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Last month I got a call from Rein Whitt-Prichette, an Albuquerque artist.  He heard about this thing called a credit union and needed information on how to start one. His vision is to have the First National Artists & Craftsmen financial cooperative. This would encompass everything from jewelers to actors to cabinetmakers to weavers. He asked if he had the right place and person.

I work at a trade association for credit unions. I’ve been in the movement for 30 years. I’ve never chartered a credit union. But, he had the right place and person. Our particular trade association was formed in 1955. Twenty years earlier Father E.J. McCarthy formed the first of many credit unions in our state. At the peak (1967) there were 141 credit unions here. Today there are 51.

I googled “How to Start a Credit Union.” The NCUA.gov page was very resourceful. I killed about 2 1/2 trees printing out the instructions and three-hold punched them into a nice big notebook. I even made a snappy cover page “How to Start a Credit Union.”

Then I met with Rein. He’s a man with a wonderful smile, and thoughtful eyes – he also looked to be on the verge of homelessness. Rein is not a hobby artist. Art is his life’s work – his job.

I googled Rein. He has pieces in the Albuquerque Art Museum. He illustrated a first edition book for the Franklin Mint. He’s an expert serigrapher. And this economy has kicked his ass. It’s hard to say how old he is, but I would venture to guess late 50s early 60s.

Rein is not pursuing this for his own interests. He has a simple list of goals:

  1. For artists and craftsmen to be recognized as business owners – not hobbyists. A bank, for instance, will make a loan to a peach farmer for next year’s crops – but not to an artist.
  2. For artists and craftsmen to have a place where they do not get charged $25.00 to receive a wire transfer (payment for a piece) and get charged $2.00 to make an ATM withdrawal.
  3. For someone to see beyond credit score (Rein does not have one – at all) and recognize the booms and busts that the art world experiences.

Before meeting with Rein I was prepared to refer him to one of our community chartered credit unions. And not in anyway to offend these open fields of membership but, let’s be perfectly honest – the chances that they will lend Rein money – no credit score and the only collateral is his art – zero.

So how about taking in the artists as a SEG with a select employer group credit union? That’s possible – but unlike the law firm, or the retail outlet or daycare centers we’re used to scooping up – artists don’t have paycheck stubs.

Then it hit me. There’s nothing to preclude them from starting a financial cooperative the good old-fashioned way. Or, as I like to call it “shoebox on a shoestring.”

Show of hands if your credit union started this way. Chances are, if you were chartered in the 1930’s your hand has to go up.

It was after the Great Depression. Credit Unions were growing at break neck speed. People with a common bond (and we are NOT talking lives works worships in a five county area) would pledge a portion of their pay to be held in a shoebox in a drawer. A ledger kept track of their shares. A credit committee, or a jury of their peers was formed.  Loans were granted based on character, capacity, and collateral. Credit scores did no exist. Losses were minimal because of the shame of non-repayment. Early credit unions were like borrowing money from your friends and co-workers – only a little less awkward.

The average credit union in the 1930’s had 187 members. Many of those credit unions are still around today – over $1 billion in assets.

The billion dollar credit union of today is largely serving the steadily employed, A+ credit, low-risk, middle market member. Banks take care of the elite, high wealth population, and payday lenders are thriving with the underserved.

In this economy the middle class is shrinking – so are the number of credit unions. Sure, many offer payday alternative loans and courtesy pay products with less than loan shark level fees. But who’s taking care of the little guy? Who’s looking out for Rein?

My new year’s resolution is to find a way to pool the resources of the art community in New Mexico. Tourists come to the Land of Enchantment for the arts (and the green chile cheeseburger). An investment in the art community is good for our entire state. We can’t afford to lose the art of Rein.

I’ll keep you posted on this journey…

 

On the way home last night NPR was taking a look BACK to the year 2000. Beginning with Conan O’Brien’s hilariously eery song “in the year 2000……”

Wow – it’s amazing how many of those came true!

So now – a look to the future. To the year two thousand……twenty.

  • Reality shows will have “jumped the shark” when The Real Househusbands of Detroit take on Dancing with Snakes and it goes horribly awry.
  • Automobiles run on charm – abandoned vehicles litter the streets and highways – Generation Y turns then into condos and forms communes.
  • Steve Jobs introduces the iEye. It’s like a contact lens and allows you to watch movies, check iMail, your Facepad and work for TSA.
  • Starbucks dispenses marijuana brownies in the first month after legalization of the weed. Sales soar.

What might be your predictions for the year two thousand….twenty?

If you haven’t see this video take 4 minutes and 26 seconds out of your day. 1,065,308 people already have:

I just bought the revised and updated book Socialnomics by Erik Qualman the creator of the video.

In it the author says:

People referring products and services via social media tolls are the new king. It is the world’s largest referral program in history.

Last week I blogged about OhioHealthcare FCU’s Next Top CU Member initiative.

They are $43 million in assets with a little over 8000 members. Today the CEO informed me that over 30,000 people have voted online.

The members (candidates) are spreading the world-of-mouth. One member emailed the CU:

I have Facebook, Twitter, Craig’s List, My Space, Super Poke Friends, and Frogs. No doubt thousands of friends who have now heard of a credit union.

How’s that direct mail campaign working out for you?

