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Project report on

360 DEGREE PERFORMANCE APPRAISAL

IN PARTIAL FULFILMENT FOR THE DEGREE OF

MASTER IN BUSINESS ADMINISTRATION

DEPARTMENT OF MANAGEMENT

STUDIES BHIMTAL

(SESSION 2011-2012)

SUBMITTED TO: SUBMITTED BY:

Mr. ASHISH BISHT MEGHA KUKREJA

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DECLARATION

I undersigned, Megha Kukreja, student of department of management studies,

declare and confirm that work done by me is original and true to the best of my

knowledge & beliefs.

I declare that this project is my prepared by me and not copied or extracted from

anywhere else. It is the result of my efforts and dedication. This summer internship

project report is just a part of department of management studies and will not be used

else.

Date: Signature:

Megha

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Acknowledgement

First, I would like to thank God, who gave me the courage and patience to complete

this dissertation successfully.

I would like to express my profound gratitude to my family, who have supported and

encouraged me in every stage of this project.

I would like to thank my inspiring supervisor, Mr.Ashish Bisht for guiding me

throughout this project. It was amazing working under his guidance.

Last but not the least; I would like to thank all the children (interviewees), who took

part in the interview. This research would not have been possible without them.

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PREFACE

Industrial Training during studies helps the students to expose themselves to the

industrial environment, which cannot be simulated in the classroom. As the needs of

the industry are changing due to rapid change in technology, management practice,

competitive quality and productivity etc., it makes the students aware of the rapid

developments in the industry.

Summer training has helped me to appreciate the theoretical knowledge gained in

the classroom. It has taught me the importance of punctuality and the sense of

responsibility. It has helped me to understand the psychology of the employees, their

attitude and their approach to problems. Apart from this it has given me good

exposure to the current technology development relevant to my subject of studies.

I avail this opportunity to thank Department of management studies bhimtal for

imparting me the practical knowledge in the industrial field.

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OBJECTIVE:-

To evaluate an employee by all the officials whoever connected with him on the job for his

Attitude as well as Job Performance. And to study the following:

1) To .

2) To study different techniques of analysis.

3) To study concept n process of 360 degree in detail.

4) To study prons n crons of 360 degree.

5) To improve the quality in performance

Background Contemporary 360-degree methods have roots as early as the 1940s, however, there is

some disagreement regarding the exact genesis of the technique.

Despite these disagreements, one point that most scholars can agree on is 360-degreeperformance appraisal has historical roots within a military context.

During the 1950s and 1960s this trend continued in the United States within the Militaryservice academies.

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At the United States Naval Academy at Annapolis, the midshipmen used a multi-sourceprocess called peer grease to evaluate the leadership skills of their classmates.

In the corporate world during the 1960s and 1970s, organizations like Bank of America,United Airlines, Bell Labs, Disney, Federal Express, Nestle, and RCA experimented with

multi-source feedback in a variety of measurement situations.

360 Degree Performance Appraisals

360-degree performance appraisal process is used as a tool that provides an evaluation about

employees performance. It is based on the opinion of different groups of reviewers who socialize

with evaluated employees. Many criteria must be considered in performance appraisal that may

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have different nature and usually present uncertainty. Therefore, it seems necessary and

appropriate to provide a heterogeneous framework adapted to the nature of the criteria. In thiscontext, criteria can be asses by reviewers, according to their background and degree of knowledge

about evaluated employees. Furthermore, the interaction among criteria, as well as reviewers

weights should be taken into account to ensure an effective aggregation process of the information,

providing interpretable and understandable evaluations.

Performance appraisal process is based on the opinion of different groups

of reviewers who socialize with evaluated employees, since they can truly respond tohow an employee develops his/her job. Moreover, the process includes the opinion of

employee about her/himself (see Figure 1). This kind of performance appraisal process

is so-called 360-degree appraisal or integral evaluation [10, 12, 24] and it overcomes

some disadvantages from traditional evaluation such as lack of objectivity, prejudice orhalo errors, etc

360 degree performance appraisal is also a powerful developmental tool because when conducted

at regular intervals (say yearly) it helps to keep a track of the changes others perceptions about the

employees. A 360 degree appraisal is generally found more suitable for the managers as it helps toassess their leadership and managing styles. This technique is being effectively used across the

globe for performance appraisals. Some of the organizations following it are Wipro, Infosys, and

Reliance Industries etc..

360 degree feedback, also known as 'multi-rater feedback', is the most comprehensive appraisal

where the feedback about the employees performance comes from all the sources that come incontact with the employee on his job.

