Question

Explain the concept of the 360-degree appraisal. How is this concept used in industry to appraise the employees. Highlight both the advantages and disadvantages of this multi-raters performance evaluation and discuss whether this method is suitable for local employers in Malaysia.

Answer 1

Concept of 360-degree appraisal

The 360 degree appraisal is the modern form of performance evaluation method for employees whereby a employee is evaluated by his or her co-workers. These co-workers annonymously gives feedback for the concerned employee in the feedback form about the competencies of the concerned employee.

How is this concept used in the industry to appraise the employees:

There are different method assigned to carry out modern 360 degree performance evaluation of employees.They are listed below:

  1) The BARS method: this method is called as behaviourally anchored rating scale where behaviour of particular employee towards particular activity is tested against preferred behavioural statements. These preferred behavioural statements are derived from critical incidents or events happened in past. The comparision thus obtained is given a numeric value which is based in good, beyond average, average, below average and poor.

2) Human Resource accounting method: In this method human resource accounting is done whereby simply a formula is used which is as follows

cost on employee minus value added by employee   

where cost means cost of employer right from hirng of employee to it's induction programme and value added by employee means input provided by employee to it's organisation. Difference is treated as performance of the employee hired in the organisation

Advantages and Disadvantages of this multi raters performance evaluation system:

Advantages:

1) Acts as SWOT analysis for employee: It is well said that our strength, weakness, oppoortunities and threats are better analysed by person who works with us day and night. therefore 360 degree performance evaluation system gives employees a mch better self awareness of thier srengths and weakness.

2) Identifies Training gaps : there is lots of data collected regarding competencies of an employee from colleagues, subordinates, managers or clients which indicate vaccum of skills of particular employee and if there is any issue identified on that data collected then there can be various trainng programmes can be deployed.

3) Gives insight into employee's work : 360 degree performance evaluation finds out the real worth of the employee examined under the appraisal. it obtains all value adding and non value adding of employees and tries to refine it's value adding activities and demolish non value adding activities.

Disadvantages :

1) Time consuming process: it is very time consuming process because fellow employees, managers are first expected to give feedback of an employee and then these feedbacks are collated and analysed and then final feedbacks are released which takes lots of time of organisation.

2) better execution but poor implementation: if leaders doesnot communicates the problems and ways to solve that problem in the employee then it creates distrust in the employee for leader and they think that they wasted there time in the whole exercise carried out.

3) sideline positive feedbacks: there are some managers in the organisation that only focuses on negative aspects of the employee and ignores the positive ones which can lead to reduction in engagement of above appraisal program. so there should proper balance between indication positive and negative aspect of an employee

Yes this modern approach is suitable for loca employers of malaysia.