Excite Innovation

How could a person who never comes up with a new idea, never approves an initiative, and has no funding authority or ability become the most important person in the innovation process?

Easy.

Sometimes all an innovator needs is someone else to be excited with him/her about an idea.

Be that person.

What Should Keep You Up at Night in 2010

A guy named Steve has been a member of your credit union for 15 years. He was an upholsterer employed by one of your original SEGs until four months ago, when he (along with 200 of his co-workers) was laid off. While he never earned much while he was working, never maintained much more than a $400 balance in his checking account, and often cashed his check upon receipt, Steve opened (and paid as agreed on) no fewer than eight different loan accounts at your credit union over the years.

Although it's been a little rough, Steve's family has been able to scrape by on federal unemployment benefits and a thrifty lifestyle. Their savings and checking accounts have been completely depleted, but they are able to afford food, their $700/month mortgage, and necessary utilities.

Yesterday, Steve's widowed mother passed away. This wasn't really a surprise. She'd been very sick for years. Still, the loss couldn't have come at a worse time emotionally or financially. She had no assets to speak of and now Steve's family is left with trying to figure out how to pay for the funeral, travel expenses to her hometown 350 miles away, and not end up starving or out on the street.

They would sell their house, but they owe $150,000 on the mortgage and similar houses in the neighborhood have been selling for $115,000.

What should be keeping you up at night in 2010 isn't interchange legislation, corporate meltdowns, the Credit CARD Act, Reg Z, or a national credit union branding campaign. Instead, as a leader in the credit union movement what should be keeping you up in the coming year is how you can help Steve and his family get through this painful time. Maybe you do it with traditional services. Maybe you do it with new innovations. But you need to address this problem.

I worry about middle America. I worry about decades of over-spending, under-saving, and apathy concerning financial literacy. I worry about the lack of personal responsibility in our society. I worry about business models that are built on deceit. These are significant concerns that require significant resources if we have any hope of changing their courses for the better.

What I worry about most, however, is that these concerns will take precedence over Steve's. If you can help Steve, there are at least 15.4 million additional Americans that have been looking for a financial institution, and a conscience, like yours.

Is "character" still an important "C" of credit at your credit union? What will the reaction be as Steve sits across from your loan officer and asks for a $3,000 loan to make ends meet? Is the capital your credit union has grown over the years for your rainy days or your members' rainy days?

Turning the Page

In November 2003, my wife (girlfriend at the time) was in her final year of graduate school at Wake Forest University. We had been dating for five years by that point, but for the previous year and a half she and our English bulldog, Leota, had been living in Winston-Salem, NC, while I lived and worked north of Richmond, Virginia. Living so far apart was taking its financial and emotional toll, so I constantly kept my eyes open for career opportunities that would allow us to remedy our situation.

I found and responded to an ad in the Winston-Salem Journal for a Director of Public Relations position at Members Credit Union in Winston-Salem, North Carolina. This was an interesting choice for me. Working in the financial services sector had never been appealing to me. In fact, even though the dot-com crash destroyed the job market for college students as unfortunate as I was to graduate in 2001, I simply refused to meet with recruiters from large banks, investment firms, and the like. I knew very little about credit unions, even though I had been a longtime member at Indiana's Centra Credit Union. I knew even less about Members Credit Union, Winston-Salem, public relations, and even North Carolina.

I didn't get the job.

Members Credit Union hired another applicant instead of me, but offered to make me her assistant. I accepted, and did the best I could to absorb everything I possibly could about credit unions, public relations, financial services, and marketing. I learned about the credit union structure, and how Members Credit Union carefully followed the most sacred of credit union philosophies. Although we offered the latest in financial services technology, this was a traditional (read: wonderful) credit union that insisted on putting people over profit, serving the community, keeping deposit rates high and loan rates low, financial literacy education, and treating employees well. I had found a home.

After only a few months, my boss suddenly resigned. I was lucky enough to be selected as her replacement. In the nearly six years since, I have been blessed to serve a credit union that truly understands, and lives, the credit union difference. Members Credit Union is conservative with lending and investments because we see the credit union's assets as our members' assets. Steady growth, we have always argued, is much more desirable (and responsible) than forced, expensive, and risky growth. Thanks to the careful guidance of our management team and volunteer board, we have always run a lean organization. We have always been open to new ideas, but insist that they be implemented with as little hard dollar costs as possible.

At times, the lack of budget dollars has been frustrating. Looking back, however, I would say that this experience was the greatest thing that could have possibly happened for my personal and professional development. They say that need is the mother of invention, but I'd argue that under-funded passion is. When you don't have the budget dollars to implement an idea, what do you do? Well, if you believe in the idea, you do anything you can to make it work within the budget. You read as much as you can. You work as hard as you possibly can. You connect with people with expertise on the subject. You teach yourself things that you never knew you would ever have a chance to learn. You work every relationship with every person outside of your organization to see your idea get its first breath of life.

This mindset has kept me interested in credit union innovation. It has convinced me that credit unions of all sizes and budgets can implement ideas they are passionate about. It has proven to me that the credit union difference is alive and well. It has allowed me to get to know many of you.

Today is my last day at Members Credit Union.

On Monday I start an 18-month contract with the Filene Research Institute to help credit unions across the globe learn about, implement, and create financial services innovations. Over the years, Filene's i3 Program has researched and created game-changing programs to help credit unions better serve, engage, and appeal to consumers. My goal will be to help as many credit unions as possible deliver these programs to their fields of membership.

This is a dream come true for me, and as close to a perfect professional fit I could ever hope to find for myself. I hope I've proven over the years that I deeply love credit unions, am a total financial services innovation nerd, and walk the talk when it comes to credit union cooperation and collaboration. This position will allow me to live and breathe my passions, while surrounding me with co-workers that I have always truly admired.

I'll miss Members Credit Union dearly, but can't wait to start this next chapter in my career. I hope you'll continue to be a part of it.

Kicking the Tires - CUECU

Screenshots and white papers aren't enough to sell most credit union decision-makers on an innovation - no matter how promising it may be. Instead, the sheep among us wait until another financial institution is brave enough to implement said innovation before it is truly considered as a viable option. This mentality creates a network of precious few innovators, and a glut of late majority slackers or, worse, laggards.

What if there were an easier, more timely, way to prove an innovation's worth? I realize that not everyone has innovation in their blood...the risk is too high, and the potential reward simply isn't worth it to them. I get that. But what if we could speed up the time it takes for this group to kick an innovation's tires? What if we could allow them to experience a financial services innovation risk free?

Could we set up a Credit Union Employees Credit Union (CUECU) that could adopt innovations FOR credit unions? I picture it like this. Credit union employees across the nation deposit money into the credit union (call it dues, deposits, investments...I don't care). The credit union, then, negotiates with vendors to get free use of their newest innovations. Better yet, the credit union can also create their own. Member owners can choose a la carte which innovations they want to kick the tires of, and test them out for themselves in a real-time environment. Members could choose any core processor and any associated interfacing products they like from a menu of available innovations...and change their account settings any time they wish.

Vendors will want to be involved because it gets their product in front of their target market. It would also give them an opportunity to find bugs in their plans before launching to the "public". Operations would be extremely inexpensive, with very few staff positions or physical office space needed.

This won't turn laggards into innovators, but it may shorten the time it takes for the former group to come aboard. For a cooperative movement of cooperatives, this improves us all.