The 360 degree evaluation process provides information to an employee from multiple sources a

circle of stakeholderspeerssupervisordirect reportshigher mg levelsinternal customers

external customers

vendors

consultants

others, anyone who comes into contact with the

employee and can provide valuable insights and information or feedback regarding the

"on-the-job" performance of the employee. It is good for both development and evaluation. It

can be a very good approach because the information gathered is from so many sources.

Self appraisal gives a chance to the employee to look at his/her strengths and weaknesses, his

achievements, and judge his own performance. Superiors appraisal forms the traditional part ofthe 360 degree performance appraisal where the employees responsibilities and actual

performance is rated by the superior.

Subordinates appraisal gives a chance to judge the employee on the parameters like

communication and motivating abilities, superiors ability to delegate the work, leadershipqualities etc. Also known as internal customers, the correct feedback given by peers can help to

find employees abilities to work in a team, co-operation and sensitivity towards others.

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360 Degree Performance Appraisal

Self assessment is an indispensable part of 360 degree appraisals and therefore 360 degree

Performance appraisal have high employee involvement and also have the strongest impact on

behavior and performance. It provides a "360-degree review" of the employees performance andis considered to be one of the most credible performance appraisal methods.

The Comparation between traditional n 360 degree

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The Process

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Integral components:-360 degree appraisal has four integral components:

1. Self appraisal

2. Superiors appraisal

3. Subordinates appraisal

4. Peer appraisal.

Contribution of different people:

SUPERIORS Contribution:

The 1st line supervisor is often in the best position to effectively carry out the full cycle ofperformance management.

The supervisor may also have the broadest perspective on the work requirements and beable to take into account shifts in those requirements

Cautions to be addressed:

Superiors should be able to observe and measure all facets of the work to make a fairevaluation.

Supervisors should be trained. They should be capable of coaching and developingemployees as well as planning and evaluating their performance.

Self contribution:

Self-ratings are particularly useful if the entire cycle of performance management involvesthe employee in a self-assessment.

The developmental focus of self-assessment is a key factor.

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Approximately half of the Federal employees in a large survey felt that self-ratings wouldcontribute to a great or very great extent to fair and well-rounded PA.

Self-appraisals are particularly valuable in situations where the supervisor cannot readilyobserve the work behaviors and task outcomes.

The self-ratings tend to be consistently higher. This discrepancy can lead to defensivenessand alienation if supervisors do not use good feedback skills.

Sometimes self-ratings can be lower than others. In such situations, employees tend to beself-demeaning and may feel intimidated and put on the spot.

Self-ratings should focus on the appraisal of performance elements, not on the summarylevel determination. A range of rating sources, including the self assessments, help to

round out the information for the summary rating.

Peers Contribution:

Employees report resentment when they believe that their extra efforts are required tomake the boss look good as opposed to meeting the units goals.

Peer ratings have been an excellent predictors of future performance and manner ofperformance.

The use of multiple raters in the peer dimension of 360-degree assessment programs tendsto average out the possible biases of any one member of the group of raters.

The increased use of self-directed teams makes the contribution of peer evaluations thecentral input to the formal appraisal because by definition the supervisor is not directlyinvolved in the day-to-day activities of the team.

The addition of peer feedback can help move the supervisor into a coaching role rather thana purely judging role.


Peer evaluations are appropriate for developmental purposes, but to emphasize them forpay, promotion, or job retention purposes may not be prudent always. Generally, theidentities of the raters should be kept confidential to assure honest feedback. But, in

close-knit teams that have matured to a point where open communication is part of the

culture, the developmental potential of the feedback is enhanced when the evaluator isidentified and can perform a coaching or continuing feedback role.

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It is essential that the peer evaluators be very familiar with the team members tasks andresponsibilities.

The use of peer evaluations can be very time consuming. When used in PA, the data wouldhave to be collected several times a year in order to include the results in progress reviews.

Depending on the culture of the organization, peer ratings have the potential for creatingtension and breakdown rather than fostering cooperation and support.

Subordinates contribution:

A formalized subordinate feedback program will give supervisors a more comprehensivepicture of employee issues and needs.

Employees feel they have a greater voice in organizational decision-making. The feedback from subordinates is particularly effective in evaluating the supervisors

interpersonal skills. However, it may not be as appropriate or valid for evaluatingtask-oriented skills.

Combining subordinate ratings, like peer ratings, can provide the advantage of creating acomposite appraisal from the averaged ratings of several subordinates.

The need for anonymity is essential when using subordinate ratings as this will ensurehonest feedback.

Supervisors may feel threatened and perceive that their authority has been underminedwhen they must take into consideration that their subordinates will be formally evaluating

them.

