In an accompanying discussion on LinkedIn (Agile Alliance group), the blog author Henrik Martensson writes:
Two things to consider are that for rewards to be effective, the feedback loop must be short, and the rewards must be linked to behavior, not results. This is basic behavioral science, but most corporate reward systems miss it. Lean is an exception. Lean companies explicitly use Management By Means (MBM) instead of Management By Results (MBR). MBR practically guarantees dysfunctional behavior, regardless of the reward system used.
No doubt the controversy will continue, but I hope the discussion will cause leaders to challenge their assumptions about performance appraisals and develop better ways for improving the system used to deliver value to customers.