining whether employee is to be
promoted, demoted or sacked (remove) in case of very poor
performance and no scope for improvement. Every
corporate sector uses performance appraisal as a tool for
knowing about the employee and take decisions about
particular employee. For the purpose of performance
appraisal of employees there are different methods under
the category of traditional method and modern methods.

What is Performance?
What does the term performance actually mean? Employees are
performing well when they are productive. Productivity implies both

concern for effectiveness and efficiency, effectiveness refers to goal

accomplishment. However it does not speak of the costs incurred in
reaching the goal. That is where efficiency comes in. Efficiency evaluates
the ratio of inputs consumed to outputs achieved. It is not desirable to have
objective measures of productivity such as hard data on effectiveness,
number of units produced, or percent of crimes solved etc and hard data on
efficiency (average cost per unit or ratio of sales volume to number of calls
made etc.). In addition to productivity as measured in terms of
effectiveness and efficiency, performance also includes personnel data such
as measures of accidents, turnover, absences, and tardiness. That is a good
employee is one who not only performs well in terms of productivity but
also minimizes problems for the organisation by being to work on time, by
not missing days, and by minimizing the number of work-related accidents.
What is Appraisal?
Appraisals are judgments of the characteristics, traits and performance of
others. On the basis of these judgments we assess the worth or value of
others and identify what is good or bad. In industry performance appraisal
is a systematic evaluation of employees by supervisors. Employees also
wish to know their position in the organization. Appraisals are essential for
making many administrative decisions: selection, training, promotion,
transfer, wage and salary, administrative etc. Besides they aid in personnel
research. Performance Appraisals thus is systematic and objectives way of
judging the relative worth of ability of an employee in performing his task.
Performance appraisal helps to identify of an employee in performing their
assigned tasks well and those are not and reasons for such performance.

CHAPTER 2
360 DEGREE APPRAISALS
What Is a 360 Degree Appraisal?
A 360 degree appraisal is a type of employee performance review in
which subordinates, co-workers, and managers all anonymously rate the
employee. 360-degree Appraisal is an assessment process used to improve
managerial effectiveness by providing the manager with a more complete
assessment of their effectiveness, and their performance and development
needs.
This information is then incorporated into that person's performance
review. The 360 evaluation feedback method was first used in the 1940s.
Analogous to the multiple points on a compass, the 360 method provides
each employee the opportunity to receive performance feedback from his
or her supervisor, peers, staff members, co-workers and customers. 360degree feedback or multi-source feedback is an appraisal or performance
assessment tool that incorporates feedback from all who observe and are

10

affected by the performance of a candidate. 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; Staff performance
appraisals

also

establish

individual

training

needs

and

enable

organizational training needs analysis and planning each individual's

performance against objectives and standards for the trading year, agreed at
the previous appraisal meeting. Essential for career and succession
planning. Provide a formal, recorded, regular review of an individual's
performance, and a plan for future development. Important for staff
motivation, attitude and behaviour development, communicating and
aligning individual and organizational aims, and fostering positive
relationships between management and staff.
DEFINITION:
360-degree appraisal is a systematic feedback process where not just your
superior but your peers and direct reports and sometimes even customers
evaluate you. You receive an analysis of how you perceive yourself and
how others perceive you.
The definition 360 degree feedback is a process for providing a person
with structured feedback from a group of people who have a range of
different perspectives. For example, a manager can receive feedback on
their leadership, communication and planning & organising capabilities
from their direct reports, peers, their own manager and possibly internal
and external customers.
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. A performance appraisal is

11

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. It is a prescribed system with a meeting arranged after a set
period to review the targets set by the previous appraisal. This may be sixmonthly or annually, depending on your organization. Nonetheless, the
performance appraisal is not only a means to review performance standards
and specific targets. It is a means to:

Identify current job performance levels

Identify individual employee strengths and weaknesses
Motivate and encourage the individual employee
Reward employees for their contribution to organizational objectives
Identify training and development needs
Identify potential performance standards
Plan future development of the individual
Discuss salary, promotion and training

The performance appraisal interview at its simplest, the appraisal interview

consists of three steps:
Setting targets or standards
Measuring performance
Planning the appropriate action

FOR WHICH CATEGORY OF EMPLOYEES IS THIS TOOL

USED? Usually, this tool is used for employees at middle and
senior level. The complexity of their roles enables the organisation
to generate sufficient data from all stakeholders for a meaningful
assessment.
WHICH ORGANISATIONS USE THIS TO ASSESS
EMPLOYEE

PERFORMANCE? Most organisations

that focus on employee development use the 360-degree

tool to assess performance and potential of staff and enable
the employees to map their career path based on the
feedback. Organisations take 360-degree feedback about an
employee before taking a major decision about the

12

professional's career. The results from 360-degree feedback

are often used by the person receiving the feedback to plan
training and development. Results are also used by some
organizations in making administrative decisions, such as
pay or promotion. When this is the case, the 360 assessment
is for evaluation purposes, and is sometimes called a "360degree review." 360 degree feedback is the most
comprehensive appraisal where the feedback about the
employees performance comes from all the sources that
come in contact with the employee on his job. This method
is being used in the (MARUTHI SUZUKI Motors and
HCL)

WHO ARE THE STAKEHOLDERS IN DOING 360DEGREE ASSESSMENT? 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. While the benefits of
multiple points of view are obvious, there are also some
challenges

to

these

types

of performance

reviews.

