To survive and thrive, CUs must capture business opportunities before competitors do.
Most human beings dislike change and are less flexible than they’d like to admit.
For years, bankers joked about the “3-6-3 rule”—pay 3% on deposits, earn 6% on loans, and hit the golf course by 3 p.m. While it was an exaggeration (like the three-martini lunch) it wouldn’t have been funny if it didn’t include a bit of truth.
But through the past few decades, financial institution executives have become harder-working and harder-driving. In virtually every industry, competition is fierce—whether from down the street or across an ocean.
Unprecedented events of the past three years have made all our jobs more demanding. While recent economic trends hint at an end to the Great Recession, we still have numerous issues to work through.
Many credit union members are still unemployed, underemployed, or worried about employment. Recent increases in home values seem to have stalled. And Congress and the administration have shifted focus from health care to financial regulation—and all the unintended consequences that probably will come with it.
The “good old days” are gone—even if the government successfully manages a graceful end to quantitative easing and other massive government intervention in the financial markets. We operate in a hyper-competitive, highly regulated industry.
While the media today more positively portray credit unions than our bailed-out financial services counterparts, we’re under no less pressure to continually improve our products and services. Members demand more, technology is moving at lightning speed, and pressure is relentless to keep costs down.
Today’s credit union executives must practice agility, which means always being prepared to identify and adapt to change. Those with vision, strong member focus, and willingness to see things in new ways will be successful. And operationally effective ones will find ways to bring their organizations along with them.
Agility, for credit unions, is the ability to consistently recognize and capture business opportunities before competitors do. It’s the skill to constantly think and draw conclusions, and then quickly take action. Ask yourself, “To what degree is my credit union agile, and how do I build the necessary skills, talents, and drive into my organization’s culture?”
In a recent Harvard Business Reviewarticle, London Business School Prof. Donald Sull indicates organizations can achieve agility in three ways:
1. Operationally, through focused business and quick action;
2. On the portfolio level, by shifting resources into more promising business lines; and
3. Strategically, by seizing game-changing opportunities.
To lead a truly agile organization, your management team must regularly assess the details in each area. Information (data and supporting materials) you incorporate into agility assessments must be reliable, timely, and current.
Focus on the issues most relevant and critical to your organization, and then prioritize them and build teams accordingly. Too many priorities lead to a lack of focus; too few priorities leave you behind competitors. Strike the right balance to manifest better services, products, and pricing for members, and more success for your credit union.
Finally, leaders must instill a sense of urgency in others. You can’t do this on your own, so look for agility at all team levels.
While we can’t return to what some consider the “good old days,” we can take advantage of today’s opportunities. While trust in big banks is faltering, credit unions can speak the truth about what we stand for and how we’re different.
It’s a rare opportunity to assist many people who’ve been through serious financial traumas. For the agile, the visionary, and the strong, the best days lie ahead.
ERIN MENDEZ is executive vice president/chief operating officer of SchoolsFirst FCU, Tustin, Calif., former chair of the CUNA CFO Council, and vice chair of the CUNA Council Forum. Contact her at 714-466-8109 or at email@example.com.