If you're not very close to the money, that's very hard. You can measure the team's productivity, but going down to the individual level is difficult. The process is also fundamentally political in the sense that it is a zero-sum game: there is almost always a certain budget available, independently of how individual people perform. The best short description I know about the constraints of performance reviews was written by Sinofsky: https://medium.learningbyshipping.com/performance-of-perform...

This is something that has to be done, but I know very few managers who enjoy the formal evaluation periods. That's certainly the part I myself enjoy the least.