Maybe Your Strategy Should Keep You Up at Night
Several years ago, a cross-section of entrepreneurs was asked what commonalities they shared as they built their enterprises. Contrary to what conventional wisdom might foretell, such as being listed on the Inc. 500 or being purchased by Google, the common thread was that each executive went to bed every night and awoke each morning fully aware that prospective customers did not have their companies’ products or services.
Getting those products and services into the hands of those in need of and without their wares was the foremost strategy. Strategy focused on the top line.
During a recent planning session, one credit union's chief executive offered this comment: “We have a tendency to overestimate what we can do in two to three years, but we underestimate what we can accomplish in 10 years. Let's build a business and operating plan for growth and profits for the next few years, but let's be bold enough to state who we want to be in 10 years and work to see it through.”
As your credit union moves into its planning season, you may discuss, deliberate and develop a plan for loan growth, margin management, increased market share, new branches to build, and much more. This level of planning is important and makes for a great business and strategic operating plan, but does it keep you up at night and wake you with zeal each morning? Does it create an entrepreneurial spirit throughout your credit union?
All credit union executives and directors recognize that strategy is significant. Strategy is more than a statement of where you will compete and how you will prosper; strategy is more than convincing your members, with good reason, to give your credit union more of their business; and, strategy is more than making the most-efficient use of your credit union's resources.
Strategy is a commitment, backed up by a plan, to take what's best about your credit union to your members – current and soon-to-be. Strategy should encourage, excite and incent executives to deliver results. Strategy should keep credit union leaders up at night – and give them energetic reason to wake up early the next morning.
Consider adding some of these to your agenda, discussion and goals.
- Develop a strategy that stretches you and makes a big impression on your members. With your board, create a vision of what you want your members to experience in 10 years. One credit union was daring enough to state, “We will be THE financial institution for all professionals in our field of membership.” While other credit unions and banks could and did serve these members, this credit union elected to own this share of the market.
- Point your strategic thinking toward objectives that steer revenue. The key influencers of your top line are your members. With your board, create a vision of what you want your members to experience in 10 years. One credit union set this objective: “Double the value that our members receive as a result of their membership investment in their credit union.” It now is achieving this objective by significantly increasing its ratio of loans approved-to-booked. The increased revenue and profits improve the members’ value via pricing, patronage dividends, new technology and more personal service. And, the credit union is able to show the dollars and cents value of membership.
- Keep your strategy natural to explain and simple for all to appreciate. Summarize your strategic selections into down-to-earth terms and ideas that allow all to participate in carrying out – at governance, executive, managerial, and staff levels.
Strategy drives revenue and revenue, managed efficiently, sustains profits. Enterprise-wide strategy demands buy-in that all accept and work to achieve. That's an excellent foundation for strategy that awakes you early each morning.
Jeff Rendel is president of Rising Above Enterprises in Corona, Calif. He can be reached at email@example.com or (951) 340-3770.