Employees almost never give "true" feedback about their

managers (out of fear that the manager finds out) and
outside contacts may be simply too busy, or unqualified to
effectively rate a specific employee (customer satisfaction
surveys may be a better way to gauge this type of
feedback).

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. 360 degree respondents for an employee can
be his/her peers, managers (i.e. superior), subordinates,

13

team members, customers, suppliers/ vendors - anyone who

comes into contact with the employee and can provide
valuable insights and information or feedback regarding the
on-the-job performance of the employee.360 degree
appraisal has four integral components:

The Components of 360 Degree Appraisal are described as under:

Self appraisal
Superiors appraisal
Subordinates appraisal
Peer appraisal
Top management
Customers

1. Self Appraisal: Self-appraisal is a very important part of the 360

degree appraisal system because it gives the employee absolute freedom to
look at his strengths and an opportunity to assess the performance. Self-

14

appraisal also provides an opportunity to the employee to express his

career moves for the future. Another important area of self-appraisal is the
concern for self-renewal and development of the employee.
2. Superior Appraisal: Here the focus is to provide constructive feedback
on employees performance and his development needs. It is the
responsibility of the superior to put carrier aspirations of the employee in
proper perspective. Firstly, superior must communicate to the employee in
clear way what the organization plans for the employees. Secondly, if the
employees have unrealistic aspirations, then also it is superiors
responsibility to share with the employee the realistic picture given his/her
strengths,

development

areas,

experience,

qualifications

and

the

organizations ability to provide growth. This is how the superiors

appraisal has a very significant role to play rather than the fixing
syndrome (condition) of the traditional appraisal system.
3. Peer Group Appraisal: Peers play an important role in the life of an
employee in the organization. They can also provide a deep insight into the
personality make up, attitude and style of working of the employee. Peers
both from within the department as well as from the other departments
which are directly connected with the working of employees department
are to be included in this system.
Peer appraisal must strive to get the feedback on

employees working style,

sensitivity towards others,

spirit of co-operation and collaboration, and

Ability to work as a team member.

15

4. Subordinates Appraisal: It signifies two things. Firstly, is a clear

expression from the organization that it encourages openness and that
feedback is a two-way process. Secondly, it is a systematic recognition of
the fact than employees subordinates do play a vital role in his appraisal.
Thus, the purpose of subordinates appraisal is to get first hand assessment
of how the subordinates perceive their superior to be in terms of:

delegation of authority,

guiding and training of subordinate,

motivation of subordinates

Team building, etc.

The upward appraisal also provides an opportunity to the subordinates to
give feedback to their superior on the kind of things they would like
him/her to continue doing (status quo), things they would like him/her to
stop doing (arrears for corrective action), things they would like him/her to
start doing (areas for new initiatives).
5. Top Management: Top management normally may rate the senior or
middle level executives who directly report to them.
6. Customers: The customers or clients can also undertake performance
appraisal of the employees with whom they interact. The customers are in
better position to give a feedback on the performance of those employees
with whom they come into contact during the course of business
transactions. The feedback given by customers can be utilized to improve
strengths and to minimize weakness of the employees. Apart from the
above six parties performance appraisal can also be conducted by:
Consultants, Personnel Department, etc.

CHAPTER 3

16

OBJECTIVES AND TRAITS, MANAGEMENT OR

APPROVAL AUTHORITY EXPECT
A performance appraisal begins with an interview between manager and
employee, an appraisal form is completed, and action is agreed. The action
plan will specify targets to improve job performance, and indicate what is
the reward for improvement. This reward may be a salary increase, job
promotion, an opportunity to join a management development scheme, or
to enrol in a new training program.
Most of the younger Group Organizations and Software Industries have sta
rtedimplementing 360 Degree Appraisals. 360 Degree Means that
all round. The employee concerned at the central Point and he is appraised
by all the officials who are all connected with him on the job. I am afraid in
most of the organizations; this new concept is being followed very
religiously and systematically. May be the acceptance level or maturity
level is not as aimed.
Employees across the entire organisation are appraised of their
performance.This could be done annually, twice a year, periodically
depending on the need of the organisation.
OBJECTIVE:
To evaluate an employee by all the officials whoever connected with him
on the job for his Attitude as well as Job Performance. And to study the
following:

To have an evaluation system very effectively.

