SCRC Fellows and Bloomberg Terminal

The Supply Chain Resource Cooperative (SCRC) Fellowship from North Carolina State University’s Jenkins Graduate School of Management is structured to be a win-win for the student and the sponsoring industry partner. In my case, Caterpillar’s Building Construction Products Division sponsors my Fellowship. The scholarship and stipend initially attracted me to the program, but the enduring value is the opportunity to obtain relevant supply chain experience by working directly with practitioners who are leading global supply chains. Supplementing academic theory, tools and skills learned in the classroom with complex, ill-defined global supply chain project work has definitely increased my value as a person who is seeking to become a supply chain professional upon graduation.

Rather than planning the difficult task of appropriately scoping a valuable project for university student teams in really two and half months of semester work, partner companies can use the fellow as a project manager who can execute and follow-through on the student deliverables and recommendations. Companies can also use fellows as an analyst on various projects and develop the fellows with increasing amounts of responsibilities in order to groom the fellow for a natural transition to mid-level employment within the company upon graduation.

In addition to the bright, motivated student leader, the partner company is also able to leverage the full resources of the university. Rarely are supply chain projects limited just to supply chain issues. In nearly every case, supply chain challenges contain a financial, marketing, technology, business risk, human resource and engineering component. Because the student has access to the full resources of the university, they are able bring faculty and research resources to the table to help find solutions. As an example, this past year I have applied the academic theories I learned in the classroom directly to solving supply chain problems at Caterpillar. My professors are always there to answer questions and offer suggestions about how to approach work related problems. With the recent addition of the Bloomberg Terminal, SCRC partner companies like Caterpillar now have access to information and data on over 630,000 companies because the university has made this research resource available to its supply chain students.

The Bloomberg Terminal is a very powerful educational tool. Although the data housed within the servers at Bloomberg is all public knowledge, Bloomberg’s proprietary algorithm saves hours of research time by packaging relevant data in a few quick mouse clicks. Combing through hundreds of Dunn and Bradsheet databases, company earning releases, conferences calls, and SEC reports can take hours, but Bloomberg has already done that for you. Financial analysts, traders, company CFOs can use the Bloomberg Terminal for its copious amounts of financial data in the debt, equity, commodity and foreign exchange markets. Fellows have access to economic statistics, news, industry research, many Excel templates and Bloomberg analysts. Analysts are available 24 / 7 by telephone to answer any questions a student may have.

Companies can also use Bloomberg’s supply chain data to make informed supply chain business decisions. Based all on public information, Bloomberg’s supply chain screen enables users to quickly see a company’s competitors, customers and suppliers. How does your company’s supply chain compare to your competitors? Users can immediately import a company’s suppliers to an Excel spreadsheet with its ticker symbol and key financial statistics such as the percentage of revenue that supplier earns with the company and the percentage of cost that supplier is to the company. Combine this data with internal company data to analyze a competitors’ supply chain. Then map the suppliers for a coherent, directionally correct picture of your competitors’ supply chains. I say directionally correct because while the Bloomberg data is neatly packaged, it still is all public data with primarily Bloomberg analysts making estimates on a supply chain’s financial statistics. On a few occasions I observed that the source of the financial data came from an actual earnings release, SEC report, or financial statement. A majority of the estimates were derived from Bloomberg’s proprietary algorithm, referenced in the Bloomberg white paper . Essentially, Bloomberg’s algorithm analyzes public data with statistics, probabilities and confidence intervals to make the financial estimates.

In addition to its supply chain capability, Bloomberg also offers market intelligence data. Users can research market intelligence about any industry. Looking for a cost of goods sold (COGS) industry average? Bloomberg can provide it for you. For example, I found the most recent (2009) industry average COGS construction machinery breakdown based on data from various sources that Bloomberg compiled enabling Caterpillar to compare itself to the industry average. Key supply chain statistics such as inventory turnover can be gathered to show your companies’ performance compared to competitors. Finally, users can easily create a portfolio that lists a supplier’s component pricing, then graphically compare it to any commodity to track lags in price increases or decreases.

After naming a few of the benefits the Bloomberg Terminal provides, what are its costs and limitations? The primary limitation with the Bloomberg Terminal and its relationship with SCRC partner companies is its untested value proposition. One project has been completed using the Bloomberg terminal, and the data and analysis simply reaffirmed the company’s strategy. Do not look for Bloomberg’s supply chain data to provide you with the definitive answer to any strategic supply chain decision. But it can provide a direction and analysis at a low cost from a resource you would not otherwise have. In the future, Bloomberg is working on a mapping capability internal to the terminal that will show product line and part number specific detail. In addition, Bloomberg Supply Chain sales managers are currently taking requests from corporations for supply chain capabilities and tools.

In my project report, my bottom-line was that the Bloomberg data provided directional guidance regarding our competitors’ supply chain using publicly available information. However, it should not be used as a basis for strategic decision-making. I recommended populating the spreadsheet with internal data and periodically checking the Bloomberg tool for updates. Finally, I recommended using the fellows as a resource for company projects and market intelligence prior to S&OP or quarterly supply chain strategy meetings.

¹ Davenport, Richard. “Bloomberg’s Supply Chain Algorithm: Providing Insight into Company Relationships. Bloomberg Terminal. 18 Aug 2012.