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VIRGINIA BEACH, Va. – Faced with the need to quickly develop and deploy new products and services in an increasingly competitive market, Chartway Federal Credit Union decided it was time to “co-source” much of its core technology. Not outsource. Co-source. That’s how Chartway CEO Ron Burniske describes the new relationship the $1 billion CU has with its long-time core processor, Summit Information Systems. Chartway is now using what the Fiserv unit calls the Summit Resource Management Solution. Nearly all the 150,000-member credit union’s enterprise IT processing is now being done across the continent, at Summit’s headquarters facility in Corvallis, Ore., leaving only the internal network itself in Virginia Beach. The arrangement differs from a service bureau solution used by thousands of credit unions, including about 140 served through Summit’s own Titusville, Fla., operation. Traditional hosting involves sharing equipment and staff. The resource management solution is indeed hosted in Corvallis, connected by high-speed data lines back to Virginia, but the equipment and several staffers are specifically dedicated to Chartway’s operations. “When you’re outsourcing, that company is just a vendor. This runs deeper,” Burniske says. “We felt if we were going to do this, we needed to do it with someone who understands our business, who feels our pain and shares our excitement. “A vendor says we’ll get to you when we can, and you’re in line with everyone else. That’s outsourcing. We’re working with someone who understands our business inside and out and we understand theirs, and we’re in it completely together and understand the responsibility we have toward each other. That’s co-sourcing.” Summit has been providing Chartway with in-house core processing since 1994, and Burniske says it was a natural choice for providing this higher level of service, too, because of the Spectrum system’s ability to integrate easily with third-party products, as well as the working relationship between the two organizations. “Ten years ago, Summit was ahead of the curve in putting its focus on what it’s good at, processing information. If you want all the other stuff, CRM and all those bells and whistles, well then they’ll make it easy to add on, and that’s what they’ve done,” he says. And that leaves Chartway able to concentrate on what it does best, Burniske says, “serving members. We’re a very thinly staffed organization, and with so much for each of us to do, we need to concentrate on our core competencies, on what we do best, on what gives us the ability to compete successfully against the Bank of Americas and Navy Federals in our market. “Well, we looked at that hard and found to our surprise that, yes, technology is important but it’s not our core competency, especially in data processing, and especially in transaction processing.” So now that responsibility lies with Summit, which manages the core processing system as well as add-ons and third-party products such as online banking, automated online applications and all the other ancillary services that make up the technology infrastructure of a modern credit union. Chartway is one of two credit unions using the resource management solution, says Kevin Sparks, Summit Information Systems president. The other is $1 billion First Community CU in St. Louis, he says. Five fulltime staffers are dedicated to Chartway with “additional bodies thrown in when we need them for integration work,” Sparks says. He describes the enterprise IT resource management option as “very unique and a niche application that we’re reserving for the high end of the marketplace, where credit unions are very aggressive in terms of business development. That then creates a need for a level of technical expertise that they really can’t develop by themselves or easily compete for.” Sparks adds, “Chartway and First Com don’t want to focus on IT management issues, they want to focus on being leading-edge credit unions. Together, we leverage their investment in us by having our experts handle the job for them. “That reduces their time to market with new products and services, lowers their internal error rates, increases their system uptime and allows them to focus on building their business.” About 12 to 15 of Chartway’s 500 employees were affected by the move to the new system. Of course, the natural question here is, did anyone lose their jobs? No, Burniske says emphatically. “Our IT vice president can now focus on things that relate to our core mission, and not about hiring a new processing manager or how she can get reports out of the system this weekend,” the Chartway president and CEO says. “And we were able to take care of all our staff and place them somewhere else in the organization,” he says. “We firmly believe that one of the things that have made us a success at Chartway is that our people know we will take care of you as long as you take care of us. And we have never laid off a person in 45 years simply because of a management decision to do something differently.” Doing things differently is nothing new at Chartway, Burniske adds with a note of pride. “We’re not afraid to go first,” he says. “We were the first credit union to have a dot-com. We were the first to start a charitable foundation, which we did 15 years ago, and last year we raised about $250,000 for that. And we were the first to change our orientation to a sales culture instead of being an order-taker like everybody else. “That was back in the early `90s. People laughed at us then, but now that’s what everyone’s talking about and trying to do.” -

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