Posted by Mr. Michael Salyer, IT Analyst, Credit Union Resources, Inc on 6/29/2016

How involved is your board of directors in IT governance? If asked, could they name what core data processing platform you are using? Do they know what kind of risks you are facing with your current e-commerce services?

Your board should be able to answer all these questions, and more. It is vital that your board knows what the credit union’s current state of information technology (IT) is in, as well as what future plans for expansion entails. It is important to remember that business needs must drive IT, not the other way around. It can be tempting to pursue a new and exciting technology, but there must be a business case for its use.

One such example would be remote deposit capture (RDC). This is a wonderful service to provide to your membership, but with this new service comes new issues your credit union will have to address to remain safe. Do you have the staff to ensure there are no fraudulent deposits? Are your funds availability policies updated to reflect RDC transactions?  Before you expand your risk appetite, you should look at what resources you’ll need to properly and safely implement new services.

One such tool credit unions can use to get both a snapshot of your current risk appetite, or risk profile, and a sense of your risk maturity is the FFIEC Cybersecurity Assessment Tool (CAT). The CAT is broken down into two main sections; the Inherent Risk Profile and the Cybersecurity Maturity. Each credit union’s current level of risk will dictate what level of maturity it must attain. Although the CAT in its current form is designed for all financial institutions, it can be a valuable tool for assessing your current risks and vulnerabilities.

Even though the NCUA is not at this time requiring credit unions to complete the CAT, they are highly recommending it. Starting in mid-2017 they will be begin to look at your cybersecurity risk and maturity CAT results. At present, the NCUA will be looking for all credit unions to at least be at the Baseline level, unless their risk maturity requires them to be at the Evolving level. Early adoption of this tool will assist the credit union in managing its risk profile and maturity as well as provide a helpful metric to your board of directors as to your current state of cybersecurity health.

Using the Cybersecurity Assessment Tool is but one facet of good IT Governance. Human resources, good communication with management, and policy approval are just as important.  Concerning the world of cybersecurity for your credit union, the key phrase for all board members is simple: Be involved.

Categories: Compliance, Education & Training, Technology Consulting & Compliance
Posted by Vickey Morris, SCMS, CCUE, CUDE, VP Marketing, Cornerstone Credit Union League on 6/27/2016

Marketing is more than a pretty postcard or sign, and placing an ad.  It is a process used to inform and generate new business from members and potential members.  Most credit unions, whether big or small, try to direct their marketing to select audiences, and that means understanding who your members are and how your products or service can better serve them.  Being able to connect on a personal level means you can focus on turning them into a group of dedicated followers.

Niche marketing by definition means “concentrating your marketing efforts on a small but specific and well defined segment of the population.”

The Benefits of Niche Marketing

It sets you apart from the pack: Presenting a set of benefits to a unique audience shows an understanding of your member’s needs.

It’s less competitive: The smaller your target market is, the less competition there will be for the same audience.

It’s more affordable: Since your audience will be smaller, you can get more bang for your buck and save on your marketing campaigns.

Your members are more loyal: Niche marketing is all about nurturing a base of true believers. Niche members trust that you have their best interests at heart since you understand them more than the competition.

Your members are easier to target: Having a very specific audience in mind makes targeting your marketing campaigns simple and straightforward.

It is important to customize your marketing to appeal to the specific interests of the member you are selling to.  But how do you know your niche market? First you need to determine:

  • Who has a need for your product or service?
  • Does your product solve a problem?
  • Who will benefit the most from your product or service?
  • Does your product make your member feel good
  • What makes your product or service better or different from other out there?

When building a niche profile you may also want to consider the following:

  • Age
  • Location
  • Gender
  • Income
  • Family Status
  • Ethnicity
  • Lifestyle
  • Interests
  • Values

Identifying your specific audience may be a challenge, but once you know who you are trying to reach you can start putting that knowledge to use by building highly targeted marketing plans and campaigns to win over the heart of your members.

Categories: Marketing & Printing, Sales & Service
Posted by Mr. Howard Bufe, AVP, Credit Union Resources, Inc on 6/24/2016

Is it time to inject some serious diagnostics into your strategic planning?

Maybe this year is the perfect time for asking ourselves some hard questions.  Is there a fault line in our current operation?  It’s always a great idea to check the vital signs of our organizations and confirm that all parts of the organization are working toward the best interest of the membership.

A great place to start is our membership.  Identify and talk to three categories of your membership: your most profitable members, your least profitable members, and those you don’t currently serve and listen to what they have to say?  Try to identify the financial, social and emotional needs of each group, along with the frustrations they have towards financial services.  Some of these questions could guide you through the process:  1) Are there unmet needs within the groups?  2) Are the members loyal to our brand?  3) Do they feel locked in, or would they defect if they could?  4) Could emerging technology simplify how the end users’ needs are met?    Gaining input and feedback can provide great benefits.

Next we should ask ourselves, is our business model appropriate to accomplish our Vision and Mission?  Do we have a need to redesign, reinvent or restructure our current operation to better meet our member’s current and future financial needs?

There are four interlocking elements in our operation and we need to identify what each of those mean to us!

  1. What’s our Member Value Proposition?  How do we create value for our members?  What opportunities are available to us to create and provide a valued proposition for our membership?

  2. What is our profit formula?  How do we design our profit blueprint while creating value for the member?

  3. What key resources do we have that we can depend on?  What key resources are we lacking?  How do we fill the GAP between the two?

  4. Have we implemented the appropriate operational and managerial processes that allow us to deliver value in a way that benefits the member while keeping the credit union a viable entity far into the future?

Bottom line, it’s always a great idea to run diagnostics and ask those tough questions about our organization and adjust or reinvent ourselves to provide value to our membership.

Categories: Education & Training, Financial & Auditing, Strategic Planning & Consulting, Succession Planning
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