"financial management"

Tue 26 January 2021
The goal of a 360-degree assessment is to identify blind spots and vulnerabilities in your professional skillset. By getting feedback from your colleagues and comparing their perspectives to your self-assessment, you can get a deeper understanding of your work performance. 

There are generally 3 outcomes from a 360-degree assessment: 1) somebody has underestimated their abilities, 2) somebody has overestimated their abilities, or 3) somebody is self-aware about their abilities. There are ten other articles addressing the two other possible outcomes of a 360-Degree Assessment available here:

Self-Aware - People Management, Innovation, Leadership Ability, Communication Skills, and Financial Management

Overestimating -  People Management, Innovation, Leadership Ability, Communication Skills, and Financial Management

Understanding Underestimating your Abilities for 360-Degree Assessments

When somebody has underestimated their abilities, they are essentially giving themselves a lower score for whatever category is being measured compared to their colleagues’ score of them. At first glance, this may seem like a positive thing: “If my colleagues believe that I’m better than my self-assessed performance, then I must be doing pretty well!” This is partially true, but this article will shed light and provide examples of how underestimating your abilities can be an opportunity for improvement.

When my team and I at Ambition In Motion facilitate mentorship programs, we also include our 360-Degree Assessment (and its report) to each participant. We’ve found that our members use these insights to reveal the areas most in need of improvement. This has helped members identify the best course for professional growth and helps provide a major launching pad for helping them open up and be vulnerable in their mentor relationships.

The 5 core areas we measure in our 360-degree assessment are People Management, Innovation, Leadership Ability, Communication Skills, and Financial Management.

This article is one in a series of articles focused on why underestimating one's score on a 360-degree assessment report based on the 5 core areas listed in the paragraph above is not necessarily advantageous for one’s career.

Financial Management

Financial management is a skill that is often overlooked but can have a large impact on the company. Financial management is based on one’s ability to manage the resources they oversee (including their time and the way they are spending their time at work), a company budget, and others’ perception of a person being fiscally responsible.

If you gave yourself a lower score than your colleagues did on your financial management, that could indicate that your team is unaware of the way you are spending resources or that you don’t trust yourself as much as your team trusts you with financial management.

Your team is unaware of the way you are spending resources

If you are in charge of a budget and the only thing your team sees is whether or not you are able to pay for things (e.g. their pay stubs and other amenities around work), it can be easy to understand why your team would think that you are managing the funds optimally. When teams are left in the dark, all they can formulate is their perception of what is going. If you put on a good face and they consistently get their check, they may feel like there is nothing to worry about. If you feel like you have made some poor financial choices, your team could be completely unaware of these choices (or their effects). If you aren’t directly in charge of a budget, you could be wasting time or resources at work. If everyone sees you at work and it seems like you are working hard, most people won’t question whether you are putting in an optimum effort. If you know that you could be more efficient or productive at work and others don’t know, that could be a reason for a gap between self-perception and colleague perception.

You don’t trust yourself as much as your team trusts you with finances

In school, many people get stuck in the rut of being “naturally just bad at math”, and they let this label hinder their ability to grow their math skills. In the professional world, a similar issue can arise with Financial Management skills. Many people have been conditioned to believe that they just aren’t great at managing finances because of things that have happened in their own or their family’s past.

Here are a few solutions to help close the gap in one’s financial management. Ask your colleagues why they believe you are so strong in financial management. Try to find out what specific tasks you do and actions you take that give them that impression. Share your expenses with your team and try to find out whether you could be better at managing them. Be sure to listen to their feedback and incorporate useful ideas into your own methods. And if you manage your team’s budget, create incentives that encourage cost-consciousness. If you don’t manage your team’s budget, ask the person who does which parts of your work are the most prone to waste and ask for feedback on how you can be more efficient.

Counter-argument

The eternal counter-argument to this is “I just set the bar really high and I feel like I am not where I would like to be in this area.” If that is the case, then you are not effectively communicating your standards to those you work with. If your colleagues don’t know your standards, then they can’t properly assess your abilities in relation to those standards.  

