Management Network June 2014

Crowdfunding Supports CU Brand

Assess With NPS

"Are you confusing doing what’s hard with doing what’s valuable?"

Great Work Provocation No. 78 from Michael Bungay-Stanier, 2014 CEO/Executive Team Network speaker and author of Do More Great Work.

Why ‘Slack’ Is Good

Running at full capacity is not always the path to optimal efficiency. In fact, sometimes aiming for all your operations to be at 100 percent just slows things down and gums up the works.

For example, when a Missouri hospital booked its operating rooms to full capacity, emergency surgeries often bumped back scheduled procedures, leaving surgeons working late into the night. But when one surgical suite was left unbooked to be used only for emergencies, planned surgeries proceeded on schedule. By allowing a little “breathing room,” the number of surgeries actually increased, and patients and surgeons alike applauded the change.

Too often, full capacity translates to scarcity, and when executives are forced to manage scarce resources, they spend more time dealing with emergencies than preventing problems and addressing structural issues that could improve operations over the long term. And executives may be so focused on bottom-line results that they neglect risk management. We all know where that left the financial services sector in 2008.

To optimize “slack management” at your credit union, consider appointing a manager, team or outside consultant to look beyond the organization’s immediate needs and challenges to identify capacity issues that could disrupt future operations. For example:

• How do “traffic jams” in branch lobbies and call centers at peak times affect members’ assessment of service quality?
• Are bottlenecks in loan decision or underwriting processes reducing your close rates?
• How long do members wait for responses to email inquiries?

Adapted from “Cut the Fat but Keep Some Slack”, by Sendhil Mullainathan and Eldar Shafir, Strategy + Business, Spring 2014.

Letter to the Editor

Thank you for the article on culture (“A Matter of Culture,” April 2014). My chairman sent me the article and told me how important he thought our culture is at SAFE. I agree with him. The credit union’s culture is the genetic code that assures that each generation of the credit union carries on the traits that define the credit union. Like the genetic code, culture also gives the credit union the traits needed to adapt and to change when the environment changes.

I was a bit amazed to learn that some credit union leaders can’t describe their culture. I feel that the culture is consciously created, molded and expressed by the CEO and the board. It is a key to how the credit union treats its employees, members, community and other stakeholders. If you don’t know your culture, then perhaps you are doing nothing to create, mold or express it. That would be a dereliction of a key duty.

I loved the point the author makes about being a “learning organization.” This is a key to any good culture. It provides the adaptability that every organization must have in an ever-changing marketplace.

I believe you should be able to define your culture in a sound bite. Our sound bite is “Do the right thing, for the right reason.”

As the article says, a good culture depends on teamwork. But that teamwork has to be inspired by a worthy purpose, by a defined way to achieve that purpose and, most importantly, by leadership that models the culture.

A weak culture means a weak credit union. A weak culture comes from weak management. I so often wonder how NCUA assigns their rating to the M in CAMEL. Surely not by any assessment of the credit union’s culture, yet that should be where any rating of management begins.

Culture is important. Thanks for raising the topic to everyone’s attention.

Henry Wirz
CEO
$2 billion SAFE Credit Union
North Highlands, Calif.

Read this letter in its entirety on the CUES Skybox blog.