In 100 Words Or Less, A Credit Union Is Defined As...

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New Years' resolutions are always individual things, but perhaps the very best thing the credit union community could resolve to do in 2003 would be to collectively answer the question: What are we?

No doubt the 8,000-plus readers of The Credit Union Journal could answer that query 8,000-plus different ways, and therein lies something of a developing dilemma for credit unions, which in recent years have howled that they mustn't allow banks to define them. Yet how do you fight the definitions proposed by others when you can't really define yourself?

I was part of a panel discussion at a meeting a while back when the moderator posed that never-fail question, "What do you see as the biggest challenge for credit unions?" The first panelist responded, "Keeping up with technology," in the process citing that phrase that should be forever banned, "In today's changing times." The second panelist answered something to the effect of ensuring a "future for small credit unions." I didn't disagree with either of the first two answers, but for my part I said I believed there is a far greater challenge that overshadows both and it's one few give attention: Success.

You've seen all the statistics. This newspaper reports them often, and the trade group's are apparently prohibited from starting a meeting without citing the figures for credit union growth, lending, membership, etc. Credit unions rose like a space shuttle launch during the 1990s, and while Silicon Valley and the stock market have fallen off like booster engines into the sea, America's cooperative financial institutions have kept riding the rocket.

When there's turmoil, as in the years leading up to the passage of HR 1151, it's easy to define yourself, the enemy, the allies and the battlefield, and to rally behind a common flag. Look at NATO. For decades it knew who stood with it, who stood against it, and even had the benefit of a nice, neat line of demarcation in the form of a helpful wall. On this side, good guys. On that side, bad.

But success creates the opposite scenario. Nearly everyone's your friend when you're successful. You know times are either very good or very bad when folks start arguing over trivial items that would have been inconsequential in the past, such as who sits where at the table when NATO meets-or which trade group should get marquee billing for a piece of legislation.

But the Big Shining Irony of Success is this: we often abandon what it is that made us successful once we get there. Every credit union and trade group should ask itself, what got us here? After all, what happens when the old apparatus outlasts the mission? It scrambles to find or even create a new one in order to perpetuate itself, and soon the question isn't how did we get here, but what are we doing here?

In those old pre-HR 1151 days, when credit unions were pinned down in their bunkers and bankers were winning the high ground, the battle shifted in part because of those who took up arms for the credit union cause: consumer groups, labor unions, working stiffs, Democrats, public policy analysts, etc.

Still glowing from the landslide win on HR 1151, credit unions plunged into new fights, specifically for bankruptcy reform. In the process they have changed how they define themselves, raised an awful lot of money, bought some new clothes and made some new friends. Lunch pails are out, power lunches are in. What shouldn't be forgotten is that temporary friends are just that-temporary.

On bankruptcy reform, the Consumer Federation of America refused to stand with credit unions. Ralph Nader accused credit unions of selling out the American consumer. Published studies from formerly faithful supporters attacked the credit union position. And throughout, the banking industry (with which, ironically enough, credit unions have partnered) has been delighted to take each instance and trumpet it as an example of why credit unions no longer deserve their tax exemption.

Away from Washington, we've heard a great deal in the past few years from credit unions talking about remaining successfuly by going back to concentrating on their "core competencies." What exactly is or are credit union core competencies? I have credit cards from two credit unions, both of which have since sold their portfolios. Today I write out my payment checks to "Bankcard services." I have a mortgage through my credit union, as well. All the documentation and paperwork related to the loan came to me from a savings and loan. It seems only a matter of time before my drive-through is operated by Goodyear, the lobby by Expo Design Centre. And is that a Starbucks they're building near the in-branch ATM?

When it comes to core competencies, it just may be that there is a little too much discussion of the competencies and not enough of the core. What is that core? Perhaps in 2003 it's time to resolve to rediscover it.

It is absolutely inevitable that in the next decade credit unions are going to have to once again turn to their memberships and ask them to define for Congress or a state legislature what their credit union means to them. But if credit unions can't decide what they are, how ever will members?

Frank J. Diekmann is editor of The Credit Union Journal. He can be reached at fdiekmann

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