You’ve invested massive amounts of time and energy into developing an ethical, member-centric sales and service culture. What steps should you be taking to ensure your staff stays true to your vision and core values?

As news coverage of unscrupulous behavior rocks the financial services world, it’s an opportune time for credit unions to re-examine their communication, goal-setting and incentive strategies, oversight capabilities, and performance management.

Three members of the CUNA Creating Member Loyalty™ team—Angela Prestil, Carla Schrinner, and Jayne Hitman—along with Denny Graham, president/CEO of FI Strategies, weigh in with advice on developing and maintaining a strong, positive culture in your credit union, designing an incentive program that prioritizes members’ best interests, and the value of earning your members’ trust.

Q: What are some of the pillars of a strong, member-oriented culture?

Carla and Denny: The following elements, executed well, produce a strong, member-oriented culture:

• A clear vision and core values that drive everything that happens in the organization;
• Strong, continuous communication about vision, core values, and expectations that flows up and down in the organization;
• Goals and expectations that focus staff on doing the right thing for the person in front of them, not implementing tactics just to meet a production goal;
• Effective training to help staff manage interactions with the member to build trust and create value;
• Regular coaching —including coaching the coaches—to reinforce expectations and observe what’s actually happening in member interactions;
• A sound reason and strategy for having incentives—and when the strategy makes sense, building an incentive plan that rewards the right behavior;
• Internal oversight that acts independently of the senior team; and
• Metrics to measure the execution of the strategy.

Q: What are some early indicators that you might have a culture problem?

Jayne: Early indicators of a “sick” culture may include:

• Organizational silos —one hand doesn’t know what the other is doing;
• Sales driven by incentives —employees push product and are competitive with each other to the detriment of the member;
• Turnover of key contributors and high performers;
• Service and sales initiatives driven by training;
• Absence of a sales process, poorly defined processes, or an ineffective sales process;
• Absence of coaching or ineffective coaching;
• Little or no accountability for managers or staff; and,
• Measurement to the bottom line and return on investment as the sole indicator of credit union success.

Q: Can you qualify the importance of developing trust with members—and to respect the fragility of that trust?

Denny: Credit unions must focus on building trusting relationships and being a “trusted financial partner,” which means avoiding poorly designed incentive programs and a demand for product quotas.

Credit unions must take a hard look at how they deliver on their brand and core values. That means taking a hard look at the messages you communicate to members versus what actual expectations and actions in the branches and various departments, whether or not incentives are involved.

In general, credit unions do have less aggressive sales cultures, and are considered the “good guys” for that reason. But good intentions and statements of value are just the start. The devil is in the execution.

Carla : You build trust with staff on a solid foundation of the communication and execution of the vision from the top down.

An environment where the credit union’s financials drive communication to managers breeds an environment where the financials are the cornerstone of every branch meeting. Intent aside, staff translates that message into making the numbers any way possible.

In this situation, trust erodes and a culture of cheating is born and thrives unchecked. It becomes difficult to work in an environment and trust your co-workers when every member who walks through the door looks like dollar signs. Worse yet, that environment breeds the feeling that your boss doesn’t have your back and won’t support you if push comes to shove in management meetings.

Q: What is the best way to explain and underscore that just because a behavior might not be illegal doesn't mean it's ethical?

Jayne : Model it. Good or bad behavior is built on what we see or hear in the culture of the organization, starting at the top. Credit union leaders have to be careful not to talk out of both sides of their mouths. Don’t start the conversation talking about doing what brings value to the member’s life and then end the conversation focusing on the numbers and making goals.

Angela: Work with front-line managers and staff to ensure they focus on member needs—and confirm the perceived need—before enrolling a member in a new product or service. Holding managers accountable for coaching and observing their staff will ensure staff that management is serious about having the member’s best interest at heart. And holding staff accountable for making service follow-up calls will create a culture where that employee “gut check” happens at the front of the transaction, along with confirming that the member really uses whatever products we sell them at the end of the transaction.

Q: What are the keys to developing an incentives program that still places the member’s needs first?

Denny: Make sure that member satisfaction is a critical component of the incentive; if staff isn’t doing what’s right for the member there should be no incentive.

Be careful with “hit your goals or be fired” consequences. One credit union we work with recently announced to staff that “although we want you to hit goal, no one will ever be fired if they missed goal but followed our sales processes.”

Make incentive goals reasonable.

Though it’s sacrilege from an accounting standpoint, if you’re using product incentives, value all products the same so there is no incentive to push high-value products. By definition, some products will be overvalued, some undervalued, but the member won’t be forced into products they don’t need.

Remember that incentives aren’t management—they’re rewards for achievement. The process still needs to be observed and managed.

The bottom line: If you’re unsure your current incentive structure truly puts a member’s needs first, get advice from a professional who has a lot of experience working with and designing sound programs.