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KENTWOOD, Mich. – If credit unions are to be optimally competitive, they’ll have to be willing to put aside “old” methods of measuring productivity and be able to innovate to reach members and learn how they use financial services. That’s the thinking behind CU*Answers’ development of CU*Base Member Relationship tools which the data processing CUSO expects to release this spring. “Credit union CEOs need to get a burning sense in their gut and compass on how they have to change. Productivity in the future has to be the driving force for innovation instead of merely being just a mid-level indicator of how we’re doing,” says CU*Answers President/CEO Randy Karnes.”Credit unions are starting to understand they need to be curious about their members, who they are, and how they bank with the credit union,” he says. But the key will be tying together transaction analysis, tiered service analysis, and household products in a way that creates better understanding of how members are interacting with their credit union, and how that may affect key variable cost and revenue opportunities. “Up until now credit unions have used productivity as a measurement of how they’re doing, but it should be an impetus for what they can do. Too often credit unions grade productivity on a scale, but innovation has nothing to do with scales,” says Karnes. To develop CU*Base, Karnes challenged credit union CEOs on CU*Answers’ “Understanding the Member” Focus Group to build a software product that ties together CU*Base’s marketing and member analysis tools and direct delivery channel functions and come up with a product that allows a credit union to present, track, and analyze member trends. Karnes threw in some additional criteria for the software: it should go beyond just being presentation and be part of the interactive features of Inquiry, Phone Operator, and the Teller platform. It should also run in the background of credit union member services and not add additional layers of work for employees. The new features should be able to create new monthly analysis files for trend analysis and not simply require credit unions to analyze month-to-month changes in third-party products such as Excel. At press time, CU*Answers was putting some finishing touches on the new product, but the CUSO is still targeting a spring release. Among some of the features of the CUSO’s CU*Base software, it allows a credit union to “label” the member based on their transaction patterns according to a credit union-defined configuration. It also includes a comparison of the member’s asset branch to their activity branch. When used with the transaction cost factor system, the analysis will break down the member’s transaction activity by origin, showing total debits, credits, and number of transaction. It will then calculate the total cost and average cost per transaction. Another feature – household analysis – shows all household member and non-member relationships with the credit union. In addition, CUs will be able to analyze member transactions by delivery channel, look at members who maximize delivery channels, and sample those members to look for trends and possible demographics that can be used to improve member services, increase revenues, or lower expenses. Credit unions have to be willing to get involved in cooperative and aggregate projects to compete and share expertise, says Karnes. “Cooperation is the key and it has to be applied to more than just technology,” says Karnes. “Credit unions have to understand that cooperation is itself a product, and they need to make sure they maximize that possibility for everyone. “Even $1 billion credit unions need cooperation,” he says. -

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