According to Forbes, over 85% of the Fortune 500 companies like Meta and Netflix use these surveys. This fact makes it clear that the method holds significant value.

But the question is: Is it the right feedback survey for your company?

To understand its effectiveness, you need to dive deep into the advantages and disadvantages of 360 degree feedback surveys.

But before that, let’s quickly take a look at what the 360 degree feedback approach is.

What is 360 degree feedback: understanding the approach

Traditionally, companies have always used managerial reviews as the cornerstone of employee performance. While such feedback is crucial, it does not provide a holistic view of employee performance.

Instead, you get a limited perspective confined to the observations and interactions within a singular hierarchical relationship, that of a manager and an employee.

This is where the 360 degree feedback survey stands out.

It provides an inclusive approach that engages multiple stakeholders in the feedback process. That’s why it is also called multi source feedback or multi rater feedback.

In other words, if an employer wants to gain a deep understanding of employee performance, 360 degree feedback represents the most comprehensive approach.

The feedback may include stakeholders like:

• Managers
• Colleagues
• Subordinates
• External clients
• Your own self (sometimes)

Companies prefer this type of feedback because it pinpoints the strengths and weaknesses of an employee, which might be overlooked in conventional one-on-one feedback.

But to truly determine its suitability for your organization, you need to see both sides of the coin.

Let’s dive into the advantages and disadvantages of 360 degree feedback.

Advantages of 360 degree feedback

Provides a wholistic & extensive view

One of the standout advantages of 360 degree feedback is its ability to provide a holistic and extensive view of an employee’s performance.

When shopping for something important online, you don’t rely on a single feedback, do you?

Instead, you go through the review section to see what the majority of customers are saying about the product to make an informed decision.

Similarly, in a 360-degree feedback survey, diverse perspectives from managers, peers, subordinates, and even external clients come together to form a well-rounded evaluation.

By using this approach, companies gain a deeper understanding of employee skills, behaviors, and interactions.

This results in more accurate and effective performance assessments.

Increases self-awareness and motivation

One of the main pros of 360 degree feedback is that it allows an employee to see themselves through the lens of others in the corporate hierarchy.

This feedback acts like a mirror which does not only reflect how an employee see themselves. But also how they are perceived in their professional ecosystem.

These insights can be extremely powerful in employee growth and performance.

For example, when an employee understands their real value in the company and the impact they have on others, it can be a significant motivating factor.

This can lead to enhanced contributions and better engagement levels.

Conversely, when employees receive negative 360 degree feedback, it offers a safe space for personal and professional growth due to anonymity.

Since feedback is anonymous, employees can focus more on the message rather than the messenger.

Provides an action plan

The benefits of 360-degree feedback are not limited to employee assessment. They also provide actionable steps and strategies for employee development.

Beyond mere reflection, the 360 degree feedback acts like a roadmap for self-improvement.

By pinpointing precise areas for growth, 360 degree feedback allows employees to create a targeted action plan.

Fosters employee engagement

360-degree feedback makes employees feel heard, valued, and more connected to the company.

When employees witness that their perspectives matter and their feedback contributes to shaping the workplace, they naturally become more invested and engaged.

This increased sense of belonging does not only raise their engagement levels. But also creates a healthy culture of mutual respect and collaboration.

This, in turn, contributes to a more productive work environment.

Enhances team dynamics and communication

Multi source feedback encourages open and constructive feedback from different levels in the company. This breaks down silos and fosters a culture of transparent communication.

Moreover, it also clarifies expectations and promotes mutual understanding and respect among employees.

As a result, the overall team dynamics and the ability to navigate challenges improve.

Now, let’s take a look at some of the drawbacks of 360 degree feedback.

Disadvantages of 360 degree feedback

Conflicting or biased feedback

One of the biggest cons of 360 degree feedback is that you might end up receiving conflicting or biased feedback.

It’s only human nature to have personal biases or conflicts. However, when these biases or conflicts enter the workplace, that’s when the problem arises.

The skewed feedback could hurt the employee assessment as it will be more reflective of personal relationships than actual performance.

How to mitigate:

To mitigate this, you can:

• Enable employees to give constructive feedback
• Encourage them to give the credit where it’s due
• Conduct training sessions to guide employees on how to give a balanced response and pinpoint areas for improvement

Anonymity concerns in smaller teams

Another notable challenge among the disadvantages of 360 degree feedback is the anonymity concern. It often arises in smaller companies or teams.

In smaller teams, more or less everybody is familiar with each other. It means that employees may decipher who provided the feedback based on known opinions and message formatting.

This could lead to discomfort or apprehension among employees, especially if the feedback is critical. Therefore, you may not get the accurate data for a fair assessment.

How to mitigate:

You can:

• Use third-party AI tools to further anonymize
• Collate responses to maintain confidentiality

Inconsistent feedback

We know that not all employees participate in filling out the survey forms.

Some would do it to address extreme situations only, while others would just take it as a formality.

This inconsistency in participation can result in skewed data, either only depicting major problems or lacking details.

This noisy data does more harm than good in providing fair employee assessment.

How to mitigate:

You can:

• Establish clear guidelines
• Provide training
• Or perhaps, Incentivize the survey process for balanced feedback

Resource and time constraints

If you want to conduct a comprehensive multi rater 360 degree feedback survey, it can take a lot of time and can be complex to carry out since it involves multiple stakeholders.

It involves coordinating with stakeholders, gathering data, analyzing the data, and whatnot.

This task can be particularly challenging for smaller teams or those with limited HR capacities.

How to mitigate:

To tackle the resource and time issue, you can:

• Make a simplified survey form focused on key, insightful questions
• Set up a dedicated schedule for feedback
• Train a team to manage the whole process

Risk of misinterpretation

Among the common drawbacks of 360 degree feedback is the potential for misinterpretation. If the context is not clear, employees might take certain feedback the wrong way.

This could lead to confusion and decreased morale.

How to mitigate:

You can:

• Conduct follow-up meetings where employees can discuss the feedback with HR
• This will help avoid ambiguity and ensure feedback is understood correctly

Now that you have a clear understanding of the advantages and disadvantages of 360 degree feedback surveys, it’s time to decide whether this approach is suitable for your company.

Should your company conduct a 360 degree feedback survey?

Does the 360 degree feedback approach align with the specific needs and dynamics of your company?

After understanding the pros and cons of 360 degree feedback, you need to answer the above question.

This approach might not be suitable for every company or organization.

For example, if you have a small team where everybody is familiar with each other and has clear communication, conducting engagement surveys might be the right choice.

Opting for multi source feedback in such a setting might backfire instead of adding value.

On the contrary, if you have a large company with multiple departments and a diverse workforce, 360 degree feedback can be beneficial.

The key is to carefully assess your company’s culture, structure, and long-term goals and then make the decision.

Use Formaloo for creating hassle-free surveys

Whether you want to create a short engagement survey or a comprehensive 360 degree feedback survey, using Formaloo can save you a lot of time and money.

Formaloo provides a user-friendly dashboard where you can use simple drag-and-drop features to create surveys within minutes.

You can also use a pre-made template and fill in the information to get started.

Start creating your own surveys by watching this video.

Bottom line!

Understanding the advantages and disadvantages of 360 degree feedback surveys is important if you’re considering this approach.

While it offers a holistic view of employee performance, drawbacks like potential bias could result in skewed data.

Give it a thoughtful consideration and mitigate potential pitfalls before implementing. Sign up with Formaloo today to boost your team development strategy and create surveys that solve problems! Follow us on our YouTube channel for more useful tips and tricks.