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While boards gather information about emerging trends for strategic planning, this information also comes into play at other times.
“You have to stay on top of the trends and figure out how they’ll impact your members,” says Pat Tollefson, board chair at $145 million asset Aberdeen (S.D.) Federal Credit Union. “Learn about them and educate each other to see if they ft into the future of the cooperative.”
Tollefson is a 21-year board veteran, says information about developing issues often influences decisions about spending and new products and services. New product decisions are more complex than simply eliminating old services to make way for “new and improved” options because members may want both.
Online banking is popular, for example, but many members still rely on the call center.
Aberdeen Federal carefully weighs when to add new services like remote deposit, which it has been able to forego so far based on low member demand.
“We always have to keep in mind what our competitors are doing,” Tollefson says. “We have to keep members loyal so they don’t choose to switch.”
Having a clear process allows Credit Union of New Jersey to translate emerging trends into credit union services, Chizmadia says.
It relies on the Carver Policy Governance® model for nonprofit organizations. Chizmadia says identifying developing issues trends helps the board set “ends,” or strategic goals, as well as “executive limitations” that specify steps the CEO should avoid while delivering “ends.”
That information is backed by “ownership linkage” surveys and focus groups that gather insights from members.
“We explore everything but filter it by letting the CEO ultimately develop the operational strategies that will deliver the member-desired outcomes,” says Chizmadia, who is also a member of CUNA’s Volunteer Leadership Committee.
Key concerns identified by this process include the evolution of payment systems, digital transformation, and growing competition from fintechs as well as tech leaders like Google and Amazon. Failing to understand these players could have a negative impact on the credit union, he says.
“Not leveraging digital transformation strategies will increase our costs, lower member satisfaction, and affect our ability to recruit and retain future employees,” says Chizmadia.
He notes that millennials and Gen Z will comprise 75% of the workforce by 2030, and they will not want to work for companies that aren’t tech-savvy.
Board members and advisers share their insights into what issues they see developing.
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