CU Sustainability: Embrace a Shared-Value Business Model

This model would allow CUs to compete without looking like banks.

September 16, 2011
KEYWORDS business , lending , model
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A holistic approach to personal finance

Another significant component of the shared value business model is the holistic relationship the credit union has with the consumer. This component reflects the former credit union model with one big difference: It creates a closer relationship between the consumer and his/her finances through emerging technology.

The shared value business model also provides a social media component within online banking. Currently when a member uses an online banking platform, regardless of device, the use is limited to transactions.

video CUNA Mutual Group's John Lass discusses CU sustainability. Watch now.

This model will allow for a social media aspect be apart of the online banking so members can create saving and lending communities, like there currently exists on Facebook.

This allows consumers to engage with others on how to solve financial problems, or to simply meet others who share a similar financial situation.

Other member-centric and member-value products and services could include:

  • Loans that have a savings give back to reward good repayment history [pdf];
  • Credit cards that donate a portion of the interchange income into a credit union scholarship fund;
  • Fee alerts to warn members they’ll be charged a fee if they continue with a certain transaction; and
  • Financial management tools to help reduce the number of members who use courtesy pay products excessively.

The shared-value future

The shared-value business model creates a sustainable way the credit union industry can compete in the future without looking like banks. It provides economic value to the credit union industry through the additional income generated from peer-secured loans.

This model also allows credit unions to capitalize on their status of being locally owned and operated, their responsible investing policies, their reasonable executive compensation policies, and their people-helping-people philosophy.

In addition, consumers are looking for authentic financial institutions after the Great Recession. The shared value model fulfills that need. It gives credit unions the ability to gage their success in the community with the number of new successful businesses they help generate.

The shared-value business model also benefits society through the creation of local businesses and jobs. This is a new and uncontested space that could be greatly served by the credit union industry, and a space that returns the credit union industry to its roots.

ANNE LEGG is vice president of marketing at Cabrillo Credit Union in San Diego and former chair of the CUNA Marketing & Business Development Council. The recent MBA graduate explores credit union sustainability in her MBA-thesis/white paper, “Creating a New Credit Union Sustainability Business Model.”

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Great article! Unfortunately, most employees don’t feel valued or appreciated by their supervisors or employers. In fact, research has shown that the predominant reason team members quit their jobs is because they don’t feel valued. This is in spite of the fact that employee recognition programs have proliferated in the workplace – over 90% of all organizations in the U.S. has some form of employee recognition activities in place. But most employee recognition programs are viewed with skepticism and cynicism – because they aren’t viewed as being genuine in their communication of appreciation. Getting the “employee of the month” award, receiving a certificate of recognition, or a “Way to go, team!” email just don’t get the job done. How do you communicate authentic appreciation? We have found people have different ways that they want to be shown appreciation, and if you don’t communicate in the language of appreciation important to them, you essentially “miss the mark”. Additionally, employees need to receive recognition more than once a year at their performance review. Otherwise, they view the praise as “going through the motions”. A third component of authentic appreciation is that the communication has to be about them personally – not the department, not their group, but something they did. Finally, they have to believe that you mean what you say. How you treat them has to match the words you use. If you are not sure how your team members want to be shown appreciation, the Motivating By Appreciation Inventory ( will identify the language of appreciation and specific actions preferred by each employee. You then can create a group profile for your team, so everyone knows how to encourage one another. Remember, employees want to know that they are valued for what they contribute to the success of the organization. And communicating authentic appreciation in the ways they desire it can make the difference between keeping your quality team members or having a negative work environment that everyone wants to leave. Paul White, Ph.D., is the co-author of The 5 Languages of Appreciation in the Workplace with Dr. Gary Chapman.

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