LAS VEGAS -
Credit unions are going through "unprecedented transformational change."
And all they expect from their various solutions providers is to tell them precisely what to do about it.
Dave Milz, president of core system provider Galaxy Credit Union Solutions, said that much is clear every time the company hosts one of its thrice-annual advisory council meetings.
In response, said Milz, Troy, Mich.-based Galaxy has increasingly carved out internal resources that are told to "Go think" about new ways to provide innovation to client credit unions.
"There are ways to drive growth and to ride this transformational change," Milz said. "We're not always sure what that will look like, but we do know there will be a new road. It's not a singular focus; it has to be done in multiple ways, in service, in product development."
Senior Vice President Vince Francone acknowledged credit unions simply won't buy a product today unless they can see how it generates revenue or cuts costs. Specifically, he pointed to the regulatory and compliance demands he said are "strangling" some credit unions. Technologies that relieve that stranglehold are one innovation that help credit unions to grow, he observed.
The Shape Of Member Expectations
Milz said Galaxy has certainly sought to add product innovation for client CUs. Recent product offerings have included its STARS rewards program; "iAdvance," an alternative to payday lending; an online Switch Kit for new member prospects, and online membership enrollment.
"Member expectations are being shaped by forces that are outside of financial services, not the least of which is consumer demand that nearly everything be cheap and quick. To sit for an hour at an MSR's desk and fill out paperwork for the Gen X or Gen Y member is just not going to happen," he observed.
Similarly, Galaxy recognizes Gen X and Gen Y employees don't like to sit in a classroom environment for training.
That's why the company has introduced podcasts of training sessions, along with greater usage of text messaging.
As for the core debate between growth or cutting costs Milz said it depends on the credit union's longer-term vision. "If a credit union is prepared to take on the innovation challenge, then it is not as concerned with cost-cutting," he said.
As an example of that, Francone pointed to the emerging Software as Service (SAS) model (CU Journal, Oct. 10). "It's not so much to cut costs but to free up time to focus elsewhere. When it comes to cost cutting, there is the dollars side, and there is the (employee) time side."
Still, Galaxy regularly hosts CFOs at regional events at which best practices are shared, including cost reductions, Milz said.
When it comes to other innovations, Milz pointed to the Fiserv Continuum effort in which the Fiserv companies (of which Galaxy is one) seek to better collaborate on shared platforms.
Chief among those efforts has been a number of compliance and BSA-related products.
Thinking Beyond Core
"You have to be thinking beyond core," he told Credit Union Journal during BAI's Retail Delivery Conference. "For producers, that's obvious. For purchasers, that's not." That has included serving some credit unions with solutions even though they do not run on the Galaxy platform, he said.
Beyond mobile banking, which Milz said the company is seeing demand for from credit unions, Francone said other areas of demand include enhanced data mining capabilities, and other efficiencies.
"Innovation is going to be the place where we are all going to have to compete," observed Milz, who along with Francone said he has force himself to use text-messaging in order to be more in touch with how younger people are communicating. "People want to be able to time shift financial services through mobile banking, and employees want to be able to time-shift training and education through podcasts. The innovation trick here is that what you do for your members you have to do for your staff, and what you do for your staff you have to do for your members."
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