360 degree feedback is a popular way for people to receive a broad range of feedback. It can also offer insight into how a team thinks their leader is performing and reveal team cohesion. There’s value in the process, but it’s far from perfect.
There’s no shortage of new dashboards and number crunching tools to share all sorts of feedback data – and the global market for 360 degree software was valued at just over $900 million in 2022 and set to double over the decade. With so many organisations seemingly investing in the process, we think it’s worth highlighting some of the issues so that organisations can form an objective view.
360 feedback can be illuminating, particularly for leaders to calibrate whether their perception of their performance matches their colleagues. The caveat throughout this article is ‘if the process is done well’. As we’ll discuss below, there are issues that call the value of a 360 degree process into question.
But let’s start with the positives:
Insight: It offers insight into how a team or peer thinks their leader is performing and reveals team cohesion. This gives the leader the opportunity to reflect – providing the process captures fair and honest feedback. However, it’s not a panacea nor a replacement for good management or coaching.
Self-awareness: It helps people make sense of the behaviour of others towards them and these observations and feedback can create the impetus to change. This is most impactful for those already open to it. But arguably, those that really need 360 feedback are those who are not self-aware, but they are also likely to not want to undertake the process and if they do, are likely to explain it away and learn very little.
It creates change: If constructive feedback is given, understood and learnt from, behaviour may change for the better. Recipients of feedback may be given pointers on certain competencies they want to improve, perhaps with the help of coaching.
And the downsides… these factors can derail the value of the process:
It’s labour and time intensive: This is not insignificant, particularly for people in pivotal positions. One COO we worked with said she spent up to 2 days a month completing 360 questionnaires! Where responders don’t spend time and effort to respond thoughtfully, the quality of information to the individual is poor. It’s a double-edged sword – there’s no easy way for it to be quick AND valuable. The time-cost factor shouldn’t be underestimated. For example, if someone asks just 10 people to contribute to their 360 and they spend 30 mins each on it, that’s a cost of 5 hours of organisational time.
Risk of bias: Everyone is prone to bias, much of it unconscious. So having people evaluate the performance of others risks carrying that bias into the process. This is a particular concern for people in underrepresented groups and makes 360 feedback challenging for organisations who want to improve on DE&I. What’s more, many managers don’t trust the process as a result of the bias they see within it. Perceptions of unfairness in reward or promotion decisions based on such feedback may contribute to this. One of the criticisms of 360 degree feedback is that it can feed inequality loops. So it’s not surprising that research published by HBR found that only 15% of female managers and 24% of male managers were confident in the evaluation process, and most managers viewed the process as ”subjective and highly ambiguous.”
Unfairness and negativity: The confidential nature of 360 degree feedback means that while some responders may well leave useful feedback, others may feel it’s an opportunity to be overly negative towards those co-workers they may have disagreements with. Add to this that confidentiality makes it impossible to address those comments directly, leaving no ‘right of reply’ to feedback that may be considered unfair and harmful. This also has the effect of weighting the feedback towards the negative, more than the positive which can be another criticism of the process.
Risk of confusion and overwhelm: Just because someone has a perception, doesn’t make it right or accurate. Receivers of 360 feedback are often confused by contradictory opinions and viewpoints. What’s more, very often people are being asked to comment on skills they don’t understand. Is it really possible for members of your team to comment meaningfully on your strategic thinking?
Ratings are often meaningless: Given the relatively low number of responders, the average scores are often highly skewed or sitting in the middle, rendering them meaningless. 360 ratings do not stand up to the scrutiny of questions about standard deviation or spread. At best they can provide some kind of comparative and some providers give industry benchmarks which are useful to a point, if your organisation is ‘standard’.
In conclusion
With risks of bias, confusion, unfairness and the time involved, 360 degree feedback has its critics. The key is in how well the process is run and the openness of participants to in-turn buy into the process and the outcomes it suggests. Our suggestion is to have a straightforward process that can be accessed at key moments in someone’s career, like promotion or change of scope and have a good coach to help them work through the data and turn it into actionable information.
