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Technology Stocks : Lucent Technologies (LU) -- Ignore unavailable to you. Want to Upgrade?

To: Mr.Fun who wrote (13131)	1/31/2000 6:26:00 PM
From: Chuzzlewit	Respond to of 21876

Lucent's sales force is compensated on a fiscal year quota basis - meaning you get paid on what you sold as percentage of the quota assigned to you for the year. If you sell too much in the beginning of the fiscal year, your quota gets raised, so the sales force sandbags to the second half of the year, and in particular, September. The incentive to close business in September means there are no easy pickings for December. Of course most of the street doesn't get this, since December is SUPPOSED to be the big quarter (Check out Oracle's revenues in its FY4Q in May if you don't understand the impact of salesforce compensation). So LU tries to stretch and make tough number and when something goes wrong, the Q is so backend loaded, there is no time to do anything about it. Not a good thing, but not a monumental f*** up or evidence the company is broken. Sales force is mighty excited about prospects for a great 2nd half. What a horrible system! What genius is responsible for this, and when, if ever, will it change? TTFN, CTC

To: Mr.Fun who wrote (13131)	2/1/2000 8:14:00 AM
From: GVTucker	Respond to of 21876

Mr. Fun, RE: The incentive to close business in September means there are no easy pickings for December. Of course most of the street doesn't get this, since December is SUPPOSED to be the big quarter (Check out Oracle's revenues in its FY4Q in May if you don't understand the impact of salesforce compensation). ORCL spent about 4 years trying to get the Street to forget one of the offshoots of this compensation system, fabricating revenues in 1990. The Street has to some extent forgotten this little transgression, but for some strange reason ORCL still has not changed its compensation system for its salesforce, and this compensation system causes unnecessary volatility in revenues. Lucent should learn. When revenue volatility is caused by the normal cycles of business, you adjust to them (e.g. retail businesses and Christmas); when revenue volatility is caused by company policy, you should change the policy. There is no reason to keep the current system, when there are many other ways to properly motivate a salesforce.

To: Mr.Fun who wrote (13131)	2/3/2000 12:28:00 AM
From: Tera Bit	Respond to of 21876

Mr. Fun: I am wondering what your thoughts are on the comments made by LU after earnings wrt. the faster than expected migration to "new" technologies. Clearly, NT and LU are going to get their share of the optical build out. (especially at tier 1 providers) Do you have any thoughts on how some of the smaller upstarts might do in the optical/edge space? My sense is that Cerent is doing quite well and I suspect NT/LU will have a tough time challenging them at the edge. Any thoughts on Optical Networks, Sycamore, Corvis, Juniper, Redback? They have taken lots of optical talent from NT,LU and a boat load of router talent from CSCO in the last year or so. My sense is that if any of the upstarts combine they would be very, very tough on the big 3.