Benefits of Performance Appraisals and 360-Degree Feedback

Abstract

As today’s businesses continue to expand, workers are expected to perform well on their jobs. This is what truly happened to management who has a tendency to measure how well they are doing on their job. The job done in a certain period of time is frequently evaluated by performance appraisal. Performance appraisals lead to enhancing employee’s performance, internal communication (relationship), and quality improvements as well.

Some experts argue that formal performance appraisal is somewhat useless and many of them contemplate performance appraisals can be detrimental to quality improvement and convey some negative perceptions to the management (David Law, 2007). Albeit many professionals pointed out disadvantages associated with using performance appraisal, I contemplate that its benefits outweigh the drawbacks. As such, 360-degree feedback is one of the numerous examples of performance evaluation methods.

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Performance appraisals can be used to measure one’s job performance with feedback from subordinates, peers, and managers in the organization, so that everyone in the particular organization knows what and where he or she needs to improve. In addition, well-scheduled 360-degree feedbacks lead to positive changes in worker’s job satisfaction and enhance the company’s effort to attain its own interest.

The stable encouragement of the effects of performance appraisal has a variety of short-term and long-term consequences including improved job performance, harmonious interpersonal relationships (superiors and subordinates), and as well as advanced quality management (continuous improvement) within organizations. History The 360-degree feedback was initially used by the U. S. Armed Forces to support development of its staff in the 1940’s. Later on, Clark Wilson from the University of Bridgeport (Connecticut) developed the first 360-degree feedback survey instruments for management development and it has been used and studied since 1973 (www. performanceprograms.com).

Valuable factors

A 360-degree feedback offers a variety of remarkably potential benefits. According to Stephane Brutus et al. (2006), all of the following benefits have been applied to six different countries in distinct functions, such as accounting, finance, manufacturing, and many other primary departments. Individuals get a broader perspective of how they are perceived by others than previously possible. It indicates that awareness of and relevance of competencies in workers’ psyche will continue to increase over time.

At this point, management should be aware that they too have development needs that are crucial for the whole organization. Once this step has been applied, employees would next give more reliable feedback to managers about their performance. I believe this method could be seen as a win-win situation which is beneficial for both workers and management. Encouraging more open feedback — new insights. It indicates that reinforcing the desired competencies of the business requires a clearer picture to senior management of individual’s real worth.

A 360-degree feedback clarifies the employee’s critical performance aspects because open feedback gives people a more rounded view of performance than they had previously. Identifying key development areas for the individual, a department and the organization as a whole. Individuals’ strengths can be used to the best advantage of the business. A rounded view of the individual’s/ team’s/ organization’s performance determines appropriately strengths and weaknesses in business environment.

Therefore, the self-awareness of managers will have personally impact upon subordinates. Supporting a climate of continuous improvement. Starting to improve the climate/ morale will be measured through the survey. Management should focus on agenda and discuss for development based upon the collected 360-degree feedback. Goals and objectives of 360-degree feedback Applying 360-feedback requires that both recipients and reviewers are involved in confidential feedback. The negative effect of transparent feedback can negatively affected by emotions and peer conflicts.

This issue can lead to impaired job performance and adverse interpersonal relationship among the employees. Patricia Angelucci (2000) states the desired objectives of a 360-degree feedback are increasing professional accountability, motivating staff, and increasing employee morale and satisfaction (Angelucci, 2000). Importantly, she claims that 360-degree appraisal given to employees provides for constructive feedback and employee recognition by objectively measuring performance, and gives the employee the responsibility to contribute information (Patricia Angelucci, 2000).

It is clear that using 360-degree feedback can necessarily improve labors’ job performance as long the evaluations are delivered honestly, openly, and objectively to the targets in every aspect of management including superiors and subordinates.

