Archive for the ‘Uncategorized’ Category

Hold please…

I had a big post about the receptionist all coming together nicely. It had grand storytelling, a few exaggerations*, and a great moral. It was nice and fun, but it missed the one question I kept coming back to:

What if tomorrow morning, the employer of our new found favorite CU receptionist announced that they were starting the process of becoming a bank?

Would that change your view on the receptionist’s comments? What if they had announced something like that the day before? What would the CU industry reaction have been then? What if they announced that they were merging with a much larger CU? What if they announced they were shutting down?

TO BE CLEAR. I KNOW NOTHING ABOUT THIS CU. I’M SPEAKING PURELY IN HYPOTHETICALS.

The deal is, you U.S. CUs are a spotty bunch. There are some good ones and there are some bad ones and there are a whole lot in the middle. The credit union movement is only as good as the CU that has the most influence on you. For many, that means the CU they are geographically closest to.

For you CU industry types, that means the CU movement is awesome because you yourself are rockin’ and have done your best to make the CU you work in or with a general realm of greatness. Others are not so lucky/blessed/self-motivated/driven/anything else you contribute your personal CU success to.

It’s really easy to say things like “Credit unions are great places to work” but seriously tomorrow the CU nearest me may be closed, or under a different name, or even be a bank. If that happened, would it have been a “great place to work” the day before? The month before? The year before?

This is the reality of the CU movement.

* I honestly still haven’t seen the original, so my original post probably had more than a few exaggerations.

Planes, Buggies, Letters, Email & Financial Services

The Credit Union Warrior (whom I am quite fond of) recently wrote “Unique Banking Needs? Hogwash.” and presents the theory that all this noise about Gen Y needing different and unique services is marketing mumbo jumbo.

We need loans, payment vehicles, investment vehicles, convenient access to our cash, and financial advice all at the best price possible…just like every other generation.

While I agree these are the basics, I cannot say they are the same as generations past. I believe that instant access to information has become a game changer and drastically effects how financial services are sought, delivered, and evaluated.

But isn’t it still just ‘loans’? Yeah…but isn’t flying ‘just’ transporting yourself from one location to another and yet the experience differs so much from driving (or horse and buggying…I’m guessing…might have to ask @rshevlin about that…) that they to hardly resemble each other.

And writing a personal email is ‘just’ communicating ideas in written form, but how different is that than sending a letter? (Both for better and worse.)

Given, flight and email are big time game changers, but so is this massive about of information we currently have at our fingertips. I’m not going to say that the use of this information breaks neatly down a generational line, but you can’t argue against it being here and being big.

If you think “We’re providing loans just like we have for the last 25/50 years” I’m afraid you’ll miss a large segment of your membership (and potential membership) that wouldn’t recognize a loan from 25 years ago if it were staring them in the face.

Pie in the Sky: Financial Self Improvement at Your Local Credit Union

In regards to my thoughts on Principle #4 and Credit Unions as self-help organizations:

With Americans apparent obsessed with all things self-help, how is this not a focal point of American CUs?

If there is a National Brand that could weave CUs together, I’d make a strong case for this as “the one”.

Principle #4: Autonomy and Independence (Part 1)

It’s time to jump back into our ongoing discussion about the 7 cooperative principles. If you need a refresh, the other articles in the series are located here.

Autonomy and Independence
Cooperatives are autonomous, self-help organizations controlled by their members. If the cooperative enters into agreements with other organizations or raises capital from external sources, it is done so based on terms that ensure democratic control by the member and maintains the cooperative autonomy.

There’s so much jammed into Principle #4 that it looks to be a 2 parter for me. Let’s start by looking at “Cooperatives are autonomous, self-help organizations controlled by their members”

Credit Unions are autonomous.

Each Credit Union is self-governing. Each has it’s own set of rules. Your CU can’t tell my CU what to do. (I do what I want!) But not really.

CUs do have levels of governance above them. No CU is an island. They are subject to local and federal laws and in most cases some kind of regulatory body. (I would say all cases but don’t really have the time to research the credit union practices of every country.)

This isn’t necessarily a bad thing. We certainly can’t have credit unions making up rules that supersede federal law. But, have you seen the 428 page beast of a document that is the NCUA Regulations? That’s a lot of regulating for entities that are supposed to be self governed.

In addition, the recent incident with TDECU and the FDIC clearly shows that Credit Unions can and are influenced by forces beyond their member controller.

Credit Unions are self-help organizations.*

For me this could be one of the most powerful and differentiating ways to look at Credit Unions. Instead of seeing CUs as Financial Institutions that are member controlled, it very much within the CU DNA to be seen as places for financial self improvement.

This means more than just good auto loan rates. (Though it’s probably under the self improvement umbrella.) This means helping members with things like budgeting and retirement planning and making that feel like the norm instead of the exception. It means educating members of their financial options in ways that are engaging, maybe even fun.

Credit Unions are member controlled.

This is the 3rd principle that mentions member control. It’s kind of big deal. (See Principle #2 and #3 for more thoughts on that.)

