Who are you striving to be?
Thanks to this photo of Roy Bergengren recently shared by credit union advocate Matthew Cropp of Vermont, I realize that we now have fewer credit unions in the U.S. than at any time prior to NINETEEN THIRTY-NINE. Think about that for a minute…. what does that mean? Now some would explain that away saying that overall membership in the U.S. is at an all time high. So let’s put those two equations together: more people, but fewer institutions. Is that a good thing? A bad thing? Just a thing?
What would Ed Filene and Roy Bergengren think? That after the past 75 years of credit union advocacy, we now have fewer credit unions serving all of America? Are the products better than before? Is the service worse than before? Is the differentiation between credit unions and banks better or worse than 75 years ago? Do we still have a need for credit unions, or has the reason they were founded pretty much gone away? Is there more opportunity than ever before for smaller CUs to succeed? Or is it just too challenging, and every CU below $10m in assets should just get merged into a larger one until there are none in this size range anymore? Do you need to offer every financial product and service that your competitors do in order to succeed? Or does that pursuit just drain time and money resources away from your CU’s core mission?
What is the mission and purpose of your credit union? Who are you trying to be? Who are you serving? What is your connection like with the members you serve? Tight? Barely there?
One of the reasons I bring up this topic is that it seems to me that more and more credit unions are basically operating as tax-exempt banks; attempting to grow no matter what, and becoming more generic in appearance and attitude (and losing connection with the group that founded them). To operate this way may serve the needs of the institution (although it may actually not), but in any case seems a disservice to the membership, and perhaps just as importantly, a disservice to the CU movement as a whole. If a credit union is going to operate like a bank, it should just acknowledge that fact and change charters and switch to being regulated and insured the FDIC instead of NCUA. That tax-exempt thing is not really that a great a business advantage anyway.
But the other surprising thing about credit unions operating like banks (aside from failing to live up to its mission statement) is that in many cases, the trend is away from generic large institutions and stores, and TOWARDS unique, local, and independent organizations. So-called “big box” stores are on the decline; while one-of-a-kind shops find their niche. Many people avoid chain restaurants in favor of unique eateries.
But being different, in and of itself, is not a sustainable business model. To increase success in business, you need to provide something different for which there exists a customer base. One way to approach this differentiation is to employ technology to make it easier for your customers to do business with you, whether that be in facilitating the process of ordering products and services, the delivery of those products and services, or help in using those products and services. From our own point of view; we’ve found that every time we make our own technology easier to use, more streamlined, and more personalized, it pays dividends immediately.
How are you using technology to differentiate and personalize your credit union? Are you using technology to strengthen the connection between your employees and your members, or is it weakening that connection? Who are you serving, and how are you making their experience with you easier and better? If providing “better, more personal service” is the differentiation point of your credit union (as many state), is your technology living up to that promise? What are your thoughts?