TACOMA, Wash. — A stringent focus on maximizing efficiency and establishing a solid product development system based on member feedback has helped Sound CU here become one of the best performing, large credit unions in the country.
"We have always put a major effort into making sure if we spend a dollar we get something for it," said CEO Rick Brandsma. "We made a decision long ago that we're only going to hire new staff if we have to. I think if you have that philosophy [of maximizing efficiency], what ends up happening is that everybody starts to think the same way."
Raddon Financial Group recently presented the $430-million credit union with a Crystal Performance Award, an honor reserved for the 10 best performing CUs in its performance index, out of the more than 500 it evaluates through its CEO Strategies Group program. The index measures growth, income, efficiency and margin management. Sound CU boasts 1.94% ROA and the average member holds approximately three accounts with the credit union.
Sound is "not 'ridiculous' when it comes to fees, but they're also not afraid of fees," said Paul Leavell, strategic advisor at Raddon Financial. "They realize there is a certain group of members who cannot bring a balance and the only way they can bring something to the cooperative is through fees. A high percentage of members are contributing to the bottom line, and when you have that, everything comes naturally."
Targeted product development generated by member feedback and original research is key to the high percentage of walletshare the credit union has achieved. Free checks, debit rewards and a "freebie" overdraft are just a small selection of product enhancements Sound CU has put into place, courtesy of member feedback. Even with a much more streamlined staff than many other CUs of comparable size, Sound CU is still able to provide a high level of member service.
"I think we have a standard of service that we set through our frontline staff. We train regularly on service," said VP-Marketing Robin LaChance, noting that the CU does not push certain products but instead instructs staff to allow conversations to gently guide members to an appropriate product. "That tends to keep people loyal and bring them back to us when something comes up."
Feedback from members comes through the usual channels like comment cards and conversations, but Sound CU places a special emphasis on getting that information from the front line to the back office.
"Even though it sounds simple, we make it a point to ask our branch staff regularly, at every monthly operations meeting of all management and at smaller project meetings in between," LaChance said. "We listen, research and respond when we get this feedback. Our culture is quick to respond; staff trusts that they will be heard when they share feedback."
Brandsma pointed out that most credit unions around $400-500 million in assets have approximately 150 employees on staff, whereas Sound CU employes 115. In fact, SCU does not even have an internal auditing staff. Instead, it relies on cross-trained employees to set up good processes and leans on its external CPA firm to provide auditing input.
"If you get right down and are honest about it, credit unions are overstaffed," Brandsma said. "We do a really good job making sure we don't have a lot of waste, and that's from the top to the bottom. From staff all the way down to supplies we have processes in place to make sure the organization doesn't have a lot of waste."
