Five Lessons Credit Unions Can Learn From Edward Snowden

What lessons can a private sector, relatively low-level, 29-year-old security analyst turned globe-trotting fugitive and leaker of top secret government data collection programs teach credit unions? More than you might think.

1. Technology has put you at the mercy of your most disgruntled employee. Let’s say a low-level, computer-savvy employee at your credit union doesn’t like the way he’s being treated. How much member information could he access? Could he take it home and post it to Facebook moments after resigning? What the Edward Snowden case underscores to me is that we give too much access to too much information to too many employees. Even if you employ a more earnest group than the Boy Scouts, given the ease with which database passwords are handed out, your member’s privacy is only as safe as your most carless employee.
2. Privacy is the next big issue…unless it’s not. I’m curious if the American public ultimately wants to have a debate about privacy breaches or simply doesn’t care. (When I see what people are willing to put on Facebook, I strongly suspect they don’t care.) If there is a privacy push-back, people may begin to question what information financial institutions have and wonder why they have to report such a wide swath of suspicious activity.
3. Big data is here to stay, so use it or lose it. The government’s data collection effort is designed to do what businesses have done for years: use huge amounts of personal information to find correlations, and identify consumer preferences with a precision that was unthinkable 10 years ago. Your credit union is going to have to engage in this research (if you haven’t done so already), whether you want to or not. Vendors are ready, willing and able to slice it and dice it for you. If people don’t care about the government’s collection of data, they certainly aren’t going to care about its uses by businesses—particularly if it helps them identify the bank products they need without even having to thumb through the newspaper.
4. The cooperative structure isn’t as big of an advantage as we think it is. The industry prides itself on having a cooperative structure more in tune with the sensibilities of younger generations. But, as Malcolm Gladwell and others have pointed out, social media has made it possible to create networks of like-minded individuals that can both facilitate group action and aid an individual in making decisions without any leadership structure. As he hop-scotches across the globe, Edward Snowden is able to tap into a network of lawyers, diplomats and instant supporters that traditionally could only be mustered by governments and Fortune 500 companies.

   Of course, credit unions shouldn’t do away with the board of directors. But the more credit unions emphasize problem-solving through ad hoc committees and consensus rather than top-down management, the better positioned they will be to attract the next generation of volunteers and members.

5. People who feel more comfortable joining networks than organizations will be much quicker to join a credit union that reflects their needs and values…but much less likely to stick with it as their needs and opinions change. A generation that expects Apple to upgrade its products quicker than San Antonio and the Bruins can blow late game leads isn’t going to stay a credit union member unless the credit union is constantly willing to reinvent itself for relevance. Online banking is about more than a conveyance to the next crop of potential members; it reflects an ethos in which individuals consider themselves to be experts who, with enough information, have the right and ability to decide for themselves what steps they should take to secure their financial future.