The annual performance review — held once a year, covering the previous 12 months, tied to a salary decision the employee already knew was coming — is one of the most consistently hated processes in IT companies. It doesn't have to be.
The problem with annual-only reviews: a review that happens once a year is always a surprise. The developer who underperformed in Q1 has no feedback loop until Q4. The developer who excelled in Q2 has forgotten what they did by Q4. Recency bias dominates annual reviews — which means your Q3 and Q4 performance matters far more than your H1.
The modern alternative — continuous feedback + quarterly check-ins + annual calibration: monthly or bi-weekly 1:1s are the feedback layer (informal, real-time, no rating). Quarterly check-ins are the reflection layer (30 minutes, structured, covers: what went well, what to improve, goals for next quarter). The annual review becomes a calibration and compensation conversation — not a surprise.
OKRs for engineering teams: Objectives and Key Results work for engineering teams when applied correctly. The rule: no more than 3 OKRs per person per quarter, each with 2–3 measurable key results. OKRs that are too vague ("improve code quality") don't work. OKRs that are too prescriptive become task lists. The sweet spot is outcome-focused and measurable.
The rating scale problem: 1–5 scales with forced distributions ("only 10% can be 5") are deeply demotivating and statistically meaningless for small teams. Several SIC members have moved to a simple 3-tier system: "Meeting Expectations / Exceeding Expectations / Not Meeting Expectations" with clear behavioral descriptions for each. Much easier to calibrate, much easier to communicate.
Peer feedback done right: 360-degree feedback is valuable when done anonymously, with specific questions ("Name one thing this person should do more of / less of / keep doing"), and when the output is shared directly with the individual. 360 feedback that only goes to HR and never reaches the subject is wasted effort.
Separating performance conversations from compensation conversations: the best practice is a one-week gap between the performance conversation ("here's how you've done") and the compensation conversation ("here's what that means for your salary"). When they happen in the same meeting, the employee hears only the number and misses the feedback.
"When the performance review and the salary conversation happen in the same meeting, the employee hears only the number. Separate them by at least a week."