Process of 360-feedback

Robert Garbett et al. (2007) suggest several recommendations to optimize the usefulness of the process in preparing 360-degree feedback:

1.  Thorough preparation. It is remarkably crucial to all members involved about the purpose and criteria used to identify role set members. Preparation indicates key to achieve successfulness in implementing 360-degree appraisal.
2. Suitability. Methods used in gathering information need to reflect what is convenient and appropriate to the colleagues one is working with.
3.  Anonymity. Anonymity and openness were found to be useful. Open approaches offer more detailed information for the development of expertise and workforce effectiveness. Further, Garbett et al. (2007) add that the characteristic useful to ensure quality on 360-degree feedbacks is self-assessment based on critical reflection using an evidence-based framework of field expertise (Garbett, 2007).

This method will prevent employees from mistakenly giving feedback to coworkers, and it should be based on observation of practice and experience in the past. The implementation of 360-degree feedback has been widely used across the globe since its benefits to the every sector of management. Metcalfe (1998) and Swain et al (2004) says, “The concept of 360-degree feedback has been extensively used, examined, and adapted in business and increasingly in healthcare as a developmental tool” (As cited in Garbett et al., 2007, p. 343). Ten steps to conducting 360-degree feedback

Chris Pearce (2007) suggests there are ten steps to help companies conduct 360-degree appraisal:

1. Preparing for appraisal interviews. This step includes agreed performance objectives and reviews that have been applied at any given times.
2. Planning appraisals Imperative interviews held by the management have to be relaxed and solemn will be covered on this step.
3. Conducting appraisals The third step involves placing situation of the prolific substitutes thoughts, demonstrating the ability of comfort and prevention due to interruptions during the interview, and pioneering the basic regulation for appraisals and the concerns by appraisees.
4. Reviewing achievements Next, this step explains about assessing appraisees’ accomplishment and detecting where the appraisees’ position.
5. Sharing views on progress Offering responses on appraisees’ accomplishment, ensuring appraisees’ aggrement on the responses, and creating the improvement if needed are covered on this step.
6. Considering ratings This step is concerned with contributing the appraisees’ beliefs by rating the conclusions before the last result comes up.
7. Plans for improvement Expanding and accentuating the further progression of the failings must be applied in the conformity and conversation should be involved in this step.
8. Dealing with development plans This step deals with sincerity and factuality that must be concerned with the appraisees’ objectives and profession ambition.
9. Agreeing new objectives With regards to SMART which stands for specific, measurable, appropriate, realistic, and timed, appraisses’ goals and time spent should be involved in this step.
10. Asking for feedback In the last step, questioning about appraisees’ responses to them, abridging the essential points of evaluation, and ending with conclusion should be applied for the last action.

Discussion

Every country has been fascinated with Japanese industry for decades and it became recognized as the world’s most competitive nation in the 1970s and 1980s. Nowadays, many small and big companies all over the world attempt to apply the Japanese system to their system in every aspect of management.

Several experts explain why Japan can compete well to attract its target market albeit the rivalry among the competing sellers is high in the country. It is simply a distinctive approach to Japanese management has brought remarkable impact in today’s practices such as total quality and continuous improvement (Porter, Takeuchi, & Sakakibara, 2000). With regards to improvement initiatives, Pryor, White, and Toombs (1998) point out that performance appraisal is one of the strategic quality management tools which use continuous improvement as a strategic weapon (http://www. 12manage. com).

In addition, Bracken and Timmreck (1999) also agree that performance evaluations are essential for developing managerial behaviors in every level that provide data in its strategic efforts when they say, “As results of 360-degree feedback are used in conjunction with HR systems, such as staffing, succession planning, compensation, performance management and even, in some cases, downsizing” (As cited in Treena L. Gillespie, 2005, p. 363). In establishing 360-degree feedback, I contemplate there is another aspect affects people’s judgment relating to leaving feedbacks to coworkers.

Coaching is one of the critical components of stimulating interpersonal relationship in conjunction with feedback results. Wright states, “The coaching component in management is a two way street. There needs to be open communication in order for successful coaching to take place” (Robert F. Wright, 2000). As such, I would like to emphasize that two-way interaction between subordinates and superiors is required in order to affect feedbacks and indeed, better feedbacks will generate better relationship.

