istock_000008584751mediumAfter spending some time across the past couple of months with diverse audiences discussing the subject of business strategy, it became clear to me that what most people are looking for is a simple, practical definition of strategy that they can use to move their business forward.

So here goes…

At the simplest level, strategy is the definition of a long-term focus for a business. By defining a strategy your credit union narrows the pathways it will pursue and defines what it is striving to create and become in the marketplace for financial services.

Your strategy should answer the critical questions every credit union must face in charting its course to success:

1 What business are we really in?

2. What are we not going to do?

3. What makes us different/distinct?

4. How do we leverage our resources…knowledge, people, locations, systems, processes, capital, experiences, alliances, relationships, and so forth…to capture a distinctive, defensible, and sustainable competitive position?

With these questions answered, the business has a clear framework that supports decision making at all levels: If it doesn’t fit our strategy, we don’t do it. Further, the definition of a strategy focuses everyone throughout the organization on doing the things that need to be done to achieve the defined outcomes of the strategy.

Once your strategy has been defined, it should become a guide for day-to-day activities at all levels of the credit union.

Consider the example of Walmart.

Essentially, Walmart is in the logistics business because their strategy is all about providing low prices to consumers. That low price strategy drives everything that the company does. Contracts with suppliers are defined to obtain the lowest possible cost of acquisition for the goods they sell.

Walmart’s distribution pipeline is controlled down to the last detail to ensure that costs are not increased by the movement of products from one location to another. The entire supply-chain is managed to ensure that they will be able to sell the product at the lowest possible price in their retail stores; and it is all driven by the definition of a strategy that focuses on delivering low prices to consumers.

That is the essence of how strategy works.


1. Start by rigorously evaluating your credit union’s strategy against the four questions above-does it effectively define a vision that addresses each question?

2. Next, consider how effectively your strategy has been integrated into the day-to-day, week-to-week, and month-to-month activities throughout the credit union-are the things that people do each day structured to produce the defined strategic outcomes?

3. Finally, examine the effectiveness of your communication process as it relates to your strategy, because this is where even the best strategic plans often fall short-is your strategy being continuously reinforced and used to drive the actions of the team?

Though a well-defined strategy doesn’t guarantee success, it puts you on a path with a much higher probability of achieving it and prepares your team to respond effectively to changes in that require you to adjust your course.