Early last year, I caught a cold. It was mere weeks after the first handful of COVID-19 cases were reported in our city. You can imagine how I felt.
The first thing I did was tell the CU 2.0 team what was going on. I tried to set us up for continued success in case I missed work. I kept thinking, “What impact would a week of my absence have on our company? What about two weeks?”
We were actively working with about a dozen clients at the time. But credit union CEOs deal with tens of thousands of members. It made me wonder…
How do credit unions plan for leadership transitions and absences?
Credit Union Leadership Transitions Are Common
The pandemic has proven that we can’t count on things staying as they are. We must always prepare for whatever comes next. For credit unions, that means more than business continuity planning—it also means knowing how to handle a leadership transition or vacuum.
What will your credit union do if your CEO announces their plans to retire? Who steps up if your President accepts a job with another organization? Surely, you’ve considered these things before…
But consider this:
Only 68% of credit unions have succession plans in place. And fully half of CEOs plan to retire or change positions in the next six years, which affects the entire executive suite.
Fortunately, there are a few ways to ease the pain of leadership transitions and succession.
Easing the Pain of Leadership Changes
As far as we’re aware, there is no one-size-fits-all solution to shielding credit unions from the pain of leadership transitions. Instead, there are various levels of preparation credit unions can undertake to minimize any associated disruption.
Kirk Kordeleski, former CEO of Bethpage credit union, is more than familiar with these levels of preparation. His goal now is to help other credit unions understand their best options regarding credit union succession plans.
That goal led him to OM Financial Group—a group serving credit unions and nonprofits with various executive services. One of OM’s flagship services is its supplemental executive retirement plans (SERPs). SERPs help credit unions retain and attract the best talent in the industry while providing long-term stability, profitability, and succession planning.
On behalf of OM Financial Group, Kirk outlined seven steps to greater credit union leadership stability:
- Encourage open dialogue between your board and CEO.
- Run fire drill scenarios.
- Vet and prepare internal candidates for promotion.
- Study competition for young executives and potential mergers.
- Network and always keep an eye out for potential leaders—many for-profit executives appreciate the credit union environment most!
- Interview recruiting firms for additional insight.
- Review executive compensation trends and how they affect your credit union’s goals.
Furthermore, Kirk suggests treating succession planning like strategic planning. That is, do it yearly, and with serious intention.
It should be clear just by reading the list above that no single item will make credit union leadership succession or transitions easy. However, together, they can make it more than manageable.
Kirk Kordeleski has also assured us that OM Financial Helps with credit union mergers, too. We’ll explore that soon!
CU 2.0 is dedicated to helping credit unions succeed in a fast-paced, digital-first world. Our work exposes us to many fintechs and other organizations who wish to increase credit union market share.
Would you like to hear our latest findings? Join our Quarterly Fintech Call list. In 30 minutes each quarter, we’ll call you to share the companies, technologies, and products that have caught our eye. Contact Chris Otey to learn more!