One of the great mysteries in life from a Talent perspective is the holy grail of pay-for-performance. Like Bono and U2, I still haven't found what I'm looking for.  Here are some of the deep thoughts I'm still searching for an answer to:

1.  If you have a fixed merit increase budget, how high do you have to stoke the increases for your top performers before the increases are viewed as significant?

2.  What's the damage to your average and below average performers if you have to take their increases BELOW the average to accommodate the A-players?

3.  Should you care that average performers might not even get a cost of living sized increase as you accommodate your stars?

4.  What's the relative value of paying your top performers more via the merit budget vs. giving your average performers at least an average increase?

Understand I have opinions - just like you.  The problem is that my takes are just that - opinions - and there really isn't any science behind what I think - just a gut on what I have experienced in my career.  That, of course, plays into employment law, where the comparable worth provision of toxic bills, like the Equal Pay Act, looks to take the teeth out of concepts like pay-for-performance.

Luckily, some industries have figured out that the rubber meets the road when the work is distributed, not when it's time to do an annual review.  That means they know who's productive and who's not before assigning work, then assign the work to the best available team member.

Free agent nation, baby. More on the art of directing work to the most productive workers from the New York Times:

"But what happens in the information age, when workers are no longer there in front of the manager, but working from home — maybe in their pajamas, or maybe with a cat on their lap and a peppy Lily Allen tune playing on the iPod? In many managers’ eyes, they wouldn’t do as much work.

No worries. Software becomes the new Panopticon. It can monitor workers who, conveniently, do most of their work on computers. It can also measure their efforts and direct work to those who do it best. LiveOps, a rapidly growing company in Santa Clara, Calif., that operates virtual call centers — agents working from home across the country — has also found that software can perform other management tasks. How it uses that software points to the direction in which technology is taking the workplace.

Founded in 2000, LiveOps fields some 20,000 “home agents,” all independent contractors who take orders for products advertised on late-night TV, sell insurance or transcribe recordings for other companies. The agents even take pizza orders. If there is a storm in a particular city and pizza orders surge because no one is going out, calls to the pizza store are routed to LiveOps agents thousands of miles away. (The delivery boy still has to brave the rain and the wind. Software hasn’t solved that problem.)

But Maynard Webb, the chief executive of LiveOps, says he thinks that the company’s software gives clients like Kodak, Colonial Penn and TristarProductions, a direct marketing company, an advantage. The software moves a company beyond simple cost-cutting. Mr. Webb says greater efficiencies can be found because the company’s software measures the results from each agent according to criteria determined by the client.

If a client wants agents to persuade callers to buy additional products, the software tracks that — and then directs calls to the agents who do it best. Those agents prosper.What about the agents who aren’t so good? “No one gets fired,” Mr. Webb said. “They just don’t get work.”  Software becomes a passive-aggressive manager."

No one gets fired, they just don't get work.  And if you only get paid when you get work, that seems to be a pretty strong motivator.  Brave new world..

Mad or feeling like you should sue because you aren't getting paid?  Check the stats - oh, YOU DIDN"T MAKE A SINGLE UPSELL WITH THE FIRST 1,000 CALLS WE GAVE YOU.  Film at 11, save yourself the trip to file the lawsuit...

Call Centers are the low hanging fruit for this type of measurement.  Can we get some of that in the HR World?  Probably will be a few years...