You are currently browsing the monthly archive for January 2009.

Fred says the score is dead – stop being score whores and DO something with the data already!

Okay – I’m paraphrasing. I just returned from the third annual Satmetrix NPS Conference. This one was in San Francisco and included such speakers as the CEOs of Charles Schwab, Intuit, Logitech and my favorite, It also included Tammy Gallegos from America First Credit Union and Diana Dykstra, San Francisco Fire Credit Union.

This conference is two days of non-stop sessions designed to push your brain into another realm. They don’t give you a giant notebook full of power point presentations, but rather a pad of paper in a nice leather portfolio and a pen. Take notes!

Here are my favorite notes from the sessions I attended:

Charles Schwab CEO, Walter Bettinger II:

Financial institutions are the king of “gotcha” fees!

Do not give a great deal to a new (unknown) client if you can’t offer the same deal to an existing (loyal) client!

Bad data leads to bad decisions.

Servant leaders breed a customer-centric culture.

Richard Owen, CEO of Satmetrix:

Flat is the new UP!

The economics of customers acquisition is changing. It’s lots harder to acquire new customers, so you better not lose the ones you have!
Word-of-mouth has always been the Holy Grail and is trusted 78% of the time.
Let your customers market FOR you! CEL Tony Hsieh:

Retention is the new Acquisition!

We are a service company that happens to sell shoes, clothing, handbags, etc.

75% of our business comes form repeat customers.

Take the money they would have spent on marketing and put it into the customer experience and let them market FOR us!

Whatever you’re thinking – think BIGGER!

Chase the vision, not the money.

and finally

Fred Reichheld, author of The Ultimate Question and co-author of the Net Promoter Score:

The only way you can afford to grow in tough times is through referral.

A promoter is worth 3X more than a detractor.

BUT, who do we care most about to learn from? Which customers should you listen to? NPS is a conversation, not a survey. Who cares what your score is, what are you DOING with the data (verbatims) you receive?

You need to get your CFO involved. Accounting systems have not caught up with NPS.

My take: This is the third year NPS practitioners from around the world have gathered and I’ve seen a distinct shift from, how to gather good data and how does your score compare in the industry to “screw the score” if you’re not listening to the RIGHT customers and making the RIGHT decisions (hard decisions) to improve your service to them, you’re toast.

Retention today is everything – stop wasting money on membership bribes and the spray and pray approach to marketing. We need new tools in this economy – the DISCIPLINE of NPS is the right tool for the right job.

That’s the new angle that CUNA is taking in trying to justify credit unions bellying up to the TARP trough.

The press release is the trifecta of bad, in my opinion. It combines the credit union brand with tainted TARP AND Timothy Geithner (newly appointed US Treasury Secretary who said, and I’m paraphrasing here, that he didn’t pay his taxes because the one page form was confusing).

I’m in California right now and I know there are a lot of credit unions that are having to make tough decisions. Some may not even survive this recession. But they are the minority. We have such a tremendous opportunity to renew our values to the seven principles – one of them is NOT government bail-out, in fact, #4 is “autonomy & independence” and #6 is “cooperation among cooperatives is vital.” Why are we not doing this CUNA?

If being treated as “second class” means we remain a financial cooperative owned and operated by our members with a 100 year history of NOT costing taxpayers money, I for one will proudly wear that label. Who’s with me? Raise your hands.

Three words.
Miss. America. Pageant.

slide_887_15431_largeLast night I was working out in a hotel gym and it came on one of the many TVs that are meant to distract us while we emulate gerbils running on a wheel.

The show began with all 52 contestants wearing jeans and t-shirts. My how the pageant has changed. They narrowed it down to the top 15 with the usual showings by New York, California and Florida (Miss Texas didn’t make it).

Then came the swimsuit competition. Wow. No longer must they wear the pageant issued modest black one-piece. Now, apparently they can go “Sport Illustrated” cover style. In fact, each woman began in a three-way mirrored type pedestal. The only thing missing was the greased up pole for them to sling around. I’m sure they’ll add that next year.

The music, the turns, the looks…..soft core porn.