To nullify biased approach
To view a person at different angles and

utilize the same for growth.

To have a consistent behavioural approach and job performa

nce
To improve the quality in performance

17

TRAITS:
Before designing a 360 Degree Appraisals, decide what are the
Attitudinal Traits and Job performance characteristics are required at
each level when the person is evaluated.
For example, an Engineer is evaluated by his Manager,
Workmen, and lateral Level of functional officials, customers or vendors
and so on and so forth.
MANAGEMENT OR APPROVAL AUTHORITY EXPECT:

Value Addition
Scope for Development
Result-oriented

Manager expects from his Engineer the following:

Organization Culture practices

Value Addition by control of Man, Material, Time, T

raining
Continuous Improvement on Work Methods, Data

Control, Safety, etc.

Effectiveness of Communication on work execution,

MIS system, etc.

Leadership Skills like Personality, Attendance &

Punctuality, Team Work, etc.

Time Planning
Stress Control
Scope for Development
Learning Skills
Training Needs.

Related Departments expect:

Co-ordination
Communication
Team Work
Sharing Knowledge

18

 Flexible Approach
Customer or Vendor Level Expect: (Wherever Applicable)

Corporate Culture
Effective Communication thro information and product knowledge
Flexible Approach
Follow-up Attitude
Listening Skills

Self Level Expect:

Knowledge
Job Satisfaction
Training Needs
Problems that were prevented him to perform
Positive Points that contributed in his Job Performance
Suggestions for Improvement
Suggestions for Welfare
Intra and Inter-personal relationships (All three levels viz. upward,

horizontal &down level)

Needs if any of infra-structure facilities
Suggestions for Organization Growth overall

Attitudes: HR Manager must know the skill of giving ratings

to Attitudes also. For this first define the Job and Man who is
executing. You give expected level rating (5) and so on the Performance or
Achieved Level. The difference will give you the TNI (Training Need
Identification). Success of implementation of 360 degree appraisals
depends on the effectiveness of role of hr managers: It is not an easy
task to implement and maintain 360 Degree Appraisals. For this you have
to Train all your personnel whoever involved in executing the 360 Degree
Appraisals. In the initial stage, you take the help of out-side Consultants'
help and expertise.

19

CHAPTER 4

DIFFERENT WAY OF 360 DEGREE APPRAISALS

FORM

20

Job Performance and Knowledge

Understanding and acceptance of team/department goals and priorities

Ability to share in workload and assists others.
Ability to share credit with the team/department.
Knowledge and skills to perform team/department activities.
Quality of work.
Ability to meet assigned tasks/commitments.
Handling of responsibility for getting things done.
Ability to seek and identify new and better ways of doing thing

Peer to Peer Appraisal Form:

Interpersonal

Level of accessibility
Level of approachability on difficult subjects
Sensitivity to others feelings and points of view
Outlook on the department
Ability to seek understanding before rendering judgment
Ability to deal with pressure, conflict and stress positively and

appropriately
Level of making commitments willingly

21

Participation as part of the team/department

Communication

Written and oral communication

Level of open information sharing with the team/department
Ability to communicate important information in a timely manner
Ability to encourage diversity of opinions

Values

Level of sharing and commitment to the teams/departments values

Trustworthiness
Ability to treat other team/department members with respect
Respect of others needs to appropriately balance work and
family/personal responsibilities

Supervision

Leadership
Ability to provide direction through setting priorities and goals of staff

Self Appraisal Form:

Self Awareness

I am aware of the physical reaction (twinges, aches, sudden changes) that

signal a gut reaction

I take a break or use other active methods of increasing energy when I

sense that my energy level is getting low

I take time every day for quiet reflection
I can usually identify the emotion I am feeling at any given moment
I am clear about my own goal and values

Motivation

22

I have several important things in my life that I am enthusiastic about,

and I let it show

Others usually feel inspired and encouraged after talking to me
I try to find the positive in any given situation
I can keep going on big projects, despite obstacles
I believe the work I do day-to-day has meaning and value to society

Self Confidence

I readily admit mistake and apologize

I have little trouble taking prudent risk
I take initiative and move ahead on task that need to be done
I am generally comfortable in new situations
I express my views honestly and thoughtfully, without being pushy

Self Control

I let go of problem, anger, or hurt from past and I can move beyond these
I open up with people appropriately, not too much but enough so that I

dont come across as cold and distant

I refrain from making up my mind on issues and expressing my opinion

until I have all the facts

I neither bury my anger nor let it explode on others
I am good at managing my mood, and I seldom bring negative emotions
to work

Self Competency

23

I can easily meet and initiate conversation with new people when I have to
I have no trouble in making presentations in front of groups or conducting

meetings
I can deal calmly, sensitively and proactively with the

emotional display of others

I am respected and liked by others, even when they dont agree with me
I can effectively persuade others to adopt my point of view without
coercing them

Subordinate appraisal form

Leadership : Does the manager:

Set an example for others to follow?

