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There are many formula methods for calculating the sales compensation payments for sales representatives These formula methods fall into two major groupings: target incentive commission formula (TICommission) and target incentive bonus formula (TI-Bonus) In both cases, the construction of the incentive plan begins with identifying a target incentive amount Once the target incentive amount is selected, a commission or bonus formula is identified to provide the calculation engine for the sales compensation payout The differences between the TI-Commission and the TI-Bonus are described below A TI-Commission looks very much like the commission schedule used for income producersThe incentive payment is expressed as a percent of sales results or payment per unit However, while the formula constructs look almost identical to those used for income producers, the underlying design assumptions are very different For sales representatives, each job title is assigned a target incentive amount Assuming that the territories are of equal potential, a commission rate is calculated to ensure that the target incentive level of pay is earned for the target level of expected performance The formula for calculating a commission rate is as follows: target incentive amount target volume Or, as an illustration: $100,000 $2,000,000 100 5% commission rate 100 commission rate

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services optimally and hence maximize the potential revenue from customers It also provides convenience and simpler management by using a single physical interface for multiple services (as noted in the end-user benefit discussion) Ethernet enables Service Providers to modify or upgrade the services offered to enterprise customers remotely This capability offers the Service Providers two major benefits (apart from speedy delivery for the enterprise user): reduced cost of introducing additional bandwidth and an increase in revenue velocity For example, given the acceptably low marginal cost of deploying a 1000M versus a 100M connection, Service Providers can physically provision a 1000M port even when the customer initially requires much less bandwidth, say 25M In this case, the Service Provider would only commission 25M of bandwidth (ie, the customer can only use 25M even though the physical port can support up to a 1000M) Then, when there is a demand for higher bandwidth in the future (as will invariably be the case), the Service Provider can increase bandwidth remotely using software and without having to send a technician (truck roll) to the site and without having to bring down the service for any meaningful amount of time (perhaps for no more than a few minutes) Speedy delivery of additional bandwidth, unprecedented in the TDM world, is increasingly expected these days With TDM, this would simply not be possible; there would be significant downtime, change out in the physical ports on either end, and additional testing needed An MEF commissioned study using a realistic scenario of 100 users receiving a host of services (private line and Internet access) over TDM (see Figure 115) showed that with Ethernet, the service provisioning cycle was reduced by 14 weeks and yielded revenues of $75 million in this period alone

For TI-Bonus plans, earnings are expressed as a percent of target incentive earnings for performance as compared to quota Use the TIBonus formula when territories are not of equal size but you wish to provide similar earnings opportunities Whether the territory is $1M or $2M, $5M or $10M, accomplishment of sales objectives can be expressed as a percent of goal: 75 percent of goal, 100 percent of goal, or 125 percent of goal, for example In this manner, the formula expresses payments as a percent of goal achieved and not as a percent

By using RSVP-TE, carriers are able to pin the primary and secondary paths for any given service to specific links in their network and to optimise use of physical resources Although this is possible with some alternative techniques (such as Ethernet over SDH/SONET or over ATM), there are other techniques (such as 8021ah Provider Backbone Bridging) that are unable to do so The benefits of traffic engineering are sufficiently clear to operators that technologies which lack the capability are often extended to include it (for example the PBB-TE effort in IEEE)

Message Signal Units (MSUs)

The shortcomings of Ethernet over MPLS may be divided into two classes: shortcomings of Ethernet itself and shortcomings of the Ethernet over MPLS architecture

Ethernet over MPLS services are still Ethernet services and don t enhance the Ethernet UNI Enhancements in the UNI are being standardised by the Metro Ethernet Forum and are required for Ethernet services to offer the same carrier-class features that already exist in protocols such as ATM VPLS services emulate Ethernet LANs As discussed, Ethernet LANs are inherently unscalable When VPLS services are used to connect routers, the service scales adequately, but when VPLS is used to connect Ethernet switches, the number of MAC addresses the PE device has to learn imposes a severe scaling limitation

Component Bonus Formula Step-Based Step-Based TI-Bonus Formula Percent to Quota Over 125% 110% to 124% 105% to 109% 100% to 104% 90% to 99% 80% to 89% Below 80% Percent of Target Incentive 150% 125% 110% 100% 75% 50% 0%

EoMPLS Shortcomings Ethernet pseudowires provide a simple point-to-point service and have no intrinsic shortcomings, other than the inability of the PE to signal VLAN

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