A Complete Guide to 360 Degree Performance Appraisal [+Checklist]

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360- Degree Performance Appraisal

Performance appraisals are mostly gut-wrenching news. 

According to the latest survey, 22% of employees called in sick, 35% complained to their colleagues, and 15% even cried on their performance appraisals. These numbers sure make us rethink the effectiveness of yearly performance appraisal methods.

Are they worth it? And if not, is the popular 360-degree performance appraisal method good enough? How do we execute it, and what should we take care of so that it doesn’t backfire? That’s a lot of questions. Let’s find answers to them in this blog!

What Is A 360-degree Appraisal?

A 360-degree assessment is a performance appraisal method that takes feedback and ratings from various sources like supervisors, staff members, peers, co-workers, and customers. 

It prefers feedback from as many sources as available than a single source of truth. After collating all the feedback, the manager uses it to gauge the employee’s skills, strengths, and weaknesses.

When implemented correctly, it paints a fairer picture. Thus, boosting team morale and performance. It also promotes employees’ self-awareness and upholds more transparent communication.

360- Degree Performance Appraisal Kit

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Objectives of a 360-degree Performance Appraisal

360-degree feedback, when implemented correctly, can be a massive opportunity for the organization. Its core objectives are as follows:

SWOT Analysis

SWOT analysis, or generally self-awareness, enables employees and leaders to compare their self-ratings to those of others. It helps them paint a fairer picture of themselves. Multi-rater feedback helps perform a SWOT analysis on parameters like:

  1. Performance in role
  2. Performance in specific activities
  3. Capabilities
  4. Working patterns
  5. Suitability for a particular task.


Change Management

The 360-degree evaluation drives change very gently when employees and leaders get a clearer picture of their behaviors and competencies. They hardly have any option. They have to change for the better, which drives organizational change.


Decision Making

Another core objective is fairer personnel decisions like performance-related bonuses, promotions, etc.


Alignment of Goals And Potentials

360-degree performance appraisal also enables organizations to align employee aspirations with the company’s goals, values, and vision.


Overall Development

This appraisal process enables the organization to plan holistic employee development, like teamwork, leadership and communication skills, and other soft skills. The organization can align the roadmap of this employee development with organizational needs and values.

Components of a 360-Degree Assessment

  • Self-appraisal: It is the part of the process where the employee reflects on his competencies and performance. It includes self-rating and review.
  • Superior appraisal: It is similar to a traditional assessment, where the manager or other superior provides ratings and feedback on employee performance.
  • Subordinate appraisal: Subordinates often provide feedback on critical performance aspects like motivating abilities, communication skills, leadership qualities, work delegation capabilities, etc.
  • Peer review (internal customers): It provides valuable insights on teamwork, sensitivity towards others, and co-operating behavior.

How is a 360 Degree Appraisal Different From a Traditional Appraisal?

360-degree appraisal Traditional appraisal
Continuous feedback and focuses on development. It is done yearly and focuses on previous achievements.
Constant data-driven feedback with no set limit of achievement. Once a set metric is achieved, there are no more follow-ups.
Opportunity to be honest and open as raters are anonymous. Raters are known, so they cannot be sincere.
It promotes healthy competition because 360 feedback is about development and not rewards. It promotes unhealthy competition because employees compete for prizes and perks.
Provides a fairer and broader perspective of the employee. Provides a single source of perspective, i.e., the supervisor.

Advantages of 360 Degree Appraisals

Benefits Of A 360-Degree Feedback System
A Complete Guide to 360 Degree Performance Appraisal [+Checklist] 1

Comprehensive Evaluation

Because the feedback comes from so many resources, it tends to be more accurate. It is easy to recognize patterns from the various feedbacks received. It also sheds light on more abstract aspects which are otherwise hard to measure.


Collaboration and Coordination

A 360-degree evaluation helps both teams and individuals understand their strengths and weaknesses. Thus, equipped with this knowledge, they can collaborate more efficiently and seamlessly.


Promotes Self-Awareness and Self Evaluation

They are better aware of their skills and try to work toward learning new skills and developing existing ones. They can form a connection between how they perceive themselves and how others do.


Identifies Training and Mentoring Gaps

Skill gaps can hinder an organization’s progress. A 360-degree performance appraisal helps identify skill gaps across individuals, teams, departments, and the entire organization.


Transparency in Workplace

This feedback method can increase trust between employees. It can lead to better decision-making, productivity, and knowledge sharing. All of these can help companies tap into unrealized potential.


Facilitates Cost Reduction

Deloitte reports that 58% of companies feel traditional performance methods are not an effective use of time. With the help of suitable performance management software, you can reduce costs and twice your revenue!

Types of 360-degree Appraisals

Employee Development

360-degree appraisal involves anonymous feedback where every employee is comfortable expressing honest feedback, which is impossible face-to-face. Equipped with honest feedback, the employee knows it’s lacking and can take steps to be more effective and efficient.

Performance Appraisal

This is when the 360-degree appraisal measures professional skills and key performance metrics. Experts do not recommend this version of 360-degree feedback because it mainly measures soft skills and competencies and can introduce the competition factor.

How to Conduct 360-degree Appraisal?

Step-By-Step Process To Conduct 360-Degree Appraisal
A Complete Guide to 360 Degree Performance Appraisal [+Checklist] 2

1. Define Purpose 

Multi-rater feedback differs from traditional methods because you need to set the purpose of conducting it before starting the process. Your goal could, for example, be:

  1. Getting an unbiased view from all touchpoints
  2. Looking out for skill gaps
  3. Understanding the interoperability level of teams, etc.

2. Choose Competencies

Set the competencies the team members will use to evaluate each other. All the competencies must be relevant to the employee role and the organization’s vision and needs.

3. Curate Questionnaires

Prepare survey questionnaires based on the chosen competencies. The questions must be such that they help identify the gaps and strengths of the team and the individuals.

4. Chalk Out Guidelines

Prepare guidelines, such as who will review whom and how you will maintain the confidentiality of the whole process. Also, you should communicate the entire process to all the employees and managers.

5. Test the Method

Before going all in, test the method as a pilot project. You can try it on a selected subset of employees before rolling it for the entire organization. Study the results and the inefficiencies. Overcome them. And gradually take in the whole company.

Conclusion

A 360-degree feedback appraisal provides a holistic view of the employee. It helps measure hard-to-gauge aspects like leadership and communication skills, sensitivity to others, team spirit, etc. It gives you and the employee a fairer and broader perspective of their capabilities. 

Hence, give 360-degree feedback a shot at your organization while keeping all the above points in mind, and you will most likely nail it.

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Arvind Mishra

Arvind Mishra is Director of Delivery & Outsourcing at HROne. He has substantial experience of two decades in HR automation and has successfully delivered complex projects across 20+ industries globally. His work is instrumental in scaling HR tech adoption for companies of every size in India.

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