CUES SKYBOX BLOG

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Tuning In to Weak Signals

A powerful strategic decision-making tool By Kathy Pearson, Ph.D. About six years ago, a senior executive from Borders book retailer sat next to me on a plane. This was in the early days of the Nook and Kindle, and Borders’ customers were starting to inquire about e-readers. While Borders focused on delivering a quality in-store experience, customers were moving on. Borders went out of business a year later due to a variety of factors, but certainly the strategic concentration on physical stores contributed.  They missed the weak signals that showed e-readers loomed as a threat to brick-and-mortar locations. Similarly, weak signals emitting in the financial services industry suggest threats and opportunities you shouldn’t ignore. For example, security, privacy, user experience and integration of digital channels are just a few topics that should be on your radar. Spotting early indicators will help you anticipate where the market is heading and be both strategic and proactive in your response. By its very nature, decision-making includes uncertainty. Sometimes you are reluctant to act until the uncertainty is gone. Often you make a best guess and proceed with the risk of being wrong. A better option to consider is to make a decision while […]

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Overcome Modern Learners’ Distraction and Impatience

Even in the age of the smartphone, great education is possible. By Dana Murn-Kohal Man, are we ever distracted. According to statistics presented in a recent CUES Webinar, Transforming Training: Meeting the Needs of the Modern Learner, we unlock our smartphones up to nine times every hour, are online 27 times per day and get interrupted as frequently as every five minutes. Plus, we’re impatient. In her presentation of the webinar, CUES member Danielle Buscher, learning and development manager at $181 million West Community Credit Union, O Fallon, Mo., and a 2015 Next Top Credit Union Executive contest finalist, said most learners won’t watch videos longer than four minutes. In addition, online designers now have between five and 10 seconds to grab someone’s attention before they click away. It would seem difficult to teach anything new to people who are that distracted and accustomed to getting whatever they want so quickly. The solution may be an extension of the age-old practice of “meeting learners where they are.” Thinking that way, it’s not surprising that Buscher described education theory suggesting that 70 percent of learning should be integrated into the workplace, 20 percent be learning from others and only 10 percent […]

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What Is Talent Management, Really?

Recruitment, hiring and retention strategies need to change with the times. By Jeffrey Davenport “Talent management” is a key buzzword in credit union land today, but do we truly understand what talent management means to our credit unions? Is it retaining the best employees? Is it finding the best potential employees? Is it effectively hiring the best employees? The answer to all of these questions is a resounding “yes.” The trouble is, we may be thinking about what defines the “best employees” in an outdated way. We may be thinking solely about banking or retail experience when we navigate these waters. We need to add to our wish list “employees who think outside of the traditional financial services box and help us change.” How will you recruit and hire employees who break out of the traditional mold? Do you, like many credit unions, place ads asking for banking or financial services experience? Are you looking for applicants who are very technical or applicants who have people skills? I’ve always believed that you can teach the basics of financial services in most areas, but you can’t teach personality. Also, does recruiting start when you have an open position or is it […]

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Free CUES Podcast Series Hits Perfect 10 Plus 1

Get insights from experts on a variety of topics when you subscribe and listen. By Lisa Hochgraf It’s exciting to see CUES delving ever deeper into offering online learning opportunities for credit union executives. Yesterday CUES Podcast, which launched in October, published its eleventh installment: CUES 11: Strategy Development, an interview with John Oliver. Some of the other topics and experts featured so far in the free series include: Achieving a Strategic Rhythm in Your Credit Union, featuring Les Wallace, Ph.D., founder, Signature Resources A Hero-Friendly Culture, featuring Jim Bearden, leadership and accountability speaker, decorated Vietnam veteran, former corporate executive Enterprise Risk Management, featuring Vincent Hui, senior director, Cornerstone Advisors, Inc. A Culture of High Accountability, featuring Doug Samuels, president/CEO, Space Coast Credit Union Mergers and Acquisitions, featuring David Ritter, shareholder in the Strategic Advisory Group, Doeren Mayhew “New podcasts will be published twice a month,” explains James Lenz, CUES’ professional development manager and CUES Podcast host. “Listeners will find CUES Podcast offers the same quality of content credit union executives and board members have come to expect from CUES, in a portable format.” The CUES Podcast is available in Google Play, iTunes, and Stitcher. Listen or subscribe using your favorite […]

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It’s Not OK That Fraud Happens All The Time

