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Many organizations have incorporated 360-degree feedback into their leadership development process, and for good reason. The data gathered from multi-source feedback can be extremely valuable both for organizations and the employees, providing honest and measurable observations that can be used to enhance employee development, as well as engagement and retention.

Making the decision to use 360 feedback is not something that should be done casually or without forethought, however. Some organizations will be better suited to the approach, but others may require some significant reframing to avoid potential challenges inherent in the process. Here are some pros and cons companies should consider before making the decision to utilize 360 feedback.

360 Feedback Can Help You To:

1: Identify Performance and Behavior Gaps

Traditional development programs put a great deal of emphasis on specific objectives and whether the person met clearly identified goals. The evaluation focuses on “what” someone accomplished, which is a reasonably objective criteria that both employees and management can generally agree upon. However, these tasks aren’t being carried out in a vacuum and fail to take into account behavior, or “how” the work was done. Using 360 feedback can provide a more robust picture of how performances and behaviors are interconnected in the workplace.

For instance, a manager’s department may have met its sales quota for the year, but that success will be cast in a different light if multi-source feedback reveals that the manager is verbally abrasive, which contributes to high turnover levels. Properly implemented 360 feedback can identify performance gaps like this, which allows organizations to formulate plans that will address the problem.

2: Expand the Range of Information

Using 360 feedback helps to provide a more objective measure of performance by bringing more data points into the analysis and minimizing bias. The diversity of opinions ensures that no one evaluator can dramatically affect the review’s outcome while also making it more likely that all performance-related issues will be overlooked. Involving more people also helps to strengthen their commitment to the review process and trains them to better identify and record relevant information between evaluations.

3: Provide Open and Honest Feedback

When properly designed and implemented, 360 feedback encourages personalized and multidirectional responses that provide a well-rounded view of how an employee’s behavior is perceived by their boss, direct reports, and colleagues. Balanced feedback from multiple sources is more likely to be received constructively. It reduces defensiveness and facilitates more open discussion about how behaviors might be changed.

4: Establish Agreement on Expectations

While the data gathered by the 360 process is important, the type of questions asked help to clarify what’s important to the organization. It establishes a basis for how people should behave and defines what effectiveness looks like. Although managers and direct reports may have different perspectives on the best way to perform a task, a well-designed 360 questionnaire frames performance in terms of specific behaviors and outcomes. Since everyone is working from the same set of criteria, feedback from different sources is easy to compare, which helps to promote discussion over the results. As part of a development process, 360 feedback presents people with actionable items and goals that they can focus on to improve performance.

360 Feedback Also Presents the Following Challenges:

1: The Process Must be Designed and Implemented Carefully

If the 360 survey questions are poorly designed and implemented, the feedback received will be useless at best and counterproductive at worst. Questionnaires filled with negative questions that ask what an employee doesn’t do or should be doing both discourages honest feedback and make the subject feel defensive when they review the responses. Impersonal questions, which ask about behavior in general terms rather than relational ones also tend to produce unhelpful results. For instance, asking “How does John help his team meet their goals?” will produce less insightful responses than “How does John help you meet your goals?”.

2: Lengthy Data Collection and Follow-Up Process

Designing a 360 feedback process is a time-intensive process on its own, but implementing one is challenging as well. A good system will collect data from a wide range of respondents, some of whom may not be punctual in responding. Even once the data is gathered, it must be sorted and analyzed in order to present constructive, directed feedback.

If an organization goes to the trouble of collecting this data, it needs to have a plan for putting it to use. While the feedback can tell employees what skills and behaviors they need to work on, they’re unlikely to make the necessary changes without direction or assistance. Workshops that provide an opportunity to improve skills and behaviors are a logical follow-up to any multisource feedback process, as are mentoring and coaching programs. While these activities take time and can incur additional expense, they can significantly improve the organization’s return on investment in its workforce.

3: Requires Significant Employee Buy-In

No matter how well-designed a 360 feedback system may be, it won’t produce positive results if employees are not willing to participate in the process. The potential of receiving feedback from a wide range of sources can put many employees, especially managers, on the defensive. Many people may have concerns about whether or not their responses will be kept anonymous, especially if they’re asked to comment on someone they report to. If employees are worried about confidentiality, they’re more likely to give answers that aren’t honest or completely forthcoming.

Any effort to implement a 360 feedback process must, therefore, be accompanied by significant outreach efforts that show employees how the process can be a positive and beneficial experience. Without their buy-in, any attempts to implement multisource feedback are sure to be met with some level of resistance.

Properly implemented, 360 feedback can transform an organization’s performance management practices. Like any significant change, however, it is not without its challenges. To get the most out of the process, organizations must take into consideration how to address these challenges at the onset to avoid more significant problems in the future. As with many other HR initiatives, readiness and forethought is paramount to success.