I’ve done a fair amount of strategic planning over the years. Mostly facilitating, some participating. On either side of the board table I always went in with this filter: How can we thrive? How do we plan for overwhelming success? Lines out the door, phones ringing off the wall, media coverage out the butt kind of success. Sure, some people look at me like I’m insane – especially in this economy.

But I’ll bet Steve Jobs thinks that way. So does Tony Hsieh. Even Ford is optimistic right now. Southwest Airlines posted another profitable quarter. Starbucks has righted their ship.

How about your credit union? Doom and gloom? Still pissed off at the corporate assessments? Held hostage by your DP vendor’s inabilities? Do you blame NCUA for your lack of innovation? Afraid of losing your job?

According to Jim Collins, author of Good to Great,  if you are not a Level 5 Leader, you will likely not thrive in this recession. A level 5 leader “builds enduring greatness through a paradoxical combination of personal humility plus professional will.”

Take 2 minutes and 35 seconds to watch this clip of Jim describing what it means to be a Level 5 leader. I got choked up.

Tony Hsieh does not have a corner office on the 32nd floor. Instead he parks his Level 5 butt in a cubicle in the middle of his call center.

Steve Jobs quietly took sick leave to battle a severe illness while still introducing the iPad to initial media criticism.

Howard Schultz admitted publicly that Starbucks grew too big, too fast. He lost sight of their original vision and posted his strategic plan on their website so the public could hold him accountable.

Yet in the credit union land we see massive mergers, not just among member credit unions but now trade associations and of course the corporates are seeking this shelter from the storm. Credit unions continue to be followers rather than leaders when it comes to innovation.

Edward Filene was a Level 5 leader. What would he tell us today? He put cause before his own ego. He made sacrifices physically, professionally and financially for the movement. Because of his leadership credit unions did not just survive the Great Depression, history showed us they thrived.

Are you a Level 5?

Ultimately our members will decide if THEIR financial cooperative will survive or thrive.

I got a message from Bill Butler, CEO of Ohio HealthCare FCU this morning. I did brand consulting for Bill and his gang many many years ago. Unlike the plethora of credit unions expanding their fields of membership to include anyone who lives, works or worships in a five plus county area, Bill decided to kick up his affinity. He decided to buck the trend and stay true to his founders. Some would say it was a very bold move.

The Ohio Healthcare FCU is limited to health care professionals (and their families).

Their tagline: We care because you care.

His members care for the sick, the elderly, the dying, the suffering. The credit union cares for their financial well being. OHCFCU launched an amazing contest this month to celebrate their members. It’s called the Next Top CU Member.

Check out Sandy’s Jessberger’s video. It’s simple and sweet and tells of her affinity with OHCFCU. She’s a trauma nurse – and when she’s not saving lives she’s raising her kids and remodeling her home and saving for Christmas and a dream vacation.  Her kids and grandkids are members of the credit union. It’s all about the affinity.

Affinity (noun)

1. A natural attraction, liking, or feeling of kinship.

2. An inherent similarity between persons or things.

All credit unions were founded on affinity. Or common bond. In the last ten years the trend has been to expand territory and target anyone. Lately the trend has been merger – yet very few are based on affinity. Some are out of necessity, others out of rapacity.

But beware — when you lose affinity,  you will likely become a utility.

Utility (noun)

1. something useful or designed for use

2. a program or routine designed to perform or facilitate especially routine operations

Also known as a bank.

Thanks to Denise for allowing me to guest-author on her blog.

Mary Beth King

Our regular eye doctor recently referred my husband to a specialist. The day before the appointment, the specialist’s receptionist called. I arrived home from work first and listened to the message. 

At first I wasn’t sure there was even a message there and finally made out a tiny, whispery voice. I hitched up the volume on our phone, reran the message and barely made out the Mouse squeaking almost inaudibly and incoherently fast to confirm my husband had an appointment the next day. He listened to the message when he got home and we both agreed this receptionist had a terrible phone manner.

He went to his appointment, was examined by the specialist and told to make a follow-up appointment. The young and apathetic looking Mouse was sitting at the front desk when he came out of the exam and stopped to schedule the follow-up. In her teensy, tinesy voice, she flatly told him she could not find him in the system – even though he had just met with the doctor. Voice and manner showed she had no intention of making any effort to find him in the system. My husband, never a patient man even in the best of circumstances, and I walked out.

The Mouse left a message again yesterday to schedule the follow-up. Again, we barely deciphered her machine gun fast, sotto voce message. He called this morning and the Mouse’s co-receptionist told him that she didn’t know anything about any follow-up and still didn’t have him in the system. She also showed the same disinclination to make any effort to help. He hung up and said ‘Never again.’

We speculated that both receptionists were either A. related to, or B. making whoopee with one of the doctors to be able to keep their jobs because they obviously had nothing else to recommend them.

My husband again called our regular eye doctor, whose competent and audible receptionist then referred him to another specialist with an equally audible and competent staff.

The whole incident made me reconsider my own telephone-side manner. Audible? Check. Coherent? Check. Do I care? Check.

Whether we speak face-to-face or by phone to members, fellow credit union professionals and other members of the public, I know most of us know the wrong answer is, to paraphrase the Mouse, ‘I don’t know’ in a rapid whisper. The right answer is ‘Let me find out and help you with that right now’ in clear, ringing tones.

Feeling smug and assured that you are never a Mouse? Good job.

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