Technology and innovation

As a rather young credit union operations manager I vividly recall a down economy that was driving our industry towards operational efficiency through the integration and effective use of various technologies. I remember the credit union rallying around the member, internal and external, to see ourselves through the lean times and thinking that the movement is learning very important lessons about the need for technological improvement and the pace of change surrounding it. 

As we collectively rebounded in the previous decade did the hard lessons learned resonate with the industry? Statistics tell me they did not. According to the NCUA, since June 2008 we have added 34.4 million members for a total of 133 million members, a whopping 39% increase. At the same time credit unions added 81,353 full time employees (FTE) for a total of 300 thousand, wait for it…an increase of 37%. We now serve 406 members per FTE as opposed to 400. 

Our scale should allow for significantly more efficient operations if we act on the presumption that the majority of the 2,600 real person credit unions that no longer exist since 2008 were less technologically sophisticated. Given the lean times we are all currently experiencing—what is the path to a more efficient organization and resilient credit union in the face of multiple “once-in-a-generation” challenges? 

We can start with a look toward Managed IT and “as a Service” or aaS solutions.

What is the current state of your Data Center? Do you have the availability you need to serve a geographically dispersed member group? First, ensure your Disaster Recovery procedures are updated and accurate. Do you have a technology partner hosting your Data Center that is appropriately geo-dispersed or are you inhouse? How engaged is your partner in reviewing and setting procedures?

Redundancy can be expensive as it relates to network solutions. Sit down for a conversation with your technology partner and review your architecture for proper connectivity, redundancies and to look for expense reduction opportunities. After all, what is the point of a robust Data Center solution if your internet and connectivity are unreliable?

With a properly connected set of network solutions how comprehensive is your voice solution? Is it complete, properly managed and do you have an actionable schedule of required and desired upgrades? As the various aspects of your IT area are reviewed, make a priority list, step back and determine if a plan is actionable or if you have obstacles such as staffing that need to be addressed. 

Speaking of “as a Service” (aaS); risk is always growing, and it is certainly outpacing the 39%-member growth since 2008. Like many aspects of the growing as a Service solution set, risk can also be addressed through technology partners. One of the keys here is the adequate assessment of risk associated with operating your credit union, as you are reviewing enterprise risk, GLBA risk or your cyber security environment—understanding potential threats is paramount in consistent and secure credit union operations. Is your technology partner properly engaging as you review your business continuity and disaster recovery planning? 

What does your managed security service look like from your firewalls to patch and maximize your vulnerability management process? Are your controls designed with security and functionality at top of mind or is it an ad-hoc solution? Is your combination of managed and hosted security set by institutional design or through the skill and persistence of a select few determined employees? What do you do as a management team when those talented individuals take on new challenges? If nothing else, ideally this article prompts you to review your internal processes.  

There is so much that cannot be adequately covered in our new work environment from a single-entry; but it can serve to drive important conversations that should not be sidelined during a downturn in net revenue. 

Does your credit union:

  • Have a proper audit process in place?
  • A plan to address your data center needs this year and in 2025?
  • A proper update and upgrade plan?
  • For partner solutions, SLAs in place?
  • An internal team to review and act on SLAs?

This is just a start and a key point to keep in mind is that IT is not a silo. IT can feel like that sometimes because of the intimidation factor around the technology; it has been my credit union management experience that questions may be avoided because a genius in lending does not want to be perceived as ignorant or unprepared. Be mindful of that when speaking with non-technologists. 

Everything your internal committee decides to do directly impacts Accounting, Branch Operations, Card Services and your Contact Center. The decisions you make should include engagement with the areas impacted, not to avoid necessary changes but to properly vet the plan to ensure adequate resources are assigned to achieve the proper improvement in the member experience. 

So much can be said for great and not just acceptable member service but one for one growth in the member/FTE ratio indicates we have not embraced the technology available to create a more efficient and effective work force. Like in 2008, we can change that starting in 2020 so that our movement is better prepared for the challenges that await us in 2032.  

“As a former Director of Emergency Operations, I can say that redundancy and connectivity is important for disaster preparedness. Each of the considerations above take vision, leadership, and actionable steps to ensure mission continuity—which is what our credit union members expect!” – Tony Hernandez, President&CEO, Defense Credit Union Council

James Gukeisen

James Gukeisen

Mr. James Gukeisen is the Director of Business, Credit Union Division for FIS, a strategic partner of the Armed Forces Financial Network.  He is a 19-year credit union movement veteran, ... Details

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