Take risks and experiment where appropriate?

Oral communication: Does the manager:

Provide information critical to successful job performance?

Provide constructive criticism? Choose the right time to deliver

messages?
Sense others' moods

Teamwork & coordination of team efforts: Does the manager:

Treat all group members equally?

Encourage group problem-solving?
Share credit with all team members?
Hold effective team meetings?

Quality: Does the manager:

Set a good example by constantly trying to improve?

Provide training opportunities?
Have a good sense of the City's customers and their needs?

Planning: Does the manager

24

Ask for help in planning?

Set realistic, attainable objectives?
Follow through with plans?
Celebrate accomplishments?

Delegation of authority: Does the manager:

Set realistic time table for completion?

Provide the resources, time and support to accomplish the delegation?
Involve the employee in budget preparation, as appropriate?
Complete his/her fair share of the work?

Superior Appraisal Form

Job Title
_____________________________________________Employee Name
______________________________ Employee ID
___________________Supervisor Name
___________________________ Title ____________________________
Department Name
____________________________________________________________
Period Covered: from ___________ to __________ Evaluation Date
___________________Purpose of review: _________________________
Other (Specify) _____________________
Please rate your Subordinate on the following parameters
Rate each question below on the scale of 1-5 by putting a 1 2 3 4 5
Best Needs and Improvement

Departments

1. Customer service
2. Attendance/punctuality
3. Ability to get along with Co-workers

25

4. Ability to get along with Colleagues on Campus

5. Time management
6. Planning, budgeting and forecasting
7. Reporting and administration
8. Communication skills
9. Delegation skills
10. IT/equipment/machinery skills
11. Meeting deadlines/commitments
12. Creativity problem-solving and decision-making
13. Team-working and developing others
14. Energy, determination and work-rate
15. Steadiness under pressure
16. Leadership and integrity
17. Adaptability, flexibility, and mobility

Performance appraisal format for L & T

26

CHAPTER 5

27

ASSESS PROS AND CONS OF 360-DEGREE PERFORMANCE

APPRAISAL

It sounds like a good idea: Let's ask customers, colleagues, direct reports
and managers to help evaluate the effectiveness of every employee. A 360degree approach: Who could argue with the idea of drawing information
from every direction? Yet HR experts caution companies to consider
carefully whether the use of 360-degree feedback is appropriate for
performance evaluationespecially when it impacts pay and promotion
opportunities. This is something a company shouldn't rush in to. For
evaluative purposes can be dangerous and has the potential to be
destructive. It as been noticed departments blow up and employees leave
companies because the 360 wasn't handled properly. 360s are most
effective when they are used as a development tool, not a rating tool. Such
instruments "were extremely popular early on. Later, they fell out of favour
because of a lack of reliability and validity, among other issues.

Advantages
There's no doubt that 360-degree rating provides a broader perspective on
employees. It frees you as an individual and as an organization from being
held hostage by the views of your bosses. It can be eye opening to see what
others see; especially when the boss is in another location and doesn't
observe an employee's behaviour. It's really valuable to get the perspective
of customers and direct reports. With a 360-degree review, "a strong
performance in one areacustomer service, for examplemight offset a
marginal performance in another.
Pre-requisites for having 360 degree review system: It is very important
for the organisation and the employees to be prepared in advance for the
change and accepting a new method for appraisal. Following are some
points to be taken care of for this method to be effective:-

28

Top

management should be able to spare so much of time to give feedback for

all the employees.

The feedback thus given should be free from bias and anonymity

should be ensured for the method to be effective.

The feedback should be considered seriously and the information
should be used to bring positive change in oneself and the

organisation.
Teamwork should be encouraged in the organisation in order to

achieve the organisations common objective

There should be existence of healthy competition among the

employees of the organisation.

Employees should be inquisitive and should want to know how
people feel for them so that they can improve their behaviour and

performance
Benefits 360 degrees appraisal gives chance to all levels of employees to
give their input and contribute towards achievement of the organisation
goal. A number of distinct benefits can be realized from this type of
appraisal, and this technique has been gaining widespread popularity
among small businesses. 360 degrees feedback helps the individuals to get
a broader perspective of how other perceive them and thus it motivates
them to work harder towards achieving organizational goal. The feedback
provides a more rounded view of their performance. Following are some
benefits of 360 degree feedback
Creates awareness among employees & senior management.
This system of feedback creates awareness and spirit to
compete among the employees. They tend to work hard to
achieve their departmental goals and their personal goals in
order to have a better performance ranking. Since, feedback
is taken from peers also so employees ten to have better
relationships with their colleagues which results in healthy
working environment. This system acts as a three
dimensional mirror because a person can have a different
dimensional view of his performance. Not only the

29

employees, but senior management too gets to know their

need for development. The feedback thus received is
considered to be more objective and valid as its collected

from various sources.

