It is normal for each student icon on the teacher interface to appear with the login name for that student. However, the teacher can ask students to enter their full names by selecting the Tools Ask student names option.
Getting your students to give their full names 1
Each student will then see the Personal data window appear in the top left of their screen and they can enter their full name and click OK.
Getting your students to give their full names 2
The teacher will then see this given name under that student icon.

Why do this? It is a very good way to learn the names of your new classes! However, the main reason is that when you collect work from students this “given name” is added to the collected file e.g. Paul Redhead.mp3 – hence you know exactly who the file belongs to without having to rename any files.