Summary: Looking to improve your performance review process? Start with employee feedback. More than 90% of top-performing companies use multi-source feedback, like 360-degree reviews, to create a complete, accurate view of employee performance. In this article, learn how to build a strong feedback culture, increase employee engagement, and integrate 360-degree feedback into your performance management system to drive performance, retention, and growth.
Manager feedback is great. It provides a valuable top-down perspective on employee performance and alignment with organizational goals, but you’re missing out if that’s all you’re relying on in your performance review process.
Up to 90% of Fortune 500 companies use some form of multi-source feedback, like 360° performance reviews, to support a holistic view of performance. Employee feedback in performance reviews fills in the gaps a manager often misses by offering a ground-level, nuanced view of daily interactions, collaboration, and contributions.
| What is 360-degree feedback? 360° feedback is a review method that gathers input from multiple sources, such as peers, managers, and direct reports, to provide a comprehensive view of an employee’s performance. |
You can wield the power of your employees’ insights in many ways. By building an effective feedback culture and utilizing a performance review process and other tools, organizations can use the wealth of perspectives employee feedback presents to create a wonderful place to work.
In this article, we’ll cover:
1. What does it mean to create a feedback culture?
1.1 What is the goal of feedback culture?
2. How organizations can go about creating a positive feedback culture
3. How to center employee feedback with 360° performance reviews
3.1 How to conduct a 360° Performance Review
What is a feedback culture in the workplace?
Creating a feedback culture means fostering an environment where open, constructive feedback is actively encouraged, accepted, and integrated into everyday practices.
When all employees provide and seek effective feedback in the workplace regularly, two desirable outcomes sprout from it.
1. When feedback is normalized, people fear it less and are more receptive. For example, if you only receive feedback twice a year, it holds a lot of weight and can feel scary. However, receiving feedback every week feels less daunting, making you more receptive and confident to continue the conversation toward action. We call this building conversational capacity.
2. Every conversation can become a development conversation if employees know how to give and receive feedback. This makes a performance review a review of feedback already received, not news you hear for the first time.
Why is feedback culture important for employee performance?
The goal of feedback culture is broadly to promote continuous growth, improvement, and alignment within an organization. There is open communication and feedback (which leads to trust building among employees and their managers), conflicts are resolved more quickly, and everyone understands each other better. Moreover, when employees feel their opinions are valued and they have a voice in the organization, they’re more engaged and invested in their work.
Research shows 360-degree feedback can boost employee engagement by up to 25%, helping organizations turn feedback into fuel for performance and retention.
How to build a feedback culture at work (step-by-step)
To nurture a positive feedback culture, organizations must focus on both the environment and the tools they provide to their employees.
1. Help employees feel comfortable giving feedback.
Provide multiple avenues for employees to give feedback, whether it’s through anonymous surveys, suggestion boxes, or regular meetings. Recognize and appreciate employees who provide constructive feedback and reinforce that feedback, when given constructively, will not have negative repercussions. This can be part of the organization’s core values or communicated regularly by leaders.
2. Teach managers how to encourage and respond to feedback.
To lead by example, managers should actively seek feedback and act upon it or acknowledge it positively. Also, consider encouraging an open-door policy where team members can approach their managers with feedback without fear of judgment.
3. Train employees on how to give specific and actionable feedback.
Partner with organizations like LifeLabs Learning to conduct feedback skills workshops. These can provide employees with tools and techniques to give effective feedback.
4. Add feedback expectations into manager standards.
Make feedback a part of manager evaluations. How well a manager handles giving and receiving feedback can be turned into a key performance indicator.
5. Codify feedback in your organization’s values.
Make feedback one of the core values of the organization. This sends a clear message about its importance. Ensure that the importance of feedback is communicated to employees right from the onboarding stage and incorporated in employee handbooks.
6. Include feedback prompts in 1-1 templates.
Make feedback a standing agenda item in 1-1 meetings, ensuring it’s addressed regularly. Include questions that prompt feedback. For example, “What’s one thing I could have done better in our last project?” or “Do you have any suggestions for our next team meeting?”
→ Here’s a free downloadable 1-1 Agenda Template
7. Build retrospectives into project plans.
After completing a project, schedule a retrospective meeting to discuss what went well and areas of improvement.
→ Here’s a project retro template managers can use in their next project plan.