Miss America. She represents “us” to the world.

When Hilary Clinton ran for president, more people criticized her pantsuits than her politics. She wasn’t “sexy” enough. Sara Palin was plenty sexy – some even said she was the “hottest” politician ever, but apparently that meant she was also dumb. Pretty can’t be smart, right? I never heard a reporter ask how much Joe Biden’s2008-miss-america-pageant-1 suits cost, or “what he was wearing.” I’m just sayin’.

Don’t get me wrong – these ladies are lovely and smart and the Miss America Organization made available more than $45 million in cash and scholarship assistance to ANYONE willing to put on a bathing suit and prance around on stage. Isn’t there a better way to help women get an education?

This was Miss America’s 88th year. I think it’s time to stop. Time for a change. You think Obama can take care of this?

I’ve been blogging my experience on CUES Nexus this week….check it out!

dw_logo012009 is going to be the best year ever. I feel it.

I asked my good friend Brent Dixon if he could draw me a new pig. I loved my old pig (designed by the amazing Gina Nass) but felt I needed a new image. An updated image.

I present to you, Hamlet. I love him. And you Brent.  

Oh, and now I’m an L.L.C. Very cool.


Today the CU Journal reports that “House leaders agreed yesterday to add a provision to the Troubled Asset Relief Program that would allow credit unions to obtain cash infusions under TARP…”

Cash infusion = taxpayer bailout.

It goes on to say “The credit union provision would allow credit unions to accept TARP cash – like banks – and count it as net worth, or capital, something they are barred from doing under current law.”

Why does our law say NO to taxpayer bailout money?? Um, because we are a financial COOPERATIVE!

Folks – we really need to find a better way to help our troubled credit unions. This is historic…..think of the long term implications. We WILL have to change our bylaws. Beginning with field of membership, and it’ll read something like this:

“The field of membership for Generico FCU will include anyone who lives, works or worships in blah blah blah counties AND the Federal Government (who now sits on our board of directors and tells us what to do.)”

I read with much disappointment an article in the CU Journal that you are spearheading another effort to access TARP money for credit unions.

Credit Unions cannot, under any circumstances cost taxpayers money. Not only will this jeopardize our tax exempt status and separate insurance fund it is absolutely in oppositon of the seven principles of cooperatives, which we hope to remain, a financial cooperative.

Credit Unions were offered taxpayer money after the Great Depression and although Edward Filene was in favor of it, Roy Bergengren (first president of CUNA) opposed it saying
(a quote from CUNA’s website):

“To him, it meant destroying the vital principle of the whole movement by converting a community enterprise into an agency of the government. To teach people how to help themselves was more important by far in times of depression than at any other time.”

That’s what we HAVE to do. Figure out a way to help each other. I understand that many credit unions in the California and Nevada Leagues’ (your former employer) membership are hurting. One solution, of course is merger and another would be for them to convert to a Mutual Savings Bank to gain easy access to TARP.

CUNA’s National Brand Campaign states “Where People are Worth More Than Money.”

If we take TAXPAYER money to bail out a few COOPERATIVES what does that say about CUNA?

Credit Unions celebrated their 100th birthday recently, I for one am proud to have devoted the last 28 years of my life to furthering the movement. I’d hate to see your name in the history books as the one that helped destroy it.

070525_hamptons_vmed_2pwidec1Last week Mark and I were in the Hamptons. Okay, I’ve always wanted to say that, but truth be told we were in Long Island looking for a place to live and had to DRIVE through the Hamptons on our way to see the lighthouse at Montauk Point (a must see for everyone). SIDEBAR: Bernie Madoff (pronounced Made-off as in with your money has a house in Montauk.

Anyway – have you ever listened to something on the radio and the scenery around you gets burned into the memory? As if you are watching television, the words mesh into the windshield and somehow make sense? Or not. Well, we were listening to NPR and Marketplace came on. The guest was Charles Handy, London Business School Founder and Claremont Graduate University’s Drucker School of Business Professor. AND, he has a lovely British accent.

The interviewer was Kai Ryssdal. The subject: the banking system.

