At a recent credit union conference, Jim Collins, author of the best selling book Good to Great stated that the business model credit unions rely upon is broken.

No doubt some met this news with a strong pushback fueled by an intense loyalty to the system, by the belief the credit union members are loyal because they receive better rates and better service than they can at other financial services institutions, and by their personal behaviors regarding the way they use the credit union.

But Collins is right.  The business model that built the industry is seriously broken, and this reality applies to both credit unions and banks.

Think about it.

The core business model that built the financial services industry was based on building visible presences where people would come to make deposits and withdrawals, and to apply for and receive loans.  Over time various products and services were added to the mix, but the core of the business remained structured around the deposit and loan business.

Today that model is not working as well as it did in the past for a number of reasons, but only a few are related to the lingering recession.  There are at least four key driving forces that demand a new business model for credit unions as they look to future:

1. Technology. Advances in technology will continue to make the traditional “branch-banking” model somewhat irrelevant to the consumer.  Smart phones already allow people to manage their accounts on the go, soon they will serve the same function as debit cards, and they are already being integrated with imaging to handle remote deposits.  Online banking continues to expand, as does the use of online bill payment tools.  And who knows what lies ahead.

2. Convenience. The demand for convenience has never been stronger.  Consumers want what they want when they want it and where they want it, and many are willing to pay for more convenient access.  While inherently linked to technology which changes the game by adding access points wherever consumers want them, there are also implications for branch locations, staffing, and equipment.  While we continue to hear that people want a branch where they can go to get support when they need it, it is becoming clear that it does not need to be a branch in the traditional sense.  It is the access to support that is important, not the bricks and mortar that give a sense of security and soundness.

3. Competition. Times of economic turmoil always lead to innovation, particularly in industries where business models are broken.  Though it’s seldom obvious where the innovator will come from, history shows us that the innovations that have the biggest impact often come from outside of the industry.  While impossible to predict, leaders in the credit union industry who are willing to break the mold and go beyond traditional thinking, can create alliances, partnerships, and collaborations that will lead the way.

4. Collaboration. The next generation of credit union leaders has grown up in a world where collaboration is integral to their lives.  As they select a supplier for their financial services, they expect to be listened to and they expect their ideas to be incorporated to improve the way you serve them. They also expect (and need) a seat at the table when the future is being discussed, since they will be the core of your membership moving forward.  Finding effective ways to engage them, build relationships with them, and gain their insights must be a part of your plan for the future.

The Bottom Line: For the credit union industry to succeed moving forward, the business model will have to evolve.  The key is acknowledging that as Einstein said: “We cannot solve the problems we face using the same thinking we used to create them.”

Adopting the mindset that change equals survival is step one.  From there it will be a matter of leading in new directions and thinking in new ways…about technology, convenience, competition, and collaboration.

ACTION ADVICE: Put this topic high on the agenda of your upcoming planning session. Explore options for improving your business model and push your planning team to really think about options that are outside the usual realm, because that is where the real successes will come from in the future.

It’s Your Turn: What do you think? How would you change the credit union business model? What has to happen to create a sustainable, competitive model that will support long-term success while building upon the rich history and the foundation principles that created past credit union success?

It seems that we live in world where certain phrases are no longer, or very seldom, part of our day-to-day discourse.  Take, for example, the phrase “You’re Welcome.”

I point this out because of an experience yesterday morning at local eatery.  Three to four days each week I visit this particular place for breakfast and a little out of the office writing time.  They have a decent menu, serve good food promptly, and they have multiple WiFi options, so that I can process my e-mail, write blog posts, and monitor my social media connections.

Yesterday morning, after reading a blog post from my friend Ray Edwards regarding ‘The Magic of Courtesy,’ I was struck by something my server said when they delivered my iced tea.  As they placed the cup on the table, I said “Thank you.”  The server actually looked at me and said “You’re very welcome.”

WOW!

A small gesture, and perhaps a blast to the past for someone like me, but a moment that got my attention.

Worth noticing?

Yes, for several reasons.

