I believe that credit unions often rely on “passive service”, serving as order takers for members instead of identifying ways for the member to achieve financial success. With an appropriate balance of sales and service, credit unions can achieve a stronger financial future with a more satisfied and engaged member base.
I joined the credit union as a loan officer where I created tools to improve lending processes and offered these tools to other loan officers. A few years later, I continued process improvement by streamlining processes and procedures for my branch as branch manager. When I started doing similar work for other departments, the CEO asked me to join the executive management team in the newly created role of Efficiency Officer. Until this point, my motivation had been simply to make processes easier but once on the executive team, I took on a more organizational view.
Two years ago, I was asked to help represent the management team on a strategic planning steering committee. This process led to a strategic plan that was then boiled down to three goals which together would strengthen the bottom line and continue to build a strong financial institution. These goals are To Create Happy Members, To Provide Total Member Care, and To Grow Loans. While we continue to work simultaneously with all three goals, my primary focus has been with Member Care which includes a balance of excellent service and proactive sales.
This spring, while working on some sales tools, it became apparent to me how much our checking accounts were standing in the way of Total Member Care; and certainly not helping to create Happy Members. With our CEO’s permission, I formed a collaborative taskforce with representatives from each department of the credit union which used surveys and focus groups to redesign our checking accounts. The goal was not just to design a good checking account, but to change the way that we thought about checking accounts. With this in mind, we plan to introduce Simple Choice checking within the next couple months.
Simple Choice will be a free account that allows our members to build their own account by choosing from a list of features including bill pay, dividends, paper statements, and overdraft protection. And if they don’t want to choose, they can get everything on the list for a small monthly premium. If we stop here, we have a pretty nice checking account. The member benefits by having a free account that is designed specifically for them. The credit union benefits by not giving away too many services for free. However, if we leverage the Simple Choice checking accounts, both parties benefit even more through a strong financial relationship.
The relationship between the credit union and the member starts at account opening. Simple Choice checking is the next step. As we have the opportunity to get to know the member and their financial goals, we can bring them the most value with a customized checking account instead of a cookie cutter approach. For example, instead of offering free paper statements to everybody, a member may choose free bill pay instead. That member now has an account that is more valuable to them and the credit union is still at the same price point since we are not paying for the paper statements that previously ended up in the shredder.
We can push this further to strengthen the financial relationship by encouraging appropriate products and services. If a member is using bill pay, encourage remote deposit capture which saves time for both the member and the credit union. If a member opens an account for their new baby, encourage them to talk to a financial advisor about life insurance or a college savings account. Simple Choice checking is not just about sales numbers. By knowing our members and offering products and services that members need, we can continue To Provide Total Member Care and To Create Happy Members.
While this may sound good on paper, the obvious fact is that it all needs to make financial sense for the credit union. We know that the member care approach can work since we have seen positive results with similar processes in our consumer lending department. We also have baseline data and projections for checking accounts including cost of funds, wallet share, and net promoter score which we will be tracking as we implement Simple Choice this fall. I look forward to sharing our progress over the next several months.