This component could cover poor communication problem which can lead to unpleasant feedbacks to employees within an organization. Nowadays, big companies such as British Airways, AT&T, Alberto Culver North America, and General Electric are increasingly using 360-degree feedback (Huet-Cox, Nielsen, & Sundstrom, 1999). According to Evans (2001), using 360-degree feedback can potentially provide a fuller, more realistic picture of the employee’s overall performance since every employee receives performance feedback from four sources: the supervisors, subordinates, peers, and coworkers, and self-ratings (Evans, 2001).

Effective appraisals usually lead to better performances from appraisees, and feedbacks should be jointly solving problems as long appraisees always focus on the future, not the past. Several characteristics of 360-degree feedback at firms may have considerable advantages of implementing TQM, and “One survey showed that more than 20 percent of firms are tying 360-degree appraisal directly to their Total Quality Management efforts” (Laabs, 1994, p. 17). Applying the 360-degree feedback compliments the implementation of TQM in businesses since it has faster communication line (superiors to subordinates) and uncomplicated system that meets customer needs and expectations. Glover (1993) argues that there is a five-stage implementation framework that could be applied in enterprises: awareness, education, structural change, necessary activities, and outcomes or expected improvements (as cited in Yusof & Aspinwall, 2000, p. 281). Appropriate design of the 360-degree feedback will absolutely provide a strong basis for the path to successful TQM implementation.

A systematic procedure such as ISO 9000 is the first-most effective way that can solve the quality problems in many businesses. Take for instance, the 360-degree feedback is used to measure the effectiveness of Just In Time (JIT) inventory system in plant department within company. Consequently, an integrated JIT inventory model generated through 360-degree system can minimize the sum of the ordering/ setup cost, holding cost, quality improvement, and crashing costs (Yang & Pan, 2004).

Once those procedures have been established, the next step is to plan for improvement. If the need for change is highly needed, some methods suggested by Asher (1992) could encourage the renovation process of the implementation: investigating cost of quality, conducting customer perception surveys, collecting data on employees’ perceptions, and establishing system and procedure (as cited in Yusof & Aspinwall, 2000, p. 289). This type of approach in context of management will escalate the job performance as it will result in improved productivity in workers.

I agree with Wright’s (2000) standpoint saying that 360-degree feedback can be seen as result-oriented concerned with focusing on the goals rather than the process (Robert F. Wright, 2000). More importantly, such a evaluation should lead the employees to work together attaining the company’s goals, as Wright (2000) says, “It is critical for a good manager to be more concerned with the results and less with the process of how those are achieved” (Robert F. Wright, 2000, p. 363). As long as the process is performed well, managers should be more concerned about the results not necessarily the technique.

With regards to labors’ skills, through evaluations management should encourage its workers give feedback about what needs to change and where to change, as Loup and Koller says,” Listening and speaking from the heart about what people think, feel, and believe about the change will keep the change process moving forward” (Loup & Koller, 2005, p. 77). As we can conclude, utilizing well-scheduled 360-degree feedbacks as a performance appraisal is the management’s responsibilities for introducing, applying, and maintaining the practice punctually once it has started.

Some companies consider a 360-degree feedback and other appraisals are attributable to adverse quality, and ironically the process in implementing those techniques seem to be time-consuming and convey some negative perceptions to the management. Management should contemplate that the company’s goals will not be successfully attained if employees do not notice whether or not they are performing well on their job as Senge (1990) concludes that yet the primary threats to our survival today come not from events but from slow gradual processes to which we are 90 percent blind (Peter M. Senge, 1990).

In conclusion, all the suggestions by experts above regarding quality improvements mostly explain the importance of the 360-degree feedback within companies. Therefore, 360-degree assessment can assist the management on track and measure employee’s performance and leadership which could contribute to overall organization performance (Marcie Levine, 2003). Finally, if the 360-degree appraisal is not applied soon, I believe companies will experience a problem which can be looming ahead for the company itself in the years to come.

References

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