Six Steps to a More Innovative Credit Union

The credit union industry is changing, whether we like it or not. We speak with members over social media. We automate tedious processes. Some of us are experimenting with AI.

These technology trends are going to continue. And they’ll continue to affect our industry.

Sure, we can turn a blind eye, cover our ears, and try to ignore what’s happening. Or we can acknowledge that change is coming. And, if we’re really savvy, we can change with it.

I’m in the “change with it boat.” With that in mind, here are my suggestions for building a more innovative credit union.

Make the Board Participate

Carve out 10–15 minutes every board meeting. Don’t think you can spare the time? As the chairman of a board, I heartily disagree.

Surely you can do without something mundane, trivial, or vacation-oriented at the board meeting. Instead, use that time to discuss innovation and the future.

You may not get a ton of ideas. You may not get even a single innovative idea out of the board. Nevertheless, you will begin to redirect the culture towards an innovation. That’s the biggest first step.

Diversify the Board

Bring on board members from different professions and backgrounds. If your board members are all firefighters, every opportunity will look like a fire to them, and they’ll just throw water on it.

Different walks of life bring different experiences and different ideas. Those will in turn present different opportunities and priorities.

Diversity among your board will help you see more. You don’t need a group of people with the same perspectives. You need a group that can bounce ideas off of each other until some really good ones pop up.

Set an Innovation Budget

Make it a line item in the budget. Ask yourself, what was your budget for innovation last year? The year before?

If you are like most, it was zero. No shame in that. The important thing is that you start.

Setting a budget line item says to the team that you expect the funds to be used. Giving them the expectation that the money may or may not come back in an obvious ROI gives them freedom to expand beyond what they would traditionally assume is their boundary.

Once the Board understands that the budget line item for innovation is money, they’ll be more flexible with it. That money may not make any returns, but simply trying new things is the real purpose of it. Making it a line item makes it easier to say yes to ideas that come your way or innovations that pop up suddenly.

Create an Iterative Culture

Perfection is the enemy of innovation. Hundreds of times over the years, I’ve seen credit unions and vendors consistently delay implementations over trivialities. I’m talking about missing features, or fonts being slightly off, or integrations not containing every single field that each employee wanted.

By the time a product gets released/implemented, it’s outdated. In today’s environment, consumers (both your members and employees) expect apps to be updated, to change, to grow. Speed to market trumps a full featured product.

As recently as five years ago, these types of implementations were necessary. In todays mobile-first, iterative environment, it’s possible to put a product in your members hands with the expectation that it will continue to grow in functionality.

Look at your phone. How many apps need to be updated? How many were updated already today? How many started with only one function, then slowly grew?

Amazon used to sell only used books, remember?

Hire Outside

Hiring career credit union employees is almost essential for the success of any credit union. How are you supposed to keep the operation running without the inherent expertise?

The question is, how many of those people do you need? Without anyone coming from the outside with fresh ideas, how are you supposed to be innovative?

Sending career credit union employees to the same conferences that have been going on for years is not conducive to innovation. Bring in outside talent with new ideas and ways of doing things and listen to them. You can teach them about credit unions. It is much more difficult to teach innovation.

Do Things Differently

Set the example. If you do things the way you’ve always done them, the staff will follow suit. If you try new things, your staff will, too.

Think about something simple. Like, is your office the same basic place that your predecessor had? Her predecessor? Is there anything you could change or update?

Another good example is the new member process. When was the last time it changed? Are you still enrolling members the same way you always have? Do they fit into a product, or do you fit a product for them?

Final Thoughts

At the end of the day, you must do things differently to compete and win with this new generation of consumers. Fintech companies are lining up as far as the eye can see to capture small pieces of your business.

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