Performance Management System through 360 Degree Feedback

Every organization has a Performance Management System in place to drive a high performance-driven work culture and retain the best of the best potential employees.

Let us begin with what Performace Management System (PMS) is all about. Performance according to Brumbach (1988) means both behavior & result. Activities come from the behavior of the individual. Campbell defines it as

1. Knowing about facts (Declarative Knowledge),

2. Knowledge on how things are done & Skills to do them,

3. Motivation to act.

Various theories have emphasized the focus points in PMS. Like the Goal Theory which encourages bring knowledge & skills together, the more challenging the goal is, the more people will draw on their repertoire of skills.

The Control theory emphasized feedback as a means for shaping the behavior. Social cognitive theory focuses on what people believe what they can or cannot impacts their behavior.

Now let us see how an ideal PMS should be like

1. PMS is about managing people and not about the system. In some organizations, PMS has become a rigid process than looking at as a people managing process.
2. It is a natural process that incorporates organizational goals or objectives.
3. PMS should focus on development and not pay.
4. It should be a quantified process, rather than subjectivity.
5. Focus on solutions and change in behavior.

Always keep in mind that an individual high performer may not lead the team to success.

How should a performance review process be :

1. Talk about achievements first, followed by shortcomings.
2. Form a clear structure (Have all the data with you related to your performance, KRAs, KPIs, Achievements, Extra efforts, and so on)
3. Please maintain an informal atmosphere throughout the process.
4. Begin with praise, talk about achievements, results, events, crucial places where employees did well, etc.
5. Invite self-assessment, talk about performance and not about personality.
6. Listen more, talk less.
7. Criticisms shall be constructive always.

RATING & REVIEW PROCESS - Disadvantages

1. Assess the level of performance from qualitative/subjective judgment to quantitative parameters, but still difficult in many cases.
2. Ratings are often subjective and may change with the manager.
3. The traditional rating process only covers one angle/aspect of individual performance.
4. It labels employees s 'average', 'below average' which may demoralize/demotivate them.

VISUAL ASSESSMENT - An alternative to the traditional rating method

This method actually plots employees into 4 major categories based on 2 visible parameters. They are:

1. Behavioral Style: Efforts, Commitment, risk-taking appetite, pro-activeness, and many other factors that are related to behavioral style.
2. Business Performance: The direct results achieved through KRAs, KPIs, Profitability, frugality, and much more.

ISSUES IN PMS

1. PMS is generally viewed as an HR Process and not as a business process.
2. Wrong goal setting, unclear goals may lead to low efficiency.
3. PMS is generally liked to Pay/Rewards.

360 DEGREE FEEDBACK

The manager is not the only responsible person for the performance of the individual. The 360 Degree Feedback is evaluating the individual from the feedback from superior, peer, customer & subordinate.

This technique has been used for

1. Learning & Development

2. Performance Appraisal

3. Succession Planning

4. Pay Decisions

5. Reward System

6. Resourcing

This system evaluates leadership, team player capability, self-management, communication, expertise, drive, adaptability, etc.

PROCESS FOR 360 DEGREE FEEDBACK

• Define the objective.
• Decide on the recipient. Decide wh gives feedback. Not all people who interact can be entrusted to give feedback.
• Decide the area of work on which the feedback would be given.
• Decide the method for data collection.
• Develop a questionnaire with the help of a system/software. (Make sure that the data can be represented graphically. Maintain the anonymity of the data based on the culture of the organization).
• Data analysis and presentation.
• Plan & initiate implementation program.
• Analyze the outcome of the scheme
• Plan and implement the full program.
• Monitor & Evaluate.

ADVANTAGES

1. Broader perspective
2. Increased awareness of competencies
3. Reliable feedback for the senior management
4. Acceptance of different stakeholders
5. Reinforcing the desired competencies
6. Encourage open feedback
7. Clarification on employee's critical performance aspects

The main advantage of carrying then PMS which includes 360 Degree feedback and visual assessment is that it removes the blind spots of the normal conventional Performance Management as seen above.

The second major aspect that needs to be focused on PMS is that it should be used as a feedback tool rather than just identifying or evaluating performance. For example, In how many of the organizations do you think that managers help individuals in setting up the guidelines that help individuals level up his or her performance for the next performance cycle. In many organizations, the process just ends by awarding promotion to the top performers, and no development plan is made for the rest to scale up further.