Overall, the goal of a 360-degree assessment and report is to identify the gaps and blindspots one may have so then they can improve their performance. The goal is to be self-aware, thus enabling you to work towards excellence in each area. Underestimating your performance might feel good at first because it shows others think highly of you, but continually failing to meet your own expectations means that you risk burning out or losing engagement. So, try being honest with yourself and setting honest goals. Professional growth is a slow process that takes dedication, consistency, and honesty, but by following the path, we are all capable of becoming our best selves.

Mon 1 February 2021
A 360-degree assessment is a unique survey that uses input from self-assessment and from colleagues’ assessments to understand a professional’s strengths, weaknesses, and blind spots. By gathering feedback from your colleagues alongside your own perspective on those same questions, we can get a deeper look at how your self-perception compares to the way your colleagues see you. 

With this data, we can break down the results of a 360-Degree Assessment into three outcomes: 

1) Somebody has underestimated their abilities (self-rating lower than colleagues’ ratings), 

2) Somebody has overestimated their abilities (self-rating higher than colleagues’), 
 or
 3) Somebody is self-aware about their abilities (self-rating matches colleagues’).

This article is going to address some possible problems and solutions that might arise for people who are self-aware of their abilities. This article is part of a series I’m writing about Ambition In Motion’s 360-Degree Assessments and how their results should be interpreted. There are ten other articles addressing the two other possible outcomes of a 360-Degree Assessment available here:

Overestimating - People Management, Innovation, Leadership Ability, Communication Skills, and Financial Management 

Understanding Self-Awareness for 360-Degree Assessments

When somebody is self-aware about their abilities, this means that they gave themselves a similar score as the score their colleagues provided on the same skill. 

Initially, self-awareness may seem to be a cut-and-dry positive outcome but looking a bit deeper reveals some potential issues. After all, the goal of a 360-degree assessment is to identify blind spots and close the gaps between one’s self-perception and the perception of their colleagues. However, we find that there are opportunities for growth within a self-aware 360-degree assessment report and this article will review those opportunities.

At Ambition In Motion, our 360-Degree Assessment has 5 core components: 

a.                People Management
b.                Innovation
c.                Leadership Ability
d.                Communication Skills, and 
e.                Financial Management.

While self-awareness is likely the best outcome relative to the other two possibilities, I’m next going to explain how you can leverage self-awareness to grow as a professional and identify blind spots in your professional perspective. I’m going to show why self-awareness on your 360-Degree Assessment is more than just a pat on the back, even if you and your colleagues share similar views on your performance. 

Financial Management

Financial management is a skill that is often overlooked but can have a large impact on the company. Financial management is based on one’s ability to manage the resources they oversee (including their time and the way they are spending their time at work), a company budget, and others’ perception of a person being fiscally responsible. 

If your colleagues' assessment of your financial management abilities is aligned with your own, that can be a very good thing or an opportunity for growth – depending on whether or not the score was high or low.

Self-Awareness but poor performance

If you rated yourself low in your ability to manage finances and your colleagues agree with you, this can be a major opportunity for growth. 

Before diving into the implications behind why this is an opportunity for growth, it is probably wise to assess, internally, the reasons for your low self-rating and why your colleagues would also rate you low.

In terms of yourself, why would you rate yourself low on your ability to manage your finances? Are you taking (or have taken) actions that are financially detrimental to the company? If so, did you learn and alter your actions from the circumstance? Or do you think that you simply could be doing more or doing better overall?  

One of the largest expenses for a company is human capital. Some managers will rate themselves low in financial management because they are unwilling to have difficult conversations with colleagues about productivity, and those colleagues don’t realize the implications that their actions may have on the financial viability of the company.

This is the type of outcome many tech startups find themselves in. Essentially, they will raise money with the anticipation that by the time the money runs out, they will have garnered enough traction to justify a follow-on round of investment or have enough revenue to cover expenses. The area that most startup founders struggle with is managing the finances. More often than not, they believe they have a strong idea that requires strong employees (with high salaries) to implement the idea. The ultimate balance is between quality talent (and the funds used to pay them) compared to what they produce and the relative difference in outcomes between a top-paid team and a lower-paid group of professionals. Analyzing which aspects of the business require top caliber salaries is crucial because the drop off between the top-caliber and a solid hire but with less pay can be extensive in terms of the effect on the company’s bottom line. 

