Resolving To Build a Successful Strategic Plan

Resolving To Build a Successful Strategic Plan

Note: This article first ran in CU Times.

Strategic-PlanningAccording to the Alliance Professional Group, 70% of strategic plans fail. You read that right: 70%. My guess is the number is at least that high in many credit unions. Think of your last (or current) strategic plan. How many initiatives were partially completed, deferred or flat out stopped before the plan was put on a shelf to collect dust?

Credit unions spend way too much time on worn out exercises (SWOT analysis), tactical decisions (branch locations) and minutia discussions (product rates) in their planning sessions. If you make strategic planning routine, that’s exactly what you’ll get: a routine plan—and more than likely that plan will be part of those 70% that fail.

Sometimes the best outcome of strategic planning is not greater analytic insight. It’s greater resolve.

If credit unions want more effective strategic plans, they must start with better resolve. So before you start the strategic planning process at your credit union, make the following resolutions:

• Resolve to involve all—Effective strategic plans involve every one in your credit union. Not just the board and not just the executive team. Everyone. It’s your loan officers, member service representatives and even tellers who will execute the plan so make sure you get their involvement (and buy-in with the plan). If you are acting like the Wizard of Oz creating a grand scheme behind a curtain then your plan is destined for failure. Stop dictating and start involving.

• Resolve to make hard decisions—We tend to avoid hard decisions. The reality is there are usually elephants in the room no one wants to talk about. But if you want your plan to succeed you better have those hard conversations. Discussions like “what are going to do to stay relevant in the next three years?” “how are we allocating our resources” and “who or what is holding our team back?” But if you just talk about those issues and never come to a resolution then you’ve wasted your time. Stop talking and start deciding.

• Resolve to focus—Let’s be honest: too many strategic plans are not strategic. They are just a tactical regurgitation of your yearly goal to hit a certain net income number. Rather than letting numbers, ratios and peer group analysis guide your discussions, let strategies dictate where you want to go as a credit union. When you are in a planning session make sure the discussions stay on the strategic level and don’t stray to the tactical side of things. Stop looking short-term and start long term focusing.

• Resolve to use help—You can’t do strategic planning by yourself. You need an outsiders’ perspective to guide you through the many pitfalls of building a strategy. Expert plans require expertise. Ultimately, what’s more expensive: a strategic planning facilitator or a failed strategic plan? The best strategic plans do not come in a “do it yourself” kit. Stop doing it yourself and start using experts.

• Resolve to allocate resources—Don’t even bother putting a strategic initiative in the plan if you are not going to commit the dollars to it. For example, many credit unions know they must have a strategic brand plan and value proposition. But then when it comes to devoting resources to accomplish that goal, they take a pass. Or credit unions know they must move to a sales and service culture but are unwilling to spend the training dollars to get there. Stop dreaming and start spending.

Successful plans don’t just happen. You must make your credit union strategic planning process intentional. And much of that intentionality means resolving to build a strategic plan that succeeds rather than fails.

Four Business Development Best Practices

Four Business Development Best Practices

2014-2015_Credit_Union_Environmental_Scan_(E-Scan)_ReportIn a recent post, we mentioned that the Credit Union National Association’s 2014-2015 Environment Scan offered several marketing insights. One of the bonuses to this year’s publication is that it also offers a mini-section on improving your business development efforts.

As the section noted, business development extends your credit union’s reach. But not automatically. Just having a business development person, staff or department does not guarantee success. Sean McDonald, president of Your Full Potential and author of the business development section, offers four best practices for credit unions to implement.

According to McDonald and the E-Scan, successful credit union business development programs share these characteristics:

(1)    Structure

Business development doesn’t start with sales; it starts with structure. The biggest key with how you structure your business development area is authority and responsibility. Make sure you give your business development people plenty of both.

(2)    At the table

“Business development should be represented at executive meetings and strategic planning sessions,” McDonald notes. One of the plusses with a “seat at the table” is the feedback business development provides executives. Having heavy interaction with non-members and the community, business development often serves as the eyes and ears for key products and issues important to consumers.

