Strategy = a carefully devised plan of action to achieve a goal.
The definition above has three distinct elements – the plan, the action(s) and the goal. It is vital to have all 3 components interconnecting in order to have any chance of success. This article focuses on the second element – action. Yet without a well thought out plan and the correct goals your chances of performing enough of the right strategic actions to achieve realization of your ideals will be greatly diminished.
Action isn’t in the “what” it’s in the “how”
Most executives in the credit union world could relatively quickly make a list of what changes or results they believe need to happen in order for their institution to remain growing, profitable and relevant. Where the strategy starts to stray is when asked specifically how they plan on enacting such changes.
If I were to make a general statement about where the difficulty lies in overcoming this challenge it would be the misperception that they need to create something new, innovative and unique. Far too often they overlook a fundamental problem which exists in the failure to properly execute the basics. For example, they believe in order to improve loan volume they need to be able to provide a mobile application platform. Yet if their ability to deliver a quality member loan experience is hindered by inefficient processes which have been cobbled together over time, adding an additional layer of complexity in executing on the loan request will only make matters worse.
Are you being honest about your ability to deliver on the core functions that generate the majority of revenue for your institution? Usually it isn’t the quick fixes which have the most lasting and significant impact. It’s in the tedious and “boring” work of refining process details that you impact the ability to deliver on your brand promise.
Time Spent on Strategic Execution, not Excuses
So maybe you agree your core processes could use some work. At this stage excuses start entering the picture – led by the inevitable lack of resources. It’s a shortage of people where the opportunity to create real transformational value generally gets derailed. When pressed with only one additional question – “what is it that your people are doing that is of greater strategic value that they can’t enact these changes?” the overwhelming response is sadly “they’re too busy doing tasks of a routine (non-strategic) nature”, otherwise known as serving the member.
We allow too much work of a non-strategic nature to consume our staff’s precious time with nowhere near enough time, effort and focus being spent on strategic doing. If we continue to permit or even endorse “routine” activities that provide no value to the co-operative we’re allowing the competition, wherever it comes from, to win. “Serving the member” to conduct routine transactions, handle basic inquiries, maintenance requests and field questions provides virtually no value in the form of revenue generation. Worse yet, time spent on problem resolution (errors and fraud) and hand-holding members through unfriendly online systems are really value detractors. Systems are great at doing routine things consistently & efficiently. Let your staff’s time be focused on managing the processes and creating meaningful relationships with members.
Perhaps the other most significant barrier to strategic execution exists in the practice of “premature withdrawal”, instigated by unrealistic expectations or faulty goal setting. Far too often, we become disillusioned and abandon strategic initiatives too early in the process because we are not meeting goals that were somewhat arbitrarily set and overly ambitious. In many cases progress is being achieved and over time we’ll eventually reach our goals. Yet because we seek immediate gratification to achieve ill-defined goals we lose focus and start seeking the next quick fix. I advocate setting goals where consistent improvement over time denotes success, not instant perfection. Occasionally there are market driven opportunities we must respond to in a timely manner, however, we must be careful to understand these are exceptions and not what we will rely on to consistently grow our institution over time.
The great fear of competition from “non-bank” providers starts with the premise that because of their technological superiority they’ll be able to avoid having to commit unnecessary resources to the routine activities and consequently can deliver the services we value at a higher level. While there may be some truth to this statement, what’s missing is that these new entrants to the market have even less of an understanding of the “how” factor in financial services. What we have, and need to leverage, is our experience gathered through years of trial and error. In my nearly 30 years in the industry (yikes) very little has changed in the fundamental services we provide, what has changed is the manner in which we deliver these services.
“There is no substitute for hard work
The quote above is attributed to Thomas Edison; perhaps the greatest inventor (innovator) America has produced. The essential element of strategic doing is the work; the “blocking and tackling” required for achieving success. Our biggest problem isn’t a lack of innovation – it’s in the deficiency of understanding what creates value and the lack of discipline in persevering when executing these strategies. The fact of the matter is that these skills and competencies aren’t cutting edge, and are certainly attainable. They simply require continuous commitment, on-going development and affirmation of positive change.