Mobile SMS alerts can help members help prevent problems. By Dana Murn-Kohal My friend’s 80-something father-in-law called her recently, frantic. Someone had called him saying her son—his grandson—had been in a terrible accident and he needed to send money. Fortunately, the father-in-law called to verify the situation before transferring any funds. And of course, the call was a fraud. My friend’s son was in school, totally fine. In a CUES Webinar late last year (playback available for CUES members), John Buzzard, account executive and fraud expert at CUES Supplier member CO-OP Financial Services, Rancho Cucamonga, Calif., said a very similar type of socially engineered fraud—bail bond fraud—is becoming common. In a bail bond scam, the criminal tricks a relative into posting bond to an account the criminal controls, often via wire or pre-paid gift cards. Buzzard noted that these scams can be averted if the victim hangs up the phone and verifies that there is actually someone in jail, like my friend’s father-in-law did. Panic works every time with this type of fraud, he noted. Unfortunately, fraud of one kind or another happens all the time, according to Buzzard. He noted that one criminal group profited by about $121 million […]

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It’s Here! CUES Certificate in Business Lending

Demonstrated proficiency you can take to market. By Jim Devine and Bob Hogan We’ve been vocal in championing member business services and business lending as the best opportunity for credit union growth and stability. As it’s become increasingly difficult to profit from consumers, attracting business clients is paramount.  The challenge, however, is catching up to other lenders who have monopolized this market niche for years. Now you can differentiate your credit union and secure a unique position in the business lending arena by certifying the expertise of your lenders. Working with CUES, we have developed a Certificate in Business Lending program unlike anything the industry has seen. Candidates will run a gauntlet of comprehensive coursework, practical application of knowledge and a thorough examination process. They’ll emerge as competent, confident underwriters, equipped with great analytical skills and the ability to discuss complex financial concepts with ease. To be certified, new candidates will: attend CUES School of Business Lending I, II and III complete all required coursework and outside assignments accumulate on-the-job lending experience and study independently participate in a high-level review session pass a rigorous proctored exam Prior graduates of CUES School of Business Lending series are also eligible for a […]

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Do Your Board Conversations Make Sense?

Framing can help roll out the right discussion for the decision at hand. By Deedee Myers, MSC, PCC, Ph.D. Thoughtful board conversations are a valuable source of organizational knowledge in the boardroom. The challenge is learning how to have a thoughtful conversation rather than the conditioned practice of speaking disparate statements that may or may not link to previously spoken statements by others. The desired result is having the right conversation in the context of the decision being made. A positive outcome of having the right conversation for the decision is a board that is highly engaged, full of vitality, nourishing and cultivating. Let’s explore a higher-level way to practice sense-making in the boardroom for the sake of deeply exploring the decision framework. The first step is to acknowledge the dominant type of conversation happening in your boardroom. For example, are your directors primarily asking questions or making statements of an oversight nature (e.g., Why did we pay $120? Should the board be involved in making the decision on the carpet color?)? Second, are you asking “inquiry” questions? These are often asked in a way that produces an abbreviated answer that does not explore context with any level of material […]

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A Case Study on Vehicle Protection Sales Success

Heritage Federal Credit Union and its members benefit from upgrading this insurance offering. By Ronni Martinez Sponsored by SWBC Change is not always easy, particularly for busy credit unions that are laser-focused on meeting their members’ daily needs. As an organization dedicated to meeting the changing financial needs of its membership, $518 million Heritage Federal Credit Union, Newburgh, Ind., understands that to better serve a broader membership base, change is sometimes necessary. Guaranteed Asset Protection is not a unique offering. Lenders know that GAP offers borrowers a level of auto loan protection while generating non-interest income for the CU; most borrowers know that GAP can help “fill the gap” between their loan balance and insurance payout in the event of a theft or total loss. However, in a competitive auto loan market, more and more lenders are thinking outside the box to find creative ways to generate non-interest income. In other industry news, we have seen a dramatic shift in consumer borrowing behavior that puts consumers and members at an increased risk for GAP exposure, making sufficient vehicle protection coverage even more critical to auto loan borrowers. Back in 2010, borrowers had a maximum GAP exposure of around $1,800 based […]

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Visionary Leadership

The critical difference between vision and goals. By Lisa Petrilli This was originally published on Petrilli’s Visionary Leadership blog and is reprinted with permission. I continue to meet leaders that confuse the concept of having a vision with setting goals. Our conversations sound a bit like this: Lisa: “So tell me about your vision for the company.” Leader: “Well, we’re looking to get into the xyz market and want to be number one in the local market by next year.” Lisa: “Those are great goals to have, but that’s not a vision. A vision is three-dimensional and has aspects of all five senses to it. It is a picture that describes what your company looks like and feels like when you’ve ultimately fulfilled all your goals and brought the impact of them to life.” I love to use Martin Luther King, Jr. as an example of visionary leadership. He had an exquisitely clear vision and expressed it magnificently in his “I Have a Dream” speech. While his goals may have included various steps along the way to passing civil rights legislation, his vision was so much bigger than his goals. His vision described exactly what it looked like when the real impact of his goals were […]

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Developing an Effective Digital Account Opening RFP

