We need clear, national standards to measure mission and margin—together

Imagine, for just a moment, that you can choose any hospital in the country for all of your healthcare. Pretend you can teleport at whim, and the only factor that matters to you is: Will this hospital help me heal—and thrive?

How are you going to decide?

You might be a CFO, and say, “I want to look at their financial statements first.” Fair: the hospital can’t help you for long if they’re about to shut down.

But you also want to know: Have they treated other patients with your specific healthcare needs? How long are wait times? How often do people have to be readmitted after surgery due to complications? Also, do they even know how to help healthy people get healthier?

And then: Are these outcomes even any good? How does this hospital compare to their peers?

Are you primarily focused on helping your members improve financial outcomes, or on building a financially thriving credit union?

In other words: financial health and wellbeing are nice, but what about the bottom line?

This stance shows up in our language and our metrics, which means it cascades into our strategy and plans, from the board to the front line. In this stance, mission lives on one side of the business—for example, in our foundations or philanthropic work—while margin is what we do all day long as we bring on new members, grow our deposits, and make loans.

As a result, our long-range strategic plans focus primarily on margin, and we’re extraordinarily lucky if we get to build core mission metrics into our business strategy, not just our purpose, vision, and values.

People helping people. Protection from sickness, hard times, and financial distress. Financial wellbeing for all.

Whether we’re advocating for credit unions in Washington or running an orientation for new employees, we explain: This is why we’re different. This is why credit unions exist. Unlike banks, we’re here to help.

And it’s true! We do pass savings back to members in the form of lower loan rates, no-fee and low-fee accounts, and better access to financial counseling and coaching.

How do we measure our mission? Answers I’ve heard lately:

These are wonderful things—but only two of them get close to the patient outcomes analog I’m after: $400 in savings and prime credit scores, the two objective financial wellbeing measures that Gigi Hyland shared in her update on National Credit Union Foundation’s FinHealth Fund data working group, which built upon the Financial Health Network’s FinHealth Score® (Spend, Save, Borrow, Plan) framework.

And none of them are clearly integrated with a corresponding margin metric to show how financial health and wellbeing for members is connected to financial health and wellbeing for the credit union itself.

I want to live in a world where the mission and margin metrics in our strategic plans are so tightly interwoven we forget where one ends and the other begins. I want the principle that when we take care of employees, employees take of members, and members take care of the credit union to be not just something we say, but something so fundamentally core to our analytics stack that we cannot imagine evaluating performance without including:

Which outcomes are mission, and which are margin?

It’s only possible to create financial health and wellbeing outcomes for employees if we have the financial sustainability to attract, grow, and retain those employees.

Same for members: we can only find new members, grow their financial health and wellbeing outcomes over time, and keep them with us for the long haul if we have the margin to deliver profoundly useful products and services that make them better off.

And we will only make the money we need for long-term sustainability if we’re able to build strong teams, members, and communities—and financial strength is a key part of that.

Both. It’s always both.

The truth is, there’s no mission without margin, and no margin without mission.

You build a financially thriving credit union precisely by helping your members improve financial outcomes, so they work with you for decades in increasingly valuable ways.

You help your members improve their financial outcomes precisely by dedicating the staff, time, and resources of your financially thriving credit union toward measurable improvement in those outcomes.

In other words:

Imagine we could actually see, ecosystem-wide, where financial health and wellbeing outcomes are improving—and more importantly, why.

How much more quickly would we learn what’s most effective in driving positive change?

How many more members could we draw to credit unions, based on our track record of positive outcomes, above and beyond rates and access to counseling?

How much more powerful would our advocacy be, given our long-range outcomes?

And, the most fun part: what new collaborations would we build to share what’s most effective, and lift all of us up, together?

Across the credit union ecosystem, we have a wonderful variety of experiments in pulling together mission and margin metrics into one central place: Filene & Callahan built a very cool social impact dashboard; CUCollaborate shares an example of eight key member-centric and financial performance metrics; TruStage is a bounty of insights and trends; CUDX is a collaborative exchange with the potential to securely host all manner of datasets and metrics; Inclusiv’s Financial Data Analytics Platform assists with CDFI reporting. Those are just a few examples—and they’d bloom to countless more if we started listing all the innovations credit unions are creating in-house, bespoke.

We have challenges ahead:

I’m curious:

Join me on LinkedIn, and let’s start a conversation about how we measure what matters most: the financial health and wellbeing of our employees, our members, and our credit unions.