One of the most distinctive differences I’ve found between credit unions who are thriving in the new economy and those who are continuing to struggle to grow is the thinking of the CEO and the board of directors.
A lack of growth is usually blamed on the economy or unforeseen circumstances, but the fact of the matter is, credit unions that are thriving are being led by thinkers who are thinking forward, progressive and willing to make necessary changes to be more competitive.
Conversely, those credit unions struggling to grow or even shrinking in membership or asset size or even loan volume suffer from self-created obstacles I call small thinking.
The following areas of small thinking can creep into any credit union. See if any of the following small-thinking mentalities have crept into your credit union and are holding you back.
When working with credit union clients on strategic planning I routinely ask about the board’s sacred cows. Usually the first response is, “We don’t have any.” After a little probing, I find sacred cows such as; name changes would never be considered, a change in membership is resisted but may be acceptable as long as the foundation remains the original SEG with significant board representation, social media marketing shifts; I’ve even heard resistance to changing the restaurant the board eats at prior to the planning session. “It’s tradition.” How can progress happen with such anchored thinking?
Sacred cows are usually anchored in the past or a board member’s pet interest. Change is happening in the new economy at the speed of thought. What we used to measure in years and months now needs to be reviewed in days and hours. To thrive in the new economy and be proactive in your service to members, self-created obstacles only make the challenge for success that much greater. It begs the question: if you are always looking to the past, how can you progress forward?
Thriving credit unions tend to have unity of thought at the top. The majority of the board opinion leaders and the CEO are on the same page as to where the credit union needs to be heading and how to get the credit union to that destination point. With unity comes momentum. With momentum comes confidence. With confidence comes success.
When a board and the CEO are pulling in different directions, want to progress at different speeds, or have a much different tolerance for risk, there is no momentum building because there is no unity of thought. Therefore, the credit union struggles to find direction and battles are waged over minor issues to where meetings literally become exhaustive.
I encourage all credit unions boards of directors to have a conversation with their CEO to determine if everyone is sharing the same vision and roadmap. Unity of thought, effort and commitment at the top creates a better opportunity for a credit union to achieve its full potential.
Over the last few years many credit unions have felt under attack from regulations changes, regulator demands, the Great Recession, growing member expectations, rapid technology changes, and shifts in their local competitive environment. This confluence of issues created an all-hands-on-deck crisis management mode for executives and the board. This prompted many board discussions about fees, staff changes, budgets and “how to stop the bleeding” of resources.
Instead of being a temporary condition to get through rough waters, some credit unions I’ve been involved with have established the crisis management behavior as the new norm. A crisis mentality is all about looking at the short term, looking at how to show an immediate positive blip in reports, and losing focus on the vision of where the credit union needs to be heading.
A CEO is responsible for developing her management team to handle the responsibilities of the short-term issues. The management is responsible for creating a solid work environment where employees deliver great service to members and perform sound business practices under any circumstances.
The CEO and board of directors are responsible for the vision and direction of the credit union. When the CEO and board become more concerned with small thinking and micro-managing details of the credit union, they have lost focus and have essentially “taken their eyes off the road.” That is how accidents happen at the wheel of a car, and at the helm of a credit union.