How 360 Degree Feedback Adds Value to Your Business

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[Update 10/17/17: This piece has been updated to reflect more timely information.]

It’s a familiar feeling. Even if you’ve moved from staff to the manager level, you remember the feeling… knowing something is coming, something that could be terrible or great but either way, it’s definitely going to have a big impact on your career.

That sinking, creeping sensation of dread can only mean one thing: it’s time for your annual performance review!

It’s that one awful day where your employees find out what their managers think about their job performance. They are crossing their fingers and hoping they didn’t upset their boss too much at the annual holiday party.

But what if it didn’t have to be like that? What if there was a way to make the feedback process more efficient and accurate while lessening the stress on both you and your employees? Maybe there is!

What is 360 degree feedback?

360 degree feedback is feedback that comes from more than one source. In business, it means a performance review that takes into account multiple perspectives, including peers, supervisors, and subordinates. This gives you a complex and nuanced view of how they are performing.

The major benefits of 360 degree feedback can be distilled into three main points:

1. 360 degree feedback gives you the full picture

A cool work of art that relies on perspective to create an image

If you only look at a person from a single angle, you’re not getting the full picture. The side you’re seeing as a talent manager might be very different from the side presented to someone else. But with 360 degree feedback you can capture those other perspectives and use them to form a more comprehensive picture of an employee and their performance.

When you have a more complete picture, you can tackle your performance review on multiple fronts.

Perhaps someone is an excellent manager, but doesn’t communicate well with their own manager. Or perhaps an employee’s peers love them but have suggestions for how they could manage their staff better. You might not know these things if you don’t seek feedback from multiple fronts.

2. It helps reinforce company values

At Capterra, our company values are pretty awesome:

  1. Seek the good
  2. Do great work
  3. Be ridiculously helpful
  4. Keep on getting better

For us, it’s easy to fit those values into 360 degree feedback. We want to look for the best in everybody, but we want both ourselves and our teammates to keep getting better, so we don’t shy away from critiques when they need to be given. But overall, we want to be ridiculously helpful, so our comments aim to be constructive.

What are your company’s values? How do you reinforce them? How are your employees embodying your mission?

If you synthesize your values into actionable metrics that you can use to evaluate performance, you can use 360 degree feedback to help keep them at the forefront of your employees’ minds.

One simple way to achieve this is to make it a question. So for Capterra, we might ask, “How has this employee been ridiculously helpful?”

When you bake your values into your feedback, so that your employees are not only looking at one another through your value system, they also learn to examine themselves through your values, if they aren’t already doing so.

3. 360 degree feedback means agility

Agile means changing, flexible, and up to the moment. Which is exactly what you want your approach to your performance reviews to be.

360 degree feedback can help give you that agility by showing you a more complete picture of your employee. When you have a single-view performance review, you’re evaluating your employee on a single level. When you open up to a larger, more complete view of that employee by inviting different perspectives, you have a more comprehensive and timely evaluation, which allows you to provide more agile feedback in your review.

When you promote company values, openness, and seek a comprehensive picture, what you’re really doing is helping to nurture an environment where transparency and an ongoing performance review approach is embraced by everyone.

That means that your response to the feedback you get will be agile, and you’ll know when you have a problem developing, when you need to give someone kudos, or simply when you need to keep your eye on something.

How can I get started with 360 degree feedback?

Interested in trying 360 degree feedback? That’s awesome!

Your first step is to build it into your existing performance appraisal system. If you’re not already using software for performance appraisals, you should consider taking a look at Capterra’s directory to find a system that fits, as the automation those systems offer will make building up a 360 degree approach much faster and easier.

Your next step is to determine what questions you want to ask your employees.

Some suggestions for employee questions are:

  • How does [employee] embody [company value]?
  • When you work with [employee], what interpersonal skills do you see them displaying?
  • Have you ever had interpersonal difficulties with [employee]?
  • Do you consider [employee] an effective leader? Why or why not?
  • If not, how do you believe they could improve?
  • Does [employee] demonstrate good time management skills?

By inviting both positive and negative feedback and leaving plenty of space for employees to explain their responses, you’ll encourage more complete descriptions to improve your view of an employee’s performance. Assure anyone filling out a feedback form that they’ll remain anonymous so that people don’t hold back necessary negative feedback.

The best way to weave 360 degree feedback into your performance review is to pull quotes from especially standout or oft-repeated feedback and discuss them in the performance review. Both positive and negative comments can be helpful.

Ready to get started?

You’ve got options!

You can start by going directly to our talent software directory to find a great program that fits your feedback style and will help you incorporate 360 degree feedback.

Or you can read one of these related articles:

Have you tried 360 degree feedback already? Got some questions about implementation? Hit me up in the comments below or tweet me @CapterraHalden.

Looking for Talent Management software? Check out Capterra's list of the best Talent Management software solutions.

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About the Author

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Halden Ingwersen

Halden Ingwersen is a former Capterra analyst.

Comments

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Hey Dominic!
Great article. Loved your insights. I also read somewhere that “Dispirited, unmotivated, unappreciated workers cannot compete in a highly competitive world.”

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