What is Magento's Compilation feature?
The Compilation feature of Magento will allow you to compile all files of a Magento installation in order to create a single include path to increase performance. The performance increase is between 25%-50% on page loads. In order to use this tool, the directory 'includes' and the file 'includes/config.php' must both be writable.
Important: Before you make any changes to your Magento installation you should always disable compilation. Once the changes are made, run the compilation process, and then enable it.