All round development of the person being rated this system
helps in the all round development of the employees. As I
have already mentioned, they will have better interpersonal
relations within their department and with their seniors.
Theyll also maintain good relations with the customers and
suppliers. The flaws of persons can be known and
accordingly training sessions can be arranged to overcome
the weaknesses of the employees. It also helps in developing
good leadership qualities as leadership qualities is one of the
parameters for providing the feedback. It broadens the
scope for employees to get various says for enhancing their
job role, performance, and views. All efforts are coordinated towards achieving organisational objective The
feedback is taken on certain parameters mentioned in a
questionnaire. These parameters are generally same for
employees of same level or same department or group. Thus
the kind of work they are expected to do is also same. They
direct their efforts towards achieving their personal goals
and organisational goals. Their feedback also depends on
how successful they were in achieving the organisational

objective.
Helps improving performance of organisation as a whole.
The companies can use the data collected through feedback
programs to monitor consistent patterns and areas of
weaknesses for employees within the organisation. Thus as
discussed in the above points, the top management can more
effective and appropriate training programs to overcome the
weak areas. This will lead to improvement in performance

30

of various departments in the organisation and as a result,

the overall performance of the firm goes up.

Increased consistency in the performance An all-round
feedback helps in improving the consistency in the working
patterns of an organisation. The employees are more
concerned regarding how others perceive them. This
motivates them to perform consistently towards achieving
the organisational goal as this will help them achieve their
personal goal as well, which will further lead to individual
growth. Thus the employees will feel more content with
their performance. 360-degree feedback allows employees
to gain a more thorough understanding of their impact on
people they interact with every day. This method helps in

motivating the employees who undervalue themselves.

Improved superior-subordinate relationships in traditional
appraisal system, the feedback are totally in the hands of the
supervisor thus he can be biased in his judgement. He can
give good ranking to those in his good books or he can rank
employees on the basis of their recent performance while
they expect to be ranked on whole years performance. This
can lead to differences between superior and the
subordinates. The 360 degrees feedback helps in creating an
environment of trust. The employees feel more motive and
work in teams towards achieving the common objective if
the feedback is positive. Employees tend to be more honest

with each other and help each other.

Complete analysis of the subject Since feedback is from
many sources and every source has a separate relation with
subject. So everybody gives feedback from their own
perspective and as per their experience and expectations.
Supervisors, for example, may judge employees based on
their output, while co-workers judge others based on their
pleasantness, and subordinates judge supervisors based on

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their fairness Thus, this feedback provides a complete

analysis of the person being reviewed and it has a positive
impact on him and can induce him to change as per the

observations.
Suitable for appraisal of top-management executives this
kind of feedback is suitable for the review of the top
management as they dont have many people as their
supervisor or boss who can rate them. Plus they are the
people on whose decisions the organisations operate so their
decisions affect almost everybody from employees to
customers to suppliers. Subordinates can provide their
opinion without any fear of being confronted because this

review is done on the principle of anonymity.

Helps creating happy employees. Employees are more
satisfied with their performance after they are reviewed by
many sources and get a chance to improve their
performance and hone their skills through effective training.
Plus they feel happy by giving their views about their
superior and this creates a sense of belongingness as their
views are considered important. After seeing that they can
bring positive change in the working of the organisation the
employees feel valued and they stick to the organisation for

a longer time, thus reducing employee turnover.

Helps in improving customer service 360

degree

performance evaluation helps in improving the customer

services as customers views are also considered important in
the review. Thus, the organisation can understand needs and
expectations of customers and can take product decisions
accordingly to satisfy customer needs. If the customers are
happy then his inputs can be used to improve the business of
the organisation and it will in turn improve the overall
performance of the organisation. Effective HR decisions. It
encourages participation of all and thus makes HR decisions

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more qualitative. Since inputs form all the levels inside the
organisations and outsiders like customers and suppliers are
collected which helps in better understanding of the needs
of insiders and outsiders and decisions can be taken

accordingly.
Its better than conventional system the employees find this
system better that the traditional feedback approaches as it
pinpoints the favouritism and biases of the supervisors
present in conventional appraisal systems. As already
explained in above points, this system is free from superior
bias and impartiality.