(3)    Compensation

If you want the best business development for your credit union then you’re going to have to pay for the best business development professionals. But with that compensation comes several key traits of your BD people: forward-thinking, self-motivated, innovative, strategic dedicated and relationship-building.

(4)    Respect and communication

Business development is not a silo position. It often takes teamwork from multiple layers within the organization, all the way from the CEO to the tellers. With this broad role, communication among peers is critical. It’s especially important to make sure there are strong lines of communication between business development and the branches. Many times, business development brings in the business while the branch serves the business.

These are a few keys regarding business development best practices. For a complete review of additional business development insights, make sure you purchase your copy of the E-Scan. Of course, you won’t just receive the business development content. The E-Scan also offers tons of information regarding the economy, regulations, technology, H.R., operating ratios and other key areas. When it comes to strategic planning, there is no better resource or tool your credit union can use than CUNA’s Environmental Scan.

The Rule of Three With Strategic Planning

The Rule of Three With Strategic Planning

“Our life is frittered away by detail. Simplify, simplify, simplify.”

—Henry David Thoreau

Talk Like TedThoreau probably wasn’t thinking about strategic planning when he wrote the words “simplify, simplify, simplify.” But he well could have. The reality is we overly complicate strategic planning at credit unions and banks.

The best strategic plans are not necessarily the most complicated. In fact, the most successful plans are the ones that are the most simple.

One way to simplify your strategic plan is to implement the “rule of three.” According to Carmine Gallo, author of Talk Like Ted, “the rule of three simply means that people can remember three pieces of information really well; add more items and retention falls off considerably. It’s one of the most powerful concepts in writing and communication.”

It’s also a powerful concept when it comes to strategic planning. Rather than making a list of five, seven (or Heaven help you) 10 strategic initiatives, focus. There is true power in focus.

Think about how the number three is effective in many different aspects: there were three little pigs, three musketeers, three wishes granted to Aladdin. The U.S. flag has three colors, there are three medals in the Olympics and three wise men brought gifts to baby Jesus.

Sticking with the “rule of three” concept, here are three ways to apply that rule to your next strategic plan:

(1)    Focus on three strategic initiatives—That’s it. Three. Max. Once you get more than three large projects, items get diluted, tasks go uncompleted and staff becomes overwhelmed. Maybe it’s grow loans, reinvent your brand and increase operational efficiency. Once you nail the top three, stop adding and adding.

(2)    Communicate three points to your staff—Make your plan simple for your staff. Perhaps you even boil the plan into three words. For example: branding, lending and selling. If your staff gets “tired head” because you have too many initiatives, then important strategies will fall through the cracks.

(3)    Condense your plan to three pages—Some strategic plans are so large they don’t even fit into a three ring binder. Scrap all the data (even though it’s important). Then reduce your plan to three pages: one per strategy. Insert some bullet point action items, rough budget and expected outcomes. Focus on keeping your plan skimmable.

Applying the rule of three to strategic planning sounds easy. However it takes a great deal of discipline to implement. You can’t accomplish everything you want to in 12, 18 or 24 months. So stop trying. Focus on three.

2014-2015 E-Scan Offers Marketing Insights

2014-2015 E-Scan Offers Marketing Insights

2014-2015_Credit_Union_Environmental_Scan_(E-Scan)_ReportThe Credit Union National Association recently released the 2014-2015 Environmental Scan. The E-Scan offers insights in 10 primary areas affecting credit unions, including lending, mobile payments, big data and of course marketing/business development. The E-Scan is a must-read for any credit union executive and is also an outstanding planning tool to use.

