Glatt Consulting has been involved in a number of varied and interesting credit union projects in recent years. In this post we have included ten recent and/or ongoing projects along with basic narrative to provide some guidance regarding our approach. If you are interested in assistance in any of these areas, schedule a complimentary conference call to discuss how you might leverage Glatt Consulting for your credit union’s benefit.
Online Branch Planning and Project Management
We recently wrapped up the creation of an online branch master plan. This plan maps out the development and deployment strategies and timelines of all aspects of a fully functioning online branch capable of supporting a diverse and geographically-dispersed field of membership. Plan development involved (among many other tasks): identifying online branch design, technology, and functional requirements, projecting development costs and return on investment, analyzing current technology compatibility with plan objectives, developing a development/deployment schedule, vetting vendors, and drafting the plan document for review/approval by the board and senior management.
Credit Union Charter Change
Recently we worked with credit unions to expand from single common bond charters to Trade, Industry, Profession (TIP) charters. One of these credit unions served a health-related arm of a major university with offices in a dense center of healthcare-related businesses. The credit union’s board and senior management determined that growth opportunities were limited given the lack of growth in the core sponsor itself. Credit union leadership was therefore interested in gaining outside assistance in the exploration and pursuit of new growth opportunities.
While this particular project involved analyzing growth opportunities within the field of membership, as well as informal merger discussions with other local credit unions possessing complementary fields of membership, ultimately the credit union decided to pursue the TIP charter. We drafted the business plan and application for charter change, submitted the application on behalf of the credit union, and managed subsequent interactions with regulatory authorities. The charter application was approved.
The other credit union we worked with to acquire a TIP charter requested our support in developing the business plan and managing the charter change application process (they had already made the strategic decision to obtain a TIP). For this client we researched and prepared the required business plan, and in the process conducted a member survey designed to acquire background business plan detail regarding member support for the credit union’s operating model. The TIP charter business plan and application expanded upon the credit union’s service to a single school district with a more broad focus on educational professionals working in a two-county area. The charter application was approved.
CUSO Development Study
On two occasions we have worked with credit union management to study and recommend credit union action regarding distinct CUSO business opportunities. One opportunity was for a lending-related product designed to help credit union loan officers quickly identify refinance opportunities based on member credit file analysis. Tasks involved in completing this project included: engaging a beta test group of credit unions to work with the system and report back findings regarding product functionality and utility, calculating the size and growth potential of the market, and calculating a general return on the investment required to fully develop and support the product.
The other opportunity was a CUSO designed to provide cloud-based workflow tools to credit unions. Tasks involved in completing this project included identifying and analyzing competing vendor product functionality and pricing, estimating the size of the market, and calculating profit potential.
Membership Survey and Analysis
We have conducted a number of member surveys on behalf of credit union clients. Our survey efforts involve querying member’s credit union service perspective, cross-referencing responses with account data specifics such as age of account, products, demographics, financial relationship, and then analyzing the results. In most survey projects we debrief clients on response details and then work with credit union team members to develop response strategy.
On many occasions we have been called upon to assist in the evaluation and selection of critical vendors, including vendors for home banking, website design, and core systems. We have written up our selection process and posted it on the Glatt Consulting website here: https://glattconsulting.com/2012/04/26/evaluating-and-selecting-critical-vendors
We have supported the strategic planning efforts of credit unions nationwide (including the territory of Guam), with support ranging from basic discussion facilitation to the development of complex business plans, financial scenarios and budgets. We generally work with both board and senior management to define broad corporate strategy, then with senior management to define the tactical actions required to support strategy.
Merger Partner Analysis and Selection
We have worked with numerous credit unions to analyze potential merger partners. Projects have included credit unions looking to acquire merger partners and credit unions looking to be acquired. One of our most notable merger projects involved a credit union seeking to be acquired. This credit union was located in a state substantially impacted by the real estate downturn and economic recession. Credit union leadership sought assistance in locating a merger partner healthy enough to absorb projected losses and impaired net worth, and that also operated with a similar service philosophy.
We first worked with the credit union’s board and senior management to identify merger partners healthy enough to support the deteriorating financial environment (the in-depth analysis conducted during this project was the catalyst that led to the creation of our HealthScore system which we still use today to gauge the general health of individual credit unions and the industry as a whole).
We then facilitated discussion meetings between our client and key board and management team representatives from preferred merger partners to determine cultural fit. Finally, we facilitated a decision strategy meeting with board and management team members to aid in their selection of a merger partner.
New Credit Union Charter
We have been approached on a number of occasions for assistance in chartering new credit unions. While most requests are made by individuals uninformed about the cooperative structures of credit unions and/or the capital requirements required to properly support a growing credit union, one particular request led to extensive chartering analysis on behalf of a national lender/servicer. Our work on this project included:
- Educating leadership on credit union cooperative business principles;
- Facilitating discovery meetings with major trade associations and regulators;
- Qualifying field of membership opportunities;
- Developing pro-forma financial projection scenarios and operating budgets;
- Preparing a preliminary business plan.
As the development of the preliminary business plan was concluded, legislative changes impacting our client’s business model required the organization’s board to weigh allocating the organization’s financial resources to start a credit union versus reinvesting in organizational change necessary to survive as a resource supporting its existing business. Though the business plan and defined field of membership showed the potential for a highly successful credit union, the board determined that the capital required to support the chartering effort was greater than what it could commit, given the uncertainly surrounding the legislative changes likely to impact its core business.
Note: We published a post covering many of the lessons learned as a result of our work on this project. It is available here: https://glattconsulting.com/2011/10/06/the-credit-union-that-never-was
On many occasions we have been called upon to mystery shop credit union operations (in-branch, call center, tech support, etc.) to gauge the effectiveness of corporate sales/service training and/or the execution of strategic initiatives. Our approach is generally to assess operations, debrief senior management on results, and then work with senior management to develop appropriate response strategy.
In addition to the projects above, we have also supported credit unions in the following areas:
- CEO Compensation and Performance Evaluation
- CEO Succession Planning
- Board Succession Planning
- Payday Loan Alternative Product Analysis
- Business Lending Strategy Development
Glatt Consulting assists credit unions nationwide and of all sizes with strategic decision-making and execution. Schedule an appointment to discuss strategy development at your credit union. You may also want to learn more about the general approach we take to credit union strategy consulting projects.