Iowa State University issued the following announcement on March 22.
The idea to develop a futures contract for the bulk trucking industry appeared to fit a need, but before investing in the concept, leaders of Tennessee-based TransRisk wanted to know if the market would support it.
In search of answers, the company turned to Iowa State University’s CyBIZ Lab for help with a market assessment that focused specifically on dry and liquid bulk haulers. David Cantor, who holds the Walker Professorship in Logistics and Supply Chain Management in the Ivy College of Business, led the research team assigned to work with the client. The team’s assessment helped TransRisk redefine its plans for this segment of the market.
“It’s really a win-win. The client received information useful in advancing its operations and strategies and students saw the impact of their work,” Cantor said. “More importantly, the students developed the business and technical skills that many employers are looking for.”
Since the launch in 2014, CyBIZ student research teams have worked with more than 200 clients, but this particular project created some unusual challenges, Cantor said. For starters, there is no single data source the research team could utilize to gauge market size. Unlike the airline or hotel industry, Cantor says no one tracks or tabulates the annual revenue of the truck bulk market, so the team had to collect its own data.
Mark Walker, an Iowa State graduate who serves on the Dean’s Advisory Council for ISU’s College of Business, liked that students would have to take an “old school” approach rather than going online to find information – a common starting point for most market research. Walker, who also serves on the company’s board of advisors, saw this as a unique business challenge that forced students to be innovative.
“These students tackled a real business problem. They had to interpret the data and extrapolate the size of the market from more general trucking data,” Walker said. “They did a great job of putting together the necessary metrics and information to lead to a decision.”
Through surveys and interviews with shippers and carriers, students identified obstacles and opportunities for the client to consider. Cantor says they found smaller carriers dominate the dry and liquid bulk market and many do not have the necessary business practices – legal, accounting, financial – to handle this type of transaction.
However, with the proper tools and education, carriers and shippers could benefit from a futures contract, which is a negotiated agreement between a buyer and seller for services that are paid for and settled in the future. Futures contracts makes the cost of conducting business more predictable and allows both the buyer and seller to hedge against risk that may arise in the future, Cantor said.
Potential employers regularly ask Hannah Williams about her work with CyBIZ Lab. Williams, a senior in supply chain management and marketing who worked with Cantor on the transportation project, says the hands-on experience helps her stand out in job interviews and better prepare her for a career after graduation.
“The connection between the work I’m doing for CyBIZ and what I’m learning in the classroom is really beneficial,” Williams said. “This is real life and the clients are putting our work to use. I’ve expanded my knowledge in a lot of ways that I wouldn’t have been able to do without this experience.”
Working on the transportation project was an ideal combination of Williams’ interests in marketing and supply chain, she said. It required her to learn more about futures markets and hedging – concepts she remembers discussing in class that now had an application. The project also demonstrated the value of conducting quality research. Williams now knows how to develop effective surveys for data collection, identify reliable data sources and compile information that is useful for the client, she said.
Learning from success and failure
Clients are often motivated to work with CyBIZ Lab because they recognize the importance of preparing students to enter the workforce, Cantor said. The collaborative, interdisciplinary environment attracts undergraduate and graduate students from a variety of majors. Alex Andrade, CyBIZ program manager, says students benefit from working on teams with diverse perspectives and skill sets.
Andrade should know. He was one of the first students hired to work at CyBIZ Lab. He now facilitates client projects and assigns student research teams. Many of the projects involve new technologies and determining if the product is viable. Andrade says this type of experiential learning helps students develop tangible skills and exposes them to the pressures of working for a client, an experience that is hard to replicate in the classroom.
“To learn and fail in real time with a real client holds students far more accountable than any classroom assignment,” Andrade said. “There is just a higher expectation when you’re working on a real project with a client paying you for the work.”
The higher expectations come with greater reward for students once the project is completed. Williams says she took pride in seeing how her team’s hard work paid off for the client. She’s also gained an appreciation for companies that see the value in working with students.
Original source can be found here.