A comprehensive performance appraisal process, widely known as 360-degree feedback, provides employees with feedback from people that surround them in the organization – supervisors, co-workers and subordinates. There are many benefits that may result from this kind of appraisal including:
- Offers multiple perspectives
- Fosters teamwork
- Diminishes fear of retribution
- Increased job satisfaction and loyalty
However, 360 reviews, also known as “peer reviews,” aren’t always sunshine and roses. I read a recent The New York Times article about the allegedly difficult workplace culture at Amazon. The article disclosed how Amazon handles evaluations, which involves any co-worker being able to critique another, anonymously, at any time. They call it “Anytime Feedback.”
I’m a proponent of providing timely feedback, positive and negative, as needed. At MarathonHR, we don’t have a formalized review process. I maintain that if managers are effective, they are continually giving employees the feedback they need to feel valued and develop professionally.
I like the concept of 360 reviews, but they are time consuming, particularly if they are done more than once a year. Additionally, you don’t want peer reviews to be an avenue for personal attacks or unconstructive criticism. Here are some advantages and disadvantages of performance appraisals in general:
| ADVANTAGES | DISADVANTAGES |
| Provide documentation of an employee’s performance over a specific period of time | If not done correctly, may create a negative experience |
| Provide a structure where a manager and employee can meet and discuss performance | Time consuming, and may overwhelm managers with multiple employees |
| Allow a manager to specifically review employee goals and if they were accomplished | Based on human assessment and are subject to rater error or bias |
| Provide a forum for an employee to clarify expectations and discuss any issues with their manager | May be a waste of time if not done effectively |
| Offer a structure for planning for the coming year and developing additional employee goals | Can create a stressful environment for all involved |
| May motivate employees if tied to a solid compensation system and merit increase | May allow raters or evaluators to take out personal feelings against an employee |
Finally, performance appraisals are only as effective as the performance management system it operates within. Organizations that only do performance appraisals for the sake of doing them are likely wasting their time. Companies that incorporate performance reviews into a comprehensive management structure and use them to implement the larger business goals and strategy will probably find them a better use of time.
If you are interested in learning more about performance reviews and how they might be incorporated into your company, call us at 678-208-2802.