Subordinate feedback is most beneficial when used for developmental purposes. Butprecautions should be taken to ensure that subordinates are appraising elements of whichthey have knowledge.

Only subordinates with a sufficient length of assignment under the manager should beincluded in the pool of assessors. Subordinates currently involved in a disciplinary action

or a formal performance improvement period should be excluded from the rating group.Organizations currently undergoing downsizing and/or reorganization should avoid this

source of PA.

Customer Contribution:

Customer feedback should serve as an anchor for almost all other performance factors. Including a range of customers in Performance Appraisal program expands the focus of

performance feedback in a manner considered absolutely critical to reinventing the

organization.

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Generally the value of customer service feedback is appropriate for evaluating team output(there are exceptions).

Customers, by definition, are better at evaluating outputs as opposed to processes andworking relationships. It is a time-consuming process.

Uses of 360 degree performance:-360 degree performance used for

1) Developmental purposes only. The information is gathered by neutral entitynot thesupervisorand shared only with the employee.

2) Evaluation. The supervisor is involved in designing, gathering information, and in

communication with the employee.

Companies using 360 degree performance appraisals

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Advantages

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Disadvantage

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Despite the fact that360 degree appraisalsare being widely used throughout the world forappraising the performance of the employees at all levels, many HR experts and professionals

argument against using the technique of 360 degree appraisals. The main arguments are:

360 performance rating system is not a validated or corroborated technique forPerformance appraisal.

With the increase in the number of raters from one to five (commonly), it becomedifficult to separate, calculate and eliminate personal biasness and differences.

It is often time consuming and difficult to analyze the information gathered. The results can be manipulated by the employees towards their desired ratings with the

help of the raters.

The 360 degree appraisal mechanism can have a adversely effect the motivation and theperformance of the employees.

360 degree feedbackas a process requires commitment of top management and the HR,resources(time, financial resources etc), planned implementation and follow up.

360 degree feedback can be adversely affected by the customers perception of theorganisation and their incomplete knowledge about the process and the clarity of the

process.

Often, the process suffers because of the lack of knowledge on the part of the participantsor the raters.

Problems

It is the most costly and time consuming type of appraisal.
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These programs tend to be somewhat shocking to managers at first. Amoco's Bill Cloverdescribed this as the "SARAH reaction: Shock, Anger, Rejection, Acceptance, Help".

The problems may arise with subordinate assessments where employees desire to get theboss or may alternatively scratch the back of a manager for expected future favors.

The organization implementing this type of performance appraisal must clearly define themission and the scope of the appraisal. Otherwise it might prove counter productive.

One of the reason for which 360 degree appraisal system might fail is because theorganizations attempt to assimilate the 360-degree method within a traditional surveyresearch scheme. In traditional survey research, investigators attempt to maximize data

collection with as many items/questions as possible and with large sample sizes. In the

case of 360-degree appraisal, creating measurement instruments with many items will

substantially increase non-response errors.

Organizations must consider other issues like safeguarding the process from unintentionalrespondent rating errors.

The culture shock that occurs with any system that creates change. And especially with amodern system like 360 degree performance appraisal; must be taken care of.

360 Evaluation of Performance

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The DecisionWiseLeadership Intelligence 360 for Appraisal is a customized multi-rater

assessment process designed specifically for use in the evaluation of employee performance.Based on over 15 years of performance management research, these assessments combine the

power of360-degree feedbackwith traditional performance appraisal to provide a more

comprehensive picture of individual performance.

Our online 360-degree feedback system allows for fast and easy access to the survey and report. As

DecisionWise handles the survey design, setup, and administration, our clients quickly find the

process results in a higher degree of appraisal completion, greater confidentiality, targeted andactionable feedback, and a worry-free administration process with no expensive software to

purchase, install, and support.

A DecisionWise project manager and consultant team will guide you and your organization

through the 360-degree assessment process. We can even help your supervisors understand how to

interpret, debrief, and coach their employees on the results, which creates in a greater level of

development and action.

360-Degree Feedback for Appraisal

Although once used almost strictly for development, 360-degree feedback has proven to be avaluable option for performance appraisal. Using 360-degree feedback for appraisal (performance

evaluation) carries with it some significant advantages:

It provides a more complete picture than a top-down, single rater appraisal (a performanceevaluation that includes only the manager's feedback).

Supervisors often don't have a full picture of their employees' performance. Multipleperspectives highlight all sides of performance.

360 feedback for appraisal evaluates more than just operational performance (which tendsto be the focus of most managers' appraisal feedback).

Appraisal 360 feedback takes into account the effectiveness of the employee whenworking with various groups and levels (supervisor, peers, direct reports, internal

customers, etc.).

