Tech-focused labs enhance the educational experience and prepare students for their careers.
When Mark Holder of Kent State University in Ohio developed a new financial engineering program for the college, he polled executives at investment firms and learned that their leading complaint about recent graduates was that they didn't know how to trade in the financial markets. To address this issue, he built an authentic trading floor to give his students the trading experience they needed.
Holder, a former manager of research and product development at the Chicago Board of Trade, wanted to build a facility that simulates trading in the derivatives market and lets students practice risk management with the same hardware and software used on real-life trading floors. He purchased 25 high-end PCs with dual monitors and acquired five trading-floor applications that offer access to real-time price quotes, news and statistical analysis from exchanges worldwide.
To give it a genuine trading-floor feel, the university equipped the room with electronic tickers that flash prices of derivatives, flat-screen digital displays that are tuned to cable business news channels, and six clocks that show the times of cities with exchanges, from Chicago to Tokyo. The school standardized on a dozen high-powered HP servers and Cisco networking equipment to run the trading lab.
“Everything about the trading floor is accurate, from the workstations to the Herman Miller Aeron chairs,” says Holder, director for Kent State's Master of Science in Financial Engineering program.
“It's an approach that is extremely helpful for students,” Holder says. “They learn the math and implement models in real trading situations. They feel the pressure and understand how it works. It's hands-on experience and prepares them for their careers.”
At peak times, Nasdaq can handle 64,000 transactions per second with a less than 1 millisecond response time.
Dozens of universities have created trading rooms to enhance their reputation and attract more students. These types of facilities offer students practical training, and they become a showcase for business schools and help their universities drive fundraising.
But creating technology-focused labs to offer students real-world experiences isn't just the purview of business schools. For many years now, journalism schools such as the one at the University of Missouri have built newsrooms full of computers and other technology, where students publish their own newspapers and produce news shows that air on school-owned radio and TV stations.
Drake University recently renovated a regular science lab and turned it into a replica of eight pharmacies – with actual prescription drugs – so students can practice their chosen craft. Each pharmacy setting features two computers, barcode scanners and printers so students can go through the step-by-step process of filling prescriptions, from sticking labels on prescription containers to counseling patients.
Kent State's business school spent $2.5 million in 2003 to build its 25-seat trading floor. About three-fourths of the funding came from donations, and the rest came from the university.
Holder made the investment to give his students a competitive edge. Financial engineers use mathematical models for risk management problems; after graduation, students might be employed in investment banks, hedge funds, insurance companies and regulatory agencies. When Holder talked to investment firm executives, they said recent financial engineering graduates are great with their quantitative skills, but they could use more hands-on experience.
The majority of the $2.5 million was spent on room renovations, but a significant amount was used for technology. Holder spent about $150,000 on PCs, $100,000 on servers, $40,000 on networking equipment and another $100,000 on audio-visual equipment, including a projector and screen, so professors could lecture to their classes. Much of the software and data feeds are donated or discounted, but it's still a considerable expense to maintain the hardware and provide the data feeds – about $350,000 a year, Holder says.
“It's more than just a glorified computer lab,” he explains. “You have to be prepared to spend some real dollars to give the students as realistic an experience as possible.”
As the trading floor aged, the university had to replace its hardware. Last year, the school spent $100,000 on a dozen new HP DL380 servers to replace its six-year-old servers, and it also upgraded its core Cisco switch to support Gigabit Ethernet speeds to the desktop. The trading floor relies on the university's Internet connection, but it also uses a separate DS3 line for its high-bandwidth data feed, which delivers market news and real-time quotes from the commodities, currencies and equities markets.
The financial engineering program runs all its applications in its own server room, including the domain controller and Exchange e-mail. Holder hired YJT Solutions, a Chicago IT consulting firm that specializes in the financial industry, to offer the university's trading room the same 24x7 network monitoring and technical support that professional trading firms receive.
The IT firm's service desk resolves most problems through remote administration tools but visits the campus on occasion. When the consultants recently upgraded the servers, they focused on improving performance, reliability and uptime. The new high-powered servers feature redundant components, such as dual-power supplies. Data is protected using RAID arrays and nightly backups.
Drake University built a lab for its students that's a replica of a neighborhood pharmacy, says Joseph Scavo.
Photo Credit: Scott Sinklier
Kent State's trading floor gets plenty of use. During trading exercises, professors ask students to develop a trading strategy. The students execute their plan and then write up the outcome, such as whether they made financial gains or losses, Holder says. The faculty grades students on how well they perform in those exercises.
While most universities with trading rooms run only simulations, some colleges such as Texas State University-San Marcos let students manage a real investment fund.
Students can't actually conduct real trades in Texas State's securities trading room, but they can do research there. And when they do decide what to invest in, their professors call brokers to make the trades, says William Chittenden, chair of Texas State's finance and economics department.
The university opened its 1,500-square-foot trading lab in 2006 at the same time it launched a $100,000 student management investment fund. It features 30 computers with dual monitors and access to financial software that offers real-time market data; news and research reports; and a spreadsheet application used for predictive modeling, forecasting and simulations.
The investment fund was created four years ago when Emmett and Miriam McCoy, founders of a chain of building supply stores, donated $20 million to the business school. The fund is managed by 20 undergraduates who conduct research over two semesters to determine which securities to purchase. At the end of each semester, the students pitch their favorite investments, and the class votes on which securities to keep and which to sell.
