The attack on cooperative values

As a frequent facilitator of strategic planning sessions, it’s my job to stay on top of credit union trends and issues. One of the more effective strategies to do so is of course to read, which means I frequently scour online articles and blog posts. In reading online commentary I have come across many schools of thought on credit union strategy, focus, branding, marketing, and the like. A disappointing theme I see more and more is the idea that cooperative values don’t matter and therefore should cease to be a concern to credit union leaders.

Where this most often comes up is in articles “informing” credit union leaders of the best way to connect with consumers in today’s competitive markets. The premise is that consumers could not care less about cooperative principles, therefore these principles should have no influence over marketing and branding. Some authors have even gone so far as to say that cooperative principles should have no bearing over any kind of strategic decision-making.

This perspective suggests a grave misunderstanding of the purpose of cooperative principles and values. It seems that some have incorrectly interpreted them as some sort of traditional or old-school credit union “marketing message” that needs to change because it won’t resonate with, or matter to, members and potential members.

Consumer messaging, branding, etc. must of course change with the times, but cooperative principles are not necessarily marketing and messaging prompts. Rather, they are to be what guides institution-wide behavior and decision-making for all credit union functions. While branding, messaging, and marketing should change with the times, the decision-making behind the effort must be properly grounded in appropriate credit union principles – otherwise there is no reason to be a credit union.

Though many of the articles I’ve come across disparage the futility of “clinging” to credit union principles, few have actually referenced any of them. In the interest of informing those marginally aware “experts,” here they are:

  1. Voluntary and Open Membership – Cooperatives are voluntary organizations, open to all persons able to use their services and willing to accept the responsibilities of membership, without gender, social, racial, political or religious discrimination.
  2. Democratic Member Control – Cooperatives are democratic organizations controlled by their members, who actively participate in setting policies and making decisions. The elected representatives are accountable to the membership.
  3. Members’ Economic Participation – Members contribute equitably to, and democratically control, the capital of their cooperative. Members allocate surpluses for any or all of the following purposes: developing the cooperative, benefiting members in proportion to their transactions with the cooperative; and supporting other activities approved by the membership.
  4. Autonomy and Independence – Cooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, they do so on terms that ensure democratic control by their members and maintain their cooperative autonomy.
  5. Education, Training and Information – Cooperatives provide education and training for their members, elected representatives, managers and employees so they can contribute effectively to the development of their cooperatives. They inform the general public, particularly young people and opinion leaders, about the nature and benefits of cooperation.
  6. Cooperation Among Cooperatives – Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional, and international structures.
  7. Concern for Community – While focusing on member needs, cooperatives work for the sustainable development of their communities through policies accepted by their members.

There is much value in this time-tested list of seven cooperative principles, and contrary to the opinion of some, a relevant framework for effective and successful contemporary decision-making exists. At a minimum, credit union leaders can use the list above to either:

  • Validate the “correctness” of existing strategy;
  • Serve as a starting point for identifying supportive strategic initiatives.

This is true for the marketing team, as well. In fact, by tweaking the two points above, we can find unique guidance suited for marketing and branding pros as follows:

  • Validate the “correctness” of a marketing message/brand campaign, etc;
  • Serve as a starting point for identifying supportive marketing initiatives.

In the context of marketing, member communication, branding, etc., these principles don’t have to be the “marketing message.” You are free to go forth and market as you see fit – just remember to take a moment to make sure your messaging (and your assumptions about those pesky consumers…) doesn’t conflict with the principles.

Of course, these principles can be used to define specific messaging strategy as noted in the second bullet point. Each principle has embedded in it very interesting and effective campaign possibilities. Those who believe otherwise–that cooperative principles aren’t noteworthy or effective points of communication–are simply not as good at the creative aspects of their jobs as they think they are.

Let’s be clear. Consumers couldn’t care less about a LOT of things, such as what documentation is needed to support a loan application, the true cost of credit, the impact of late payments on credit risk, the cost of using foreign ATMs, that a social security number as a password is risky. The message on the subject is still worth sharing.

Let’s embrace the fact that credit unions ARE cooperatives. Let’s use the cooperative principles above for guidance in daily decision-making. And, most importantly, let’s not be shy about sharing the details behind the very foundation of the credit union community!

Tom Glatt Jr

Tom Glatt Jr

Tom Glatt, Jr. is founder of Glatt Consulting, a credit union consulting firm specializing in strategy consulting for credit union leaders. Tom applies his 19 years’ experience in the credit ... Web: Details