Business Problem to be solved:
- Feedback and increased communications will result in better management practices and reduced conflict which will increase productivity and reduce turnover.
- Improved teamwork will result in increased productivity.
Increased feedback and multi-source feedback results in a change in management behavior and an increase in performance. Theoretically, anonymous feedback is more open and honest then one-on-one feedback. The assumption is that honest feedback changes management behavior faster than restricted feedback.
It is also assumed that employees (and customers) that are “listened to” and involved will produce more and have higher satisfaction and retention rates.
A basic assumption is that employees have knowledge of management behaviors that can be provided to management. A further assumption is that the “anonymity” provided in the 360 processes is credible and results in honest feedback.
Possible Program Goals:
- Get managers to understand how others perceive them.
- Involve workers in developing their own manager.
- Opening more lines of communications (including customers and employees in a formerly top-down process).
- A management competency development tool.
- A management evaluation/assessment tool.
- A promotion/layoff qualification tool.
Department Where Program is Usually Based:
- EE (EE = Employee) Relations
Possible Advantages / Benefits of the Program:
- Provides multi-data points/opinions which may reduce Perf App. errors and biases.
- Employee’s (EE’s) feel that their opinions count.
- Increases EE and possibly customer involvement.
- Increases EE ownership of their managers’ development.
- Increases management responsiveness to EE concerns.
- Allows honest feedback (when it is anonymous).
- Has multiple uses? RIF, Promotion, Assessment of skills, individual development, etc.
- Increases overall communications.
- It increases self-awareness of what others think of us.
- It can include external customers in the feedback process.
- Encourages productivity improvement through increased communications (Individual & Team).
- It provides more open communication at the upper levels of management where open criticism is more difficult.
- Replaces occasional “war” story performance appraisals with periodic sampling and data.
- Relatively cheap compared to the costs of bad performance and bad management.
- It is analyzed with statistical tools that can eliminate “outlying data” and allow for trend analysis.
- Its statistical record provides good documentation for possible legal actions.
- It has more “face’ validity than traditional performance appraisal techniques.
- Its visibility increases the discussion about the need for better performance appraisals
- Giving the results to both EE’s and top managers lets the EE’s know that top management is aware of their concerns.
- Feedback discussion sessions result in increased time spent on Performance Appraisals.
- It’s a good first step in opening the lines of communication.
- Most of it can be done “remotely” (without face to face meetings) when necessary.
- It may result in a higher “success rate” in the promotions of managers.
- Sales and profit may improve because customers’ concerns are placed on the table for all to see.
- Because it is often administered by consultants “outside’ advice is available to identify and resolve performance problems.
- Baseline data makes cross-departmental and multi-year comparisons more accurate
- At least initially it’s “fun” to do and it increases EE excitement because they are being listened to.
Possible Disadvantages / Concerns of the Program:
- There is no data it actually improves productivity, increases retention, decreases grievances or that it is superior to forced ranking and standard Perf. App. systems. It sounds good but there is no proof it works other than a lot of companies have tried it.
- It serves as a poor substitute for unassisted 1 on 1 communication and can short circuit natural feedback channels.
- The need to use it shows how poorly normal communications channels are working. 360 use discourages efforts to “fix” these essential systems.
- It, like all traditional Perf. App. systems, focus on historical events while businesses must focus on future events. In a rapidly changing world, the past may not be the best model to learn from.
- There is no evidence of a correlation between high 360 scores and high performance.
- It is time-consuming (when done periodically) and managers and EE’s learn to hate the time commitment.
- Little evidence that managers actually listen to EE’s opinions. This can actually decrease productivity due to frustration when the EE’s realize they have been deceived into thinking their opinions matter.
- It’s subjective, not objective. It is based on opinions, not behaviors. Popularity is not performance. Opinions are not business results.
- Opinions serve as a poor substitute for real performance data.
- Most EE’s don’t see the big picture so their feedback is based on minutia and gives no real insight into strategic issues.
- Anonymous processes short circuit the need to develop 1 on 1 communication skills and the ability to provide negative feedback.
- It is a slow and time-consuming process. Respondents are slow to fill out the forms and a skewed response occurs when only the unhappy respond. Anonymity does not allow for encouraging individual non-respondents to participate, resulting in a low response rate.
- Questions often relate to attitudes and soft skills which are not easily assessed or observed by the average EE.
- Managers / EE’s despise doing additional Perf. App. of any kind.
- The ROI can be a negative number.
- Outsourcing the analysis of the results (because it increases EE confidence in 360 anonymity) often slows the reporting of the results and makes it expensive (some aver. $200 per manager). It allows sensitive company data to be seen by consultants who may compromise it.
- The process is not “owned’ by the managers and they thus learn to treat it as another HR program of the month. It’s just another fad.
- It will not work without top management support and participation.
