1. How are the government takeover of Fannie Mae and Freddie Mac and the bankruptcy of Lehman Brothers Holdings Inc. affecting credit unions?

The greatest impact may be the damage to the level of confidence that credit union members hold in our financial strength. I’m sure we’re all getting many opportunities to talk to members who are concerned about the safety and security of their savings.

2. Do you think the fallout from of Fannie and Freddie could impact the fate of one of the top priorities of credit unions: regulatory relief?

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1. Jim, since you were hired in January of 2004, ROA has increased 180%, loans have increased $175 million and spending has been reduced by over $7 million a year. What do attribute your success to?

Hiring great people and prioritizing. We focused on reducing operating expenses and cleaning up the loan portfolio. Since taking the helm our team has worked together to cut the equivalent of $12 million a year in waste. In the first 18 months, Keith Rountree, our VP of Lending, and his team reduced annual loan losses from $4 million to $1 million.

We have a very talented and dedicated group of executives and managers here that know how to get results. Those savings are now passed on to our members making us one of the top performing credit unions in the nation for member returns.

2. I understand you have a lot of experience creating a winning team for bottom line impact, can you elaborate on that?

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Credit union CEO compensation rose at a faster pace than chief executive pay at other industries last year. The gains also outpaced inflation.

Specifically, average CEO salary plus bonus increased 8.59 percent, according to the 2007 CUES Executive Compensation Survey.

So what?  (more…)

What exactly is Onboarding?

A: Generally it is the process by which newly hired employees at all levels — entry-level thru CEO — get “assimilated” (i.e. transition and integrate) to the new position and organization.  It is NOT just a new term for an orientation, which is actually a subset of an onboarding process. Onboarding is by design much more comprehensive than an “orientation”, has a different focus, and is typically for an extended time period.  Orientations are usually during the first few DAYS and are primarily to inform the new employee about ‘things’.  Onboarding is primarily about providing support for 3-6 MONTHS. The goal is to integrate the new employee into the organization and have them feel part of the team as soon as possible.  For newly placed managers and leaders the process involves even greater support because of the added complexity of those roles and the organizational value proposition involved.

Beyond “assimilation” an onboarding process should focus on accelerating the new person’s contribution and impact.  My Onboarding Process is for (both recruited and promoted managers and leaders) and is designed to provide four months or more of support and the leadership skills to help the new leader effectively navigate the organizational hazards and challenges that are common to all onboarding situations.  In other words, it provides a roadmap for rapid and successful assimilation. It has a performance focus that tracks targeted objectives and a leadership development focus that assures the new leader uses best practice approaches and well-developed ‘emotional intelligence’ in achieving those objectives.

Does all that extra work really matter? (more…)

What do you do after 38 years in the credit union business and 22 years as president/CEO of  $900 million Orange County’s Credit Union?

If you’re Judy McCartney, you hire a financial planner, relocate to a new city and purchase tickets to exotic destinations.

During her tenure, McCartney helped others grow and contribute to the credit union industry. She was a pioneer in her field, serving a Hispanic membership long before it was the ‘cool thing to do’; and, under her guidance, OCCU paid a monthly bonus to Spanish-speaking associates for a decade. Another accomplishment of McCartney’s was being a textbook editor for a finance course, used at a local college. She convinced the editors to replace the word “bank” with “financial institution.” (more…)

OMA: You first came on board at Orange County’s Credit Union as a VP in 1982, and retired as President and CEO earlier this year. What are some of the most significant changes you saw during your 26 years at OCCU?

JM: The addition of money market accounts, credit cards, CUSOs, expanded fields of membership, real estate loans and securitization of those mortgages, overdraft loans for checking accounts, IRAs, ATMs, ATMs moving online, shared ATM networks and shared branching.

OMA: Baby Boomer CEOs are nearing retirement age. What are the best ways credit unions can find new leaders? (more…)

By Candice Reed

Though recent headlines argue whether or not the 78 million Baby Boomers expected to retire this year actually will, the fact remains that most industries will be losing most of their leaders to retirement within the next decade. Our Baby Boomers are pretty much taking their ideas and skills and hitting the road in their motor homes, leaving everyone else behind wondering what the heck to do now. (more…)

From the MVN meeting and now from the NACUSO meeting (ZOPA even with all of my questions about it viability) my head is buzzing with the concepts of “peer-to-peer” commerce. And while it is impossible to be absolutely pristine in having an organization serve its peers – I do believe that the spirit that drives the tone or culture of a cooperative/collaborative business or more importantly the crafting of its business model and financial engines should resonate with the “peer-to-peer” perspective.

And while you might nod and say I agree Randy, the credit union marketplace and the cooperative marketplace are driven by these concepts/tones, you might challenge why that would work in today’s or the future marketplace. It is simple – it is everywhere – in today’s growing networked world where peers aggregate and demand that the essence of their own importance makes them famous, makes them “in-the-know”, and makes them part of the transaction (sometimes customer, sometimes retailer, and sometimes even the designer of transaction) then we might say they “get it”.

