Strategic planning must change. Get out of your comfort zone

For far too long credit unions have owned 8% of the market or less nationally. We are too good to be satisfied with that outcome. Real transformations are needed and must start with the planning process.

However, the majority of businesses are not satisfied with their strategic planning efforts. The estimates of failed plans are all over the board, ranging from 50 – 90% across the country and industries. Credit unions are not immune from this performance.

But why?

Well, the obvious, strategic planning is difficult.

There is more to it though. Often, the planning retreat is repeated year after year. Most likely following the same agenda layout. Typically, there will be recap of accomplishments and status of current projects. Not very strategic, right? Focusing on the past and short term diverts the attention from the future and hinders the ability to look forward.

Creating a strategy requires serious, high-level discussions. The resulting vision must identify what the credit union wants to become, who they want to serve and how they will serve them from an ideological viewpoint. It also demands discussing – not predicting – the future and the risks of action versus inaction.

Frederick Wilcox said “Progress always involves risks. You can’t steal second base and keep your foot on first base.” This is germane to strategic planning. You cannot enact change while doing things the way you always have.

Strategic plans need to be a long-range vision. One that requires advancements to current operations. Staying with the status quo may be comfortable but it is extremely risky.

We live in a world of change. You have probably heard that the pace of change today is as slow today as it ever will be. This is so true. However, it is difficult for people to accept and make changes. Great leaders recognize this and prepare their teams and companies for the inevitable changes, whatever they may be. While no one can predict the future, the act of preparing – strategizing – better prepares the credit union for the future.

As you enter your next planning session, consider including these concepts to enhance the strategies developed:

• The strategic vision is conceptual/idealistic, not a prediction. – While the strategic objective does create an expected destination, it is not turn by turn directions. Tactical plans that factor the current and expected conditions (strengths, weaknesses, opportunities and threats) create the road map to the future vision created by the strategies. Just as driving on a long trip, flexibility is needed to allow for unexpected detours or delays.
• Ensure the strategic vision is simple and focused. – Great strategies require restraint by leadership. The number of strategic initiatives must be maintained at a manageable level. Change is difficult, but essential. Each identified strategy will have major reverberations throughout the organization. Additionally, products services and locations that do not conform to the strategy must be eliminated.  Simplicity facilitates the understanding, engagement and focus of the credit union. There will be ample opportunity to fold complexity into the tactics that are developed and implemented to achieve the desired outcomes.
• Move. – Implement agreed upon initiatives. Operational plans must formally document how the particular initiative contributes to achieving the strategic goal, expected timeline, accountability for the project and success factor(s) of the operation. Given the member-centric structure of credit unions, member satisfaction, relationship growth and market share performance factors should augment traditional profit, asset size and net worth targets.
• Review/Discuss/Adjust. – Don’t restrict planning to a one time a year event. At least quarterly (preferably monthly) review progress of the action/tactical plans. Are they on schedule? Are the results as expected? If not, what are the ramifications to the overall plan? Is progress towards the overall strategic vision being achieved? What internal conditions have changed to impact the plan? External? During this process it is important to remember the first bullet point. The strategic vision is not a prediction. It is a process. As such, lessons learned must be factored into the future steps. Credit unions cannot afford to be blindly locked into the “plan”. As Edward Filene once said, “Progress is the constant replacing of the best there is with something still better.” It is important to keep in mind that the ultimate goal is to make progress towards the strategic vision.

Credit unions are vital, member-owned financial cooperatives that deliver tremendous value to their members and communities. It’s time to acquire more market share and expand the benefits provided to more of our friends and neighbors.