First, because it seemed very genuine…like this person actually cared about my dining experience.

Second, because it was unexpected…no one these days seems to say “you’re welcome” anymore, let alone make eye contact.  In fact, most of those who respond at all utter a tortured or careless (depending upon their mood at the time) “No problem,” as if it should be a problem for them to do the job they have signed up for, i.e., delivering a beverage to a customer in an eating establishment.

Third, because it reminds of the importance of small gestures…they build stronger relationships and create better experiences.  The kinds of experiences that people talk about that help to grow your credit union.

Enough said.

ACTION ADVICE: Review your member service training and execution.  Are you training your team members to say a sincere “You’re welcome” when a member thanks them for something they have done?  Are they delivering a sincere “Thank you,” when they conclude each member contact?

VALUABLE  BONUS TIP: If you really want to take it to the next level, teach your front line staff to not only say “Thank you” and “You’re Welcome,” but also to use the member’s name along with these statements, i.e., “Thank you, Mr. Hudson” or “You’re Welcome, Mr. Hudson.”  These personal connections will increase the impact and help you build stronger member relationships that increase loyalty and support your credit union’s long term growth!

It’s that time of the year again.  Credit unions Boards and Leadership teams across the country will soon be gathering for weekend retreats to discuss the strategic direction their credit unions should take in the future.

It’s a valuable and important process, and it can be greatly improved by investing some time and energy in planning to plan. Here are five important steps for every credit union to consider to make this year’s planning session more successful:

1. Connect with Your Facilitator. Odd as it may sound, there have been a number of occasions in the past where clients have preferred to limit my interaction with the planning team prior to the planning session.  This is short-sighted and compromises the outcomes.  My preferred, and recommended, approach is to speak the CEO about the desired outcomes from the planning session, and then to have individual conversations with each member of the planning team to gain their insights and to better understand their perspectives.  This allows me as the facilitator to draw people into the conversations at the planning session and to bring issues to the table that are sometimes hard for individuals to bring up.  The process takes time, but is it time well spent.

2. Scan Your CU’s Environment. Scanning the environment is a critical step in developing a strategic plan for any business, and credit unions are no different.  Task every member of the planning team to look around and gather information that might be relevant to the discussions that you will have at the planning session.  Push them to go beyond what is being written and talked about in the credit union industry–that is important, but you need to go deeper.  Look at your geographic market area, prepare a demographic profile of your membership, map that market where you compete, talk with business leaders and economic planning…gain a broad-based understanding of what people see coming down the road in your market so that you can better determine the pathway to success for your credit union.

3. Listen and Learn. One of the missing elements in most credit union planning sessions is the input of people who are not in the room. This is a big mistake. Your employees and members have ideas that should be considered in your discussions. It’s important to find ways to learn what they are thinking. Even if the ideas seem operational or pie in the sky, they can reveal important insights that the planning team should be considering. Perhaps even more important, when you invite the input of staff and members, you remind them that the credit union is a collaborative place and you gain a bit of buy-in to the planning process because they feel they are a part of it.

4. Plan Your Agenda. Too often the agenda for the planning session is left up to someone who won’t even be at the event–it gets worked out by an administrative staff member and a sales rep from the property where you hold your planning session.  Occasionally the facilitator will be asked for some input, but more often the flow of the meeting is set up the same way it has been in years past.  Don’t let this happen anymore!  The last thing a strategic planning session needs in 2010 is the same old, same old.  Be creative with the agenda and find ways to make people realize the goal is to think differently.  Simple things like using breakout sessions if you don’t normally do that, or starting the sessions at times other than the top or bottom of the hour, or having a couple of hours of free time in the afternoon and including an evening discussion…all of these are ways to break the normal patterns and bring some fresh thinking into the process.  And don’t forget to include some planned downtime where people can engage in informal conversations to build the relationships that the team needs in order to work together effectively.

