Multi-source/360-Degree Feedback (Part 9 of 10 of HRSG’s Guide to Performance Management through Competencies)

This is the first in a 10 part series that looks at:

1. What is Performance Management?
2. Linking Performance Management to Corporate Strategy
3. How to Design a Performance Management System - Step 1
4. How to Design a Performance Management System - Step 2
5. The Performance Cycle – How Competencies are Incorporated
6. Stage 1 – Planning for Success
7. Stage 2 – Managing & Feedback for Success
8. Stage 3 – Evaluating Performance
9. Multi-source Feedback
10. Performance Management in Summary

Multi-source/360-Degree Feedback Defined: “evaluations gathered about a target participant from two or more rating sources, including self, supervisor, peers, direct reports, internal customers, external customers, and vendors or suppliers.”

First introduced to support development, the underlying premise of multi-source, or multi-rater feedback is that individuals with different relationships with the target will have different perspectives on job performance. By combining different perspectives, it becomes possible to construct a more complete picture of the person’s strengths and development needs. Although controversial, more recently multi-source feedback is also being used also to support administrative decisions – e.g., promotion, bonuses, etc.

How are Competencies Integrated?

Most commonly:

• Behavioral indicators of the competencies form the basis for rating performance
• The scores are then combined to result in ratings of Competencies
• Reports provide detail to support development based on key competency strengths and areas for development
• Action plans / recommended development options are linked to the competencies

An example from a multi-source feedback report is shown below:

Key Questions and Best Practice
There has been extensive best practice research on multi-source feedback. There are a number of benefits, but there are also down sides to engaging in a multi-source process.

Benefits:

• Subordinates and others are often in good position to observe target behavior and provide valuable perspectives
• Multiple assessments increase reliability and validity
• Opens candid discussion – it is not just the supervisor providing feedback
• Increases informal and formal feedback
• Increases management learning
• Increases focus on customer service
• Encourages goal setting and skill development
• Focuses on important organization performance dimensions
• Changes corporate culture
• Improves behavior and effectiveness

Downside:

• Costly to develop and implement – money and time
• Feedback might not be truthful – too positive or too negative

However, the research indicates that it does work to improve job performance, especially for those with initially low levels of performance, because it:

• Signals certain performance is important to organization
• Enables the subject of the feedback to set specific goals
• Motivates change for managers with largest differences between feedback and performance standards
• Links key performance dimensions to organization's strategy

Use of Results
Multi-source feedback is most often used to support development, because it enhances self-awareness. Sometimes is used as part of the performance appraisal process, because it provides a perspective other than just the superior; however, when doing this, it should be remembered that ultimately it is up to the superior to manage employee performance, and therefore the final decision regarding the recommended final rating should lie with the superior.

Multi-source assessments are sometimes used in combination with other assessment methods as part of an assessment center process to make assignment or selection decisions for high-stakes jobs and for leadership development.

Organizational Readiness
Regardless of the end use of the results, best practice indicates that the organization and those participating in the process must be prepared for this type of performance feedback. Key questions include:

• Is there a culture of learning and changing?
• Do employees feel free to speak up without reprisal?
• Do managers view openness as essential to organizational success?
• Will managers use what they learn to make changes?
• Will managers discuss results with employees to show their input matters?

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In the final blog post in this series, we will summarize some key findings from the latest best practice research on competency-based performance management as well as discuss how competency-based performance integrates and supports the whole talent management process. Sign up to our blog’s mailing list through the form on the right-hand side to receive the rest of the series in your inbox.

HRSG is a leader in competency-based performance management solutions and training. Contact us today to find out how we can help you.