If you don’t manage a team, you might think to yourself “I don’t manage a budget therefore my ability to manage finances doesn’t really matter.”

I am going to make the argument that this notion is not correct at all.

If you are paid a salary (or hourly) for the time you put in at work, you manage finances – that being the time you spend working and how effective you are in the time you do spend at work. In some cases there are egregious misuses of time like taking actions detrimental to the business like working on non-work tasks while on the clock, spreading rumors or negative gossip about other employees, and clocking in late or early. 

There is also the contemplation of whether you are optimally using your work time. For example, if you know your brain is optimally effective in the morning, you should be considering that with your daily schedule. If you choose to pursue social tasks or tasks that don’t require deep thinking in the morning, you could be squandering your brain’s daily threshold of deep mental focus. If you have open office hours or are expected to have your emails checked and responded to within an hour, you are diminishing your ability to complete any task that requires focus because you are constantly having to check your email.

Think of your salary as a budget your company allocates to you to be optimally effective at work. Are there components to this budget that are misused or could time be reallocated in a way that is leveraged more effectively? That is a question you will have to answer for yourself, but once you get to a point where you feel like you are optimally leveraging your time at work, you can start to see improvements in your ability to manage the most important budget your company entrusts you with, your salary/time.

The biggest counterpoint I hear about why not be optimally effective with your work time is “everyone else clocks out early or takes breaks more frequently than advised. There doesn’t seem to be a financial incentive to perform any more optimally, so why should I work on optimizing this?”

The answer is that how others work should not affect how you work. Back to the analogy of considering your salary like a budget your company entrusts you with. If somebody mismanages their budget, does that justify that you should mismanage your own? 

Of course not! But this is a trap that people fall into all the time.

If you gave yourself a low score for your financial management abilities and your colleagues agree with you, that is a sign that you can improve yourself.

The best way to improve your abilities in this area is to research methods for best managing your time and creating a schedule for yourself that allows you to get the optimum amount of work done in a day given your unique set of responsibilities. This is not a one-size-fits-all solution as everyone has different work tasks. If your role requires you to frequently check emails, perhaps creating a space in time once or twice a day set aside for checking your emails. You could even create a “vacation” response informing senders when you will be checking your emails next so they can anticipate a response. Of course, this would need to account for specific time-sensitive requests if necessary. 

If you are willing to take action to start improving your efficiency at work (and encouraging your team as well, if necessary) you can start to measure whether what you tried worked or didn’t work. The best way to achieve improvement is to try things you haven’t tried before.

Self-Awareness and high performance

If you rated yourself relatively high on your financial management abilities and your colleagues agreed with you, that is excellent. That is a positive sign that you are properly managing the time you are paid for both in terms of your salary and (if applicable) the budgets you have responsibility over. 

However, this is not necessarily something to get caught up in because there could be factors contributing to your colleagues' (potentially generous) rating or a lack of self-awareness causing you to rate yourself high. This may not be the case, but it is important to point out examples of these types of situations so you can assess whether they hold any weight.

For those who manage a budget, oftentimes their team will rate their financial management abilities high because as long as they receive their paycheck every two weeks, nothing else really matters. Many teams are completely unaware of which activities are the most expensive to the business. Most employees don’t understand the relative dollars they generate from their work and the specifics of why paying their specific salary is a financially responsible decision. 

Let’s use a pizza restaurant as an example. Say there are 3 people working inside the pizza place each making $10/hour and an additional manager making $20/hour. On top of that, the cost of running the ovens and the electricity comes out to roughly $5 per hour. If each pizza costs $10 and the company on average sells 10 pizzas every hour, they are driving an average net profit of $45 per hour. If the employees of the pizza place understand this, they can work on ways to try and sell more pizzas in the same hour to improve their own performance and the performance of the company – making them more valuable to the company.