Critical criteria to consider By Alissa Fry-Harris Sponsored by CUES Supplier member Bluepoint Solutions Prospective customers and members have demonstrated clearly their willingness to choose financial institutions that offer digital account opening. Adopting a leading-edge omnichannel capability is the best option for banks and credit unions that aim at account growth. To satisfy consumer demand, it isn’t enough to put out a digital “welcome mat.” The entire consumer experience matters—from being able to easily enter the virtual front door, to exiting with an active account and a sense of engagement with the provider. A few recent industry research findings illuminate where we find ourselves today: Most financial institutions plan to add a mobile optimized solution, but only 20 percent are there now. Up to 80 percent of the attempts to apply for a new account via a mobile device fail, either abandoned before being completed or completed but never funded. Friction in the process creates most of these failures. Processes are either too complicated, take too much time, require too much data entry or can’t be completed immediately. Some even require a branch visit, which too often doesn’t happen. Most current digital account opening services do not match the convenience […]

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Is Your Board ‘Looking Busy’? Beware If It’s Bored

‘Social loafing’ a contributor to ineffective leadership By Deedee Myers, MSC, PCC, Ph.D. Social loafing is the idea that the pooled efforts of a group result in individuals putting forth less effort than if they were working alone. The first study on social loafing was Max Ringelmann’s rope-pulling experiment in 1913. Ringelmann studied the individual efforts of pulling a rope vs. pulling a rope as part of a group. He found that individuals tended to exert less effort when part of a group. In subsequent variations of the experiment, participants pretended to be pulling by looking busy. In another Ringelmann experiment in which participants were seated in a semicircle and asked to yell and clap alone, in pairs, or in groups of four and six, the researchers found that two-person groups performed at only 71 percent of their individual performances, four-person groups at 51 percent, and six-person groups at just 40 percent. People tend to exert less effort, yet feel pressure to look busy, in larger groups. This phenomena also can manifest in credit union boardrooms. Directors are less likely to contribute because they think their individual thoughts and perspectives are not needed! These board members pretend to look busy. […]

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Five Major Innovation Priorities

OK, we need to be open to innovation. But where on earth do we start? By Graham Seel This was excerpted with permission from “OK We Need to Innovate – But Where Do We Start?” Most credit unions accept that they need to innovate—and that they need to be both strategic and tactical about it. But in practice, many CU leaders are asking themselves these kinds of questions: “Where on earth are we going to start? What are our priorities? Where should we apply technology? Which issues need capital? And which depend on organizational change?” For most people, “innovation” means technology. So let’s focus on the top five themes I hear over and over from community financial institutions. They’ll give us clues about where innovation is needed. Net interest margins are continuing to narrow. The cost of funds can’t go any lower, but competition is squeezing yields on every kind of loan. So although loans and interest income are growing, net income isn’t keeping pace. Interest rate increases would help, but this is outside our control. If we’re to maintain or grow net income, we have to reduce expense (again!) or profitably grow non-interest revenues—or, preferably, both. Business members are […]

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Getting Members to Vote

Strategies to encourage members to cast a ballot. By Deepak Prakash When only half the eligible voters in the United States turn out to vote for the highest office in the land, it’s not so surprising that credit unions sometimes struggle to get members to vote in board elections or other key decisions for the organization. A way credit unions can help spur members to participate is to offer electronic voting as an option along with paper ballots. We recently had a client host a hybrid election in which members could either vote online or receive a paper ballot from us. This allowed our client to gradually transition its voters from paper-based elections, with the goal of moving over to entirely electronic voting in the long term. Here are some additional strategies for encouraging members to take the time to vote: Send a postcard or paper mailer to each member with their voting credentials, especially if members are accustomed to receiving communications from the credit union through the mail. This can be particularly important for CUs that are transitioning their votes to electronic means. Send a personalized email to each voter that contains his or her login credentials. Send a […]

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457(f) Plans Help CU Keep Key Execs

‘Golden handcuffs’ an effective benefit for top leaders of Randolph-Brooks Federal Credit Union..  By Scott Albraccio Content provided by CUNA Mutual Group through CUESolutions When you’ve taken careful measures to build a strong leadership team, it can be devastating to lose a key executive to an outside organization. $7.3 billion Randolph-Brooks Credit Union, Universal City, Texas, uses 457(f) plans to help retain its top executives and preserve leadership continuity. According to industry data, 55 percent of credit unions offer 457(f) plans to their executives. EVP/CFO Robert Zearfoss explains the strategy of Randolph-Brooks FCU. “To be competitive in the marketplace, it is something that we have to offer,” says the CUES member. “Otherwise, our executives are going to be taken away by other institutions that have those programs.” What Is a 457(f) Plan? A 457(f) plan is a type of non-qualified retirement plan that creates an opportunity to supplement executives’ income with no contribution limits. The assets are owned by the credit union until they are paid out to the executive. These plans are not subject to IRS limits on contributions, meaning your credit union can add an unlimited amount of funds to any of your executives’ 457(f) plans. This makes […]