- Evaluators do not have copies of the managers’ job descriptions or performance goals against which to assess their performance.
- Managers’ rewards are often not tied to getting excellent 360 assessments.
- Subjective opinions of managers are influenced by outside factors (general satisfaction, pay increases, etc.) which cause results to vary, even though management behavior hasn’t.
- Opinions are not tied to the performance of the individual giving the assessment. This may result in an “averaging” of the opinions of high performers (or large customers) with those of low performers and thus skew the results.
- Anonymity allows forgetting, even “pot shots”, and worker “secret collaboration” on assessments to “get” a tough manager. It discourages managers who are change agents and “punishes them” for their aggressiveness with feedback resulting from resistance to change. Also, anonymity does not automatically result in unbiased opinions.
- Unions resist it and often claim it is a tool to fool/distract the workers from their unhappiness
- It makes top management “lazy” because they often stop “managing by walking around.”
- Managers are often not trained on how to interpret and use the 360 feedback. Managers are not trained in how to change and not all managers can change whether they get feedback of not.
- Many 360 systems survey everyone rather than relying on statistical sampling techniques.
- Managers feel they are often evaluated by people who have never seen them in action (or seen them at all) or do not understand the nature of management work.
- If forces managers into making popular decisions rather then tough ones.
- Perf. App never works whether there is data or not. Managers are promoted on results and/or politics. Workers’ opinions and 360 will not change that.
- It’s base on an unproven theory that increased feedback results in increased performance.
- It wastes managers’ time by requiring them to go to 360 feedback training which they dislike.
- It asks for problems but it doesn’t ask for solutions or show how to solve the problems.
- No proof that managers with good Perf. App. are more productive than those with bad Perf. App.
- Often misused as a RIF, promotion or disciplinary tool.
- Customers can be frustrated when they must waste their time filling out forms, especially when actual performance rarely changes.
- Nothing actually happens after 360. There are no forced rankings and no one is ever fired or demoted as a result. Eventually, this results in the program being dropped.
- 360 questions are not usually customized to departmental or company needs.
- EE’s are suspicious that 360’s are really anonymous and thus are not really honest in their assessments. EE’s assume managers will “see them” in the comments and retaliate against them.
- There is no reward (punishment) for EE participation and spending the time to give honest feedback.
- EE’s are not trained in how to give honest and accurate feedback.
- Once a year, feedback is not sufficient in a rapidly changing world. A form is a poor substitute for a face to face meeting where trust can be built
- Employees in a rush can “Christmas tree” the form and skew the results.
- Results are skewed by recent events and are not reflective of performance over the entire period.
- Most 360 programs are dropped as budgets get tight or as managers tire of the time it takes.
- It doesn’t let the manager “self-monitor” their own performance so they can continually improve.
- Not all managers have enough EE’s to make the feedback statistically significant and reasonably anonymous.
- Picking who to survey is subjective and is difficult in a team environment when teams don’t stay intact for long.
- In an international environment, meeting for feedback sessions is too expensive. Cross-cultural/language interpretations are difficult to put into a questionnaire.
- Questions seldom correlate directly with the required core competencies and thus can confuse managers by sending mixed signals. 360 scores often conflict with other assessment and reward systems.
- It only makes a difference in “sick” organizations. Well managed companies get better feedback, faster and cheaper using other tools.
- It’s run by psychologists.
Critical Success Factors / Characteristics of a World-Class Program:
- It has a direct, measurable impact on productivity and shareholder value.
- Anonymity maintained.
- Integrated with other systems.
- Owned by EE’s and management.
- Its costs are billed to the managers using it.
- Tailored to company needs and flexible for changing needs.
- Focuses on core competencies.
- Managers and evaluators are trained in how to use it.
- Focuses on improvement and the future rather than blame and the past.
- It is tied to rewards.
- Allows responses to be analyzed by their “source code” (not the individual).
- Has a set of targeted goals.
- Has JIT and worldwide capabilities.
- It can be adapted to the team environment.
- Its success is continually monitored and improved.
Examples of firms that are considering/have tried it:
- DFS inc.
- Failure Analysis Inc
- And many others
Program Costs/ Development Time Estimates:
- Expect a broad range of costs ($50 – $1000 per manager) depending on the amount of consulting help and # or respondents selected for each manager.
- Development time is long (expect at least 6 months) unless off the shelf vendors are used.
Measures of Program Success:
- Increase in productivity in divisions using 360 vs. those who don’t (also this year vs. last).
- Higher EE and customer retention rates.
- Increased promotion and reward rates for managers with “high” 360 scores and vice versa.
- High ROI on 360 programs (Benefits less costs).
- Manager / EE / Customer satisfaction with the 360 process.
- Possible consulting help includes PDI, Inc., and Feedback Plus
As seen on Gately Consulting