1. PERFORMANCE MANAGEMENT SYSTEM INTERNALS
Name: Rasika Salodkar Roll No. M14087
PERFORMANCE MANAGEMENT
It is an on-going communication process between employee and supervisor for the purpose
of improving job performance and contributions. Performance management is a system.
That is, it has a number of parts, all of which need to be included if the performance
management system is to add value to the organization, managers, and employees.
PERFORMANCE APPRAISAL
Performance Appraisal is the systematic evaluation of the performance of employees and to
understand the abilities of a person for further growth and development. Performance
appraisal is generally done in systematic ways which are as follows:
1. The supervisors measure the pay of employees and compare it with targets and plans.
2. The supervisor analyses the factors behind work performances of employees.
3. The employers are in position to guide the employees for a better performance.
360-DEGREE FEEDBACK
360-degree feedback, also known as multi-rater feedback, multi-source feedback, or multi
source assessment, is feedback that comes from members of an employee's immediate
work circle. Most often, 360-degree feedback will include direct feedback from an
employee's subordinates, peers (colleagues), and supervisor(s), as well as a self-evaluation.
It can also include, in some cases, feedback from external sources, such as customers and
suppliers or other interested stakeholders. The number of people from whom feedback is
taken can range from 6 - 20. It may be contrasted with "upward feedback," where managers
are given feedback only by their direct reports, or a "traditional performance appraisal,"
where the employees are most often reviewed only by their managers.
The results from a 360-degree evaluation are often used by the person receiving the
feedback to plan and map specific paths in their development. Results are also used by
some organizations in making administrative decisions related to pay and promotions.
When this is the case, the 360 assessment is for evaluation purposes, and is sometimes
called a "360-degree review." However, there is a great deal of debate as to whether 360-
degree feedback should be used exclusively for development purposes or should be used for
appraisal purposes as well.

2. HISTORY OF 360-DEGREE FEEDBACK
The German military first began gathering feedback from multiple sources in order to
evaluate performance during World War II. Others also explored the use of multi-rater
feedback during this time period via the concept of T-groups.
One of the earliest recorded uses of surveys to gather information about employees
occurred in the 1950s at Esso Research and Engineering Company. From there, the idea of
360 degree feedback gained momentum, and by the 1990s most human resources and
organizational development professionals understood the concept. The problem was that
collecting and collating the feedback demanded a paper-based effort including either
complex manual calculations or lengthy delays. The first led to despair on the part of
practitioners; the second to a gradual erosion of commitment by recipients.
However, due to the rise of the Internet and the ability to conduct evaluations online with
surveys, Multi-rater feedback use steadily increased in popularity. Today, studies suggest
that over one-third of U.S. companies use some type of multi-source feedback. Others claim
that this estimate is closer to 90% of all Fortune 500 firms. In recent years, Internet-based
services have become standard in corporate development, with a growing menu of useful
features (e.g., multi languages, comparative reporting, and aggregate reporting).
FOR WHICH CATEGORY OF EMPLOYEES IS THIS TOOL USED?
Usually, this tool is used for employees at middle and senior level. The complexity of their
roles enables the organisation to generate sufficient data from all stakeholders for a
meaningful assessment.
WHICH ORGANISATIONS USE THIS TO ASSESS EMPLOYEE PERFORMANCE?
Most organisations that focus on employee development use the 360-degree tool to assess
performance and potential of staff and enable the employees to map their career path
based on the feedback. Organisations take 360-degree feedback about an employee before
taking a major decision about the professional's career.
The results from 360-degree feedback are often used by the person receiving the feedback
to plan training and development. Results are also used by some organizations in making
administrative decisions, such as pay or promotion. When this is the case, the 360
assessment is for evaluation purposes, and is sometimes called a "360-degree review."
360 degree feedback is the most comprehensive appraisal where the feedback about the
employees’ performance comes from all the sources that come in contact with the
employee on his job.

