The extended version of this article was published in Compensation and Benefits Review. We’re excited to announce that since publication, the article has become the SAGE Publishing most downloaded article of 2009 and 2010. The full version of the article, as published, is available for free download, here.
Originally used almost exclusively for developmental purposes, using 360-degree feedback for purposes other than employee development increased significantly over the past decade. One application increasing in popularity is the use of multirater feedback for performance appraisal. Whether one agrees with it or not, economic reality has caused an increasing number of organizations to begin using 360-degree feedback for appraisal rather than exclusively for development.
A number of organizations have successfully used 360-degree feedback for their performance appraisals and have noted great benefit from this. These organizations appear to share a common process that helps them succeed where others fail. Companies can use the following tips to smooth the way:
1. Recognize the differences in use and purpose of 360s for performance vs. 360s for appraisal: Understanding that scores will differ depending on the purpose will help in determining how best to use and interpret the scores.
2. Communicate the purpose and process: Let employees know the intended purpose before administering the assessments as well as how the results will be used. Communicate the process and hold to it.
3. Use a pilot group: Using a pilot group before rolling the survey out to the full organization allows for refinement of the process and of the instruments used.
4. Do not use the organization’s first 360 process as an appraisal process. Start with using 360s for development: Although some organizations successfully use 360s for appraisal on the first 360 roll-out, most have waited 12-18 months before tying 360s to compensation and administrative action. This allows people to become more comfortable giving feedback before the feedback has consequences.
5. Select the appropriate raters: It is critical to ensure that selected raters have regular interaction with the employee being rated and can provide accurate feedback as to performance.
6. Use small but relevant rater groups: Multirater appraisals involve much of the organization in terms of providing feedback. Limit the number of raters to minimize the time spent on survey completion across the organization.
7. Consider and communicate the rating scale: A 7-point Likert-type scale is generally more effective than a 5-point scale.
8. Keep the survey short: Design a survey that is short enough that it can be completed in 15 minutes or less.
9. Use a customized survey: Multirater assessment for development should include questions geared at behavior (the how), whereas appraisal assessments can focus more on operational performance (the what).
10. Provide a score for each question, not just each section: Rather than providing scores for each survey item, many appraisals solicit one overall score for the category. When this is the case, it is often difficult or an employee to know which area of a category is being addressed. Be specific in scoring.
Maylett, T. M. (2009). 360-Degree Feedback Revisited: The transition from development to appraisal. Compensation and Benefits Review, September/October 41(5), 52-59.