At best, 2020 was a year of change; at worst it was a year of hardship, punctuated with largely negative memories. Regardless of how you remember it, now that we’ve successfully transitioned to a new year, 2020 can be remembered as a time of opportunity and even growth for many credit unions.
That was a primary finding of the first phase of a recent study we completed with our strategic partners NewGround called CEOpulse. We surveyed 50 credit union CEOs to capture their sentiment on lessons learned from last year and how those lessons are driving their strategic and tactical focus this year.
Like our memories of 2020, we went into the data-gathering largely foreseeing a lot of negative reflective thoughts balanced with an equal amount of skeptical anticipatory planning. However, we soon realized that perspective was mistaken; to a very large degree, the CEOs we talked to were proud of their credit union’s success over the past 12 months and cautiously bullish on the prospects moving forward.
Following is a sampling of the key findings in a few of the categories we addressed:
- 66% of respondents indicated they expect their local economy to be “somewhat better” or “better than before” in 2021 with many economies tied to military and government entities seeing minimal negative impact. And all but one CEO rated their feelings about growth prospects as average or better in 2021.
- In the coming year, CEOs expect earnings and ROA to take a hit but that should be offset by improving non-interest expense. The number one concern, with little surprise, was the potential rise in delinquencies; however, some CEOs quickly noted they’ve learned a lot from the mortgage crisis of ten years ago and, therefore, are better suited to withstand a DQ bump.
- Regarding their employee culture, 64% noted the emotional well-being of their staff was “about the same” as it was one year ago and only 13% described their staff as “struggling” emotionally. Further, only 30% expect their staffing situations to remain the same as it was pre-pandemic so employees can expect continued culture change in the months ahead.
- Most CEOs pointed to their enhanced focus on marketing and branding as well as further streamlining and augmentation of all delivery channels, especially mobile, online, and call center, as their primary focus in the early parts of 2021. “We need to tell the community, we’re here to help,” said one CEO.
Maybe the most fruitful aspect of our CEOpulse study has been the long list of best practices shared by participants. Many of the CEOs we interviewed were forthcoming with specific steps their staff took to pivot from legacy delivery methods to new and innovational ways of fulfilling member needs. Here are just a few of those success stories you should consider incorporating into your credit union’s operations in 2021:
- One credit union is offering financial counseling free to everyone in their community, not just members. “We need to help them through these tough times,” the CEO said. “If we don’t do it, no one else will.” The program has been so well received, he said, that appointments are booked months in advance.
- Delinquencies are an area of keen focus in 2021, as noted above; yet, for one credit union it also serves as a distinct opportunity. “A member in a delinquent situation is a great opportunity to build a member for life,” said one CEO. She went on to say they have added a staff member to their collections team in anticipation of increased volume but also provided empathy training for all collections staff to help them connect better with their members.
- Without question, a biproduct of the pandemic has been the sudden migration of branch transactions to other channels. And while that has some positive effects from a cost standpoint, one CEO lamented the lost opportunities from those face-to-face transactions. She said, “I love that transactions are moving out of the branches but how are we going to cross-sell to those members now?” She, and other CEOs, anticipate an increase in “sales” training in the coming months to teach all staff to capitalize on those precious few interactions they’re going to have with in-person members.
- There’s a saying that it doesn’t matter how you treat your employees during good times, what matters is how you treat them during difficult times. Well, some of the CEOs we talked to obviously knew of this sentiment because they treated their employees remarkably well in 2020. One said, “We’ve never allowed ourselves to refer to employees as ‘assets,’ they’ve always been ‘people’ to us and that really paid off last year!” Another said their HR leaders went to every employee early on in the pandemic and asked, “What can we do for you?” They didn’t generalize; they personalized the approach as much as possible.
- Other CEOs effused on how well their teams pulled together and worked in ways they weren’t previously. That doesn’t mean teamwork was necessarily poor before but now it was at an all-time high. “I actually think our morale is higher today than it was one year ago,” he said. “We all talk about how we’re going to take care of one another.”
- Like many workers in all businesses, credit unions transitioned employees to work from home models last year. And, according to our participants, did so with much success. “We are much more effective than we expected to be,” one CEO said. “It pushed that model up 5 years. I hope it becomes more prevalent in the future.” Other CEOs also think WFH is here to stay for many employees and one even found it to be a better situation for some employees than working in an office. “It wasn’t easy at first, but we invested in the right equipment and went through Zoom training and now it’s great!” She further noted, “We’ve found that video coaching is actually better because there are fewer distractions. It’s just you and the person on the screen, one-on-one.”
- Good communication is always a vital management tool, of course, but during a pandemic it takes on heightened importance. Many of our CEOs talked about steps they and their leadership teams have taken to be as accessible, visible, and transparent as possible. One explained, “I do a Teams meeting for one hour over lunch every Monday and Friday. Anybody can login and nothing is off the table – ask me anything you want to discuss. Not only have I received great questions but great suggestions, too!” Other CEOs spotlighted virtual town halls they’ve been conducting and video messages regularly posted to the credit union’s intranet.
These are just the tip of the iceberg in terms of successes that credit unions who participated in our study are celebrating. If you’d like to hear more, we’ve created a four-part video series that presents an overview of our findings. Following is a link and we’d love to hear your feedback on what you see: http://www.newground.com/ceopulse-2021/
Further, we’d also like to hear about additional topics and issues you’ve tackled recently or are currently confronting in 2021 related to the pandemic impacts on your credit union – with a particular focus on the positives! Again, while certainly challenging for us all, it obviously has also produced some magnificent successes that deserved to be acknowledged and celebrated. Send me an email with your ideas: firstname.lastname@example.org.
And finally, CEOpulse will be an on-going study throughout 2021 as we chart the course with our credit union clients, spotlighting their challenges and keeping our finger on the pulse of what’s driving their highest levels of success. We’d love for you to join us on this journey – there’s no cost involved and your time commitment will be as minimal as possible. Let us know when you’re ready to join the fun!