Strategic Planning: Ditch the Gut and Focus on the Data
The season for strategic planning is upon us, and it can be looked upon as process that should guide your credit union toward your desired future. Or it can be an exercise in futility that drains valuable resources, time and effort.
Too many times credit union strategic planning activity falls short because leaders fail to critically assess the external environment by focusing too much on internal processes and systems and rehashing historical data and old procedures.
Leaders instead should be reading the economic and financial tea leaves so they can synthesize trends into strategic organizational directions for the credit union.
Taking an outside-in instead of an inside-out approach to your thinking would serve leadership well. A focus more on innovation and less on tradition would help focus the change process for all involved in moving the credit union forward.
Credit union leaders (CEOs and board alike) must also utilize strategic thinking in their strategic planning. “Strategic thinking” is trying to define a world that may exist – like trying to see a chess game many moves ahead.
Leaders should base your directions and tactical action strategies on accurate information. So “ditch the gut” and focus on the data in your goal-setting process.
There must also be more emphasis placed on taking a member-centric approach, or understanding the needs and building stronger relationships with members.
The financial services/economic environment and how to serve members more effectively should be the primary drivers of your planning efforts.
There are some crucial components that comprise an effective strategic planning process.
Conducting a thorough environmental scan to understand the credit union's current and future financial marketplace environment. This will involve some market research regarding national/local financial services and credit union industry economic and consumer market trends.
Conducting an analysis of the credit union's strengths, challenges, opportunities and threats – its SCOT – is a very important component of your planning process. A review of member surveys, focus groups, product/service usage patterns and feedback are key member service assessment indicators.
Understanding the difference between your credit union's mission (who you are) and vision (where you want to go or become) is crucial for leaders. The core values and philosophy of the credit union need to continue to be aligned with the strategy for growth.
Identifying and prioritizing key strategic initiatives, competitive advantages and strategic directions needed. Knowing who your competition is, and what your credit union's competitive advantages are, will help you properly develop product and service strategies to position you for prospering in the financial services marketplace.
Developing a tactical action-step plan that includes budget and key result areas, as well as business plans, timelines, completion dates, outcome measurement, accountabilities and impact on resources, including financials, staff and facilities.
Creating an evaluation process to ensure how effectively the credit union will meet the measurement criteria. This should be monitored on a regular basis throughout the year at monthly board and staff meetings.
Communicating the progress to key stakeholders for direction, motivation and performance assessment. Sharing progress reports keeps communication open and the process on track.
Strategic plans should be reviewed at least monthly for progress and then annually updated to stay aligned with the direction of the credit union and to incorporate responses to changes in the financial environment and new member needs.
An effective strategic plan should also be flexible and have enough elasticity built into it to respond to sudden changes in the environment.
Your strategic plan should be used as a guiding map to keeping the credit union on course to achieve results and move it toward fulfilling its mission and vision to the members.
By staying close to trends – and even closer to your members – your strategic plan should become a foundation for sustaining and ensuring your credit union's future during changing and challenging times.
John A. Vardallas is founder/CEO of TheAmericanBoomeR Group in Madison, Wis. He can be reached at firstname.lastname@example.org or (608) 577-8707.