How employee feedback improves team performance: Using 360° performance reviews
The 360° performance review is a powerful tool, especially in an environment with a thriving feedback culture. When implemented effectively, organizations report an average performance improvement of 14.9%, making 360-degree feedback not only a culture builder but also a performance enhancer.
Unlike a single-source review, the 360° feedback technique ensures employees learn from almost everyone they interact with regularly, including but not limited to their superiors, peers, and subordinates (and sometimes even clients).
Harvard Business Review notes that 360° performance reviews, when administered correctly, lead to expanded self-awareness and an increased likelihood of change. There is a greater tendency to accept feedback when one realizes multiple people have the same opinion of them.
→ Want to upgrade your performance review process? Download The Performance Review Playbook
| What is an example of employee feedback? “I appreciated how you stepped in to lead the team meeting last week. You kept us focused and made sure everyone had a chance to contribute. One suggestion for next time: consider sending the agenda a bit earlier so people can prepare their updates in advance.” |
How to conduct a 360-degree performance review
There are many ways to incorporate 360° feedback into your performance review process. You can administer a digital survey, hire an external consultant, or organize direct employee-employee feedback.
Steps include:
1. All-around communication: Communicate the purpose, process, and benefits of the 360° performance review to all employees involved, and lay out clear expectations and guidelines on structuring feedback. Also, specify how the feedback will be used: is it for development, promotion, or both?
2. Raters selection: Choose a diverse group of raters, including supervisors, peers, subordinates, and sometimes even customers, to provide a well-rounded view of the employee’s performance. Ensure those providing feedback have worked closely with the individual in the recent past, ensuring the feedback is relevant and based on recent observations.
3. Ensuring anonymity: If raters know their feedback will be anonymous, they’re more likely to provide candid, honest input. You can also consider using a third-party tool or an external consultant to gather feedback to ensure confidentiality.
4. Data analysis and reporting: Collect and analyze the feedback data, identifying trends, strengths, and areas for improvement. Prepare a comprehensive report that serves as a helpful guide to the employee to direct their introspection and self-improvement. If the resources are available, consider including a personalized development plan.
5. Feedback discussion: Schedule a facilitated discussion between the employee and a manager or HR professional. This ensures feedback is understood and any emotional reactions are addressed constructively and empathetically.
Invest in Employee Feedback in Your Organization Today
Like any successful project, implementing a feedback culture that effectively encourages employee feedback won’t occur in a single, transformative leap but rather in a series of adjustments, refinements, and progressions over time. Just as software comes out in versions like 1.0, 1.1, 1.2, and so forth, feedback culture, too, evolves through phases.
LifeLabs Learning can be your partner as your company navigates these phases. Let’s build a robust and empowering feedback culture together. Speak to a consultant today!
FAQs:
What is multi-source feedback in performance reviews?
Multi-source feedback, also known as 360-degree feedback, collects input from peers, managers, and direct reports to give a complete picture of employee performance.
How does employee feedback improve performance reviews?
Employee feedback adds real-time, ground-level insights that managers might miss. It makes performance reviews more accurate, balanced, and helpful for development.
Does employee feedback improve engagement?
Yes. Studies show 360-degree feedback can increase engagement by up to 25% and improve retention.
Why do companies use 360-degree performance reviews?
Companies use 360 reviews to promote fairness, boost self-awareness, and support leadership development. More than 90% of Fortune 500 companies use some form of 360-degree feedback in their talent management strategy.
How do I implement 360-degree feedback in my organization?
Start by selecting a diverse group of reviewers, ensure anonymity, and provide clear instructions. Use digital tools or external consultants to streamline the process, analyze results, and support coaching conversations.
What tools can I use to gather employee feedback?
Tools like pulse surveys, 360-feedback platforms, project retros, and 1-on-1 templates help collect and organize employee feedback effectively.
Is employee feedback anonymous in 360 reviews?
Yes, 360-degree feedback is typically anonymous to encourage honest, constructive responses. Anonymous input helps build trust in the process and ensures more useful insights.
What are the benefits of creating a feedback culture?
A strong feedback culture improves communication, increases engagement, and helps people grow faster. Employees in feedback-rich environments are more likely to stay, perform better, and feel valued.
How often should employees receive feedback?
Ideally, employees should receive feedback weekly or biweekly, not just during annual reviews. Regular feedback leads to higher engagement, better performance, and fewer surprises during formal evaluations.