5. Plan the Communication Process. Too often the planning process appears like some odd mystical ceremony to those who are not involved with the actual planning session.  Though that may sound a tad over-dramatic, think about the way it appears to those who don’t participate.  The Board and Leadership team go away for a few days and return with a plan that the team is tasked with implementing.  Don’t let this be the way that your team sees the planning process.  Before you even hold your planning session, define a plan for communicating the outcomes to the entire team and the membership.  They all need to know what happened at the planning session and why the decisions were made, and they all have a stake in the outcomes.  Define a clear and easy to implement process to inform them and engage them if you really want your plan to succeed.

ACTION ADVICE: Share this post with your planning team and allocate time to plan to plan before you hold your planning session this year.  Take action to make sure the investment of time, energy, and money pays off with a strong strategy that everyone is engaged in pursuing.

It’s Your Turn…How do you plan to plan?  What steps are you taking to make sure you hear what others have to say and that the plan is communicated to everyone after the decisions are made?  Do you have any examples of things you have done that have worked effectively?  Please take a moment to post a comment and share your insights…

It inevitably happens at some point in every credit union planning session, and for most it will happen sometime in the next few weeks.

The discussion will start with an innocent question,such as: “How can we attract more members from the younger generations–they are our future?”

From there, it will go downhill because everyone in the room will unconsciously make one simple, understandable, and easy mistake…a mistake that is not acknowledged and given sufficient weight in the discussion.

Here’s why it happens.

We see the market and the credit union’s membership from where we are in the market.  Simply stated:  We forget the old sales adage that to sell Jane Smith what Jane Smith buys, you have to see Jane Smith through Jane Smith’s eyes.

The result is that our discussion about how to reach new members is biased and ineffective.  No matter how hard we try, we cannot understand what others want unless we ask them and listen to what they tell us, or analyze their behavior and see what they actually do.

So we explore ideas and options based on our perspective of what the credit union offers, how it has impacted us and those we know, and what we believe it can do for others in the future.

In plain language, this is A VERY BAD IDEA!

If we seriously want to define a strategy for reaching the next generation of members, we need to engage them in the conversation.  Not only will it help us understand what they really want, but it will also be an important first step in building relationships with them.  Remember, these people we are trying to reach have grown up in a collaborative world where their opinions matter…reaching out and giving them a chance to share them has more value than most of us realize.

ACTION ADVICE: Before your next planning session, consider taking these steps as you plan to plan so that you are better prepared to address this inevitable question more effectively:

1. Conduct a few focus groups or do some survey work via social media to learn what your current and prospective younger members want from your credit union;

2. Analyze your current membership data and identify the habits and behaviors of your current younger generation members…what products and services are they using, how often do they come into the credit union, how heavily do they use your online services, and so forth.  Document the results and use them as a baseline for understanding the behavior of those you have already attracted to reveal how you can attract more of them.

3. Invite a broad spectrum of members to an informal reception with your Board prior to the planning session.  Serve some refreshments, let the people mingle, and focus the conversation on what they like, what they don’t like, and what they want from your credit union.  Summarize the knowledge gained and use it to make better decisions at your planning session.

It’s Your Turn…What do you think?  How can your credit union avoid making this common mistake?  Any Gen Y or Millennial readers care to share your insights on how to handle this?  Who will post the first comment and get the discussion started…?

Credit Union leaders spend spend much of their time thinking about ways to grow their credit unions and solve the problems they are experiencing.

Their conversations often take place on the run, at a conference table between meetings, or sometimes over lunch (when they have time to grab a bite to eat).

It’s not uncommon at some point in these conversations for someone to grab a pen and a napkin, business card, or tablet to sketch out their thoughts and explore solutions.

That’s the core premise behind Dan Roam’s book The Back of the Napkin.

Roam points out the most people are visual thinkers, so when they explain their ideas they rely on pictures. Though many argue that they are not good at drawing, they nonetheless reach for a pen and paper to map out their thoughts. Their goal being to show the listener how they came up with their idea and why it will work.

In The Back of the Napkin, Roam suggests there is much more to this simple process of sketching ideas on napkins than we may realize. He reveals its power by showing us how we think and revealing the role that pictures play in our thinking.

