The Power Law Distribution in Salary

In your book, you believe wide variations in pay among employees might actually be a good thing. In reality, we all hear about the 80-20 rule where 20 percent of your people generate 80 percent of your value. So what that means is if you're paying everyone, assuming that your very best people are only 10 or 20 percent better than average when really they're 50 or 100 or 200 or 500 percent,. You're underpaying your best people.