How does this apply to CUs?
If we take a page from the cooperative grocers, we need to connect our members to money. Does that seem odd?
Let’s hold that thought for a moment and look at a few business strategies:
• Repositioning strategies. The life cycle of a business has four distinct stages: introduction, growth, maturity, and decline.
|CUNA Mutual Group's John Lass addresses CU sustainability. Watch now.|
When a company reaches the decline phase, it has two options: Cease to exist or re-invent itself into a new company and start the lifecycle all over again.
Much debate surrounds which phase credit unions are currently in, but it seems to be either maturity or decline. Either way, credit unions will need to consider strategies to re-invent or re-position themselves.
• Innovation strategies. As repositioning strategies can help credit unions renew their competitive position, so are innovation strategies.
The Blue Ocean Strategy is the product of W. Chan Kim & Renee Mauborgne. It’s based on the study of 150 strategic moves spanning more than 100 years and 30 industries.
The primary contention of Blue Ocean Strategy is that value innovations will create value to both the firm and its customers, rendering rivals obsolete and creating uncontested market space.
Currently, credit unions complete in the same space as big banks. If the credit union industry doesn’t want to move into the space already occupied by large banks, where can it move?
Based on Blue Ocean Strategy, I propose we enter into a space that’s more cooperative and highlights the fact that credit unions:
Part II of this report will address how a shared-value business model would benefit credit unions.
ANNE LEGG is vice president of marketing at Cabrillo Credit Union in San Diego and former chair of the CUNA Marketing & Business Development Council. The recent MBA graduate explores credit union sustainability in her MBA-thesis/white paper, “Creating a New Credit Union Sustainability Business Model.”