As technology continues to be increasingly interwoven into almost every aspect of financial services, more credit union CEOs today have a background in information technology and its many applications.
This final installment of Credit Union Journal's four-part series profiling CU chief executives who moved from the server room to the corner office focuses on how the IT experience of Heritage Trust FCU's Jim McDaniel Sr. informs his approaches to leadership and decision making.
McDaniel began his career at the now $505 million-asset credit union in 1988, joining an effort to take over a computer conversion. During that same year, the Heritage Trust's CEO abruptly resigned. The newly appointed president/CEO was looking for an apolitical contact in the credit union that could save the conversion project and tapped McDaniel to be a senior vice president of administration.
"I got in to credit unions by my familiarity of the hardware and the software that was used, but I had an accounting background as well," said McDaniel. "The CEO at the time thought I could learn, or he could teach me, the credit union side of the business, and he did. I was like an [Israelite] crossing the Red Sea. I had two choices: sink or swim."
CEO SEE-SAW
Over the course of the next few years, McDaniel was immersed in all things Heritage. He was in charge of the IT department and reported directly to the CEO. The conversion was stabilized and McDaniel's compliant programming efforts were successful.
"One of the things I liked about programming was that I could get to the end of my day and see how successful I was by looking at how many lines of code I generated or how many programs were operational," said McDaniel. "As CEO, it can sometimes take years before you see something come to fruition, which requires a lot of patience."
In 1994, there was another changing of the guard and McDaniel became the interim CEO. Two years later, he moved to Myrtle Beach to accept the position of CEO at Carolina Trust Federal Credit Union. "That was really my first CEO job," McDaniel reflected. "It was great learning experience and it was a wonderful board to work for."
In 2004, Heritage Trust FCU was again in need of CEO. McDaniel was contacted and encouraged to apply. The following July, he returned to the first credit union he worked for nearly two decades earlier.
When he arrived, Heritage FCU was experiencing financial troubles, especially in its indirect lending department. McDaniel managed to right the ship into profitability during the first year, while converting the core system to Symitar.
McDaniel notes that while technology has changed over the years, the fundamental concepts are the same. "It's just a matter of settling on a core system that will do what you need it to do and grow with you."
THE LEADING EDGE
Now celebrating his 10th anniversary as Heritage FCU's CEO, McDaniel better understands how to balance the needs of all the CU's moving parts. "We are technology-focused credit union and I believe in the technology, but by the same token, I also know that technology budgets are not unlimited."
Historically, when it comes to technology, McDaniel noted that Heritage FCU has been forward-leaning. For example, the CU had the first operational ATM in South Carolina. The CU also offered text banking before it was "popular."
"My background has given me a strong appreciation for technology in credit unions, the need for it and understanding that there is a very thin line between leading edge and bleeding edge technology," said McDaniel. "Having had a technology background before I sat in this chair has made it somewhat difficult for IT sales people to blow smoke at me."
With deference to his IT colleagues, McDaniel said that once he became CEO he had to change the way he viewed operations. "I had to learn when to back out and let the IT people take over. Sometimes I want to put my IT hat back on, but I have to stop myself at the door. They know I back them 100%."
Today Heritage FCU supports more than 44,000 members, 200 employees at nine locations. Moving forward, McDaniel said he wants to ensure members are afforded the best possible services, which often relates to adding new technologies.
To this end, there are certain technologies he pushes for such as fingerprint security biometrics, which was introduced earlier this year. "This will help cut down on fraud. For example, with biometrics the wrong person can't get access to a member's account," said McDaniel. "We will be working toward something similar in biometrics for membership in 2016."
Though his background on the subject is strong, McDaniel is self-effacing when it comes to technology. "I may know a little more [than other CEOs], but in the IT arena, I may also be considered a dinosaur."