Common Mistakes in Execution

Some organizations that use 360-degree feedback fail at the planning and
implementation stages. Too often, no one sits down to discuss the
particulars. What competencies and skills [do we want] to review? Do we
have enough participants to maintain some level of anonymity among the
reviewers?
It advises companies to ensure that all raters can provide relevant feedback.
"If an employee rarely deals with customers or clients, it is unlikely that
useful information will be obtained from customer or client ratings, and the
employee may be subjected to unfairly skewed assessments."Once the
assessments are collected, "Staff or their bosses focus too much on isolated
pieces of feedback as opposed to broad themes [from multiple
respondents].Focusing on one-off comments can make the process appear
persecutory. It is observed that managers "often look only at the last few
months" of data. The worst offense is when a manager drops a report on
someone's desk and says, 'Looks like you're doing OK.' Or, 'You've got
room to improve,' then walks away, thats inexcusable, and unfortunately,
not uncommon."

Shortcomings 360 employee feedback surveys

33

One of the most common HR practices, but unfortunately that popularity

may have led to a degree of complacency. There are certain risks associated
with introduction of a new technique into the organisation. Moreover as I
have mentioned earlier also people are generally averse to risk and change.
One cannot be sure of anonymity in a small organisation and in the absence
of anonymity; the usefulness of data is lessened.
The following shortcomings of this system:

Fear of being confronted In the absence of anonymity, one will

always shy away from providing his actual views about his
superiors and peers because of fear of being confronted. This can
affect the relationships among the employees and thus can affect
the performance of the organisation due to strained relationships

among departments.
Difference of opinion everybody has his own mindset and
expectations. No two minds can be same and in an organisation
employees working at different levels can have different opinions
about a same person. The superiors could have a different view
point than the subordinates. The feedback also depends upon the
expectation of a particular person thus there can be difference of

opinion and the feedback can be affected.

No evidence of improvement on

performance

Most

organizations have no cause-and-effect data that actually proves

that the 360 process directly improves productivity. It cant be
said with certainty about what kind of effect will it have on the
employees and whether it will actually result in bringing any
positive change in the employees. No evidence as such has been
found which prove that managers in the organisations using 360
degree feedback are more efficient than their counterparts in other

organisations.
Its not futuristic the performance of past is being judged and no
such future plans are made by using this method. Thus the past
data of the employees last years performance cannot be helpful

34

in deciding the future course of action. As such future is uncertain

so nobody can predict how the employees will behave in future

and one cant be sure if theyll act in the desired manner.

Its a lengthy process As compared to one-on-one communication,
this is a more time consuming process. It consumes a lot of
productive time of employees which can be utilised for other
productive issues. And unfortunately, if there is a multi-year lag
between changing the way we treat employees and their resulting
improved scores, most existing business and statistical process

will never be able to prove a cause-and-effect connection.

Its a costly procedure this is more costly process as it comprises
of the cost of questionnaires and technological inputs required for
the process of feedback. These resources can be used for more
productive purposes. This is a secondary motivator the rating is
not the main motivator for high performance but it is the
secondary reason for it. If a company is providing good working
environment and is paying well to the employees and they get
incentives, etc. for their performance than they themselves are

motivated to work more.

Employees may be hardworking even without high rating It is not
necessary that only those employees who get high scores from
people will work hard. It actually depends on the nature of the
employees. Some may be efficient from inside and some may not
work hard even after getting a high score. So its basically not the
score which motivates the employees, there are many other

factors which come into play.

Main aim is not the score but to increase productivity the main
aim of the organisation is not to obtain scores but to increase the
overall productivity. The 360 degree provides the management
with the scores but the problem of productivity still remains to be
taken care of. It only ranks the productivity of the employees but
ignores factors like how to reduce labour costs and wastage of
time, etc.

35

Its not a fair method to rate an organisation has so many

employees. Some are top performers, innovators, game changers
and pioneers, but rating parameters are same for everybody. It is
not fair to rate efficient and inefficient employees on same scale.
Some departments have large number of employees but some
have very few employees who may not be enough to make a

feedback successful
It does not provide solution to improve the productivity the scores
dont tell which actions to be taken to improve the productivity. It
only tells whether the employees are performing well or not but
the main task of choosing actions to improve employee

satisfaction and performance is done by the management only.

Employees can give poor remarks to the manager they dislike
some employees give poor remarks to the managers they dont
like and vice-versa. This is done on purpose and the person being
reviewed has to put in more efforts in order to be liked by people

in the organisation.
Not suitable for rating managers one hasnt worked with this
method is not suitable if the feedback contains large number of
reviewers who may not even know the manager they are rating.
Some of them may not have even worked with the manager
concerned and have not seen his work but they are included in the
appraisal. Such rating will be misleading and proper conclusions

cant be drawn out of it.

Subordinates cannot assess their managers properly Subordinates
dont have proper expertise to rate their manager. They are not
competent enough to judge their performance. They can just give
their view on the managers based on his behaviour with them but
they may not be able to understand the work to be accepted from
him.

