What are the benefits of a merit pay plan?

Merit pay plan is really beneficial as the employee will concentrate more on the merit rather than hard work,In this competitive world merit is more essential than mere hard work,smart work plays a vital role in achieving the success,lets consider a well known example of the race between the rabbit and the turtle,here tortoise won the race for the application of the brain rather than only believing in hard work.Through Merit pay everyone tries to excel his/her merit in order to increase the pay,this is a benefit for the company as many of its employees will be more competitive and potential comparative to other companies.