Along the way, he outlines a straightforward approach to becoming more effective in solving problems and selling ideas with pictures. Best of all, he shows us that there are only a few basic shapes one needs to learn to draw in order to become an effective visual communicator.

Dan Roam is founder and president of Digital Roam, Inc., a management consulting firm that helps executives solve problems through visual thinking. His client list includes Google, eBay, General Electric, Walmart, Wells Fargo Bank, the United States Navy, and many others. The insights he reveals through the examples he shares make the book a great reference for improving visual communication.

ACTION ADVICE: Pick up a copy of The Back of the Napkin and give it a read, then put it in an easy to reach place for reference. The ideas are solid and useful, and applying the concepts of visual thinking will improve your problem solving, decision making, and selling of ideas.

There’s something new happening in the world of social media.  It’s an interesting idea and one that seems to be catching on, at least in some circles.

But the key question is whether it is a new direction that will take hold, or a passing fad that will disappear before it really gets any traction.

Here’s what is happening.

New websites are popping up that are essentially mini-Facebook sites targeted to groups with common areas of interest.  In some cases these are entirely new sites created by thought leaders who are seeking to provide a place where like-minded individuals can connect with others who share their interests.  In other cases they are existing websites with a membership base adding a new feature to their services, i.e., a social networking function.

At first glance, this sounds like an interesting and potentially valuable approach for credit unions to consider.  Your members have a common interest and they may be interested in the opportunity to connect with others who share that interest without having to deal with the inherent noise of an open community, i.e., Facebook.

On the other hand, the prospect of having yet another place to check in each day and another set of conversations to participate in may be too daunting to engage them.  That was my initial reaction to seeing this new development–the last thing I need or want is one more stream coming into my already overcrowded information flow.

That is what leads me to ask the question:  Is this emerging social media trend a mistake or an opportunity to build stronger relationships with your members?

The best answer at the moment is probably that it depends.

It depends on your members and what they want.  It depends upon your team and its ability to manage such an initiative in addition to what they are already doing.  And it depends upon the goals you have defined for your social media efforts.

If your objective is to build a place that serves your credit union members and provides them with access to ‘members only’ information while enabling them to engage with other members online, then this approach might have real value for your credit union.

But if your objective is to connect with your members where they already are without adding more work for them, then this may not be something you want to consider at this point.

ACTION ADVICE: Monitor this development and its evolution across the coming months.  Chances are there will be much more written about it as it unfolds, and there will be valuable lessons to be learned from those who are currently walking this path.  If you know of one of these, consider signing up and monitoring it to see firsthand what it happening so you can evaluate the potential of the approach for your credit union.

It’s Your Turn…What do you think about this emerging trend?  Do you think that having a social media function on your website would help or hurt your relationship with your members?  Please take a moment and share your thoughts…

It is our pleasure to share a guest post with you today from James Robert Lay, a leading voice in the credit union industry on the power of social media, innovation, communication, and collaboration.  Enjoy!

As more and more credit unions enter the social media conversation, it can sometimes be overwhelming with all the different accounts one has to manage.  In addition, to follow up Michael’s previous thoughts, it is also important to post and create content after hours when people are checking their social networks.

While some are connected all day to Facebook and Twitter, others do their primary social networking after general business hours.  But what happens to your credit union in the conversation?  Are your social media channels playing the quiet game after hours?

There are some amazing web tools available to manage multiple social networks and even schedule posts to go out at a certain time.  Before we take a look at a few, please remember that social media is about being social and providing relevant information to your followers.  Social media is NOT about broadcasting or reusing marketing messages about the latest promotion, rate or holiday closing.  If this is all your posting, there is a good chance that no one is listening.

As an alternative, I recommend three simple steps: listen, learn and engage.  Listen to what is being discussed by your followers, learn from their conversations and then engage them in a real and personal way.  Keep in mind that all your tweets or posts do not have to be financially related or even about your credit union.  Make them real and relevant to your members and community.