Kai cuts to the chase: How did we get in this mess?

Charles: “I think we got carried away, you know, at least the bankers did mainly. After all, for many, many centuries, making money out of money has been regarded as rather a bad thing. In fact, it used to be called ‘usury.’ ”

Me: “Oh hell yes!”

Charles: “They forgot what their proper job was, in my view, which was to take money from some people who had some to spare and to pass it on to people who could use it usefully and profitably.”

Me: “That’s the CREDIT UNION cause!!!!”

Kai: “But from purely a business proposition, if you can’t make money giving a loan, why do it at all?”

Mark: “Good question!” (former CFO, current Financial Advisor)

Charles: “That’s right, but you must make sure that you don’t exceed the money that you’ve been given by the people who are saving it. These people went wild actually. They went way in excess of the ratios that normally were deemed respectable..”

Kai: “It seems to me the solution, when we have one of these crises, is always a variation on what I suppose you could call the “big three,” right. One is increased transparency, the other is increased accountability, and then some kind of regulation. But we’ve tried all of those things in crises past, so what’s the answer this time?”

Charles: “Get them smaller?”

Kai: “Get the BANKS smaller?”

Me: “Oh hell yes!”

Mark: “Shhhhh, listen.”

Charles: “Yes. Get the banks smaller. I’m actually sure. Markets work well when there are a lot of players, and if one falls out, the whole system doesn’t crash. When we crate organizations that, in the words of some people, are too big to fail, what we really mean is we can’t ALLOW them to fail. So I really think that we’ve allowed the banks to get too big. So I think the answer is basically to de-structure them.”

“I also think we really should stop putting everything in one basket. I think investment banking should be separated out from retail banking. They contaminate each other.”

Me: “Wow. You mean bigger is NOT better? What about achieving economies of scale? What about being a full service financial institution?I guess that didn’t work, did it?”

Mark: “Shhhh. Listen.”

Kai: “So now what then?”

Charles: “I’m not sure the solution is going to be easy to get by, and I think it’ll take about three years for things to bottom out. But there may be some good news in all of that. I mean we may get back to a saner kind of world – what Adam Smith (Author of The Wealth of Nations) called ‘cultivation’ or ‘civilization’ — where we don’t all sort of spend our life trying to make money, to buy things we don’t really need to impress the neighbors, and so on.”

“I’ve often said that capitalism, particularly in America, is a very exhausting business. It tires people out.”

Kai: “Charles Handy, than you very much for your time.”

Charles: “Thank you very much. It was wonderful to talk to you.”

Me: “Do you think that will actually happen?”

Mark: “Not anytime soon.”

TODAY: Morgan Stanley, Citi plan $3 billion broker bonuses.

Even though a slept through the “5,4,3,2,1…Happy New Year” moment this year, I did wake up New Year’s day with a sense of relief that 2008 is behind us and excited to make 2009 the best year ever!!!

Then I read this:

Local Credit Union Changing Hands.

“Valley Credit Union is officially handing over the keys to an out-of-state banking group. Service will resume Friday without many visible changes at Valley Credit’s three branches.

The credit union was facing the possibility of failure, so it sold itself to Illinois-chartered Citizens Equity FInancial Credit Union.”

I didn’t know credit unions could “buy” other credit unions – or sell to an out-of-state banking group??

How many ways is this article wrong? No wonder people are confused about credit unions. Are they member owned anymore? Does the phrase financial cooperative mean anything?

This article was a little better but you have to be an insider to fully understand that this is not your run-of-the-mill-bank-failure-buy-out fiasco.

The coverage of this merger could have such a positive and educational bent. How about saying this:

“Valley Federal Credit Union in the Silicon Valley has merged with the members of Citizens Equity (formerly Caterpillar Employees FCU). The members of Citizens Equity will respect the ownership and Valley Fed will keep their name and 90% of their employees. This is a great example of people helping people in these trying times. Credit unions are member owned financial cooperatives and in their 100 year history have never cost taxpayers money.”

Enter your email address to follow this blog and receive notifications of new posts by email.

Join 993 other subscribers

Follow me on Twitter


January 2009