Organizations find it less biased (and even more legally defensible) than the evaluationprovided by a single individual.

Organizations familiar with 360-degree feedback find it a logical step in assessingperformance.

360 evaluations tend to have more process and structure than the haphazard performanceappraisals typically done in most organizations. This greatly increases the likelihood that

the appraisal will be complete, and will give useful feedback.
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Important consideration:- In order to obtain a successful 360-degree performanceappraisal process to make right decisions in the company, three main aspects should be considered:

A 360 assessment for appraisal is different from a 360 for development. Off-the-shelfsurveys typically do not take this into consideration.

A multi-rater appraisal addresses both whatwas done and how it was done. It is important that the purpose be clearly communicated. Communication prior to beginning the process should be very clear, providing guidance on

the how and why of the process.

The evaluation framework should be flexible, such that the reviewers can provide theirjudgments within different domains (numerical, interval-valued and linguistic), according

to the uncertainty and nature of criteria and the background of each reviewer, i.e., a

heterogeneous evaluation framework.

The application of an adequate set of aggregation operators that take into account theinteraction among criteria and reviewers weights.

The evaluation of the results should be close to human natural language in order to beunderstandable and interpretable by multiple members of the company.

When used for evaluation, in particular, it's important that the entire process be considered- not

just the tool. Our DecisionWise teams are the experts in 360-degree feedback for both appraisaland development.

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Guidelines for introducing 360 degree appraisals

Here is a simple guide for introducing 360 degree appraisals into an organization (and any other

management system for that matter):

Consider and decide what you need the 360 degree system to achieve. What must it be?How must it work? What difference must it make?

Choose/design a system (or system provider), ie., research and investigate your options(other local or same-sector companies using 360 already are a helpful reference point, or

your trade association HR group, or a specialist HR advisory body such as CIPD in the UKif you are a member).

Check the legal and contractual issues for your situation - privacy, individual choice,acceptable practices and rules, training, data protection, individual rights, adoption guide,etc. (360 degree systems are now well-developed and established. Best practice and good

reference case-studies are more widely available than in the early years of 360 feedback

development.)

When you've decided on a system, pilot it with a few people to make sure it does what youexpect. (It's best to establish some simple parameters or KPI's by which you can make thisassessment, rather than basing success on instinct or subjective views.)

When satisfied with the system, launch it via a seminar or workshop, preferably includingrole-plays and/or practical demonstration.

Support the implementation with ongoing training, (include an overview in your inductiontraining as well), a written process guide/booklet, and also publish process and standardson your intranet if you have one.

Establish review and monitoring responsibility. Ensure any 360 degree appraisal system system is introduced and applied from top

down, not bottom up, so everyone can see that the CEO is happy to undertake what he/sheexpects all the other staff to do. As with anything else, if the CEO and board agrees to

undertake it first, the system will have much stronger take-up and credibility. If the plan for

360 feedback introduction is likely to be seen as another instrument of executivedomination then re-think your plans.

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Format of template:

A 360 degree appraisal template typically contains these column headings or fields, also shown in

the template example below:

Key skill/capability type (eg communications, planning, reporting, creativity and problemsolving, etc - whatever the relevant key skills and capabilities are for the role in question)

Skill component/element (eg 'active listening and understanding' [within a'communications' key skill], or 'generates ideas/options' [within a 'creativity/problem

solving' key skill]). The number of elements per key skill varies - for some key skills there

could be just one element; for others there could be five or six, which I'd recommend be themaximum. Break down the key skill if there are more than six elements - big lists and

groups are less easy to work with.

question number (purely for reference and ease of analysis)

specific feedback question (relating to skill component, eg does the person take care tolisten and understand properly when you/others are speaking to him/her? [for the activelistening skill])

tick-box or grade box (ideally a,b,c,d or excellent, good, not good, poor, or rate out of 5 or10 - N.B. clarification and definitions of ratings system to participants and respondents is

crucial, especially if analysing or comparing results within a group, when obviously

consistency of interpretation of scoring is important)

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FORMAT DESIGN:

It can be a single format starting from Down Level as follows:

Level 1.By Sub-ordinates

Level 2. - By Co-ordinating Departments/ Officials while executing a job

Level 3. - By Vendors/Customers (if applicable)

Level 4. - Self Appraisal

Level 5.By HOD (will refer all levels upto 5)

Level 6. - By APPROVING AUTHORITY (will refer comments of all levels)

IMPORTANT INSTRUCTIONS:

1. If you design a one single format, arrange the comments in such a way i.e. starting from down

level to top-level.