3. HOW FREQUENTLY SHOULD WE USE 360-DEGREE FEEDBACK?
Normally we should use 360-degree feedback once in a year as it is a very inn depth method
of performance appraisal and takes a considerable amount of time to complete it.
WHO ARE THE STAKEHOLDERS IN DOING 360-DEGREE ASSESSMENT?
360 degree respondents for an employee can be his/her peers, managers (i.e. superior),
subordinates, team members, customers, suppliers/ vendors - anyone who comes into
contact with the employee and can provide valuable insights and information or feedback
regarding the “on-the-job” performance of the employee.360 degree appraisal has four
integral components:
1. Self-appraisal
2. Superior’s appraisal
3. Subordinate’s appraisal
4. Peer appraisal.
Self-appraisal gives a chance to the employee to look at his/her strengths and weaknesses,
his achievements, and judge his own performance. Superior’s appraisal forms the traditional
part of the 360 degree appraisal where the employees’ responsibilities and actual
performance is rated by the superior.
Subordinates appraisal gives a chance to judge the employee on the parameters like
communication and motivating abilities, superior’s ability to delegate the work, leadership
qualities etc. Also known as internal customers, the correct feedback given by peers can
help to find employees’ abilities to work in a team, co-operation and sensitivity towards
others.
Self-assessment is an indispensable part of 360 degree appraisals and therefore 360 degree
Performance appraisal have high employee involvement and also have the strongest impact
on behaviour and performance. It provides a "360-degree review" of the employees’
performance and is considered to be one of the most credible performance appraisal
methods.
360 degree appraisal is also a powerful developmental tool because when conducted at
regular intervals (say yearly) it helps to keep a track of the changes others’ perceptions
about the employees. A 360 degree appraisal is generally found more suitable for the
managers as it helps to assess their leadership and managing styles. This technique is being
effectively used across the globe for performance appraisals.

4. 12 steps to a great 360 degree feedback process
Step 1 – What is the purpose ofthe feedback
Why doit inthe firstplace?Whatdo you wantout of it? The answerto those questionswill affect
the way youset-upyour360 process,how you communicate aboutitwithyourpeople andhow you
reviewthe processdownthe track.
For example, hereare twocommonreasons:
1. As part of an on-goingperformance managementprocess.
 Making sure yourpeople have the capabilitiesneededtoachieve the corporate goals.
 Developingpeople toimprove performance.
2. As part of a leadershipdevelopmentprocess.
 Targetingdevelopmentforparticipants.
 Providingapostmeasure of the effectivenessof the program.
Step 2 – Gaincommitment from management
Managementneedtobe committedtothe 360 degree feedbackprocessforitto work.If theyaren’t
committed,yourpeople willsee thisandthe process won’tbe effective. Gettingmanagementtobuy
intoit comesdownto whyyouare doingitin the firstplace.A directfinancial argumentalsohelps –
this’ll be the subjectof afuture post.
Step 3 – Involve your people upfront and pilotthe process
Involve yourpeopleinthe designof the process.Use a nice crosssectionof people –the oneswho’ll
be affectedbythe process. You need:
 To get themto buyintothe reasonsfor doing360.
 To get inputonhowto run the processto make sure it’ll workin the real world.
 To get inputandfeedbackonthe competencies(see step3).
 Implement360witha pilotgroupfirst.Getfeedbackandmake anychangesneededbefore
goingout to the widergroup.
Step 4 – What competenciesorvalueswill be used
You can get feedbackonalmostanythingincludingyournew hairstyle,butthe mostcommonthings
are:
 Competencies.
 Values.
 Behaviours.
Many organisationshave acore setof competenciesorvalues.Some alsohave leadershipspecific
capabilities.Andthose who have advancedtoJedi level use rolespecificcompetencies.

