One CU's Step-By-Step Approach To Expanding To Community Charter
About This Article
This article is an excerpt from a thesis authored by David L. Thieme, CEO of General Credit Union in Fort Wayne, Indiana. It was written as part of the SWAT Team Project Thieme completed for the Credit Union Executives Society's CEO Institute II on Organizational Effectiveness. Fore more information on the program, visit www.cues.org.
Credit unions of all shapes and sizes have one thing in common: change. Making the most of change can be the difference between success and failure. Here's how General Credit Union turned five years of change into a success story.
Between 1998 and 2003, General CU changed from federal to state charter, moved from the NCUSIF to American Share Insurance, merged Insurance Employees FCU into its operation, converted both credit unions to a new data processor, and expanded its charter from primarily Verizon Communitcations and Lincoln National Life Insurance to include persons living and working in the city of Fort Wayne, Ind.
The change from a relatively closed membership to the more open field of membership encompassing a city of nearly 200,000 brought about some challenges, particularly in marketing, where we realized we would need to put more dollars toward television and radio advertising than we had in the past.
We drew up four potential means of meeting our main goal of getting the General Credit Union name out in the community.
1. Start advertising on television with emphasis placed on getting the name General Credit Union in the minds of Fort Wayne's consumers.
2. Start advertising on radio with emphasis placed on getting the name General Credit Union in the minds of Fort Wayne's consumers.
3. Get our management team involved by taking an active part in volunteer work in the community. The second part of this is to become a sponsor of some fundraising event for a charitable organization.
4. Use a direct mail, promotional campaign to get the public to open accounts at General Credit Union.
We had to have an action plan outlining not only the activities and tasks that would have to happen but also who on the GCU team would be responsible for each part of the action plan.
Our marketing officer, Kathy Knight, was put in charge of researching the opportunities in our television and radio marketplace, including overall costs and review coverage. She reported back to VP-Operations Lori Huglin and myself. Knight was given a deadline for finishing the research in time for the board's budget meeting.
It is fairly easy to measure if a commercial is done or not. I believe a better form of tracking is to know if our present and future members see our advertising. The only true way to do this is by listening to our members to see if they are seeing our advertising efforts. We required new account personnel to ask new members how they heard about us.
The other measure we used was to look at the numbers, such as loan volume, new accounts and deposit dollars, in relation to our competition by monitoring the required CU reports that are submitted quarterly.
The Obstacles Encountered
Among the obstacles we had to overcome: remaining within budget, deciding what types of messages to relay, what stations to use, who should do the commercials, keeping the staff informed of advertising's intent, and making sure staff asks the right questions of new members and relays that information to management.
In order to free up dollars for these new projects, some old marketing methods had to be eliminated or revised, and other cost-savings had to be developed, such as cutting back on quarterly statement stuffers and aggressively attempting to get dormant accounts to become active again to close these accounts.
We also required all home banking members to only receive monthly and quarterly statements via e-mail to reduce mail and printing costs.
It's a well kept secret that General Credit Union has a long history of helping people and the community, and we decided it was time to "leak" that secret so that we could continue to grow and help more people.
During the course of our research, we learned our local ABC affiliate sponsors a program called "Companies that Care"-a group of local companies that help sponsor several fundraising and community events and educational gatherings. We expressed an interest in taking over any spots that opened up, and part of our sponsorship included a short commercial stating General Credit Union is a "Company That Cares" that aired over 300 times in the ensuing 12 months.
Along with that, there were some 200 other times where our logo appeared on television in sponsorship of various events. We could not have found a better way to get our name out and get involved with the community, so what started out as work done to accomplish our first and second goals also led to progress on our third goal of getting more involved in the community.
Getting Management Into The Community
Other efforts along those lines included encouraging management staff to volunteer time in the community as well as to sponsor a fundraising event for a charity. While individuals were allowed to choose what types of charities and volunteer work they wanted to get involved in, we put our marketing and operations officers in charge of researching events and charities so we could pick one for our corporate sponsorship goal.
Our goal was to finish the research of the local charities by the first quarter of 2003 so we could sponsor an event during the summer or early fall time frame.
We used our monthly management meetings to monitor the management team's progress in getting involved on an individual basis. We let the volunteer organization know that General Credit Union would allow staff to be available during working hours.
Among the things our people got involved with during the year: hospital, animal shelter, church groups, high school board and Junior Achievement.
In this pursuit, there were several obstacles we had to overcome. First, the whole idea of promoting volunteerism to the management staff was totally new. Second, when a manager is out, other management staff must be willing to fill in. Third, depending on the individual, they may feel uncomfortable about getting outside their box. Fourth, at times there is a tendency to not help outside of work hours. Since these were managers, the point that management's responsibilities go beyond the 9-to-5 timeframe was made, as was the importance of making a difference in the community.
As a result of our efforts, the credit union is seen in the community as an organization that is a partner, and as an active participant that cares about people.
For our fourth goal, we created a direct mail campaign. The initial mailing was a letter introducing General Credit Union and a promotional giveaway that was sent to zip codes directly around our three office locations. This was followed by a postcard about a month later and another post card about 60 days after that. We generated the mailing list using the Polk Directory.
The Challenge of 'Knowing The member'
Our marketing person was directed to write the letter and work with IT to produce labels for the mailing. Teller staff as used to stuff envelopes. In order to better track the promotion, only the manager or assistant managers opened the new accounts generated by the mailing and then reported back to the marketing officer on a weekly basis.
The major obstacle we faced was "knowing the member." Before the new charter expansion adding those living and working in Fort Wayne, we were very limited as to who could join. This made it fairly easy to identify new members. Once we became more "public," it became more important that new account procedures be followed. A new account checklist was created for those opening accounts, and our training stressed the importance of ensuring all items on the checklist be accounted for.
Additionally, in response to several robberies a couple of years ago, we installed lock down doors, which meant staff had to recognize an individual before granting admittance-a clear problem for potential new members coming to see us.
The benefits of the promotional endeavor are clear. First, continued growth is key to a healthy organization in today's environment. By receiving new members we have been able to grow and expand. Second, and probably more vital, is that these new members are bringing diversity to the credit union. Bringing in community members will help insulate us from the ups and downs of affiliate downsizing.
As I reflect back over my credit union career, one thing keeps coming up, and that is change.
In marketing as in all areas of business, we must change and adjust to what our members need. I know that we must stay flexible and be willing to adjust.
I firmly believe that those companies that make the adjustments in the future will strive.
David L. Thieme is the CEO of General Credit Union, Fort Wayne, Indiana. This piece is an excerpt from the SWAT Teams Project Thieme completed for the CUES CEO Institute II on Organizational Effectiveness.