Linux guests' performance may be improved if they have been created without much thought.
Always use a single VCPU when the CPU capacity requirement of the VM allows it.
Install VMware Tools and keep it updated.
Add the options "nosmp noapic nolapic clock=pit" to the guest's kernel (2.6) parameters. Don't add "nosmp" if using more than one VCPU.
Note clock=pit is depracted since kernel 2.6.16. Use clocksource=pit instead if your kernel is newer than that.
On RHEL 5.1 (and variants such as CentOS 5.1) add the option divider=10 to the kernel boot parameters. This causes the default clock tick rate, 1000HZ to be divided by 10, so HZ=100. On other distros, try using a kernel with Hz=100. Most 2.6 desktop distros are using HZ=1000, while the server distros tend to use HZ=100 or HZ=250.
See also http://kb.vmware.com/kb/775 and http://bugs.centos.org/view.php?id=2189
You might also benefit from optimizing the host: I need more performance out of my VMware environment