What’s your take?

My big questions for members of the Credit Union community in regards to part 1 of Principle #4 are:

  1. Do you feel like your CU is really autonomous? Is there too much regulation? Is there not enough regulation? What are the areas where you feel free to self-govern and write your own rules?
  2. Do you view your CU as a self-help organization? Do your members view it that way? What would you need to do internally and externally to act more like a self-help organization

* I’m not 100% sure about the original intentions of “self-help organization.” Self-Help could be an adjective to describe the organization or part of the noun. It could make a difference in one’s interpretation of a credit union as a self-help organization. Is a credit union an organization that provides for itself and solves its own problems (an organization that is “self-help”) or is it a place where people go to help better themselves? I prefer the later.

Skeptic 2.0

I don’t know whether it was the great conversation that was getting started, the blinding lights on stage, or the sweet smell of Ron Shevlin, but I hopped off stage last Thursday without addressing Skeptic 2.0. Well let’s get into it now.

Objective #1: Keep writing and write more

The attitude around my unveiling has reinforced my resolve to make this blog happen, even without anonymity. I’d like to post once a week which would double my pace from last year. This industry has never left me short of topics, it’s time to start taking on more of them.

Objective #2: Allow you to unleash your inner Skeptic

I’ve already posted one and been approach by another member of the CU community that would like to post a guest article under a veil of anonymity. I wanted to make this kind of sharing easier and more anonymous so I setup a form over at Your Inner Skeptic for just this type of submission. I look forward to helping you share your observations with the CU world.

Objective #3: Start changing this thing from the inside out

I’m looking for a credit union to join. More than that, I’m looking for a credit union to join and a board to run for. More than that, I’m looking for others that want to do the same. (Or have already done the same.)

If you want me at your CU, or on your Board, let me know.

If you’ve been considering something similar and are ready to get this thing rolling, let me know.

If you’re on a board and reading this…well hi Ginny…any advice?

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I told you this was only the beginning….

Presentation Reflection

First up, I promised the slides so here they are. Not sure how much they’ll help: 2008_symposium_skeptic_pdf

Also the links to the Filene Research I referenced: Employee Perceptions of Credit Unions and Why Choose a Credit Union? An Ethnographic Study of Member Behaviour

A few other notes, appologies, etc after watching the video myself:

  • I referred to the second Filene Research Study (Why Choose a CU) as “recent” when in fact it was released in September….2007. I sincerely apologize for the inaccuracy. It’s still fairly recent as far as research goes.
  • In the same vein, I casually referred to George Hofheimer as ‘George.’ The Chief Research Officer at Filene probably deserves a little more respect from someone he’s never met. Once again, sincerest apologies.
  • There are a few times I used the word bank when I meant credit union. Sometimes even my mouth doesn’t know the difference. 😉

Feel free to email me any other criticisms you wish or, if it’s something you think is worth a public lashing, go ahead and let me have it in the comments.

Thanks again to Doug True and Forum Solutions for inviting me to share my message. Also thanks to everyone who has sent positive tweets, blog posts, and comments my way.

Kum-ba-ya Over. 😉

I have a real name ;)

These last few days have worn me out, but I just wanted to say thank you to everyone who made the Reveal at the Partnership Symposium be a truly great experience.

In case you missed it, you can find it here: http://www.ustream.tv/recorded/757734

I’ll have the slides up (with sources) by Monday morning!

Thanks again, and don’t worry, this isn’t the end. I’m just getting started.

Why MyLifeMyMoney is great for the CU Industry (And possibly even better for Currency Marketing)

There is a lot of talk about the rip off job Resource One’s MyLifeMyMoney campaign did on Currency Marketing’s Young & Free efforts which are live in Alberta and Texas. It has created quite the buzz around the CU blogosphere and in case you’ve been living under a rock, you can go here and here to catchup with all the happenings.

My Take: This is exactly what the CU industry needs to better understand how to reach Gen Y

Yes. Anyone blessed with sight can easily tell a quality difference between what Currency Marketing is rolling with and what Resource One has put out there. It’s honestly pretty sad if you put the two side by side. But beyond aesthetics, this campaign has the opportunity to offer a ton of insight into many questions out there about this type of campaign (Some of these I now realize where even asked by Jeffry Pilcher in his post breaking this story.):

  • Does the quality of the spokester search campaign effect the quality of applicants?
  • Is the spokester more important than the infrastructure?
  • Is a part timer (MLMM) more or less effective than a full timer (Y&F)?
  • How much traditional media is needed to accompany one of these campaigns?
  • Is a 200k* budget required to effectively reach out to and participate with Gen Y?

From strictly an industry perspective, you should be rooting for this campaign to work. You want to think that you don’t need hundreds of thousands of dollars to be relevant to Gen Y. You want to think that if you can just make a little effort, you can make headway in this space.

