We do not need a crystal ball to figure out what tools financialinstitutions will need to compete in the 21st century. The internethas disrupted many business models, including the credit unionbusiness model. While the internet provides credit unions with theopportunity to connect to their members remotely, the internet hasalso enabled credit union competitors nationwide to access members.Some of these competitors have technology that is extraordinary andimproving every year. The latest example is Rocket Mortgage byQuicken Loans. While the eight-minute approval it advertises israrely a reality, its approval process takes a fraction of the timefor conventional underwriting.

The bar on what constitutes swift, effective and convenientservice keeps rising as do the expectations of consumers. Thistrend is irreversible. If a financial services provider cannot keepup the pace, it will be left in the dust. You remember Kodak,Blockbuster and Borders. Advances in technology and their refusalto react to change in a timely manner turned their business modelfrom vibrant company to business school case study.

The ability to acquire, store, analyze and act on data is also agame changer. Credit unions have an image of themselves that theyare close to their members and know their financial needs, but thatimage in most cases is just that – an image. Today, Google andAmazon likely know much more about a credit union's members thanthe credit union. If a credit union's competitor has the ability toleverage data on a credit union's membership better than the creditunion, there is little doubt what the outcome of that competitionwill be. Leveraging data enables a credit union to provide productofferings that are relevant and timely to particular members,anticipate loan pay-offs and provide modifications to keep theloans, ask fewer but more relevant questions in the underwritingprocess, and undercut the competition on loan rates with betterdata on credit risk.