360 degree appraisals are usually successful if employees take the activity in the right spirit. If not, they will feel that one will retaliate to any adverse comment given by the other -> I-scratch-you-if-you-scratch-me attitude.

How will you solve this problem?

Just like Farmville is structured, one can structure the game in such a way that various levels can be constructed based on the real-life bands/levels in the organization. Whenever one joins, the person will join at the level he is currently working in the organization.

Based on his tasks and its impact, he will be rewarded points that will allow him to go different sub-levels. For example, if person A helps another person B to achieve his goal, B can reward A with some reward points. Similarly, when person B wins a new deal, his Manager will give him reward points based on the size of the deal.

Here, the achievements are structured and tangible while flexible enough to accommodate the non-tangible activities (like mentoring, coaching, etc) being done.

Also, the entire environment of the work is different now. It helps the organization take up challenges and work in a very informal (at the same time effective) manner.

The most important aspect of this solution is to leverage the Facebook experience of employees. Like all of us know, majority of us use the Social Networking sites like Facebook, Orkut, etc. Why not use this 'like' of people at work to improve productivity?

Appraisals from peers, colleagues, managers, reportees will come in form of money rather than actual words. That will make everyone give their feedback more freely (since it is in a way indirect method of providing feedback).

For example, if A is giving a feedback to B by giving him 5 coins of the possible 10, B will indirectly get to know what is the feedback of A.

Like all such initiatives, the major challenge is to structure the rewards, levels, expertise, etc that are part of the game. One can look at Farmville and take 'inspirations' accordingly.

Convicing the employees is another major issue - if the push comes from top-down, it will be easier to achieve the goal.

First step is to try it in one separate group, get feedback and then expand it to the entire organization.