The question is if they “get it”, and we had it, how can we learn from the new age consumers and morph our tradition to their space and earn from it. How can we drive ourselves to deal with the realistic needs for nurturing organizations while projecting our beliefs for gains through a “peer-to-peer” focus?

Attached is a financial report written to my peers – projecting the importance of responding to opportunities, and driving into our space a commitment to our peers.

I recently had a conversation with Chip Filson, it challenged that our industries tone might be slipping far too often to our “organizational focused voices” versus “peers” voices. How do we live in an economic layer where member, credit union, and vendor equally swap our needs, solutions, and goals?

Working on a concept to teach in my board planning sessions in 2008 – would love your comments.

UNDERGROUND Conference Catalyst for Intellectual Exchange
Sponsored by Member Value Network

Why call it the Underground Conference?  It sounds a little like you are trying to go beyond the norm, move outside the box and be rebels, even elitists.  No not elitists, just 30 executive activists that believe in the credit union system and want to try to mobilize the industry’s intellectual capital to enhance our opportunities through insightful dialogue – that has no boundaries, no vested businesses.  “We aren’t trying to do something for MVN but for the attendees by providing access to former leaders experience to help today’s leaders make better decisions.  It isn’t about politics, it is about business and the opportunity to participate in constructive debate to generate innovation,” declared Randy Karnes, CEO of CU*Answers and MVN Network cofounder. 
Thus began a day of intellectual exchange of contrasting opinions at the first Underground Conference on April 24^th.  The location was the exclusive Cascata Conference Center and the tone was set – contribute, be controversial and talk about it.   “Paul Parrish did us a favor.  It was a wake up call that should spur credit unions to enhance their value,” stated Chip Filson, Callahan & Associates.   Here’s a sampling of what was said and the top five issues.

1. Save credit union charters.  “Once we lose the footprint that comes with an individual credit union charter, it will be near to impossible to start anew “ stated Sue Mitchell, CEO of MSA, Inc.  Everyone seems to be taking for granted there will be fewer than 5000 credit unions (or even less).  Why not invent a new structure, such as the unit banking model where a holding company provides consolidated management services from CEO leadership to shared operations.  Action to be taken:  Develop a strategic business model that defines CU holding company structure.  Task Force:  Sue Mitchell, Randy Karnes.
2. “Community charters are supposed to help the community – not just sponsor charity events” commented, Judy McCartney, CEO of Orange County’s Credit Union.  The Treasury Department expects credit unions to make a REAL investment in their neighborhoods – help people of modest means, student loans, health care programs, etc.  There is grant money available to foster these programs.  Action:  Form a CU community cooperative task force to investigate best practices, grants, and pilot programs.  Task Force:  Judy McCartney, Chip Filson.
3. Don’t fight the GAO compensation disclosure issue.  “Do your members want the low bidder babysitting their children or managing their money,” asked Dave Doss, CEO of Arizona State Credit Union.  Be proactive in defining the message and prepare a communication plan that includes compensation components, the value of the position and talk with your membership.  “When we focus on the members, they know it and value our leadership” commented Jim Warren, CEO of Tyndall Credit Union.  Action:  Create a communication plan template.  Task Force:  Dave Doss, Mark Elliott.
4. Guest speaker, Brandi Stankovic, BLS Consulting challenged the group by observing that relevancy should not be a question, it should be the foundation of your credit union core business.  Why are credit unions not attracting new members, emerging markets and young adults? What have we learned from myspace.com?  What can we learn by watching American Idol to study their model.  “Consumers will change doctors because of the $40.00 fee associated with moving outside their primary area, what makes us think they won’t switch financial institution,” asked Mark Elliott, CEO of MVN Leadership Services.   Action:  WIIFM – What is in it for themember.  Task Force:  Jim Warren, Brandi Stankovic, Dave Rhamy.
5. Credit unions are not in the business to generate votes for NCUA.  However, we must communicate our business models and practices to all our governing and support organizations to ensure maximum cooperation. CUSOs are providing incredible service to credit unions today and we need to continue to enhance this model as a means of increasing cooperation and decreasing costs.  Action:  Form a political action group that joins together to communicate constructive position statements.  Task Force:  All

 To join a task force, just email Sue at msasmitchell@aol.com. 

Yes, there were other Underground discussion points and candid business disclosures.  Learn more by visiting membervaluenetwork.com or by contacting any MVN Partner.
 

Has the industry lost the ability to leap forward. Did we ever have, or have we lost the ability to coordinate an industry effort beyond what is contributed through stand alone organizations. In other words are we now limited to activities through ownership alone. How would we start a wave of expectations through the industry? Where is the collective coordination power centers in the industry today? If you challenged that an organizations true corporate foot print was defined by three parts; what it owns (O), what it controls (C), and what it influences (I)- so the total power in play for the membership is T= O+C+I. Is it not reasonable then to assume if a portion of the industry is already too far behind the competition to grow through O, that is might not compensate by expanding C and I. What kind of activities would you do to expand C? I? Who would have such capabilities? What strategies would they use?

Can we start a wave? Can we be at the center of new pools of influence? control? Can we afford to wait for significant ownership consolidation before our industry has lost all of the clout on numbers? We must use collaboration to consolidate what we do NOW.