Some Advice On Knowing When To Invest In Technology
We all remember playing Follow the Leader as children. Given the option, did you choose to be the follower or the leader? Like most kids, you probably wanted to be the leader. However, somewhere along the charge down our career paths, we realized that it's often safer to be the follower.
Faced with a difficult decision-choosing a new technology, for example-we rationalize that it makes good sense to simply follow along and do what all our peers are doing. There used to be an old saying that nobody ever got fired for buying IBM, and we can apply that same thinking to any number of products that our peers have adopted.
Keep in mind, though, that there's one furry, little rodent that has become famous for his lifelong vocation as a follower: the lemming. Mr. Lemming spends his whole life following closely behind his peers, making sure to never step out of line. Of course, we all know how his story ends. He follows his peers right over the edge of a cliff, and meets the same watery fate that they do. Poor Mr. Lemming! If he'd only made the effort to step out of line just once and maybe go for lunch at The Four Seasons.
Don't get me wrong. I'm not suggesting for a moment that there's no value in looking to your peers for input and advice. Evaluating the choices made by your peers is a very important part of any due diligence effort. However, this should never constitute your entire due diligence effort.
First and foremost, each credit union is different. Unless you sat in on your neighbor's strategic planning meeting and are certain his or her credit union's long-term goals are identical to yours, you may be trying to fulfill different strategic needs and objectives. Plus, you can't ignore the fact that "most popular" doesn't always equate to "best." Our world is full of examples.
McDonald's sells more hamburgers than anyone else, but do their hamburgers really taste better? Wal-Mart sells more CDs than any other retailer, but you'd hardly classify them as a great music store. Coca-Cola sells more product than Pepsi-Cola, and yet the "cola wars" have raged on for years. The list is endless.
The question then becomes: When it's time to invest in new technology, how do I balance the experience of my peers with my own independent evaluation? Here are a few tips:
* Make sure you step back and consider the bigger picture. Start by defining how the technology under evaluation fits within your overall strategies and get feedback from other credit unions that directly relates to your broader goals. When making technology decisions, it is always critical to find technology that is effective in dealing with your immediate needs while having the capabilities to scale with your needs over time.
* Look outside the industry for input. Experience counts for a lot. In addition to input from credit unions, you'll want to solicit feedback from organizations in industries that have been using a particular technology (and others like it) for several years. A great example of this is when dealing with technology focused on improving member service and support. Many other industries have been using so-called eService technology (including knowledge management) for years. They are well aware of what technology is needed and what a multitude of vendors competing for their business have to offer. Unless the technology is unique to credit unions, beware of vendors that have not successfully competed against seasoned products in industries well-acquainted with that technology.
* Get the facts that relate to your membership. Opinions are like noses; everyone has one. Be sure to get to the facts that support opinions and see how they relate to the short- and long-term expectations of your members. Creating a matrix that defines and rates vendors against critical features is always important. An essential part of this assessment is to understand how features actually work by talking to existing customers and through product demos. Don't accept "we can do that" and "it's easy to use" without seeing the functionality in action for yourself.
* Involve the right stakeholders within your credit union. For any material technology decision, it is crucial to involve the credit union staff that will be responsible for using the technology along with staff that has a broad understanding of your credit union's strategies and goals. Operational areas are often so busy dealing with immediate issues that their perspective becomes too narrow to adequately assess technology beyond what it will mean to their day-to-day operations. While this is an important factor, it only represents one factor upon which to base a technology decision.
* Find a financially solid partner that is committed to the credit union movement. More than just a vendor, you will want to find a partner that will be around tomorrow and brings to the table core competencies for optimizing the effectiveness of the technology for your credit union. This is one example where talking to existing credit union customers will provide you with great insights.
Technology decisions are difficult and have far-reaching implications for your credit union and its ability to remain competitive. Completing a detailed evaluation involving relevant people internal and external to credit unions will significantly increase your likelihood of making the technology decision that's right for your credit union today-and tomorrow.
Chuck Van Court is the President and founder of Fuze Digital Solutions (www.fuze.com), an eServices and knowledge management software solutions company based in Seattle, Washington. Prior to founding Fuze, Mr. Van Court was the CIO for a $45-billion bank in Seattle and president of a Web-focused professional services company.