5. Where do yougetthe competenciesfrom? There are heapsof libraries.Andif youuse software
package to do your360s itmay alreadyhave one. Choose the competenciesthatwill supportyour
corporate goals.Use aroundsevencompetenciesall up. The competencieswill formaquestionnaire
that feedbackproviderswillcomplete.Decide onaratingscale to use withthe questionnaire.The
competencylibraryyouuse will probablysuggestone.
Step 5 – Whowill provide coaching – they may needto be trained
Whenyour people eventuallyreceive theirfeedbackthey’ll needsomeone tohelpthemunderstand
it andto create a planto developareasneedingimprovement.Thispersonneedstobe skilledat
coaching.It isusuallyaperson’smanager,someone fromHRor a coachingprofessional. If youwant
your managerstoprovide coachingandtheyaren’tskilledinthisarea,they’ll needsome training.
Step 6 – Communicate with your people – letthem know why and how
Let yourpeople knowthese things:
 That a newprocesscalled360 degree feedbackisbeingimplemented
 Why itis beingimplemented –see step1
 What it is
 How itwill work
 What theywill getoutof it
 What theyneedtodo
Step 7 – Whowill receive feedbackand who will provide it
Alrightnowyouneedtodetermine whoisgoingtoreceive feedback –the people beingreviewed.
Once thisis done,the feedbackprovidersneedtobe selected.There are twowaysthisistypically
done:
 The employee nominatestheirownreviewersandgetstheirmanager’sapproval.
 The manager nominatesthe reviewers.
Employee nominationisbetter–why – because people take more notice of feedbackfrompeople
theyknowwell andrespect.Atfirstyourpeople maynotgetthe whole ideaof whatthe feedback
processdoesforthem.So the managerapproval processisneededtomake sure people don’t kid
themselvesbychoosingbuddiestogive themfeedback.
Step 8 – Ask people to provide feedback
The nextstepisto ask the reviewerstoprovide feedback.Theydothisbyrespondingtoa
questionnaire andprovidinganywrittencomments. It’salsoessential thatapersoncompletesa self-
review.Thisreallyhelpsapersonidentifygapsbetweenhow theysee themselvesandhow theyare
perceivedbyothers.

6. Step 9 – Follow-upand collate feedback
Collate responsesforeachpersonreceivingfeedback.Follow-upwithstragglerstomake sure they
respondbefore the deadline.
Step 10 – Produce reports
A reportisproducedfor each personreceivingfeedback.Thishelpsthemunderstandthe feedback
providedbyeachof theirreviewers. Responsesfromeachof the reviewers,exceptmanagers,are
generallyaggregated.Thisprotectsanonymityandmakessure thatan individual’sresponses can’t
be identified.Soforexample,insteadof seeingeachdirectreport’sindividualresponse,you’ll seean
average of all directreportresponses. Managerresponsesaren’tnormallyanonymous.Inother
wordsa personwouldbe able tosee exactlywhatfeedbacktheirmanagerprovided.
Step 11 – Provide coaching
The report isprovidedtothe personreceivingfeedbackaspart of a coachingand development
process.Thisshouldbe done bysomeone skilledatcoaching – thiscouldbe the person’smanager,
someone fromHRor a coachingprofessional.
The report isusedto helpthe personidentify,understandandgainconfidence intheirstrengths.It’s
alsousedto highlightopportunitiesforimprovementandareasfordevelopment.
The coach helpsthe personcreate aplanto developtheircapabilities.The personundertakesthe
developmentwithprogressbeingreviewedaspartof the coachingprocess.
Step 12 – Post implementationreview
Afteryourpilotprogramand afterthe firstfull 360 degree feedbackprocess,conductapost
implementationreview.The purpose of thisreviewistodetermine:
 Whetherthe feedbackisproducingthe resultyouwanted.
 Where improvementscanbe made to the process.
ADVANTAGES
1. Improved Feedback From More Sources:
It provides well-rounded feedback from peers, reporting staff, co-workers, and supervisors.
This can be a definite improvement over feedback from a single individual. 360 feedback can
also save managers’ time in that they can spend less energy providing feedback as more
people participate in the process. Co-worker perception is important and the process helps
people understand how other employees view their work.
2. Team Development:
It helps team members learn to work more effectively together. (Teams know more about
how team members are performing than their supervisor.) Multirater feedback makes team
members more accountable to each other as they share the knowledge that they will

