If the company performed well, and politics or weird accounting ju-jitsu is the reason for lower raises either across the board or in your department, you can p

If the company performed well, and politics or weird accounting ju-jitsu is the reason for lower raises either across the board or in your department, you can push for the top 2-3 employees to be awarded RSUs or stock options, those usually are very well received and they're good retention mechanisms. If somebody has ever come to you looking for a promotion or transfer (either works in this case), give them a great annual review (meaning: huge praise, no nitpicking) so they have a better chance at escaping your clearly underappreciated team. Otherwise, give the news 1:1 (no team meeting for bad news please) and tell the truth, but not bitterly, and don't linger on the topic. Explain the priorities for next year. As far as your own position, you need to figure out (with top management/your management) how your department is seen, who decides of the final allocation, and why you're getting scraps. Money is feedback and the feedback you're given is no one care about you or your team. No it doesn't matter if they say otherwise, what matters is their actions.