PHOENIX—When it comes to turning around the fortunes of a struggling credit union, if the CEO is not paying close attention to the organization’s culture, all the strategies and tactics in the world won’t make any difference, says Jane Dobbs.
Dobbs, who has been called on in her career to turn around several credit unions and who has done so at the $201-million Canyon State CU here, will speak at the CUTomorrow Conference and address what credit unions need to do to right the ship if it is faltering.
The CUTomorrow Conference (cutomorrow.info) is scheduled for Sept. 9-11 at the Omni Hotel in downtown Austin. The meeting, priced at just $499, was put together in response to feedback to CUToday.info and is for credit unions that are not seeking to merge, but instead want to be a part of an old-fashioned credit unions-helping-credit unions collaboration. Sessions are focused on practical, pragmatic real-life examples of successful programs from peer-group leading CUs.
Turnaround At Canyon State
Canyon State had suffered through a number of unprofitable years prior to Dobbs’ arrival. But in her first three full years the credit union has posted net income gains of $969,666 in 2014, $587,330 in 2015 and $545,774 in 2016. She is also a former consultant who worked on NCUA conservatorship teams to turn around CAMEL 4 credit unions,
“There is a saying, culture eats strategy all day long,” said Dobbs. “What that means is that I can implement as much strategy as I want, but if no one in the organization is following me, if the culture stinks, you will not be successful in turning things around. If you are not investing your time in understanding the current culture and making sure the culture is right for the credit union, you are wasting your time.”
Dobbs said that when she steps into a credit union for the first time to assess what’s going on, she focuses first on the feel and attitude she encounters.
“If the credit union is not performing, it’s often because a culture of apathy exists,” Dobbs said. “There has not been any investment in the people, and there are ‘sacred cows’ no one is talking about.
The Sacred Cows
Dobbs said that sacred cows are problem areas, even people, within the credit union that no one has been addressing, often because the person, the process or the problem has been around for so long that staff simply accept them.
“For example, an underperforming employee who has been at the credit union for 30 years,” said Dobbs. “A sacred cow could be a system or a vendor that has been allowed for years to underperform. Since these issues have been around for so long, staff simply don’t talk about them. They won’t say, ‘Let’s address them. Let’s get the vendor in here and talk about how their solution can be improved.’ People avoid sacred cows’ they just don’t go there because these things have become engrained in the business—longstanding relationships well protected—and people think ‘we’ve always done it this way.’ They don’t question vendor relationships that have been in place for a long time. That hurts the business.
“At the highest level, when you are turning around a credit union, it’s all about what kind of culture are you walking into,” reiterated Dobbs. “If you are coming to the CUTomorrow Conference, and you either are in a turnaround situation or just want to make the credit union better, and you have been unsure about how to begin, I am going to tell you to look at your culture.”
The Source of Strategy
Once the culture has been accurately assessed, from there the CEO can begin to determine what needs to happen next.
“Strategy will come from this,” she said. “It’s easier to determine strategy than it is to assess your culture. From there you can develop a plan that has tactics that will lead to results.”
Dobbs emphasized that a goal within the turnaround process is to get people to think about how they can do things differently, approach a task in a new way.
“Get people to think if there are any areas they are purposely putting aside because they are protecting them,” she said.
Dobbs said that those who attend her session at the CUTomorrow Conference will walk away with actionable strategies and tactics they can implement right away and begin heading the credit union down a new path.
“Most important, I will share a lot of ideas that will allow people to find what works for them, pick what fits their needs, and get to work,” Dobbs said.