Politics and Human Behaviour

36

Applying 360-degree feedback to development or coaching probably

doesn't do much harm, but when it's used for determining compensation
and/or promotion, misleading information might be provided "by the office
screw-up who doesn't know anything anyway. And also by the guy down
the hall bucking for the same promotion I am [who] wants to put a dagger
in my ribs. It's hard to be sure there aren't people collaborating" to produce
certain results.
Even if such corruption is not present, there may be highly specialized
skills involved that [raters] do not know or understand, and therefore the
reviews don't, give a full picture of performance. 360s provide only "a
snapshot. Performance should be examined continuously, and a 360 is
usually focused at a point in time. Moreover, cost is a factor. A 360
evaluation, might involve you, your boss, three to five peers and three to
five direct reports. So for each employee that's eight people filling out
reports; called it report overload. The numbers of staff hours necessary to
complete a staff assessment are fairly staggering.
Experts said 360-degree performance appraisals can damage morale.
People felt demoralized after reviewing results. I never saw anyone feel
better about their work or their performance, even people who were very
good performers. Employees will reject feedback, if they disagree with the
way that their behaviour is described or if they feel; that their peers are
rating them unfavourably to get ahead themselves. The stronger the
feedback, the 0higher the chances of rejections. That's the opposite of what
we want. Beyond the Five-Point Rating Scale, Some reviewers say they
never give out fives because that means a person is perfect, other reviewers
hand out fives with no problem. People define the scales differently, and
that skews the results. Companies should provide an opportunity to ask
questions of reviewers. Often, the anonymity does not allow for that to
happen."

37

The 360 approach to performance appraisal used successfully, and have

been seen it become a black hole. It requires senior management support
and a strong culture of communication and trust. Without those things in
place, it is doomed.

CHAPTER 6
360-DEGREE PERFORMANCE EVALUATION
The 360-degree evaluation is a common tool in human resource
management. Simply put, it is a mechanism for evaluating someones
performance based on feedback from everyone with whom the individual
comes in contact supervisors, co-workers, partners, subordinates, the
general public. It is a method of collecting input from many sources in an
employees environment. This can be a powerful tool. Each of wants to
know how were doing in our work. This method of collecting evaluative
input is an excellent source of motivation for employees because it
provides a truly honest assessment of how the employee and her
performance are viewed by a variety of constituents.
In the more traditional method of performance appraisal, supervisors meet
with employees one-to-one to discuss performance. By contrast, the 360degree method uses confidential input from many people who can truly
respond to how an employee performs on the job. The supervisor and
employee meet to discuss the feedback received. This type of feedback
helps employees see themselves as others see them and allows them to
seriously examine their behaviour. It can reveal areas in which employees
are performing particularly well and those areas in which there is room for
improvement. It provides information of which neither the employee nor
the supervisor may be aware. Specific input allows employees to adjust
their performance.

38

The most challenging aspect of the 360-degree evaluation is the evaluators

concerns about confidentiality. When implementing this type of evaluation,
its best to assure other employees that what they share will remain strictly
confidential. Likewise, explain to each employee that he will be evaluated
by many people, including those who know his work best.Typically,
employees will find this methodology to be more fair. When they consider
this process as opposed to being evaluated by an individual supervisor who
has limited knowledge of what they do, they will begin to see the value in
this type of evaluation. They will conclude that the 360-degree feedback is
more accurate and equitable than other traditional approaches and puts all
employees on a level playing field. This review process is also helpful for
the supervisor. It can provide a more accurate assessment of an employees
performance and help eliminate accusations of favouritism. The 360-degree
process provides greater objectivity. And because the feedback is submitted
anonymously, it provides a supervisor with the most unbiased and accurate
information from which to draw performance conclusions.
Most people are not able to see clearly how their performance is either
enhancing the work situation for others or detracting from it. This
performance evaluation method can help reveal these areas and allow us to
improve the way we do our job, thereby creating greater harmony and
better productivity in the workplace. The 360-degree evaluation will help
employees identify their strengths so they can build on them at the same
time it addresses their skill gaps. It is a process that leads to continuous
learning,

team

building,

growing

self-confidence

and

improved

productivity.
Sounds like a winning system, right? It can be, but organization must be
ready to accept the change from the traditional method of employee
evaluation. Formal and informal leaders must buy in to this idea and see
the value of its adoption. Some questions should be asked including the
following: Is your organization committed to continuous learning?

39

 Does your organization see the value of developing leaders in-house?

Are you willing to make the changes necessary to do this?
What is the level of trust in your organization? Will your culture
support honest feedback?
Is upper level management willing to lead the way and volunteer for
360-degree evaluation?

The 360 degree appraisal has become popular recently

because of:
The changing expectations of the customers or clients. The
customers expect better and improved products and services at all
times.
The cut throat competition in business, where only the fittest can
survive.
The openness of employees, especially at higher levels to know of
their strengths and weaknesses.
The need to maintain excellent team work for effective results.
Increasing emphasis on quality of performance , especially at the
managerial levels.