But I digress… let’s get back to practical ways to manage social networks (primarily Twitter and Facebook) during the day and even after business hours.

One amazing online tool I recommend for managing both Twitter and Facebook is Hootsuite.  Hootsuite runs in your browser and let’s you manage multiple accounts including Twitter, Facebook, LinkedIn and more all from one location.  No more going to Facebook to make a post or Twitter to make an update as Hootsuite allows you to do it all from one location.

In addition, Hootsuite also allows you to schedule posts whenever you like.  This is very helpful when following a social media plan and strategy where you have planned content to go out that is helpful and educational.  Furthermore, Hootsuite allows you to schedule posts to go out after hours or on the weekends to keep the conversation going with your followers.

Another useful tool for after hours social media management are mobile applications that run smart phones.  There are many different apps available for iPhones, Androids and Blackberries allowing you to connect and manage your social networks where ever you are.  So if it is the weekend and someone tweets out to your credit union, instead of waiting until Monday to respond, using a mobile app will allow you to respond much quicker as needed.

In summary, there are many different ways to connect and manage multiple social media accounts in addition to scheduling posts and tweets to go out after hours.   There is also an option of syncing your social networks with your cell phone for easy mobile management.  Take some time to play around and try new things to find what works best for you.  But remember… listen, learn and engage.

About James Robert Lay

James Robert Lay is the Grower of Relationships at PTP NEW MEDIA and the Chief Tailor of Conversation at CU*SWAG. He is a web, viral and social marketing consultant as well as credit union advocate dedicated to helping credit unions connect and build relationships with their members and community. In addition, he is also one of the founders of www.cugrow.com, a credit union industry blog with a focus on innovation, communication and collaboration.

Leadership is not easy.  Everything changes from day to day, the environment is never certain, and the time to celebrate successes is often eclipsed by the next crisis.

For credit union leaders the recent past has been a challenge to say the least.  And at times like this its helpful to have a few simple guidelines that can help you navigate the waters.

In Rules of Thumb, author Alan M. Webber provides 52 such rules that credit union leaders can learn from.  Though Webber writes from the perspective of small business and entrepreneurship, his insights can easily be adapted to the very small-business like world of credit unions.

Frankly, it’s hard not to get excited about reading Rules of Thumb when you take a look at the back flap of the book and read the author’s bio: “According to those who know him best, Alan M. Webber is witty and wise (on Mondays and Wednesdays), thoughtful and provocative (on Tuesdays and Thursdays), and irreverent and creative (on Fridays and Saturdays).  On Sundays he rests.”

Anyone with a bio like that must have a wealth of experiences and insights to share, and that is exactly what Webber does in the book.  Webber is the cofounding editor of Fast Company magazine and was the editorial director and managing editor of the Harvard Business Review.  He calls himself a ‘global detective,’ something he admits “has the benefit of little meaning but sounding cool.”

In Rules of Thumb, Webber draws upon his experiences with some of the world’s best thinkers and highest achievers to define his fifty-two rules of thumb.  His rules span a broad spectrum of topics, but all are intended to help people in every walk of life “make sense out of confusing, challenging, and compelling times.”

The real strength of the book, and the key reason it should be of interest to credit union leaders, lies in the real world stories that underlie each of Webber’s rules. Sharing many of his experiences in starting Fast Company, as well as stories from his days at the Harvard Business Review, Webber keeps his insights practical and accessible.  This is the kind of book you should keep on the shelf, pull down regularly, and use as a guide to improve your effectiveness.

ACTION ADVICE: Pick up a copy of Rules of Thumb and put it in a place where you can read it from time to time.  The advice is solid and the book is organized to support reading one rule at a time, or you can use it as a reference and look up a topic when you are wrestling with a challenge to get some new perspective and insight.

Social media is here to stay and it needs to be part of every credit union’s marketing mix.

Though not all of your members are there (at least not yet), a significant portion of them are using these new tools as a way to connect with people and get information.