Currency Marketing could come out the big winner

As much as it sucks to have your hard work ripped off, if I were at Currency, I would be very excited about how this is currently playing out. If the MLMM campaign is doomed to fail (as everyone predicts), then Young & Free just became a heck of a lot more valuable. Resource One will have provided the case study that participating with Gen Y is no easy task, and just hiring a Gen Y-er and giving them some cool gadgets won’t do the trick. They will have proved that you NEED the experts of Currency Marketing. And that will be 200k*…please pull forward and pay at the first window.

Don’t get me wrong, I definitely feel for what Currency Marketing is going through, but I think it’s a great thing for the industry and could have a huge silver lining for Young & Free.

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* I don’t know what the exact numbers on a Y&F rollout are. They have been mentioned in the hundreds of thousands of dollars by various sources.

A Guest Rant

I was sent this post by a member of the CU community that didn’t feel comfortable having it appear on his/her personal blog. I totally understand wanting to say things that need to be said, but not wanting those things always tied to your personal persona, so I’m always happy to publish anything you want said in total annoyminity. Here we go…..

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The first step in solving a problem is admitting that there is a problem. In credit union land, this realization has simply not been made.

The world of auto sales is a perfect indicator of this point. When the economy tightens, guess what auto dealers do? They cut prices. They improve interest rates. They do everything they can to make their products more attractive. After all, “waiting this economy out” is not an option for them. Even Honda and Toyota, the two most attractive automakers of our time, are offering 0-2% financing and huge rebates (or employee pricing).

What do credit unions do in tough economic times? We move mountains to decrease our cost of funds. We make it tougher to get loans. We become less attractive when our members need them most. We become an equally bad deal as banks, when we should be scrambling to take advantage of the opening banks are giving us.

Yeah, I know. I’m comparing apples to oranges, right? Maybe.

Consider wages, then. In 2007, total compensation for CU executives rose 7.7%. Assets from December 2006 to June 2007 grew only 4.3%. Is this in line with what the rest of America is experiencing? Hardly. Earnings increased only 1.1% for all workers in the U.S. economy.

This is not to say credit union executives are overpaid. I truly believe that in many cases the opposite is true. What is startling, however, is that our behavior communicates to the public that we are isolated from the struggles they are facing. While they are facing layoffs, hiring freezes, and pitiful pay increases, we are giving financial high fives to way too many executives who simply aren’t performing.

We say we want to start attracting younger members and employees, but have we changed our approach to either? Hardly. I have seen precious few examples of true innovation in our industry that would excite anyone under the age of 45. We are not recruiting on college campuses. We are not attracting elite employees. We aren’t putting our money where our mouth is when it comes to investing in innovation.

Peer-to-peer lending? Give me a break! Taking a cut out of an over-priced peer-to-peer lending transaction is not peer-to-peer lending. Blogs? Let’s face facts, that’s not innovation. Turning teller lines into pods? Wow, no bank could ever pull that off.

And why do credit unions think that “best practices” are the answer to all of our woes? Best practices are simply proven strategies for other credit unions. If you are waiting to act on an idea until a best practices report comes out, you are part of the problem not part of the solution. Want to convert into a bank? Good riddance. We didn’t want you any way. And if bank conversion is what’s truly best for your members, why should the movement stop you? Isn’t that what we’re in business to do?

How often do we truly cooperate with one another? No, seriously. How often? Being chummy at a conference doesn’t count. I can count on my right hand (and right now it is on my keyboard’s home row) how many times in the last year credit unions have come together to meet a specific, or even general, member need. Where are our solutions to high energy prices? What are we doing to help folks cope with, or better yet avoid, foreclosure or bankruptcy? The truth is we don’t cooperate unless there’s something in it for us, or it’s a community service project.

We’ll blame regulators or ALM or “the economy”, but in all actuality the riskier (read: more needy) a member is the less likely we are to help them out. “Not-for-profit” should not mean “for charity”, I realize. But you and I both know that we are still shutting out an awfully large amount of people. Essentially, we aren’t serving unmet needs. Instead, we are duplicating the efforts of banks and, worse, each other. We’re competitors. Stop pretending we are inter-cooperative until you prove otherwise.

You see. The frustrating thing is not that the credit union philosophy is broken – it most certainly is not. What should piss everyone who loves and believes in the credit union movement is how credit unions have implemented and modernized that philosophy.

We haven’t admitted that we have a problem. So that’s what I’m doing here. We haven’t found a way to increase our paltry share of U.S. deposits. We have yet to convince the majority of Americans that there is a credit union difference. We need new leadership. We need to start being honest with ourselves about what we are and what we are not. And the sooner recapture the greatness of credit unions past, the sooner we can reintroduce ourselves as legitimate players in the modern financial services world.

There. I said it.

(Apologies to the 100 or so credit unions out there that are actually changing with the times. YOU are not the problem. The folks out there that are just now copying the things you did 5 years ago are.)

My guest post on the CU Brand blog…

Do you love Currency Marketing? I know I do. But what if Tim had built his company the credit union way? Would you love them? Would you even know who they are?

Checkout my guest post on the CU Brand Blog (by Currency Marketing): If Currency Marketing were built the Credit Union way.