How We Have Worked To Create Best Practices In Our Credit Union
In this issue and next, Credit Union Journal is featuring Best Practices, so I’ve assembled my own Top 10 from SAFE Credit Union, beginning with the first five, below.
One: Reduce member attrition, increase services per member and increase member satisfaction by on-boarding new members. At SAFE all new members are contacted by our outbound calling center at two days, two weeks, and two months after opening a membership and then twice more during the first year. The goal is to open four key relationships with the member.
At the top of or key services list are 1) Checking accounts with debit card, electronic statements and notices; 2) VISA Credit Card; 3) Home banking and bill payer; and 4) Home or auto loan. We call the member to ask how well we are meeting their needs and then we follow up to see if they will open one of the top four or if they already have those services we lead with another suggestion, such as an IRA account, safe deposit boxes or investment services.
Two: Increase member deposits at your ATM. SAFE found that members come into the branch rather than use the ATM outside because they want to cash a check and think that the teller will give them a larger amount back on their check.
We created a new inquiry that allows members at the ATM to see how much of their check deposit will be immediately available for deposit. This inquiry has caused ATM deposits to grow at twice the rate of ATM withdrawals. Our ATMs now gather more in deposits than they dispense in withdrawals and we have seen more members choose the ATM versus the teller in the branch.
No More Couriers
Three: Get rid of branch courier service. We have 21 branches and we provided them with courier service each day to pick up outgoing mail and deliver incoming mail. We opened a project to determine what was in the locked courier bags that are transported from our 21 branches to our headquarters. We found that most of what was being transported could be replaced with electronic documents (loan documents were most of the documents in the bag).
We were able to change our loan process to create electronic documents and otherwise eliminated the need for most of the couriered items. What was left were very few documents. For those we authorized the branches to use Fed Ex, which in the end cost far less for the few days a week when the branch needed something sent to headquarters that could not be sent electronically. We eliminated two FTEs and two vehicles and saved a considerable amount of money.
Four: Put in place a vendor management system. We have a vendor management system that reviews all vendor contracts and logs them into a data base. All vendor contracts with a value of over $5,000 a month are reviewed by legal counsel (we review some under that amount depending on whether the contract extends for longer than one year or affects member data). We always price shop to see that we are getting the best price and we always build in our service level agreements so that we can hold the vendor accountable for the level of service we want.
The biggest recent savings amounted to more than $3-million a year when we renegotiated our debit card processing contract. Starting next year we will have debit, credit and ATM driving all with one vendor. The combined contract saved us a lot of money and were able to reduce on FTEs because the invoice and billing reconcilement work is so much easier with one vendor and one contact.
Five: Develop a sales and service culture. There are three ways to compete (in our opinion). You can compete on price, you can compete on convenience and you can compete on service. We believe you can’t be best at all three and you have to be at least competitive in all three but you have to be really best of breed in one of the three.
We feel the banks have chosen to compete on branch convenience; many of the credit unions in our area compete on price. We have chosen to compete on service. Our brand promise is to offer exceptional experiences, best solutions and
professional experts to help our members improve their financial wellbeing and enjoy life.
The Role of Branch Managers
We hire employees who want to be part of a sales and service organization. We train employees to deliver good service and we provide them with product knowledge and sales training. Our branches have a manager who is focused 80% on sales and 20% on operations. The assistant manager is focused 80% on operations and 20% on sales. The manager does chair-side coaching with each employee to train them on sales skills. All employees have frequent product knowledge training. All employees have sales and services goals as part of their evals.
We want members to come to our branches. The tellers are all sales experts. We generate about 9,000 sales leads each month from our tellers and we convert about 15% of them into sales. We open more checking accounts than members each month and our checking penetration is over 70%. Our member satisfaction surveys rate us very high and our new member growth last year was over 4%.
In the next issue we’ll look at five more Best Practices from SAFE Credit Union.
Henry Wirz is CEO of SAFE Credit Union, N. Highlands, Calif.