“Before, we could teach them how to manage a portfolio or compete in online portfolio competitions, but when it's real money, students act much differently,” Chittenden says. “If it's
play money, they can take risks. But they can't do that with someone's real money, and that enhances the experience.”
Since the fund started, the students' portfolio has increased in value. They've done so well that the fund's foundation board will increase the student investment fund to $250,000 next fall, and to $300,000 in fall 2011. The experience helps the students when they seek jobs after graduation, Chittenden says.
Ready for Life
At Drake University, the goal of its pharmacy practice lab is to give students a realistic pharmacy setting so they can practice the workflow process of filling prescriptions and become comfortable with using pharmacy technology and counseling patients. That way, when they are involved in their first pharmacy rotation as students, they can hit the ground running, says Joseph Scavo, systems administrator at Drake University's pharmacy college.
The new lab, which opened in spring 2009 and was largely funded by donations, features eight pharmacy stations with the latest technology. The gear includes iMac computers, a biometric system that reads students' fingerprints so they can log in to the system, and a robotic pill-dispensing machine that can fill some (but not all) prescriptions.
“This is as close to a real-world simulation as we could give them. When you walk in, it's almost like your neighborhood pharmacy with over-the-counter drugs on display on shelves,” Scavo says.
Scavo uses VMware Fusion desktop virtualization software so each iMac can also run Windows. Students toggle back and forth between the two operating systems – Windows to access a pharmacy application and the Mac to record video of student interactions with patients, which professors will later view and critique.
Three students at a time work in each station, where they share two computers. Each computer has several USB peripherals attached, including a Fujitsu duplex scanner used to scan in prescriptions, Dymo thermal printers to print out barcodes, and point-of-sale signature pads.
When a patient comes in with a prescription – typically, a professor or another student who is role-playing – the student pharmacist sticks a barcode label on the paper prescription to identify the patient. Barcode labels are also printed on the prescription bottle to identify the drugs. When the prescription is filled, the student uses a barcode scanner to scan the barcodes to verify that the right drugs are going to the right patient.
When it's time to explain the medicine to the patient, the pharmacy student turns the monitor of the computer around to face the patient and records the interaction with the built-in webcam and microphone, so faculty members can later review it and grade the student's performance.
The patient reads from a script prepared by a professor. It can be ornery and full of questions, providing the student pharmacists with experience about how to deal with touchy situations. “It could be tense situations with combative patients, but the faculty want to see how students deal with it,” Scavo says.
Once recorded, the sessions are uploaded to a password-protected portion of Drake University's iTunes University server, which faculty members can access.
Besides learning workflow at the lab, students learn to perform patient assessments, such as reading blood pressure measurements. They also examine patient histories, consult with electronic databases and determine whether a combination of medications could result in bad side effects.
Overall, college officials say high-tech labs not only prepare students for their careers, but also give universities a boost. Kent State's trading floor helped the school's financial engineering program build a solid reputation. Today, top firms such as Goldman Sachs and exchanges such as Europe's Eurex recruit its students, Holder says.
“It's helped us establish a good reputation with the top firms, and it's added prestige to the college of business and the university as a whole,” he says.
Journalists Train for the Future
Five years ago, the journalism school at the University of Missouri launched a convergence track to give its students the multimedia and technology skills they need to thrive in an industry where print publications are dying and broadcast radio and TV audiences are dwindling.
Graduate and undergraduate students studying convergence become jacks-of-all-trades. They take turns working for the school's community newspaper and the school-run radio and TV stations, as well as websites that the university partners with. As part of their coursework, the students learn web design with tech tools such as Adobe Dreamweaver and Photoshop. They learn to record podcasts with digital recorders and microphones, and take photos with digital cameras. They also shoot video, edit the footage with Apple's Final Cut Pro and post it online.
The goal is to give them multiple career options when they graduate, from traditional newspaper, TV and radio jobs to new media jobs, such as blogging or producing a website, says convergence chair Lynda Kraxberger.
“We train them to work across the media platforms. But we also constantly push them to think critically about the traditional media and explore how the Internet changes what people want and how they want it,” she says. “And involved in that is marketing – social networking, blogging, and creating their own brand and online identity.”
Each student is required to purchase their own notebook computer, so they can do all their work in any location. But they can also work out of the school's TV, radio, newspaper and convergence newsrooms, each of which has its own computer lab, Kraxberger says.
Tips for Setting Up a Lab
1. Let faculty take the lead on technology. Faculty members know the tech tools and applications that are widely used in their field. Let them decide what to standardize on, but make sure IT managers chime in on important issues, such as infrastructure and hardware compatibility.
2. Tech labs must double as classrooms, so don't forget the tech tools that let professors lecture. Drake University's pharmacy lab is equipped with a document camera, faculty computer, DVD player and four flat-screen displays. Faculty can project their computer screen or PowerPoint presentations onto the displays.
3. Purchase high-end PCs. Schools with trading floors must purchase computers with multiple processor cores and plenty of memory that can support multiple applications running simultaneously. Dual monitors are also important because they're standard in real-life trading rooms and allow students to multitask.
4. Fill the lab's daily schedule with classes. You invested a lot of money to build the lab, so use it. Besides trading-room activities, fill it with classes.
5. Focus on physical security. Graduate assistants at Texas State University-San Marcos supervise the room during open lab hours. Video cameras record all exits to the building. At Kent State, the room has a security system with fingerprint access.
6. Invest in training so students know how to use the technology. Each year at Kent State, the school's software vendors come on campus to teach new students how to use the applications.