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Meeting the Challenge - Financial research anchors undergrad case competition

Purdue undergraduate students from across the West Lafayette campus recently took part in the Finance Management Research Challenge, a case competition made possible through alumni engagement and a partnership between the Mitchell E. Daniels, Jr. School of Business and Purdue Federal Credit Union (PFCU).

The challenge was a two-round team project to determine whether a company loan should be approved or rejected. Judged by alumni, the first round was a virtual curricular activity for Financial Management (MGMT 310/304) in which all students participated. The second round was an extracurricular case competition for the top five teams identified in the first round. In total, it engaged more than 320 students from four course sections and over 60 Purdue alumni who provided feedback on the students’ assessments.

The competition was developed by Clinical Assistant Professor Fabricio d'Almeida through the Center for Business Communication as an opportunity for students to apply the academic theory they learn in the classroom to solve real-world financial scenarios. In addition to d’Almeida, judges for the final round included faculty member Phil Baeza, Professor Emeritus Charlene Sullivan, PFCU President and CEO Bob Falk, and Adam McKinney, senior credit analyst at PFCU and an alumnus.

“The experience allows students to practice the soft and hard skills employers seek,” says d’Almeida. “It helps them become job-ready by developing presentation skills, critical thinking, and teamwork ability. Students also get hands-on experience analyzing real data, applying class topics, and combining their collective experiences.”

Importantly, the high-impact case competition differs from a typical project or final exam by aligning with Purdue’s plans for a new School of Business focused on experiential learning activities, Transformative Education 2.0, a Purdue Provost Office initiative, as well as helping meet standards for AACSB business school accreditation.

The students were challenged to evaluate a loan request from Geddes Corp., a fictitious wire and cable manufacturer located in West Lafayette, Indiana, that wants to acquire a new site to build a warehouse that will host future production lines. Because Geddes does not have the required capital to purchase the property, the company is requesting a loan of $6 million from PFCU to fund the acquisition.

Among other tasks, the students developed a qualitative and quantitative credit scoring model used in the decision-making process of accepting or rejecting loans. The model is typically based on information provided or gathered about the borrower that allows banks to assess loan risks based on factors including credit history, management experience, available capital, cash flow, and collateral value.

Team Lion 20 won the top spot in the competition, led by presenter Nicholas Most, a biomedical engineering student. Other members of the winning team were James Foster (Polytechnic Institute), Emi Quist (Liberal Arts), Khushi Shah (Science), and Adam Spensley (Liberal Arts).

“All the teams exhibited deep knowledge and understanding of the task at hand, leading to varied thought processes and imbedded assumptions to answer the questions being asked,” says Talmo Martins, Director of Enterprise Accounts at STEM and a first round alumni judge. “This was a key element and they all did a great job.”

The teams showed more than academic knowledge and the use of key financial concepts, Martins adds. “What impressed me most was the students’ genuine desire to present the case, answer the questions, and build the rationale behind their decisions in a professional manner, showing their prep work as well as how the tasks were distributed among each participant,” he says.

According to Bob Falk, president and CEO of PFCU and a second-round judge, the top five teams backed their recommendations with analytics and strong presentation skills. “They could have easily just given us the numbers and moved on, but we wanted to see if they could put that together with what's going on with the economy and what's going on in the industry.”

Falk says the experience also gave students a glimpse of possible careers. “I don't think students always recognize the many different jobs you can find in banking and finance,” he says. “This competition opened their eyes to new opportunities and helped create a pipeline of future talent for our organization.”

First-round judge Sarah Arthur, a Purdue business alumna and financial advisor at Valeo Financial Advisors LLC, says case competitions and similar experiential challenges are important opportunities for both students and alumni.

“I recall as a student being insulated and all-consumed by my college experience without a good idea of what was going on in the world,” she says. “In business, it’s crucial to understand what events are taking place, even at a high level. Involving alumni in a learning experience like this is beneficial for students to have a tie into how knowledge is applied post-college, and for alumni to help the students become more prepared for putting their degrees to work.”