The Implementation and Effects of Instituting a 360-Degree Performance Appraisal Method

Traditional performance evaluation methods such as critical incidents, multiple person comparisons, behaviorally anchored rating scales (BARS), and management by objectives (MBO), limit the source of feedback to management personnel. Because the feedback only reflects one rater\u27s perspective, the feedback data is likely to be insufficient and inaccurate. In response to the limitations resulting from traditional methods, organizations have been turning to a different approach. This approach, known as 360- degree feedback, has been in existence since the early 1980s, but is only recently gaining in popularity. This approach elicits feedback from a number of sources including internal and external customers. Implementation of 360-degree feedback allows internal customers such as co-workers, supervisors, and subordinates, and external customers such as clients and suppliers, to rate an employee. Thus, these individuals are given the opportunity to participate in a formal process of performance evaluation. The organization that chooses to implement a 360-degree feedback appraisal must be committed to the process in terms of time and money. There are several critical steps for implementing this approach effectively and successfully. Although many companies have instituted a 360-degree feedback system, the search continues for ways to improve this approach as well as the entire process of performance evaluation