Avoid These Strategic Planning Pitfalls
By Jon Haller

As strategic planning time rolls around, credit union boards and management will weigh the effects that a down U.S. economy, rising competition, emerging technology, and other outside influences will have on their ability to achieve their goals and objectives.

Ideally, most also will include an essential ingredient of strategic planning: member survey information. This information will guide credit unions' decisions about policies and procedures, operations, and marketing strategies for the upcoming year and beyond.

Yet some credit unions approach their decision making without thoroughly understanding their members' financial needs and behaviors.

Following are some of the common pitfalls credit union boards and management encounter in the strategic planning process and why they should be avoided:

1. "Budgets are tight. We can't afford to do a survey."

While economic downturns and tight budgets sometimes lead credit unions to eliminate their plans to conduct a member survey, it's during these tough times that this research is most essential.

If members are borrowing less because of the state of the economy, your credit union must ensure it is doing all it can to attract whatever borrowing that does exist.

Moreover, members and consumers no longer hesitate to leave financial providers that are unable or unwilling to meet their remote banking, service quality, and product needs.

Past CUNA & Affiliates surveys show that nearly one of five members switched primary financial institutions during the previous two years. The primary reason for leaving: service dissatisfaction.

Keeping abreast of members' satisfaction levels and financial behaviors must be a priority--in good times and, just as important--in bad times.

2. "We did a survey three years ago. We're on top of what our members want."

The broadening of remote-banking delivery channels, the shrinking pool of members and consumers in the peak borrowing ages of 25 to 44, increasing competition from existing financial providers, and emerging new competitors are just a few reasons why you no longer can let three or more years pass between surveys. The financial services environment simply is changing too quickly. A maximum two-year time frame between member surveys may be in order.

This time frame allows you to identify problem areas, note opportunities to attract more business, implement necessary adjustments, provide time for members to recognize these adjustments, and reliably measure how these adjustments have affected members' perceptions and financial behaviors since the previous survey.

3. "We have multiple offices. We're sure they're all doing equally well at meeting our members' needs."

Members at various credit union branches are likely to have different demographic profiles. For example, one branch might serve a higher income population; another might serve a younger group of members. These factors call for different approaches to best meet these groups' financial service and service quality needs.

It's also common to find one or more branches excelling in factors such as staff service quality, lending services, location or hours, and ability to attract members' business. The flip side: an office that isn't performing as well as the others in these areas.

By conducting a member survey and reviewing the demographics, satisfaction levels, and financial behaviors of members relying on your different branches, you can pinpoint and address the areas within each office needing attention. Only then can you ensure that you're meeting all of your members' needs--regardless of branch location--as effectively as possible.

4. "Our member satisfaction, market share, and PFI levels seem to be reasonably high. That's good enough for us."

One advantage of using an outside firm to conduct your member survey is that some providers-–including CUNA-–will compare your member survey findings to benchmarks (other credit unions' findings). These comparisons provide you an important perspective on how well your credit union is performing-–where you excel and where there's room for improvement.

"Is our member PFI level above or below what it 'should' be?" "How do our staff friendliness and knowledge, convenience of hours, loan rates, and approval time stack up against other credit unions?" "Should we be attracting a larger market share of our members" vehicle or home equity loans?" "Do other credit unions get this many complaints about their location?" Comparisons to benchmarks can shed some light on these and other important issues.

Member surveys play a key role in credit unions' strategic planning process. Industry research, national perspectives, and networking can help your credit union stay abreast of current and upcoming issues affecting your members and your credit union. But nothing is more valuable than solid feedback from your own members.

With apologies to Nike, whether you use an outside firm or conduct the member survey yourself, "Just do it."

FOR MORE INFORMATION, contact us by:

• Phone:	1-800-356-9655, ext. 4172
• E-mail:	mktresearch@cuna.coop
• Fax:	(608) 231-4027
• Mail:	Credit Union National Association, Inc Center for Research & Advice PO Box 431 Madison, WI 53701-0431
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