Wondering whether to conduct a 360 feedback review or a performance appraisal? Both bring specific benefits that can aid an HR department in performance management. Rather than considering whether to use one or the other, think about how you can use both tools strategically.
Here, we’ll consider the key differences between the two to give you a stronger understanding of how to use them both effectively.
Who provides feedback
In a traditional performance appraisal, only the manager provides feedback. In contrast, within a 360 review, an employee gains feedback from a broad range of people in various positions. Thus, instead of gaining a deep level of insight from one person, they provide a broader range of input from many of the people an employee interacts with, from colleagues to clients.
Don’t assume that feedback will always be fairer on 360 reviews. In many cases, a supervisor can be more objective than coworkers, as a good manager carefully keeps track of an employee’s accomplishments and progress. However, 360 reviews can give employees a broader understanding of how others perceive them by helping them identify patterns. For that reason, 360 reviews can help teams work together more smoothly.
While a traditional review is not done anonymously, a 360 review typically entails full anonymity for participants. Whereas a performance appraisal involves a one-on-one meeting between a manager and employee, a 360 review gathers feedback without the employee being present. An HR manager might review the feedback with the employee afterward when sharing it.
The anonymity of a 360 review is a key benefit, as it can encourage more open feedback—which is particularly important when seeking feedback from direct reports and colleagues who may otherwise feel hesitant to be fully honest.
A standard performance appraisal often helps a manager make a decision about whether an employee should get a raise or a promotion. Many HR experts advise against using 360 feedback for that purpose, as it would promote a sense of competition among employees that could skew results instead of fostering a positive workplace environment. Rather, 360 feedback should be used to provide direction for a developmental plan for the employee. Employees will feel more receptive to the feedback when they know it’s intended to encourage their growth.
In a performance appraisal, a manager evaluates whether an employee has met particular goals defined at the start of the appraisal period. Both the manager and the employee know what these goals are, and in the evaluation, they focus on discussing whether they were met. In other words, a performance appraisal focuses highly on achievements, which tend to be based on measurable data. The manager aims to look objectively at the facts to determine whether an employee has met certain goals.
In a 360 review, all participants don’t necessarily understand the goals of the person they are evaluating. They’re not directly stating how well certain goals or objectives were met. Rather, they’re answering a broad range of questions that collectively help define an employee’s strengths and target areas for improvement.
Therefore, the scope of a 360-degree feedback review assesses skills like leadership abilities, teamwork, communication, and other “human” skills that people witness on a daily basis. It provides valuable insights on how employees relate to others so they can keep growing in these ways.
Now that you have a clearer understanding of these tools and what they can do for your organization, consider whether you can use either of them more effectively. Could your managers use some coaching on how to deliver a performance appraisal that gets results? Or could your HR department use a 360-degree feedback tool that streamlines the process? Taking these steps will help you to maximize the effectiveness of your performance management.
Both 360 feedback reviews and traditional performance appraisals are effective tools that should complement each other in performance management. Employees will benefit most when you use them both to further their growth.