Predicting Business Success: Using Assessments to Improve Business Impact

Part 3

By Scott Mondore, Hannah Spell, Matt Betts and Shane Douthitt August 28, 2018
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This article is one in a three-part series of excerpts from Predicting Business Success (SHRM, 2018) by Scott Mondore, Hannah Spell, Matt Betts, and Shane Douthitt. 

Part 1: 6 Steps to Becoming a Business Partner

Part 2: Avoiding Benchmark Myopia

Part 3: Using Assessments to Improve Business Impact 

360-degree (or multi-rater) assessments, like employee surveys, are widely used in organizations of all sizes in all industries. While they are widely used, there are numerous opportunities to use smarter analytics to improve their impact in organizations. This article will show you how to take a classic assessment approach (the multi-rater 360°) and use smarter analytics to

  • Connect 360° data to actual business results,
  • Make 360° assessments a business driver for all leaders at all levels,
  • Analyze 360° data holistically to look for broader trends and inform leadership development programs, and
  • Integrate 360° data with other data points (e.g., employee surveys) to gain more detailed views of performance.

Industry thought leaders will often write articles and blogs proclaiming that a process that has been used for a long time should be declared dead and never be used again by organizations. 360º assessments have been under the microscope recently, and it is fair to ask what the ROI of these types of assessments is. The good news is that 360º assessments, using smarter analytics, directly impact business outcomes and provide key information regarding needs assessments, leadership gaps, and even succession planning. Data integration, which has advanced in recent years, also increases the value of 360º assessments.

One of the big obstacles, as with most assessments, is getting the recipient of the feedback to take action on the results. When it comes to 360s, there is often pushback if the feedback is not over positive. If it is average, then there may not be a sense of urgency to work on anything. The question becomes: How do we overcome the obstacles to getting leaders to take action on their feedback?

At minimum, you need to set expectations early in the process that this is not just an exercise in rating each other: providing 360° ratings is just the first step. Instead of just providing reports of scores or a list of strengths or weaknesses with little direction on what they or action to be taken, organizations on the forefront of smarter analytics have embraced new technologies around 360s. For example, some connect the behaviors and competencies measured in the 360s to actual business outcome data (sales, quality, individual performance, etc.), using advanced analytical techniques to show impact. By using a more advanced analytical approach, leaders are able to prioritize which competencies and behaviors have the greatest impact on actual business outcomes.

Once those key behaviors and competencies are identified, 360º participants need to take action. Providing the 360º participants with access to their business drivers is a start, but two key components to drive real action are to (1) show them which competencies and behaviors have the biggest business impact and (2) provide them with action-planning tips, online courses, best practices, and so on. In today's environment, technology, like our SMD Link, can facilitate and automate proven action tips that leaders can implement in the workplace. For 360s to be effective, you must go beyond simply gauging satisfaction with the multi-rater assessment process and make the findings actionable for frontline leaders by linking the process to meaningful business outcomes.

Additionally, technology is helping facilitate the process and removing the stigma surrounding 360º assessments. As you know, 360s can be time consuming for raters when they are asked to rate multiple targets. Advances in technology, such as applications that can be used on multiple types of devices, and improved designs that facilitate ease of use (e.g., not having to scroll to answer items) are really removing the pain often felt by raters. Ultimately, this helps get raters on board with the process and can help build senior leadership buy-in. The more raters, the more buy-in, leading to better data and quicker follow-up action.

Because a 360º assessment is predicated on having a behavioral content to administer, a valid competency model is a perfect basis for this type of assessment. A competency model, by definition, should be made up of the critical competencies and underlying behaviors that are important for a role, job type, or job family. Thus, the competency model content aligns well with the purpose of a 360º-- to understand behavioral strengths and weaknesses that impact performance and business outcomes.

To align the competency model behaviors with the administrative needs of a 360º, the behaviors within the competency model need to be written in a way that raters can read each behavior as a statement with which they can agree or disagree on a scale. For example, if the behavior within a competency model is about setting clear performance expectations to those who report directly to them." Alternative formats should also be developed for the self-rating component, such as "I provide clear performance expectations to my direct reports."

Once the content from the competency model has been written in a way that can be administered in a 360º assessment, the 360º can be administered and then the focus is on the analytics to connect the 360º ratings to business performance metrics. Connecting to business outcomes will allow the prioritization among the competencies and behaviors for individual and systemic developmental focus. 

Please visit the SHRMStore to order a copy of Predicting Business Success by Scott Mondore, Hannah Spell, Matt Betts, and Shane Douthitt.

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