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.

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.

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-appraisal2. Superior’s appraisal3. Subordinate’s appraisal4. 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.

12 steps to a great 360 degree feedback process

Step 1 – What is the purpose of the feedback

Why do it in the first place? What do you want out of it? The answer to those questions will affect the way you set-up your 360 process, how you communicate about it with your people and how you review the process down the track.

For example, here are two common reasons:

1. As part of an on-going performance management process.

Making sure your people have the capabilities needed to achieve the corporate goals. Developing people to improve performance.

2. As part of a leadership development process.

Targeting development for participants. Providing a post measure of the effectiveness of the program.

Step 2 – Gain commitment from management

Management need to be committed to the 360 degree feedback process for it to work. If they aren’t committed, your people will see this and the process won’t be effective. Getting management to buy into it comes down to why you are doing it in the first place. A direct financial argument also helps – this’ll be the subject of a future post.

Step 3 – Involve your people up front and pilot the process

Involve your people in the design of the process. Use a nice cross section of people – the ones who’ll be affected by the process. You need:

To get them to buy into the reasons for doing 360. To get input on how to run the process to make sure it’ll work in the real world. To get input and feedback on the competencies (see step 3). Implement 360 with a pilot group first. Get feedback and make any changes needed before

going out to the wider group.

Step 4 – What competencies or values will be used

You can get feedback on almost anything including your new hair style, but the most common things are:

Competencies. Values. Behaviours.

Many organisations have a core set of competencies or values. Some also have leadership specific capabilities. And those who have advanced to Jedi level use role specific competencies.

Where do you get the competencies from? There are heaps of libraries. And if you use software package to do your 360s it may already have one. Choose the competencies that will support your corporate goals. Use around seven competencies all up. The competencies will form a questionnaire that feedback providers will complete. Decide on a rating scale to use with the questionnaire. The competency library you use will probably suggest one.

Step 5 – Who will provide coaching – they may need to be trained

When your people eventually receive their feedback they’ll need someone to help them understand it and to create a plan to develop areas needing improvement. This person needs to be skilled at coaching. It is usually a person’s manager, someone from HR or a coaching professional. If you want your managers to provide coaching and they aren’t skilled in this area, they’ll need some training.

Step 6 – Communicate with your people – let them know why and how

Let your people know these things: That a new process called 360 degree feedback is being implemented Why it is being implemented – see step 1 What it is How it will work What they will get out of it What they need to do

Step 7 – Who will receive feedback and who will provide it

Alright now you need to determine who is going to receive feedback – the people being reviewed. Once this is done, the feedback providers need to be selected. There are two ways this is typically done:

The employee nominates their own reviewers and gets their manager’s approval. The manager nominates the reviewers.

Employee nomination is better – why – because people take more notice of feedback from people they know well and respect. At first your people may not get the whole idea of what the feedback process does for them. So the manager approval process is needed to make sure people don’t kid themselves by choosing buddies to give them feedback.

Step 8 – Ask people to provide feedback

The next step is to ask the reviewers to provide feedback. They do this by responding to a questionnaire and providing any written comments. It’s also essential that a person completes a self-review. This really helps a person identify gaps between how they see themselves and how they are perceived by others.

Step 9 – Follow-up and collate feedback

Collate responses for each person receiving feedback. Follow-up with stragglers to make sure they respond before the deadline.

Step 10 – Produce reports

A report is produced for each person receiving feedback. This helps them understand the feedback provided by each of their reviewers. Responses from each of the reviewers, except managers, are generally aggregated. This protects anonymity and makes sure that an individual’s responses can’t be identified. So for example, instead of seeing each direct report’s individual response, you’ll see an average of all direct report responses. Manager responses aren’t normally anonymous. In other words a person would be able to see exactly what feedback their manager provided.

Step 11 – Provide coaching

The report is provided to the person receiving feedback as part of a coaching and development process. This should be done by someone skilled at coaching – this could be the person’s manager, someone from HR or a coaching professional.The report is used to help the person identify, understand and gain confidence in their strengths. It’s also used to highlight opportunities for improvement and areas for development.The coach helps the person create a plan to develop their capabilities. The person undertakes the development with progress being reviewed as part of the coaching process.

Step 12 – Post implementation review

After your pilot program and after the first full 360 degree feedback process, conduct a post implementation review. The purpose of this review is to determine:

Whether the feedback is producing the result you wanted. Where improvements can be 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

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.

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 system will 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."

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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