Some leaders might read this story and start playing the “what if” game (e.g. what if my employee's demand raises because they understand the financial impact of their work?), coming up with every bad possible outcome if their employees knew their financial value to the company. But these old thought patterns should be reconsidered with new research.

In research from companies that leverage Open Book Management, companies in which the employees have a greater understanding of the financial implications of the company’s decisions perform better and are more profitable than companies who don’t. Conversations around raises and relative improvements to the business become substantially more tangible and objective when there is hard data justifying and showing how one person’s improved efficiency deserves greater compensation, especially compared to the “everyone gets a raise just because!” method of giving raises.

If you are an individual contributor for your company and you don’t manage a budget, per se, you still manage your time. If you consider your salary as a budget your company has entrusted you to manage, are you optimally using that budget?

One way to make improvements in this area is to identify potential opportunities for you to become more efficient at work. You could ask your boss or co-workers for feedback on ways you can be more efficient at work. And you could also provide some (ideally research or evidence-backed) suggestions for ways you have identified to help make yourself more efficient at work. Your manager will likely appreciate your drive for improvement and the fact that you came prepared with research-backed suggestions on ways you could improve your own efficiency and work output.

Overall, having a self-aware response on your 360-degree assessment report isn’t a free pass to give in to stagnation. It simply shows that you and your colleagues are on the same page. But, it doesn’t mean that there isn’t room for improvement. The implications from having a self-aware score are not wholly positive or wholly negative. Instead, it is a snapshot of your current performance which can help you make informed decisions about where you need improvement. As long as you possess an open-mindedness about making improvements and are willing to measure whether the new changes worked, you can ensure that you are on a positive track towards continual growth and improvement.

Wed 17 February 2021
A 360-degree assessment helps you understand your professional performance by having both you and your colleagues assess your abilities across several key skills. 

The goal of a 360-degree assessment is to identify blind spots and vulnerabilities in your professional skillset. By getting feedback from your colleagues and comparing their perspectives to your self-assessment, you can get a deeper understanding of your work performance.  

There are generally 3 outcomes from a 360-degree assessment: 1) somebody has underestimated their abilities, 2) somebody has overestimated their abilities, or 3) somebody is self-aware about their abilities. 

This article is going to address some possible problems and solutions that might arise for people who have overestimated their abilities. This article is part of a series I’m writing about Ambition In Motion’s 360-Degree Assessments and how their results should be interpreted. There are ten other articles addressing the two other possible outcomes of a 360-Degree Assessment available here:


When somebody has overestimated their abilities, they are essentially giving themselves a greater score for whatever category is being measured compared to their colleagues’ scores of them.

At first glance, this can sting because you are essentially learning that your perception of yourself is greater than your colleagues' perception of you which may cause one to think “I must not be as good as I think I am” or “My colleagues must not realize all of the things I do to be strong in this area.”

For most people, the answer is somewhere in the middle. 

When my team and I at Ambition In Motion facilitate mentorship programs, we also include a 360-Degree Assessment and report to each participant. We do this for two reasons: 1) these reports can help reveal opportunities for growth in one’s professional skill set, and 2) deep self-reflection is a major launching pad for fostering vulnerability in a mentor relationship. These two components are crucial to developing strong, valuable mentor relationships. 

The 5 core areas we measure in our 360-Degree Assessment are: People Management, Innovation, Leadership Ability, Communication Skills, and Financial Management.

Next, I’ll explain the significance of each of these categories, and then suggest ways that someone can learn after finding out they are overestimating their abilities in each category. This should be an opportunity for growth and understanding, not a time to be defensive and stubborn.

Financial Management

Financial management is a skill that is often overlooked but can have a large impact on the company. Financial management is based on one’s ability to manage the resources they oversee (including their time and the way they are spending their time at work), a company budget, and others’ perception of a person being fiscally responsible.

If you have overestimated your financial management abilities, you have either given yourself a moderate score and your colleagues rated you low or you gave yourself and high score and your colleagues rated you moderately or low.

