Planning amidst a whirlwind of change

Planning amid a whirlwind of change

Beyond COVID-19, boards must address the rapidly shifting digital landscape.

May 20, 2020

When the coronavirus (COVID-19) pandemic struck the nation, credit union boards sprang into action with their leadership teams, not only envisioning how to continue service to members but how the board would function in an era of social distancing.

“Our board of directors moved quickly to evaluate and take board action regarding the rapidly moving developments related to the COVID-19 outbreak to ensure the health and safety of our staff, membership, and communities,” says Tara Leer, board vice chair at $1.3 billion asset Potlatch No. 1 Financial Credit Union in Lewistown, Idaho.


  • Identify and understand emerging trends to have a clear picture of members’ needs and challenges.
  • Stay at a 30,000-foot level to be an effective board member.
  • Board focus: Think like members to address emerging issues.

But to make those decisions, boards needed to meet. With social distancing guidelines in place, in-person board meetings weren’t possible. Most boards have switched to virtual meetings, using video conferencing or conference calls to conduct board business.

Adopting virtual meetings involved not only making sure the technology was available and board members knew how to use it, but also that it was an option allowed by the credit union’s bylaws, Leer says.

“Although the board is equipped and knows how to use the technology, we have always been an in-person board as everyone lives relatively close to the credit union,” says Gary Chizmadia, board chair at $345 million asset Credit Union of New Jersey in Ewing and vice chair of CUNA’s Volunteer Leadership Committee. “A certain shift needs to happen to be effective in a virtual environment. The challenge will be to keep the same level of engagement virtually as we have in person.”

The COVID-19 crisis also means boards have had to re-evaluate their strategic plans and priorities in addition to the credit union’s financial health and forecasts.

“We are working with our CEO to develop new forecasts using several scenarios of varying degrees of severity—worst case, most likely case, and best case—in terms of loan losses, loss of revenue, liquidity, growth, and costs related to COVID-19,” Chizmadia says.
Boards are also discussing the future of the credit union beyond the COVID-19 pandemic.

Credit Union of New Jersey is exploring future service delivery models as forced remote service delivery may have created opportunities for new ways of doing business. Members who previously didn’t use remote services may now be more willing to use them, especially if the need for social distancing continues, Chizmadia says.

In addition to COVID-19, board members need to examine several emerging trends to get a picture of members’ needs and credit union challenges.

‘Stay on top of the trends and how they’ll impact your members.’
Pat Tollefson

‘Move at the speed of members’

Rapidly changing digital products and services are resetting members’ expectations and making it essential for credit unions to “move at the speed of members” when introducing new products, says Jeff Rendel, president of Rising Above Enterprises.

Boards should acknowledge members’ experiences with services like Amazon Prime, which offers one-click convenience and next-day delivery—and how those experiences are raising expectations for all organizations.

Other key topics boards need to watch, Rendel says:

  • Digital marketing and engagement, which includes both how members learn about your credit union and how they engage with its products and services. Credit unions must have “master level” expertise in digital interaction, Rendel says, because digital services have already replaced the branch in driving member experiences.
  • Employee engagement and experience, which allows credit unions to compete for the talent they need. Although pay is important, credit unions also need to be creative in the benefits they offer different demographic groups. For example, one of Rendel’s clients may consider providing housekeeping services to give employees more family time in their off hours.
  • Partnerships with fintech companies to expand products, streamline operations, automate processes, and build member loyalty.

Partnerships can allow credit unions to reserve their resources for what they do best: deliver products and services to members.

Understanding what’s being forecast will lead to better board decisions, Leer says.

“Being well-versed in trends allows for the board’s engagement to transform beyond a rubber stamp,” says Leer, who serves on CUNA’s Volunteer Leadership Committee. “No matter how capable your executive team is, a range of external perspectives will help ensure the strategy is robust.”
Among Leer’s top concerns are applications for artificial intelligence, the development of future credit union leaders, and cybersecurity threats. She notes that protecting members’ data is the board’s legal, ethical, and fiduciary responsibility.

“Member loyalty and trust become eroded with cyber-related incidents,” Leer says. “There’s a strong reputation risk if members believe the credit union isn’t making every effort to protect members’ information and assets.”

Leer expects to gain more insights from a new think tank comprised of cross-generational management and staff charged with identifying fintech and “out-of-the-box” products the credit union could test-market with certain member groups or at specific branches.

“The better we’re able to recognize these trends, the more relevant we’ll remain in members’ lives,” she says.

NEXT: Beyond strategic planning

Beyond strategic planning

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.

NEXT: A 30,000-foot view

A 30,000-foot view

Pursuing emerging trends can tempt board members to stray into management’s role of deciding how to pursue them. Ed Marvin, a director at $9.7 billion asset Randolph-Brooks Federal Credit Union, Live Oak, Texas, says he learned why that’s a mistake when a past board chairman took him to lunch almost 20 years ago.

“You have to stay at a 30,000-foot level to be effective as a board member,” he says.

A former Air Force officer, Marvin now focuses on questions that help him identify what goals the credit union should pursue and then check progress toward them. That helps him pinpoint the right questions to ask at board meetings.

“I ask, ‘are we where we need to be on diversity, on empowerment, on equity, on our strategic planning?’” Marvin says.

He believes board members should use the credit union’s services so they understand their potential impact on the credit union. Becoming familiar with technology allowed Marvin to recognize the importance of the items on his trend list: keeping the credit union “digitally sophisticated” while maintaining proper cybersecurity.

Marvin also believes it’s essential to refresh the board periodically with new members who have fresh perspectives on member needs. Randolph-Brooks Federal now bars board members from seeking another term once they’re 80 years old.

“You keep excitement in your ranks by bringing new people along, grooming them, mentoring them, and letting them take over,” he says.

The price of falling behind

Boards should recognize that “failure to grow” is the price of failing to keep pace with members. When credit unions fail to make ongoing investments in technology and digital services, Rendel says they risk falling so far behind that they cannot afford the capital investment required to catch up.

Monitoring the changing landscape and building it into strategic and business planning can help credit unions avoid that fate.

“Look at how the average consumer goes about his or her business,” Rendel says. “If they have a great digital or in-person experience, they carry the same expectation into the next retail business they go to.

“You have to think like a member all the time.”

This article appeared in the summer issue of Credit Union Magazine. Interested in subscribing? Visit