In an earlier post we took a cursory look at five critical areas where credit unions need to focus attention and energy to improve their performance. This post kicks off a five-part series where we will take a deeper look at each of these areas and provide some simple action steps to get the conversation and the action underway.
Efficiency is job one for credit unions in the current economic climate. Finding ways to do more with less, reducing expenses without compromising service, and implementing systems that ensure consistency are at the heart of discussions happening in credit unions across the spectrum.
If you’re serious about making an effort to improve efficiency, here are three things you must consider:
1. Improving Processes. Small changes in the way you do things can yield huge pay-offs. Chances are that over time some gaps have crept into your processes, and that some of the processes defined in the past would not be defined the same way in the present. While the tasks feels daunting, it is worth the effort…review all of your processes with an eye on making them more efficient and more consistent throughout your credit union. It will take time, but the simple act of putting your processes in writing and reviewing them will quickly reveal opportunities to reduce costs and improve efficiency.
Remember: you’ll have to eat this elephant one bite at a time…your process improvement effort will take time and energy, but taking time to document and improve today will pay off tomorrow!
2. Measuring Outcomes. It’s often said that if you can’t measure it, you can’t manage it. The question to ask throughout your credit union is how well are you measuring outcomes? Too often our attention gets focused on busy-ness of the business. Everyone is engaged and working hard, but it is not always clear what they are achieving with their efforts. If you want to reveal and correct the inefficiencies, you need to define the outcomes you are seeking and find ways to measure them on a day-to-day, week-to-week, and month-to-month basis.
The issue here is not one of dehumanizing the work that people do, but rather of defining what the desired outcome looks like and finding ways to measure its achievement. General targets such as ‘satisfy every member’ don’t go far enough, and ‘make no mistakes’ probably goes too far. But in the middle ground there are things that can be measured…finding things that can be tracked so that people know how well they are doing will go a long way toward improving efficiency as your team becomes more focused on doing the things that matter.
3. Outsourcing Support. Credit unions are well aware of the value of outsourcing support…they do it all the time with the software support and tools they use to deliver their services. But the opportunities don’t need to stop there. Every function that you now do in-house should be evaluated and the potential for outsourcing it considered. Things like marketing, human resources, tech support, call center services, project management, and so forth are all possible candidates for outsourcing. For some credit unions outsourcing or sharing top leadership positions with other credit unions is even a possibility.
The point here is that there are new opportunities available for getting things done that do not require you to make the investment in people and departments. The key to your becoming as efficient as possible may well lie in finding ways to hire the things that you need from companies and individuals who do not increase your fixed expenses and overhead. And while there are other things to be considered in your decision besides costs, the very act of evaluating the alternatives will improve your perspective and lead you to do things better, even if you opt to keep doing them in-house.
ACTION ADVICE: Convene you leadership/management team and discuss the potential for improving efficiency within your credit union. Use the three items above as a starting point and define an action plan that allows you to get started on this important task. Don’t let the enormity of the effort overwhelm…look for small steps that can be taken quickly and easily, the fast results will drive the effort forward and help you keep the effort on track!