You rated yourself moderately

If you rated yourself moderately in terms of your financial management, there are a few possible explanations. Perhaps you aren’t in charge of a budget, or maybe you don’t think that managing finances is that critical to your role. 

If your colleagues rated you low for financial management then that is a sign that there is an opportunity for growth for your abilities.

This is also typically a sign that others believe you could be more effective or efficient with your work. Even if you aren’t in charge of a formal budget, you are responsible for your time and how effective you are with the time you spend at work. 

By giving yourself a moderate score, you might think that you are doing enough to get by and do the “normal” amount of work compared to your colleagues. But if your colleagues rated you low, they clearly do not see it that way.

Your colleagues' low score indicates that you are either spending either company dollars or company time on things that aren’t helpful to the business. We aren’t robots; everyone does this to some degree, but once your colleagues start to notice, that’s a strong sign that you need to do better.

Dr. Robert Cialdini has a concept called “what is focal is causal” meaning that what people see is what they perceive and internalize as important or significant. If people are giving you a low score on your financial management ability, they perceive you as lazy, or looking for ways to get out of work, or as someone who spends money recklessly; no matter which way they perceive it, they end up realizing that you shouldn’t be trusted with a budget.

Before getting your results on a 360-Degree Assessment, you may think others aren’t noticing, or that others in the company are way more wasteful than you. However, clearly in the perception of your colleagues, that is not the case and you have been put on notice.

You rated yourself highly

If you rated yourself high on your financial management abilities but your colleagues gave you a low or moderate score, it indicates that you aren’t as strong of a financial manager (in the perspective of your team) as you think you are.

This typically stems from a lack of communication. If you manage a budget and your team sees you spending money on things that seem lavish and unnecessary (from their perspective), this can cause them to feel like you aren’t managing your company’s finances appropriately. This feeling is magnified if they feel underpaid while seeing this. If you don’t manage a budget and your team gave you a low or moderate financial management score, it means that they don’t believe that you spend your time at work effectively or that you are overpaid for your work. If salaries aren’t public information, people make assumptions for income based on your lifestyle, and if your lifestyle appears to be better than others, especially if they see you doing the same or less work than them, they will notice.

If people at your work are staying late and getting in early, and meanwhile they see you working the base 9 to 5, then that may cause them to become frustrated. They might think that either you are lazy, or that you are expecting more from them than is fair. What they may not realize is that your work responsibilities might be deeply analytical and have a compounding impact on the business, or they might not see the parts of your job that take place outside the office. For example, some work directly correlates time with output – essentially the company can get a certain number of tasks done by an employee for every hour they are at work; this is called linear productivity. On the other hand, there is work that, with intentional deep thinking, has an exponential impact on output in shorter bursts, but with increasingly marginal returns over a long period of time; this is called exponential productivity. Not every job has the same types of tasks and productivity needs; but without your open communication with your team, you can end up looking like a slacker. 

The point is that until the truth is communicated to those you work with, they will form assumptions to fill in the gaps as to why things are happening the way that they are. Unfortunately, many of these assumptions are negative.

The best thing you can do to improve your financial management abilities, both for you and for how your team perceives you, is to communicate and learn. New innovations are constantly happening to make our work more efficient and effective. If we are open to learning about these tools and resources, we can ensure we are up to date on what needs to be done to be most effective at work – both for managing a budget and managing our time at work. Communicating effectively to those we work with allows them to know how we are spending our budget and our time. The more we can loop our team in on budget decisions and decisions about how to best spend our time, the more aware they will be as to what we are doing and how that is impacting the business. The best-run companies did not end up that way by accident; they intentionally fostered a company culture of honesty, hard work, and accountability from the top down and that pays dividends when everyone is brought into the fold.

In essence, overestimating your abilities in these categories does not mean that you will forever be this way, but it does mean that there are opportunities for growth that you must tap into if you would like to improve. 

Building Mentor Connections Through Work Orientation

Kickstarting Mentorships For Fulfilling Careers