A Merger of Equals

Perhaps the most challenging merger involves two CUs of similar size.

August 01, 2012
KEYWORDS board , credit , merger , staff , trust
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Moving forward

The board approved the plan, and we formed a transition group committee to move forward. The committee included the board chairman, vice chairman, and one other board member from both credit unions along with the two CEOs.

The committee agreed to keep its proceedings confidential and met off-site to discuss whether or not a merger really made sense and, if so, what the new organization might look like.

Knowing that efficiencies could result wasn’t enough—we had to have a plan for actuallyrealizing these efficiences. The committee quickly developed mutual trust and synergy. We started our discussions around a mutually agreed upon vision and set of values.

From there, we built a foundation that would support us as we addressed more sensitive issues. And we did have more sensitive issues—board structure, a governance model, and a process for evaluating staff talent and competencies.

  What is Policy Governance?

Policy Governance® is a model of governance designed to empower boards of directors to fulfill their obligation of accountability for the organizations they govern. The model, developed by Dr. John Carver, helps the board:

♦ Focus on the larger issues;

♦ Delegate with clarity;

♦ Control management’s job without meddling;

♦ Evaluate the accomplishment of the organization; and

♦ Truly lead its organization.

Policy Governance separates issues of organizational purpose (ends) from all other organizational issues (means), placing primary importance on those ends. Boards follow 10 integrated principles that enable accountable board leadership, according to the International Policy Governance Association.

For more information, visit or

Directors who weren’t on the transition group committee had to trust their committee colleagues to communicate progress and keep everyone informed.

We developed detailed plans for the accounting analysis that helped us decide which charter to collapse. As the merger process unfolded, we brought other managers into the analysis to plan for due diligence.

During almost 20 years of leading our respective organizations, Bill and I had developed different management styles, so we expected major adjustments for our staff and for us.

Our challenge was to manage ensuing conflict while keeping momentum moving forward.

Not surprising, we experienced moments of doubt, which our staff reflected as well. We learned that the merger process required not only mutual trust but the ability to be flexible and agile.

Basically, Bill and I had to renegotiate nearly everything. We continually asked ourselves: Were the disruptions and compromises worth the benefits to members? In retrospect, we believe they were.

The expertise of our combined management teams helped us understand what we had and what we needed for the new organization. The transition group committee went through every board policy and determined what to keep.

We adopted the Policy Governance® model based on the needs of a larger organization, the clarity and efficiency that comes with it, and the fact that NuUnion had 10 years of experience working with it. We reviewed and scaled each policy to fit the needs of Lake Trust Credit Union. 

During the process, we realized the need for an impartial third party to mediate some important issues. So we hired Susan Mitchell, CEO of Mitchell, Stankovic, and Associates—experts in organizational development and coaching for performance.

Susan helped us resolve our personal biases, because Bill and I weren’t that familiar with each other’s organization. She had no former connection to either credit union. We also retained Laura Huggler, Ph.D., an external consultant who had advised NuUnion for many years.

  NEXT: Focus on the future

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