As credit unions evolve, so must their employees’ skills and responsibilities. That evolution is driven by a host of factors—technology, member preferences, cost, competition, and labor trends. In the next decade, the work force will be enhanced with new skills and characteristics. It’s important for each credit union to clearly define its vision in as much detail as possible, and then hire the people to get it there.
The following list is not exhaustive. Every credit union job will change to some degree, but these jobs are in for the most extreme changes:
Branch managers acting as ‘franchisees.’
Branch managers will be required to have a better grasp of member data and to be multimedia savvy, says Greg Inman, senior vice president of retail operations at Neighbors Federal Credit Union, Baton Rouge, La.
They’ll need an understanding of which channels members prefer and which messages resonate with members and potential members. And when members come in for visits, branch managers will need to have systems and staff in place to seize every opportunity.
Neighbors Federal challenges its branch managers to think like sole proprietors, says Inman. Branch managers at the $570 million asset credit union are asked to attain customized goals—lending targets, business development goals, or becoming active members of the local chamber of commerce.
“Act as if you’re a franchisee,” Inman tells branch managers. “What are you doing to build business in your credit union? What’s your strategy for growth? How can you operate more efficiently?
“We hire branch managers who bring a variety of skills and experience with them,” he adds. Not all of them come from credit unions. “Some have retail backgrounds, others were in the mortgage or finance business.”
Neighbors Federal has invested heavily in training to prepare its branch managers to play this more active role. Each branch manager goes through a six-week program conducted by Success Labs—a leadership development company. The program is designed to help branch managers build leadership skills in a variety of areas.
“Credit unions might find they can’t cost-justify having a traditional branch manager in each location,” notes Robert Carmichael, senior vice president at $241 million asset Maine (Hampden) Savings Federal Credit Union.
Perhaps each branch will have an assistant manager with a regional manager over multiple branches, he adds. “This decision might come down to your lending model: If you have local decision-making authority, it could still be appropriate to have either a manager or a lending officer at each branch.”
Marketers becoming tech-savvy strategists.
While social media and delivery channels are important, credit union marketers need to think bigger.
Marketing has traditionally focused on “creative” and “delivery channels,” says Amy Davis, vice president of marketing at $580 million asset community-chartered Red Canoe Credit Union in Longview, Wash. But marketers must become a driving force in strategic planning, she adds, and gain a seat at the executive table.
Marketers also need to take responsibility and embrace a new role: informed stewards of the bottom line, she says. Marketers must understand credit union liquidity needs, loan-portfolio dynamics, and profitability.
Marketing can’t be perceived as a cost center—it’s an investment, she adds.
To take on expanded roles, marketers need excellent data-capture and data-mining capabilities. Credit unions need to hire data-management analysts, says Davis. “We need to know which campaigns are working and which channels are most important to our members. To do that, we have to integrate with our marketing customer information file.”
Georgia (Duluth) United Credit Union shares this viewpoint and recently created a chief marketing officer (CMO) position.
“As the role of marketing has become more complex, it’s increasingly critical for us to show the return on investment from our marketing efforts,” says Jason Halperin, CMO at the $890 million asset, multiple-select employee group (SEG) credit union. “Our advertising agency is primarily responsible for the creative side, but every aspect of our marketing is driven by our organization’s strategic goals.”
Halperin, who has background in both lending and marketing, stresses the interdependence of credit union functions. Good marketers use all the resources available to them, he says.
“They understand the credit union’s financial goals, they know what members value, and they rely on IT to know what is and isn’t working,” he adds. “This coordination will continue to be critical as the credit union movement becomes more complex.”
Next: Tellers and MSRs perform more complex roles
Tellers and MSRs performing more complex roles.
Moving the front line to a sales mode has been in the works for decades. But there’s increasing pressure now to move high-cost/low-value transactions to nonbranch channels or to automate them within the branch.
Teller transactions have decreased an average 4.4% annually in recent years, according to a productivity survey by the research firm Novantas. And about 30% of branch teller transactions will disappear during the next three years because of remote deposit capture, according to Mercatus, a research center at George Mason University.
Does high-tech necessarily mean low-touch?
“There will always be a human presence in branches,” says Carmichael. But as members handle transactions on their own, he adds, tellers and member service representatives (MSRs) must take on new, more complex roles.
At Red Canoe, CUNA’s Creating Member LoyaltyTM System of Training is turning tellers from order-takers into relationship-builders.
“We spent a good deal of time educating staff on the difference between selling and meeting a need,” says Davis. “We aren’t trying to push certain products or services—we’re using cues we’ve gained from listening to members to provide credit union resources that seem like a good fit.”
Neighbors Federal, a community-chartered credit union, also focuses on relationship-building. “We train our front-line staff to do things ‘the Neighbors’ way and empower them to ‘wow’ our members and turn them into raving fans,” says Inman.
Neighbors Federal plans to put a new spin on “wowing” by trying the increasingly popular concierge approach at one of its branches later this year. Instead of going to a teller window, members will sit at a counter, face-to-face with a credit union staffer who can handle everything from transactions to loans. “We’re focused on engagement,” says Inman.