The marketing section is entitled “Tell Your Credit Union’s Story.” And it aptly notes “Your credit union needs broader distribution of its compelling story—about how you help members achieve their financial dreams. Your story is your credit union’s unique brand.” Decision Journey

According to the E-Scan, the traditional consumer decision funnel used by many marketers is now replaced by a journey. This journey has six steps:

(1)    Consider

Credit unions currently only hold 6.8% of all the assets held by depository institutions in the U.S. The only way to move that number up: create strong brand awareness for consumers to actually use your brand. Suggested tools to use in this stage are sequential messaging, mobile technology, social advertising and immersive brand experiences.

(2)    Evaluate

“During this stage, members traditionally have asked friends and family for advice about financial institutions, but they’re now more likely to turn to social media for that advice,” the E-Scan says. Suggested tools for credit unions to assist consumers during the evaluation stage are rating sites, blog posts and tweets.

(3)    Buy

Credit unions must create an “omni-channel” experience for consumers during the buying process. You must align every single marketing channel into one database. This lets you make specific offers to members based on purchase patterns, social network affinities, website visits, loyalty programs and other information. Your credit union has tons of data on your members; now you need to use it.

(4)    Experience

The member’s journey does not end with the purchase. Through the power of social media and networking, now it’s about the experience they have with your credit union. What is it like to do business with your credit union? What experiences—both online and offline—are you giving your members?

(5)    Advocate

“Social media presently is the primary channel through which members share their experiences,” the E-Scan notes. “Mobile, however, will play an increasingly important role as the primary device for accessing social content.” The key with this stage is to turn your members into advocates.

(6)    Bond

If members positively connect with your brand, then they will also bond with it. If that is the case then they are more likely to repeat the buying cycle with your credit union. The best way to create that bond? Use that big data mentioned previously and use credit union’s traditionally strong member service. 

One of the best parts of the E-Scan is its action items after each chapter. With marketing and business development, the authors give several practical suggestions credit unions can take to better reach your members.

These were just a few snippets about the new buying process and telling your story—there is obviously much more detail about this marketing issue and other relevant areas in the E-Scan itself. To get the full context of the marketing section and to read the other insights, be sure to purchase your copy of the E-Scan. In addition to the report itself, you can also order the full E-Scan package, which includes the E-Scan report, the E-Scan Newsletter, the E-Scan DVD, the Strategic Planning Guide and the E-Scan Research & Advice Portal. When it comes to strategic planning, there is no better resource or tool your credit union can use than CUNA’s Environmental Scan.

Every Financial Product Has a Story

Every Financial Product Has a Story

Storytelling - 1Credit unions and banks don’t sell loans, checking accounts or investments. Or at least they shouldn’t. Financial institutions sell dreams. The new car dream. The perfect home dream. The debt free dream. The vacation dream.

You’ve probably heard the saying “features tell, benefits sell.” While that statement is true, let’s build on its premise. It’s not just benefits that sell—it’s stories. As Carmine Gallo says in Talk Like TED, “storytelling is the ultimate tool of persuasion.”  If you want to “sell” more products (loans, checking accounts, investments, etc.) then tell more stories.

But do financial products actually have stories? Absolutely. Here are the types of product stories you can tell:

(1)   The testimonial story—These are the best. Capture examples of how your members used a product or service to benefit them financially. Rather than information about a home equity loan rate, tell a story about the family who used that product to finance their son’s education and that son became a doctor.

(2)   The why story—Why are you even offering that particular product or service? For example, if it’s to offer free checking accounts to combat predatory payday lenders, then tell stories about one of your consumers who saved money with lower fees at your institution.

(3)   The history story—Some of your products have been around for quite some time. Or maybe some of your products are some of the first to market. Either way, your products have some history to them. And that history can be a story. As an example, you might could match your product’s history with the history of your community or niche markets you are serving.

(4)   The impact story—Your credit union or bank is making a difference in the lives of consumers every single day. Whether it’s dollars or time invested in giving back to the community, working with a particular charity or reinvesting in small businesses, the work of financial institutions is a key to our economy. Show those results with companies or individuals that are impacted by your positive work.

So capture those stories. Use video where possible. Tell them in your marketing materials. Every product has a story—it’s up to you to share it.