But there is a HUGE MISTAKE that virtually every credit union using social media is making, and it needs immediate attention if their efforts are going to succeed in having any meaningful impact.

Here’s how I discovered this problem.

Last Saturday I had the privilege of speaking at the West Virginia Credit Union League’s Volunteer Leadership Conference at the Stonewall Resort. During a session on Strategic Thinking we ventured online to take a look at the Facebook and Twitter presences of a few credit unions.

And that’s where I discovered the HUGE MISTAKE that credit unions are making.

The Mistake: Credit unions are not joining in the conversation on the weekends or in the evenings.

The Evidence: I follow over 500 credit unions on my Facebook account and reviewing posts for the previous 18 hours around 2 pm on a Saturday revealed a total of ZERO POSTS from any of them. And that has been my experience virtually every time that I have done this little experiment during a weekend presentation, or when I check in the evening during the week.

The Reality: Your members are online and checking their social media accounts at night and on weekends, not during the business day. If you are only putting out information during the day, you are missing the real opportunity to connect. In fact, based on casual conversation, it seems that many Facebook users don’t even take the time to review posts that were put up when they are not online.

The Bottom Line: If you aren’t connecting when they are live and paying attention, then chances are you are wasting your time, or at least achieving less impact than you would like.

Enough said.

ACTION ADVICE: Find a way to start connecting with your members via social media when they are actually online so that they are reading current information and can join in the conversation with you live…not with a time delay. Perhaps you can engage some volunteers who would be willing to provide leadership in this area…you provide them with the messages and they post them and monitor the conversation at night and on weekends. Or maybe you have some staff who are avid social media types who would be willing to handle this for you. Whatever you do, find a way to make it happen…and your social media efforts will yield bigger impacts.

It’s Your Turn…What do you think about this issue? Any ideas for getting this done effectively and efficiently? Any experiences worth sharing? Post a comment and let everyone know.

One of the most critical challenges credit unions face today is coming up with new and innovative ideas that will position them for long term success. The first step is expanding the way people think and helping them look beyond the comfortable to consider the possible.

An easy and effective way to start the process is to have the team read a book that focuses on the power of thinking big and then have them discuss their reactions and insights. That will open the mind to creativity and set the stage for better idea creation.

From my perspective, there is only one book that fits this purpose.

Some books just have staying power. Sometimes it comes from the point when they came into your life and the impact they made. Other times it comes from the information they share and the value it has. Still other times it’s because they keep popping up on the radar screen and being recommended by people you respect.

The Magic of Thinking Big is a book with staying power on all levels, even on my recent tenth read. While many of the ideas are now familiar, and the insights may feel a bit dated to some, the wisdom is timeless. These concepts are as relevant today as when the book was first published over 50 years ago. Reading (and rereading) the book is guaranteed to stimulate new ideas and convince you to think bigger.

Dr. David J. Schwartz was a professor at Georgia State University in Atlanta and the president of Creative Educational Services, Inc., a consulting firm specializing in leadership development. Schwartz’s book has sold over 4 million copies and is widely respected in the fields of personal development and life coaching. Its lessons have significant and meaningful implications for today’s credit union leaders.

Not surprisingly the core message of The Magic of Thinking Big is that you have the power to change the way you think. From that premise Schwartz provides examples illustrating the impacts of thinking bigger on your personal and professional life. The action steps provided are easily within reach, and the potential impacts for your credit union are significant.

ACTION ADVICE: Buy a copy of this book for everyone on your planning team. Set up a timeline that will have everyone read the book across a set period of time…perhaps several weeks or even months. Block out time when the team is together to discuss the concepts and ideas in the book, then do some quick idea storming about the future of your credit union. Write the ideas down and bring them to the next meeting. Consider giving everyone an idea journal and asking them to note the ideas that come to them as they read the book and between your sessions. Investing this time in expanding the thinking of the team will pay significant dividends in the long term. Get started today!

It’s Your Turn…What book(s) (or articles) would you recommend to jump start the creative process? Do you have any tools or exercises that you have used with good results with your team? Please post a comment and share your insights.