The impact of 360 feedback appraisal system on organizational justice and sustainability

Purpose This paper aims to extend previous results demonstrating a statistically significant causal relationship between the implementation of 360-degree feedback in an organization and employees’ perceptions of organizational justice. It explores the sustainability of this justice, ultimately making it an integral part of the organizational culture. The paper examines whether the previous model (based on relationships among 360-degree feedback, organizational justice and sustainability of organizational justice) is invariant across different levels of management (i.e. operational and top/middle managers) and across a group of female versus male employees. Design/methodology/approach Structural equation modeling multigroup analysis and invariance tests were conducted with a cross-sectional sample of 400 employees in various positions in home appliances and electronics organizations. Findings The results further sustain/contest previous findings on the relationships among appraisal, organizational justice and sustainability among respondents of different genders and at different managerial levels. The results also provide significant practical implications. Top managers and supervisors can incorporate gender and managerial level differences identified in this study to modify their management styles and appraisal techniques to install high levels of organizational justice and achieve a competitive edge through the sustained levels of this organizational justice. Originality/value This study is the first to explore the impact of implementing a 360-degree appraisal system on employees’ perceptions of justice, while taking into consideration gender differences, i.e. whether males or females tend to perceive different types of justice within the organization and whether they differ in the way that they react to the appraisal system being implemented within the workplace. Given all the positive traits associated with a 360-feedback appraisal system, the way that this feedback is viewed and interpreted by employees can differ according to the employee’s rank within the organization, i.e. whether he/she belongs to top/middle management team or the operational/front-line management team.

The Legal Environment for 360 Feedback

Many organizations rely on 360 Feedback to drive their strategic talent agendas. Even when 360 is purposed for development only, organizations are frequently reluctant to limit it to this use. The 360 data represent unique input that informs several talent management processes, from high-potential identification and promotion to performance management and succession planning. When 360 results are extended beyond development only and affect an employee’s status, however, a host of psychometric standards and legal requirements emerge. Highlighted is a series of considerations, beginning with design limitations as a decision-making tool (i.e., assessing performance while supporting development) and including score equivalence (across languages/cultures) and perceived fairness. After providing an overview of the legal framework of human resource decision-making, it is applied to the 360 Feedback process, including disparate impact, adverse impact, validation, and alternative selection procedures. The chapter concludes with recommendations for 360 practices, from design to implementation to use in making talent management decisions.

What Kind of Talent Do We Have Here?

This chapter describes a global pharmaceutical company that used 360 Feedback and other talent assessments to address critical strategic challenges in its business. The company collected behavioral data on approximately 400 sales leaders as part of a system-wide talent assessment that allowed a newly appointed leader to craft a talent strategy that would support his business strategy. By linking 360 Feedback data, personality assessments and sales results, the organization’s senior leadership team was able to critically examine its system-wide talent profile in the context of its ambitious commercial strategies. This system-wide profile was then used to shape short- and long-term plans for developing talent and shifting the culture at all levels to better align with business goals.