Home » Credit Union Strategy Blog » Growing Your Credit Union

Archive for the ‘Growing Your Credit Union’ Category

RECOMMENDED READING: Rework

Thursday, December 16th, 2010

Attention credit union leaders looking for new ideas that can take your credit union to the next level.  Here is a book that is packed with insight, that will challenge your thinking, and that delivers actionable advice that you can put to work now and in the future.

The first thing that drew my attention to this book was the Seth Godin quote on the dust jacket stating: “Ignore this book at your own peril.”  It got told me a lot about what I would find inside the book, and I was not disappointed.

Rework is filled with practical tips, actionable advice, thought-provoking insights, and a core message that will have value to anyone running a credit union (or any other business).

The book was written by Jason Fried and David Heinemenier Hansson, the founders of 37Signals, a company described as “a trailblazing software company that produces products used by millions of people around the world.” These are the guys who created Basecamp, Highrise, and Ruby on Rails, and several other products that help teams work together more effectively. Along the way they’ve learned a number of lessons and this book shares them in an effective manner.

But Rework is much more than a story of what two guys learned while building a successful business. In fact, one of its real appeals is that it skips the usual self-indulgent stories about what the authors did, why they did it, and how amazingly it worked.

Instead, it opts for a more direct dose of reality on a wide range of topics from getting started to productivity to hiring to culture. You’ll nod in agreement, scratch your head while pondering, and ache to change the way you do things to liberate yourself from the binds that are holding your credit union back.

ACTION ADVICE: Buy a copy today, read it tomorrow, and put it to work in the days, weeks, and months ahead.  You’ll be glad you did, and you credit union and your team will realize valuable results from your efforts.

Growing Your Credit Union: It’s Time to Get to Really Know Jane Smith

Tuesday, October 12th, 2010

There’s an old adage in sales that says “To sell Jane Smith what Jane Smith buys, you have to see Jane Smith through Jane Smith’s eyes.”

Truer words have never been sp0ken (and they are equally relevant for John Smith).

For today’s credit unions, this statement is something that should be top of mind in every thing that you do.  Serving multiple generations with increasingly diverse perspectives is a challenge, and it is one that must be overcome if you are to achieve long term success.

It starts with asking the question:  How well do we understand the real needs of our members across each generation that we serve?

Next, depending upon your answers to the previous question, take action to learn more about what your member want and need.  Find out where they are getting the things they need that you don’t offer.  Learn what it would take for them to switch to your credit union for those services, and why they haven’t already done so.

Finally, as you move forward and look to grow your credit union by attracting new members, figure out how you can leverage the relationships you have with current members who have similar demographic characteristics.  Strive to learn what Jane Smith sees and figure out how to deliver the products and services she wants to buy from her credit union.

ACTION ADVICE: Use your member customer information files to identify members who represent the key demographics you credit union serves, then invest some time talking with members from each segment to learn more about their needs.  You can use formal focus groups, or informal lunch-n-learn type sessions.  Remember to ask the questions and listen to the responses, not to defend, justify, or explain.  The way to learn what Jane Smith buys is to ask her and then listen carefully to what she says.

What do you think? What has your credit union done to learn more about the needs and wants of your members?  Do you have any suggestions for other credit unions regarding how to better understand and serve the different generations within your membership?  Please post a comment and share your insights.

How Do You Define Growth?

Wednesday, October 6th, 2010

One of the more interesting discussions that often arises during planning sessions is how a credit union should define growth. It’s an important question, and your planning team should come to an agreement about it before making any decisions.

The reality is that everyone seems to have their own definitions of what it means to grow the credit union, with the most common views and their rationales including:

Memberships. If the number of members is increasing, then the credit union is growing because more members will use more services and that will lead to improved financial performance.

Assets. Assumes that as the credit union attracts more assets it is able to lend more money to its members and as loans grow, the credit union will grow.

ROA or ROI. When the rate of return is growing (or at least being maintained), then the credit union is (or at least holding its ground).

Net Worth. When net worth is being increased, the credit union is strengthening its financial position and therefore growing.

There are merits to each of these, and perhaps in many cases some combination of these or other measures is the best approach.

The real point is that it needs to be explicitly defined so that everyone on the planning team, as well as everyone on the staff, knows how growth is being measured, since it is often the primary goal of the strategic plan.

ACTION ADVICE: Block out some time during your planning session to discuss what growth means to your Board and Leadership Teams.  Work to come to a consensus about how you will measure growth so that you can define clear performance targets.  Be cautious not to just create a measure(s) that can be manipulated too easily or that will not accurately reflect the outcomes you are seeking for your credit union.

It’s Your Turn…How does your credit union define growth?  What have you found works best to keep the team focused and to produce the results you want?  How do you use growth as a guideline or outcome measure for your overall business strategy.  Please post a comment and share your insights.

RECOMMENDED READING: Conquer the Chaos

Thursday, September 23rd, 2010

One of the often overlooked realities about credit unions is that they are small businesses.

Think about it.

Most employee less than 200 people, serve a relatively targeted market area, and have only a few locations. The day-to-day business operations and the associated challenges closely mirror those faced by entrepreneurs and small business owners.

Recognition of this parallel opens up a world of options to credit union leaders for advice, insight, and ideas on improving credit union success. There is wealth of information available that is designed to support the growth of small businesses, and much of it has direct applicability to credit unions.

Conquer the Chaos is example. The subtitle of the book is “How to Grow a Successful Small Business without Going Crazy.” And the book’s authors speak from experience, having built the software company Infusionsoft which is a leading provider of e-mail marketing software for small businesses. (more…)

The Business Development Challenge: Going Beyond Grips, Grins, and Giveaways

Tuesday, September 14th, 2010

Across the past two weeks it seems that the subject of business development for credit unions has crisscrossed my desk at least every other day.

Some of the conversations have focused on getting clear about the definition of business development as it relates to credit unions.  The core question being whether there is a difference between developing relationships with local businesses and developing the membership base for the credit union.

Other conversations have focused on the challenges involved in doing something that has never really been done effectively by most credit unions.  These conversations usually end up lamenting the lack of success of efforts, and often lead to some questioning of whether the talent pool or experience exists within the credit union industry to really achieve success in the area of business development.

These folks I’ve been speaking with are concerned and anxious to find a way to increase their effectiveness in growing their credit union membership.  Listening to their concerns and sharing ideas has led me to form a few general conclusions that may help you as you think through your next steps in this important area. (more…)