I really dig what the guys over at ChinaSolved.com have to say - I just caught this post on compensation options that really nails the concept of variable pay (as in more pay for performers) as far as I am concerned.

It?s not supposed to be fair.
You know this ? now they have to. You will be treating some members of your staff differently. They will get better compensation, better opportunities and more responsibility. Some of your young managers may find this stressful. Others will become power-crazed monsters. You will need to manage both...(http://www.chinasolved.com/blog/?p=275)

Anyone in sales understands that top performers make more. 

What I would like to see is more attention being paid to variable pay options rather than salary surveys in today?s fast-moving talent market.  Aside from the fact that salary surveys are obsolete the moment they are created we seem to be missing an incredibly important point in this talent driven market. 

Point:  There are not enough top candidates to go around.

The rest is all supply and demand economics in action.  It is getting pretty simple in today's market.  The companies that are willing to offer something special to the hard-to-find-even harder to recruit-top-talent are the companies that are able to get them and keep them. 

If you are able to quantify the contribution a top performer will make you should be able to find a way to get him or her on board and keep him or her happy.  If this upsets the "internal equity " of your department you may need to revisit the goals your CEO put in front of you.  I am willing to bet that "equity" in terms of equality was not on the list. 

There are a number of options out there to address this issue and I think it is about time that more companies in China took the time to look into them.  I have seen several companies miss out on talented individuals because their company?s compensation policies did not allow them the option of paying top talent the rate they are getting elsewhere.

Let me know if you have any good suggestions to combat this and I will happily post them here and on my personal blog, www.recruitinginchina.com.cn, in order to spread the word.

In the mean time, get back to work.  No one is paying you to be average.

Brian