Thousands of research articles have been published on the practice of performance appraisals. Most researchers find that such appraisals are exceedingly noisy. This sobering conclusion comes mostly from studies based on 360-degree performance reviews, in which multiple raters provide input on the same person being rated, usually on multiple dimensions of performance. When this analysis is conducted, the result is not pretty. Studies often find that true variance, that is, variance attributable to the person’s performance, accounts for no more than 20 to 30% of the total variance. The rest, 70
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