Okay, so just how good...how successful...is your credit union?
Before you answer, think for a minute: Just exactly how should success be measured? By asset size? C.A.M.E.L. rating? Delinquency rate? Loan-to-share ratio? Employee morale? Growth? New technology? Running your own CUSO? Lack of member complaints? The answer: none of the above!
The sole purpose of a credit union–the factor that makes it different from banks!–is that of helping members improve their financial circumstances. How? By providing an attractive array of banking services…with more and better features and benefits...and more help and assistance than is generally found elsewhere— and then, by getting members to take advantage of all of it…getting them to use it!
So if you're running a credit union, but most of your members are doing most of their banking elsewhere... you’re not exactly cutting it!
That’s it, then. Your effectiveness should mainly be determined by the extent to which your members actually use your products and services, rather than those of other banking sources.
Yet today's reality is that, at most credit unions, one-third to one-half the membership has nothing more than a share account (most with relatively low-balances). On the borrowing side, most hold less than half their members' vehicle and consumer loans. And, when all account connections are added up, the stats show that, in most cases, only about one-in-three members do their “main" banking at their credit unions.
But these statistics apply only in a general way. A closer look shows that some credit unions do a better job of generating business among members…much better, in fact than others. More checking accounts, more loans, more deposits. They show higher accounts-per-member ratios. And for these credit unions, the payoffs are significant! NCUA's 5300 reports consistently show positive correlations between accounts-per-member…and…net earnings! In short, when members use their credit union more, the more productive (more profitable) the credit union becomes. (See The "HP" Advantage)
And here’s the essential point– credit unions that generate higher net revenues end up with more to give back to members... in the form of more and better products and services, more and better features and benefits, more in the way of help and assistance. All of this is, and always has been, the credit union difference– the reason people choose to bank "...the credit union way".
So this is the case for a "High Performance" focus: Credit unions that do more with members…can do more, in turn, for members. And today’s competitive reality is forcing us to do more and better for members just to hold our business, let alone grow it.
But “High Performance” doesn't just happen. It comes only as a result of holding a concentrated, deliberate, single-minded focus on doing more with and for members. Today, for credit unions— for every credit union— this must be the top priority. There is nothing else that matters more.
"High Performance" IS imperative!
Is yours a "High Performance" credit union? Check the list. And check the criteria!