‘Progress is a constantly moving target.’
How do you assess the progress of the credit union idea?
First, let’s look at the numerical trends that might answer that question:
These numbers point to the growing relevance and impact of the credit union idea. But they also can mask the real story of progress. Numbers are relative to other factors, such as inflation, financial sector growth, or population expansion.
It would likely take a Ph.D. in econometrics to determine the good, bad, or indifferent in them. (Note to self: Do this research.)
Filene Research Institute’s archives provide a few hints as to where the credit union system stands today.
Federal credit unions rose in the 1930s as a way to formalize a consumer credit and savings function the banking industry wasn’t fulfilling. So it’s natural to compare credit unions’ progress with that of banks.
Credit unions have been progressing at a pretty amazing clip. Two great business philosophers tell us what’s next.
“Success breeds complacency. Complacency breeds failure. Only the paranoid survive,” says Andy Grove, CEO of Intel. And “progress is the constant replacing of the best there is with something still better,” says Edward Filene, the father of the U.S. credit union movement.
Credit union progress isn’t an end point. Progress is a constantly moving target. It’s influenced by technology, consumers, regulation, competition, and economics.
For credit unions to continue to progress, they must think in a slightly paranoid manner about how to meet these four challenges and opportunities:
If you’re constantly thinking about emerging technologies, new consumer needs, and the changing economic and social environment, then you’re progressing.
If not, the success of the past will take a dramatic turn on the wrong side of history.
GEORGE HOFHEIMER is Chief Research + Innovation Officer at Filene Research Institute.