And at $137 million asset West Community Credit Union in O’Fallon, Mo., there’s a strong emphasis on hiring front-line staff who can go beyond transactions. “We created a program we call ‘listening and lending,’” says Gary Hinrichs, president/CEO of the community credit union. “This program is giving our front-line staff the tools they need to help members solve problems. They love it, and it helped grow our loan portfolio 14% last year.”
Even though members likely will handle more of their own transactions in the future, staff have to be familiar with the tools members are using.
“To optimize our investment, we need to help members help themselves,” says Robert Reh, chief information officer at community-chartered $370 million asset Nassau Financial Federal Credit Union, Westbury, N.Y. “Employees at every level need baseline knowledge of the tools in your branches and on your website.”
Business development staff are specializing.
In the past, when credit unions served only SEGs, business development was primarily a matter of hosting a few seminars or showing up at the employee picnic. But as more credit unions gain community charters—or function as de facto community charters because of the number of SEGs they serve—the business development role is changing.
“It’s important to have a sales mindset to have a successful business development program,” says Sean McDonald, director of business development at $18 million asset, community-chartered Mid-State Federal Credit Union in Carteret, N.J.
You have to set goals and create plans for achieving them, he explains. “You’re no longer in the business of merely sustaining an existing relationship. You’re in a very competitive space and you need to become visible in the larger community and build new relationships with centers of influence in that community.”
Multichannel connections are critical. Nothing will replace time-honored traditions such as face-to-face meetings and phone calls, but credit unions know that some people will never enter their branches.
“Keep track of where interactions take place, and respond accordingly,” says McDonald. “If someone’s only connection with you is online banking, use it to try to build business.”
Hold every credit union leader accountable for new business, and assign someone—perhaps a regional vice president—to lead your efforts, suggests Carmichael. If business development is a critical growth strategy, don’t bog that person down with administrative tasks, he says. “Give them the time they need to accomplish your business development goals.”
Your business development person also needs specialized expertise, adds Carmichael. “I don’t think you can grow your business unless you have strong mortgage and commercial lending programs. If you don’t have that knowledge internally, you might have to go outside.”
Next: Compliance staff dealing with complexity and heavy loads.
Compliance staff dealing with complexity and heavy loads.
Although most credit unions weathered the financial crises of the past few years better than banks did, that doesn’t mean they’ve received a lighter regulatory load.
“We’re seeing regulation upon regulation, especially related to lending,” says Carmichael. “This is an enormous job and the position where we’ve seen the most change in recent years. I don’t anticipate that letting up anytime soon.”
Staying in regulatory compliance demands a broad understanding of credit union operations, lending practices, data management, and overall risk management. While these categories aren’t necessarily new, they’ve become increasingly complex with the explosion of both electronic data and regulations.
Maine Savings Federal has a full-time person in the compliance role, and also works with several outside vendors to handle auditing functions.
“This position requires a tremendous amount of knowledge, attention to detail, and focus…and a huge amount of time,” says Carmichael. “It will take on increasing importance.”
Security officers becoming more proactive.
In the past, security largely focused on operations, notes Nassau Financial Federal’s Reh. Credit unions considered “how could people circumvent your procedures, how could they use social engineering to commit fraud. It typically occurred at the person-to-person level.
“Now, because security revolves around your technology and your electronic data, the risk has grown exponentially,” he adds. “Every time we add a new channel or allow another type of transaction to occur electronically, we open ourselves up to new types of fraud.”
This means anyone who is managing credit union security needs exceptional technology skills and the dedication and tools to constantly monitor and address security risk.
Security professionals must take a more proactive approach to protecting members’ data instead of waiting for something to happen, says Jennifer Weiss, vice president of information technology (IT) at $1.7 billion asset, multiple-SEG Sandia Laboratory Federal Credit Union in Albuquerque, N.M.
“The role of the security professional no longer will be about reviewing logs and trying to detect anomalies,” she adds, “but more about education for both employees and members, and recommending both technology changes and policies and procedures that will prevent fraud before it happens.”
Credit union size often determines whether security is managed internally or externally.
“A credit union with billions in assets probably will hire a high-level security person, while a smaller credit union probably will rely more heavily on vendors,” says Carmichael. “Our credit union is in the middle: We out-source some things and we manage some internally. It requires ongoing evaluation to strike the right balance.”
Hybrid is the new norm
It’s becoming more difficult to compartmentalize credit union functions, staffing professionals agree. Technology and tech skills are required in every credit union role in varying degrees, and roles overlap in many areas—business development and marketing, marketing and IT, and regulatory compliance and security.
“Most marketers have adjusted to managing website content, but they’re still struggling with social media,” says Weiss. “Marketers not only have to get the message right, they also need technical skills that never were required before.”
“The question shouldn’t necessarily be, ‘Where does this person sit? Are they marketing or IT? Are they in business development?’ It’s more a matter of results,” says Davis, “and finding ways for people with different skill sets to work together effectively.”
Click here for an interesting perspective on the branch of the future.