A reader asks the question: My manufacturing company is
considering using 360-degree feedback to make promotion decisions to
upper management. Do you think this is a good idea?
You pose an interesting question as the past decade has seen
explosive growth in the use of multi-source feedback systems in
U.S. organizations. Multi-source or 360-degree feedback measures
collect confidential feedback from a worker's peers, supervisors, and
subordinates along with the worker's own self-evaluation. The idea
behind this is to provide the worker with information about his/her
performance from multiple perspectives. From this feedback, the worker
is then able to set goals for self-development that will advance
his/her career and benefit the organization. It is commonly estimated
that up to 90% of Fortune 1000 firms use some form of multi-source
feedback, most often for executives and upper-middle managers.
While the use of 360-degree feedback has exploded in recent years,
not everyone is aware of its most appropriate uses. Most researchers
and experts contend that 360-degree feedback is ideally used as a tool
for personal development rather than evaluation. However, it is not
uncommon for marketers to target a much broader array of
organizational uses, such as compensation, performance appraisal, and
selection. Relatively little is known about how effective 360-degree
measures are when used for evaluation and promotion decisions. The
particular concern raised by researchers is the extent to which the
measures meet some of the most basic standards for quality
measurement.
A recent study conducted by Cal Hoffman, Ph.D., Senior Consultant
with EASI·Consult, evaluated the measurement quality of
an internally developed 360-degree feedback measure that was used as
part of a management development initiative in a large utility
company. (Hoffman, C., Olson, D. & Haase,
S. (2001)). Results from the 360-degree measure were compared to
results from two selection measures (writing assessment and structured
panel interview).
The study had two goals. First, to examine the extent of
differences in ratings provided by self, peers, subordinates and
supervisors. Second, to draw preliminary conclusions about the wisdom
of using 360-degree feedback for Human Resource (HR) applications
beyond development. Findings indicated the rater groups in the
360-degree measure simply did not agree enough to establish a reliable
measure that could be used for making decisions. The writing
assessment and structured interview were clearly found to be much more
acceptable for use in decision making than the 360-degree measure.
While this study makes it clear that rater groups do not agree when
rating a given worker, it is not clear which rater group offers the
best information for making compensation or selection decisions. The
findings do support the notion that different rater groups produce
widely varying views because they may attend to different things, or
may place different values on the qualities being rated. As such, the
findings provide support for using 360-degree measures in providing
developmental feedback.
Because findings across studies are consistent that there is often
substantial disagreement between (and within) rater groups evaluating
the same person, strong concerns are raised about the appropriateness
of using scores from such measures for guiding the kind of decisions
your company is considering. Bottom line is that 360-degree feedback
measures are better used in their original context of developmental
feedback, and should not be used for making promotion decisions.
Hoffman, C., Olson, D. & Haase, S. (2001). Contrasting a
360-degree feedback measure with behaviorally-based assessment tools:
An application of generalizability theory. The Psychologist Manager
Journal, 6, 1, 59-72.