The terms and references that are thrown around about performance
evaluations and 360-degree reviews can make it difficult to delineate the two.
Here are the big differences:

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CHAPTER 7

41

360 DEGREES FEEDBACK & INDIAN SCENARIO

The 360 degrees feedback has gained momentum in many countries but it
is still to take off in full swing in Indian companies. This is because people
here are averse to change. They like following the old traditions and
patterns which have been made long back. Importance is given to the
hierarchy and the person on top rules. The subordinates follow the leaders
even if any one of them is competent enough to lead because the
recruitment is still done on the basis of qualification and work experience
and not on the basis of competency. Moreover people here have a habit of
pleasing their bosses and they do not open up about their bosses because of
fear of coming in his bad books. The authority flows from top to bottom
and the opinions of subordinates are not given any importance because of
internal politics in various departments. Moreover, appraisal information is
needed for several purposes which ignore the major purpose of the
appraisal i.e. achieving the organisational objectives. Managers make false
promises and lack of training facilities lead to poor co-ordination among
the groups and individuals.
Although this system has many advantages but it still has some loopholes
which need attention to make it work. This system needs to be co-ordinated
with other developmental activities so that it yields better results. By this
the employees can become aware about various jobs being performed and
thus they can give better review. If specific training is being linked with the
process then it will help in improved performance. The system should be
more objective. It should not include any remarks that can hurt others
feelings. Even if someone is not very pleasant to work with than he can be
told this in a polite manner and he should be given chance for
improvement. More importance should be given to the decisions to be
taken after the feedback process is complete. The process should not end at
the feedback report; rather it should be aimed at providing suggestions for
the improvement and comprehensive training programs should be followed

42

as action.

Appraisal feedback should be treated only as a part of

developmental process and not the way for development. Other

developmental factors should be linked with appraisal process to motivate
the employees to improve their performance. Proper care should be taken
not to hut anybodys ego while giving remarks to him. Some employees
may be efficient in their work but may not like some kind of remarks
against them. Care should be taken while writing remarks. The appraisal
system should be undertaken after taking into consideration the demands
and feelings of religious groups or labour unions in the organisation.
Labour unions hold the power to malign the decisions of workers by saying
that the appraisal system is just a candy to lure the employees to work.
Thus, system should be designed by keeping in mind the psyche of such
groups. Internal politics and groupism should be discouraged within the
organisation as it can affect the appraisal system as it could lead to a
particular pattern in rating. The employees form small informal groups and
they can decide among themselves regarding what kind of remarks to be
given to a particular person. This can change the review result hence
formation of such groups should be discouraged. Top level executives may
not like to be reviewed by the junior level employees so they should be
explained about the benefits of this feedback system and they should be
encouraged to accept their feedback and to improve themselves
accordingly. For the system to be successful, active participation of top
management is required. They should be involved from designing the
feedback criterion to evaluating the feedback reports. And they should
make sure that the questionnaires should contain meaningful points and
should cover the actual experiences of the employees everybody in the
organisation should provide the feedback seriously and there should be a
sense of commitment and loyalty while giving their opinion about
someone. Honest opinions should be given without any fear of undesirable
action.

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CHAPTER 8
CONCLUSION

I can conclude that The 360 Degree Feedback can be used as an addition to
the conventional system of appraisal. It is not feasible to use it as a
standalone system of appraisal because of its shortcomings. It is only a part
in the development process and not the whole development process. It was
also found that the system is not being used properly as its importance is
not clearly understood by the companies but if it gets into the mind of
people properly and if it is handled properly then it can actually lead to the
improvement of organizations as well as individuals performance and it
can reshape the internal & external communication. Active participation of
all the sources can make a lot of difference. Like any other innovation, 360
degree feedback is also as good as the people who are operating it. Success
of any new thing depends on the acceptance by the people who are going to
use it. Similarly, the success of 360 degrees feedback depends on the
employees and management and on how they perceive it and it can be
successful only if it is followed by a desirable action of providing
development training. The system should also measure the leadership
competency of the managers only then it will be useful in providing the
mangers with the useful feedback. If the criteria for measuring
performance are not set in accordance with the organizations mission then
it will prove to be a sheer wastage of time.

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CHAPTER 9
BIBLIOGRAPHY
BOOK:
USING 360 DEGREE FEEDBACK IN
ORGANIZATIONS
JOHN W. FLEENOR & JEFFERY MICHAEL PRINCE
PUBLICATION: Centre for Creative Leadership (CCL)
360 DEGREE FEEDBACK AND PERFORMANCE
MANAGEMENT SYSTEM
T V RAO
PUBLICATION: Excel Books
Websites:
www.citehr.com
www.yourarticlelibrary.com
www.slideshare.net
www.36dollar360.com
www.shrm.org
www.scribd.com
www.missouribusiness.net

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********************* THANK YOU********************

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