360-Degree Feedback Works Best as
Conversation Starter, Catalyst for Development

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 Industrial and organizational psychologists often engage in spirited debate about the best applications for the popular and potentially powerful tool known as 360-degree  feedback.  Most large organizations have used this method of gathering input on employees’ performance from peers and direct reports as well as managers and supervisors.  Psychologists tend to fall into two camps on the issue.  Some believe, as I do, that 360-degree feedback is an excellent tool when its use is focused on individual development.  Others view it as integral to performance reviews and decisions about raises, promotions, and even hiring and firing (e.g., Bracken, Dalton, Jako, McCauley, and Pollman, 1997).

I have found that advocates of using 360-degree feedback data for performance appraisal often don’t take the realities of today’s workplace into full account.  They commonly envision a company with a continual feedback loop, where managers support development, reward improved performance, and cultivate a culture of trust, openness and honesty.  Unfortunately, this is far from the reality in most organizations.  Many managers gravitate to 360-degree feedback as a quick, relatively inexpensive instrument that they think can serve as a Band-Aid on a broken system.

My stance: in most organizations, the likelihood of successfully using this tool for performance appraisals is very small.  Evidence can be found in the world of education, where students often evaluate their teachers.  It has been shown that teachers then modify their teaching approach to please the students – a form of teaching to the test – and pay less attention to the rigor of the subject matter.  Does this make them better educators?

There are many difficulties associated with 360-degree feedback.  It is subjective and ambiguous, and it is based on raters’ perceptions. Off-the-shelf feedback instruments often don’t explore issues pertinent to a particular organization and therefore don’t always provide relevant information.  Sometimes inexperienced or non-expert raters are invited to rate skills or behaviors about which they know relatively little.  For example, a group of peer-raters may know little about a manager’s delegation skills and may base their ratings only on impressions rather than actual observed performance, which makes their responses difficult to interpret and use in a performance evaluation setting. In addition, using the data for hiring and firing decisions can give rise to legal issues concerning a defendant’s right to face accusers – an impossibility with raters’ anonymity, which is key to getting honest responses in the 360-degree feedback process.  

Applying this tool at the wrong time or in the wrong place can backfire in very damaging ways.  I’ll never forget meeting with an information technology department manager after he had received his 360-degree feedback report.  There were huge discrepancies in the ratings.  This individual’s own self-ratings showed he thought he was doing a good job, but his direct reports had given him terrible ratings.  “Either you’re the world’s worst manager, or something else is going on,” I said.  He told me that he had been on the job for three months and had been hired just as the company was downsizing.  The workload had doubled for everyone in his department, and all of the remaining employees were afraid of losing their jobs.  “You’ve just been dumped on,” I said and then moved on to talk about how the ratings, nevertheless, could be used as the basis for some productive discussions with his raters.  Consider what might have happened if I hadn’t been able to serve as an interpreter in this situation.

Most organizations simply do not have the structure, systems, culture and circumstances in place – nor are they willing to invest the necessary time and energy – to successfully apply 360-degree feedback to performance-related decisions or to follow up with performance-based development programs.

On the other hand, I believe strongly that this tool can be used to support individual development.  It can be applied in a way that increases receptivity to change;  sets or raises performance standards; and provides a context for handling the animosity, distrust and anger that is often a first reaction to negative feedback within an organization.  Following are some tips:

• Use 360-degree feedback as a stimulus for conversations about why people involved in the rating see things differently.  This tool can provide wonderfully powerful data to provoke constructive discussions about performance.  If there are few discrepancies in the ratings, be suspicious.  I once worked with a company in which all of the ratings were high, without much variability.  I concluded that these people either were the world’s best performers (I knew this wasn’t the case based on other assessment work I had done with the company!) or they were “cooperating” with each other to help everyone get by.   
• Shift the motivation to change to the person receiving the feedback. For ambitious people who continually seek to improve and advance, information is power.  And 360-degree feedback can provide very powerful information that can be wisely and effectively used – if 1) it is viewed as the beginning rather than the end of a process, and 2) when those being rated feel a sense of ownership and control. Ratees should have follow-up discussions with their raters.  When they make a commitment to change, they should tell their raters and enlist their help.  
• Move people away from the data and toward productive performance discussions.  Ratees tend to overvalue the 360-degree feedback data when they look at the bar charts.  They think, “I must be doing something wrong,” and then look for reasons outside of themselves and ways to protect themselves from having to change.  Instead, the goal should be to ask , “I wonder why my peers rated me lower on leadership than I rated myself?”
• Utilize outside experts to help design questionnaires, conduct training, interpret data, and facilitate discussions.  Most managers don’t have the training to make the most of a 360-degree feedback process and aren’t aware of its many possible pitfalls.  Outside experts see it as a whole system with many steps that must be properly executed.  Just one of those steps – designing a good rating instrument – can make a world of difference.  For example, a question that asks how often someone exhibits  an observable behavior is much more useful than a question about something unobservable, such as what a person thinks or feels. 
• Garner the support and participation of top management.   As with most things, employees won’t take 360-degree feedback seriously unless their leaders advocate it, participate in it, and tie it to important organizational goals.  And top executives can benefit the most from 360-degree feedback because they have the toughest time getting any feedback – particularly honest feedback – about their performance.       

If You Want To Read More:
Bracken, David W., et al. Should 360-Degree Feedback be Used Only for Developmental Purposes? Center for Creative Leadership, September 1997, pp. 1-36.

Prewitt, Edward. “Should You Use 360-Degree Feedback for Performance Reviews?” Harvard Management Update, February 1999, pp. 3-4.