Effective feedback to and assessment of team members

Formal assessment of the team members is very much subjective in most of the companies. It is dependent on the company culture, personality and expectations. Assessment is done by the human beings on some point based system (1-5 or 1-10) that can easily have error of 10% to 20% (depending on what point system was used).
Some of the companies try to assessment project quite objective and quantitative using different methods. 360 is one of the most famous ways to have objective feedback about an employee but in most of the cases your line manager has largest share on your feedback.
Whatever method is used, employees of the organization should have clear idea about the methods used and implication of the output on the individuals. Rules of the assessment should be defined unambiguously so that the assessor and the assessed don’t have scope for argument. But the project managers should be ready for the difficult performance related discussions.
HR can take role of psychological support before and after the assessment. Performance is good or bad, candidate needs support for the next action and how to progress next and achieve targets for the next assessment.
To make it amicable experience, assessment should be of specific targets and how they will be measured should be explained when the targets are set. Targets should be realistic and achievable. Just by imposing some targets those are not realistic will not serve any good to anyone.
Individuals' performance can be improved if assessments are conducted with integrity, skill and communication and can help in building professional excellence.