2. Separate the forms of Customers/Vendors and Self Appraisal.

3. It is better to have separate Format at each level to avoid influences.

4. All comments are kept as confidential.

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360-Degree Performance Evaluation Form

This form will assist management in preparing the performance evaluation for the individual listed

below. As someone who works with this person on a regular basis, your feedback regarding his orher performance will be useful to the overall review process. You are not required to put your

name on this form.

Employee Name: ________________________________________________

Relation to Employee:________________________________________________

Your Name (Optional): ________________________________________________

Time Spent Every Day

A few

times a

week

A few

times a

month

Every few

months

NA

(Never)

Your interaction withemployee

Quality of Work

Strongly

Agree Agree Disagree

Strongly

Disagree

Not

Applicable

Sets high standards for

quality of work output

Ensures work is error-free

before submitting

Helps others improve the

quality of their work

Communication

Strongly


Strongly

Disagree

Not

Applicable

Communicates well orally

and in written-form

Displays good listeningskills

Shares information freely

with others

Teamwork

Strongly


Strongly

Disagree

Not

Applicable

Contributes positively to

team

Helps define team roles to

maximize output

Can be counted on to

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complete tasks correctly

Personal Qualifications

and Leadership

StronglyAgree Agree Disagree

StronglyDisagree

NotApplicable

Presents a positive image to

outsiders

Is friendly and easy to work

with

Adapts well to change

Has high professional and

ethical standards

Expectation:-

Manager expects from his Engineer the following:

1. Organisation Culture practices2. Value Addition by control of Man, Material, Time, Training3. Continuous Improvement on Work Methods, Data Control, Safety, etc.4.

Effectiveness of Communication on work execution, MIS system, etc.5. Leadership Skills like Personality, Attendance & Punctuality, Team Work, etc.

6. Time Planning7. Stress Control8. Scope for Development9. Learning Skills10.Training Needs

Lateral Level Departments expect:

1) Co-ordination2) Communication3) Team Work4) Sharing Knowledge5) Flexible Approach

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DOWN-LINE Personnel expect:

1. Personal Cleanliness & Personality2. Attendance & Punctuality3. Team Work4. Communication5. Training6. Concern for their developments7. Sharing Knowledge and Skill8. Listening Skills

CUSTOMER OR VENDOR LEVEL EXPECT: (Wherever applicable)

1. Corporate Culture2. Effective Communication thro information and product knowledge3. Flexible Approach4. Follow-up Attitude5. Listening Skills

SELF LEVEL EXPECT:

1. Knowledge2. Job Satisfaction3. Training Needs4. Problems that were prevented him to perform5. Positive Points that contributed in his Job Performance6. Suggestions for Improvement7. Suggestions for Welfare8. Intra and Inter-personal relationships (All three levels viz. upward, horizontal & down

level)

9. Needs if any of infra-structure facilities10.Suggestions for Organisation Growth overall

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360 degree feedback stages:-

360 Feedback involves four stages of adoption:

Awareness: This comes from reading articles, attending presentations, talking to others etc.

Experimentation: In this stage individuals try it out in a limited way, either on themselves or

on a small population. The instruments used for this are either developed internally or generic

tools available from suppliers on the open market. The aim is to try out the technique to learnmore about it, and to see if it has relevance to the organisation.

Pilot: This is usually the prelude to larger scale implementation, and is intended to test out or

de-bug a new questionnaire and system.

Rollout: This is where the now proven system is spread to the whole of the population it wasintended for.

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360-Degree Performance Appraisal Mode

Our aim in this paper is to present a novel integrated model for 360-degree performance appraisal

based on a decision analysis scheme with a flexible framework in which reviewers can expresstheir judgments in different domains, providing linguistic results, considering the interaction of the

criteria and reviewers weights.

To do so, the 360-degree performance appraisal model consists of the phases shown

in Figure 4 that cover the essential phases of decision analysis.

The following subsections present in further detail these phases

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CONCLUSIONS

The growing interest by all types of organisation in experimenting with, and then using 360

appraisal in a variety of applications leads me to believe that it will become a significant tool

which line managers and Human Resource specialists use to measure performance. This interestalso carries with it a worry, namely that after a peak it will go the way of other new techniques.

It is possible to see already the seeds of failure as well as success.

Here are the key issues which will cause 360 to get a bad name:

1. Insufficient attention to any aspect of the feedback loop - particularly not giving participantssufficient support in reflection and action planning, or rewarding them for changed behaviour.

2. Lack of thought and preparedness when implementing 360 projects, particularly

underestimating the need for good communication, logistics planning, and facilitation

3. Lack of clarity on the real reasons for carrying out the project, with a consequent inability to

measure its true results.

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