If one of the keys to remaining relevant and viable is finding the right leaders, credit unions still have some work to do. But finding the right leaders is no simple task. Plenty of barriers and obstacles still exist as credit unions try to attract and cultivate leaders.
Most people would agree leadership is difficult to define, but they know it when they see it. Most can identify those galvanizing personalities that influence, motivate, inspire, and achieve. But to recruit and retain capable leaders, credit unions must define leadership and identify the skills and attributes they want. They can’t wait until they see it to decide. They must articulate what it is that sets leaders apart, find those people, hire them, and then develop them once they’re hired.
Like most organizations, credit unions look to their CEOs for leadership, “but credit unions must start looking beyond their CEOs,” says George Hofheimer, chief research and innovation officer for Filene Research Institute. Leadership rarely resides exclusively in the CEO’s office, he says. In fact, research shows that most credit unions have leaders at multiple levels—from CEOs to tellers.
“In one of our research projects, we mapped the social networks within organizations and identified the real centers of power,” Hofheimer says. “Sometimes it wasn’t a perfect reflection of the organizational chart.”
But credit unions oft en fail to look for leadership skills or invest in leadership development beyond the CEO. They’re usually concerned about the cost of leadership development. They claim there aren’t enough resources available to invest in anything but hard skills or in employees other than C-suite executives.
“Some credit unions see leadership skills as soft skills, but they’re anything but,” says Andy Janning, a credit union management consultant in Indianapolis. “Leadership skills are core skills.”
Some credit union boards are reluctant to invest in leadership training beyond the CEO because they believe a chief operating officer or CFO will leave the credit union to become a CEO elsewhere once they develop these skills.
Whatever the reason, failure to cultivate leadership in employees other than CEOs puts credit unions in a precarious position. “It’s a diversification issue,” says Steve Winninger, credit union consultant and former CEO of $1.6 billion asset Lake Trust Credit Union, Brighton, Mich. “If you concentrate leadership in only one person, the organization is only as powerful and smart as that one person. Groups, however, are smarter and more capable than individuals.”
Even worse, Neill says, it sends the message to other executives and managers that their growth and development aren’t that important. That’s the wrong message to send talented people who have risen through an organization, Neill says, and one that will inevitably backfire. A better approach, Neill says, is to invest in leadership development and reap the rewards while those employees are still with you.
“An intelligent, ambitious person who wants to be a CEO is going to be a CEO at your credit union or somewhere else. The fact that you didn’t prepare them and invest in them won’t prevent them from leaving,” Neill says. “Talented people leave when you don’t invest in them.”
The Department of Labor will publish its final rule Wednesday regarding employees’ eligibility for overtime pay--a rule which CUNA believes will have unintended negative consequences for credit unions, particularly smaller credit unions and those in non-metropolitan areas.
Further CUNA analysis of the U.S. Department of Labor’s overtime rule found minor relief, but CUNA remains concerned about the increased burden on credit unions. Several CUNA-suggested changes were included in the final rule.
Six federal agencies published guidance last week designed to ensure all depository institutions are aware of expectations when it comes to deposit reconciliation. CUNA’s compliance explains what it means for credit unions in a recent CompBlog post.