One of the most dreaded times of a financial year in an organization is the Performance Appraisal time. Traditional way of conducting performance appraisal is to hold it once, usually at the end of financial year with feedback coming in from the higher levels of management that is the team lead and the reporting manager. This method works well if one is at the lower levels of the hierarchy. But this traditional method of performance appraisal is now replaced by a more flexible method by integrating feedback throughout the year or in frequent intervals, without reserving it for the special occasion.

As an associate goes up the levels of hierarchy, his or her pay component also changes. That is, the base or the fixed component decreases and the variable pay which is linked to the performance of his or her team increases. And that is where the concept of 360-Degree Feedback kicks in. 360-Degree Feedback is the process by which surveys are used to gather and analyse feedback about the performance of a particular employee (usually at a higher-grade) from about 10 or 20 people which includes colleagues, managers, vendor, customers, suppliers, supervisor, peers and other stakeholders, who have an experience working with that employee either directly or indirectly. So to sum up, a higher grade associate is usually rated on the performance as depicted by the people he or she is interacting with.

The mail goal of 360-Degree Feedback is to convert the intangible qualities into the strengths and deficits, which can be used as a report, thus carving out a path with highlighted points which require definite action for improvement. 360-Degree Feedback has a lot of other advantages too, some of which are:

1. Provides deeper insight into the mode of doing a particular job, in terms of collaboration, communication and promotion of innovation.
2. Provides an interesting contrast in how the participants view themselves and how the others see them.
3. Gives rich data for statistical analysis and provide ratings, based on actual data, thus eliminating subjectivity.

360-Degree feedback is highly valuable and is receiving a lot of positive responses due to its objective nature, is very much candid owing to the fact that the feedback from the peers will be anonymous and is highly compelling in nature. If one analyses the very purpose of such a feedback, benefits can be reaped from the administrative perspective as well as from the personal perspective too. From the administrative perspective, the results of the feedback is used for performance appraisal and thus for performance rating which ultimately affects the compensation. For executives at higher grade, a small increase in compensation without much analysis usually has a tumultuous effect on the bottom line of the company. And from the personal perspective, the feedback, which was provided anonymously can provide the strengths and the pain points, which can be used as reference by the associate for improvement.

360-Degree Feedback works very well for the executives at higher grades because in that way, their performance is very much linked to the performance of his or her peers and direct interacts. So in one way, it can be a great tool to improve or to remove someone if that associate is unable to perform the expected. But it has to be used with great care. Not only there is a distrust regarding the results of the 360-Degree Feedback, but also sometimes the outcomes generates more questions than answers. So this mode of feedback should be handled with utmost care and with proper control.

But in one way, 360-Degree Feedback means – “Once I knew the problem, I could fix it and I had a game plan.”

Source: https://qulture.rocks/en/blog/360-degree-feedback-what-is-it-and-how-does-it-work/