Local (DCOM) connections are only supported for ArcGIS Server versions prior to 10.1.
About ArcGIS for Server application performance tuning
Developing ArcGIS for Server applications is based on programming ArcObjects remotely. The Server application programming interface (API) is extensive and includes numerous ArcObjects components that are organized into object libraries. Developers can build all types of applications using the Server API, from high-performance, scalable applications to slower applications that do not scale.
The performance quality of an application depends on the developer and the geographic information system (GIS) server administrator working together to design an application that performs and scales given the available hardware resources. There are a variety of techniques that can be used when developing an application to optimize performance. For more information about these techniques, see the following topics: