Credit unions, large and small, should culturally view technology as a valuable interconnected strategic capability across all functional areas to give back to their membership. Technology is an integral component to organizations, especially mediating organizations such as credit unions, which obviously bring savers and borrowers together for their respective communal benefit.

Credit unions facilitate an exchange or transaction between two or more members of their charter, and must do so in the manner and with the timing that is most beneficial to these members. Today that is often 24/7, online, or via a mobile device, and certainly members' desires will continuously evolve as a society and culture transform.

For a credit union to be a member's primary financial “go-between” per se, technology is not separate, it is not an organizational silo operating independently, nor does it solely exist for the productivity of the back office. Instead, technology is a multidimensional capability to deliver significance and member experience, in addition to creating operational excellence, automation, and standardization to such routine activities as opening memberships, conducting transactions, and completing loan applications.

Furthermore, the rapidly evolving external technology sector, much like the political, legal, social, cultural and economic sectors in the broader strategic landscape, will influence the overall environment in a multitude of ways that may emphatically force a credit union, large or small, to adapt to remain viable. This remains true even if their ability to employ such technology is limited.

Yet, technology can also be one of the greatest evolutionary stimuli on the internal activities of a credit union. For example, computer technology, data and the inherent consumption of information inspire shifts in organizational business models, strategies, structures (social and physical), and operational practices, while simultaneously affecting societal expectations for access and responsiveness.

Moreover, technology affects other direct and indirect stakeholders such as partners, vendors, regulatory agencies and competitors in each respective credit union network. In fact, the technology imperative theory argues that choosing a particular technology will actually determine many other vital aspects of an organization, large or small.

Likewise, the social construction of technology theory essentially describes how technology evolves via complex social trade-offs. Interestingly, there is further duality in this social theme. Social and cultural constructs influence technology and technologies influence society and culture. Ergo, while a credit union may be unlikely to influence overall society with its technology (the financial services industry as a whole may) or even have the capacity to deploy specific technology, society (members) will continually influence the need to employ certain technologies by all credit unions.

Last, tying into the internal benefits of technology, the Aston Group found evidence that the smaller the organization, the greater the significance of technology with regards to structure and performance. So it seems that smaller credit unions have the most to gain by exploiting technology – even when such ability may be constrained.

Consequently, choosing a core system, selecting software applications, electing technology platforms, or installing infrastructure will ultimately dictate a wide range of explicit and implicit changes to the credit union, internally and externally.

However, a credit union, like any organization, has a set of values that include principles, goals and standards that it believes have intrinsic worth within its own walls and within the general environment in which it operates. Technology should be cooperatively valued by the internal culture in order to maximize its advantage, and senior leadership should willingly foster its adoption as a strategic means to an end.

Moreover, the culture should nurture the coordination and collaboration of technology across the various functional areas to dismantle silos effectively, increase communication, streamline processes and strengthen organizational performance.

A lot hinges on how a particular credit union views technology in relation to its values, vision, mission and strategy. Do I, as a credit union, wish to be a leader or a laggard with technology with respect to serving my membership and creating member experience? How much operational efficiency and cost savings do I think I can achieve with the right technology? Is technology a means to enable my strategy, realize a competitive advantage, influence collaboration, and foster innovation; or do I see technology as just a necessary “cost” to remain in business?

If my opinion is the latter, I may find myself investing in the bare minimum and always playing catch-up with member expectations, the financial services industry, and society. Finally, do we as a board and CEO envision technology as a key pillar of our strategic plan for providing credit union products and services or do we merely think of technology expenditure as a compulsory pain-point?

The organizational posture in the context of these questions will ultimately set the priority for technology investment and strategic exploitation. Culture and technology should be tightly aligned in order to deliver the most value to the members.

Anthony W. Montgomery is a senior director for a global non-profit in Nashville, Tenn., and a former credit union executive.

Instant Insights /

The Technology Imperative, Social Constructs and Intrinsic Worth

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