7. provide input on each member’s performance. A well-planned process can improve
communication and team development.
3. Personal and Organizational Performance Development:
360 degree feedback is one of the best methods for understanding personal and
organizational developmental needs.
4. Responsibility for Career Development:
For many reasons, organizations are no longer responsible for developing the careers of
their employees, if they ever were. Multirater feedback can provide excellent information to
an individual about what she needs to do to enhance her career.
Additionally, many employees feel 360 degree feedback is more accurate, more reflective of
their performance, and more validating than prior feedback from the supervisor alone. This
makes the information more useful for both career and personal development.
5. Reduced Discrimination Risk:
When feedback comes from a number of individuals in various job functions, discrimination
because of race, age, gender, and so on, is reduced. The "horns and halo" effect, in which a
supervisor rates performance based on her most recent interactions with the employee, is
also minimized.
6. Improved Customer Service:
Especially in feedback processes that involve the internal or external customer, each person
receives valuable feedback about the quality of his product or services. This feedback should
enable the individual to improve the quality, reliability, promptness, and
comprehensiveness of these products and services.
7. Training Needs Assessment:
360 degree feedback provides comprehensive information about organization training
needs and thus allows planning for classes, cross-functional responsibilities, and cross-
training.
DISADVANTAGES AND PROBABLE SOLUTIONS
1. Exceptional Expectations for the Process:
360 degree feedback is not the same as a performance management system. It is merely a
part of the feedback and development that a performance management system offers
within an organization.

8. Additionally, proponents may lead participants to expect too much from this feedback
system in their efforts to obtain organizational support for implementation. Make sure the
360 feedback is integrated into a complete performance management system.
2. Design Process Downfalls:
Often, a 360 degree feedback process arrives as a recommendation from the HR
department or is shepherded in by an executive who learned about the process at a seminar
or in a book. Just as an organization implements any planned change, the implementation of
360 degree feedback should follow effective change management guidelines. A cross-
section of the people who will have to live with and utilize the process should explore and
develop the process for your organization.
3. Failure to Connect the Process:
For a 360 feedback process to work, it must be connected with the overall strategic aims of
your organization. If you have identified competencies or have comprehensive job
descriptions, give people feedback on their performance of the expected competencies and
job duties.
The systemwill fail if it is an add-on rather than a supporter of your organization’s
fundamental direction and requirements. It must function as a measure of your
accomplishment of your organization’s big and long term picture.
4. Insufficient Information:
Since 360 degree feedback processes are currently usually anonymous, people receiving
feedback have no recourse if they want to further understand the feedback. They have no
one to ask for clarification of unclear comments or more information about particular
ratings and their basis.
For this reason and for the points listed in the several bullet points following this one,
developing 360 process coaches is important. Supervisors, HR staff people, interested
managers and others are taught to assist people to understand their feedback. They are
trained to help people develop action plans based upon the feedback.
5. Focus on Negatives and Weaknesses:
At least one book, First Break All the Rules: What The World's Greatest Managers Do
Differently, advises that great managers focus on employee strengths, not weaknesses. The
authors said, "People don't change that much. Don't waste time trying to put in what was
left out. Try to draw out what was left in. That is hard enough."

9. 6. Rater Inexperience and Ineffectiveness:
In addition to the insufficient training organizations provide both people receiving feedback
and people providing feedback, there are numerous ways raters go wrong. They may inflate
ratings to make an employee look good. They may deflate ratings to make an individual look
bad. They may informally band together to make the system artificially inflate everyone’s
performance. Checks and balances must prevent these pitfalls.
7. Paperwork/Computer Data Entry Overload:
Need I say much more here? Traditional evaluations required two people and one form.
Multirater feedback ups the sheer number of people participating in the process and the
consequent organization time invested.
360-DEGREE FEEDBACK FORM USED IN A COMPANY (SAMPLE)
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