"In Engineering, we tend to hold this idea that these people systems —career ladders, performance reviews, calibration — are these evil things that aren't very valuable. They're thought of as bureaucracy. But it's a shame. These are really powerful systems, and I'm actually excited to personally spend a lot of time with them."
Will Larson, who was previously an engineering leader at Digg and then Uber, now leads Foundation Engineering at Stripe. His organization partners with Infrastructure, Data, and Developer Productivity teams to build the tools that support every Stripe engineer and keep Stripe reliable and performant.
You can go about building a performance management system in uncountable ways, but Larson points out that most of them are comprised of three core elements: career ladders, performance designations, and performance cycles. These combined systems focus your team's efforts on the activities and metrics that ultimately help the organization succeed, by providing direct feedback to engineers on how valuable their work is (and by measuring it against expectations).