> Take a few minutes to conduct a 'performance review'

I have never seen a company implement a performance review:

  - That mattered
  - That would have detected anything
  - That would be more than the obvious

I feel that most performance reviews I've had have been at least pretty decent. Basically just going through what I've done the past 6 month, talking about what I'd like to be working on over the next 6 month and if there's anything that I should work on or might need to help me manage to do those things better. Often there is some sort of checklist that has be worked through, but I always get a few minutes to just talk in general about my work.

that sounds like feedback you should be getting in manager 1:1s, the formal review process isn't necessary

It's not even a performance review; it's just root cause analysis. Something like, "Why isn't Sally meeting her deliverables?" "Because she spends her time doing PM work." "Ok, let's see if she want to transfer roles."

Your world class Y people should have valued communication. They should raise red flags every time they need management to remove an obstacle in order to increase their productivity and realize their full potential.

They obviously should, but many don't. Some people don't like causing 'trouble', some people just quietly do what they're told, some people are just shy or introvert or have trouble communicating clearly. I good manager should be able to work with and get the most out of these sorts of people as well, without those people also having to the managers job for them.

From your brief description that sounds like a useful meeting. Useful enough to do more often than once or twice per year. But it doesn't really sound like a performance review.

If you retroactively define a performance review as whatever isn't good, of course they are bad.

And they were hired for y in the first place.