Recently, I had the pleasure of speaking to a very intriguing business leader. He told me a story of the credit union of which he is currently the CEO. Below is an account of the story he told me.
“Don’t overreact, just stay calm and listen,” this was my mantra for my first few weeks on the job as the new CEO of a struggling midsized credit union. I knew I needed to make changes. However, I didn’t want to overreact and steer this credit union into a ditch. Most of the time a complete overhaul isn’t needed. It can actually be harmful.
After three months on the job, our board continued to offer suggestions on how to return the credit union to profitability. The suggestions included changing our investment strategies, adding new lending programs, firing overpaid staffers, closing branches, and cutting expenses. If it was that easy, the previous administration would have already corrected the problems. I decided to go back to basics and read through our mission and core value statements.
One morning, I noticed the mug I had been using for coffee. It had our largest sponsor group’s logo emblazed on the cup. A lightbulb went off. The credit union was created to serve our sponsor groups. The credit union wasn’t created to compete with every bank in town, and we weren’t created to service the entire community. Historically, we were our most profitable when we were concentrating on our sponsor’s needs. I decided to setup a meeting with the President of our largest SEG group the following week. Our road to profitability was going to go through the corner office of our largest sponsor group. We were going to return to our roots and our niche in the market place.
When I walked into the office of our largest SEG Group, I received a chilly reception from the CEO’s admin. I knew this wasn’t going to be easy. I started off by apologizing to the CEO for not doing a better job of serving her employees. Admitting one was wrong is never easy, but the credit union had taken this relationship for granted. It was obvious from her expression that she was not expecting my apology. I explained how I wanted to realign the credit union with her company. The original reasons for creating the credit union were as valid today as ever. I asked the President what programs we could create that would benefit her employees.
She requested financial education. Many of her employees had little more than a basic high school education; money management was important. I personally volunteered to provide lunch and learn sessions in her training room for employees interested in financial literacy. She continued by stating convenient access to funds would be another win. Her largest office had over 1,000 employees. We decided to place a cash dispense machine at that location. Not a full ATM machine, as the credit union wasn’t doing that well, but we could afford the dispenser.
Over time, I visited each of our sponsors with a similar message and received a warm welcome. Three years later, our credit union is opening new accounts with our sponsors, generating new loans, getting direct deposit, credit cards and more. We no longer feel the need to be the largest credit union in the state, but we are profitable and having fun again.
The message from this CEO was clear. Find your way back to serving your SEG Groups and find your way back to profitability.