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Innovation Still the Right Thing for CUs

Here are three suggestions for building a culture of embracing new ideas throughout your organization. By Christopher Stevenson, CIE “Innovate or die” still stands. That catch phrase—going back at least two decades—has been used to encapsulate the idea that innovation holds the key for a company’s survival and growth in the fiercely competitive market. In 2007, Hayagreeva “Huggy” Rao was quoted in an article saying that even though the high importance of innovation “is a truism,” it’s so important to an organization’s lifeblood that “there is nothing wrong in harping on it.” A professor at Stanford University and lead faculty for CUES’ Strategic Innovation Institute, Rao said in that same article that innovation becomes possible only when an organization’s culture encourages new ideas. “To state the obvious, the CEO need not necessarily be the most brilliant, or most original, mind in a company,” he explained. “He, or she, has to welcome suggestions from employees at all levels.” How are you going to ensure that new ideas are welcomed at all levels of your credit union in 2017 and beyond? Here are three suggestions: Take stock about where you are in terms of innovation. Use the 15 questions in “Self Assessment: […]

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CUES Members: We’re Thankful for You

As U.S. Thanksgiving nears, CUES’ President/CEO John Pembroke has been feeling thankful as he reflects on some of the many ways CUES members help make possible the learning necessary for credit union leaders to succeed in the changing financial services marketplace. Read more in his recent article on CU Insight.   View CUES’ “Honorary Team Members“. Find out about the offerings of the CUES Councils near you. CUES Councils are local, grassroots professional development organizations run by CUES members. Learn about individual and group CUES membership for executives and directors.  

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Pressure Wash Your Board’s Barnacles

Don’t let directors add drag. By John Waupsh Excerpted and adapted with permission of the publisher, Wiley, from Bankruption: How Community Banking Can Survive Fintech by John Waupsh. Copyright (c) 2016 by John Waupsh. All rights reserved. This book is available at all booksellers, starting today. Barnacles create such significant drag that the U.S. Naval Academy estimates they increase the Navy’s petroleum expenditures by $250 million a year. Community financial institutions can have their own barnacles, and they typically come in the form of an aged, unimaginative, unresponsive, disinterested board. This is a shame, because a great board can positively transform an organization—as early PayPal CFO-turned-Sequoia-Capital-Lead Roelof Botha suggests, “Good board members act as shock absorbers.” At a time when the nimbleness of smaller boats would be an advantage, the would-be community FI trawlers have significant hull drag. For once, small isn’t small enough. There’s something smaller and faster than you. These days, board members are required by regulators to be deeply involved with their institutions. Unfortunately, barnacles hide behind this fact, and use it as an excuse to require undue reporting, which ultimately increases expense and frustration. A friend of mine is CEO for a $300 million community institution […]

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Employees Want Something More Important than to ‘Be Engaged’

They want to be leaders. By Holly Buchanan Talk with the leaders of just about any company, and you will hear a lot of talk about “employee engagement.” Employers are constantly trying to find new and better ways to create employee engagement. They want to know how to “motivate, inspire and engage” their employees. They want this, of course, because ultimately they want productive employees. But is that what employees want? Is their top desire to work for a company that inspires, motivates and engages them? Or is it something else? I believe part of the problem is that employee engagement is framed from the perspective of the employer. That perspective says the employer is the leader that has to inspire and engage employee-followers. What if we switched that frame? Your employees want to be leaders, not followers. When your employees are leaders, they are more engaged than when they are following. I heard the CEO of a large financial company give a lecture to a large audience of college students. He told them, “If you want to be leaders, you have to have followers.” I remember thinking that I couldn’t disagree more. How many of you, given a choice, […]

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Education Key in Director Onboarding

Board learning expectations are part of the conversation with prospective directors at a Kentucky CU. By Charlene Komar Storey This is bonus coverage from “Developing Director Development,” forthcoming in the December 2016 issue of Credit Union Management magazine. At $1.3 billion Fort Knox Federal Credit Union in Radcliff, Ky., director education is so important that it’s part of the very first conversation with a potential board members, according to CUES member Ray Springsteen, president/CEO. “The board incorporates the areas of training into the job description for volunteering,” Springsteen says, so there are no surprises for new directors. Part of director onboarding at Fort Knox FCU is to make sure that new volunteers know where to go to ask questions, he adds. They may turn to more experienced board members, or ask senior staff, including Springsteen himself. Education is ongoing for the CU’s nine board members, three associate directors and four non-board members of the supervisory committee. The credit union uses several modes of training including online modules, conferences and staff-directed education. “The board reinforces education by ensuring directors report on the use of all three,” Springsteen says. In addition, one of the non-board members of the supervisory unit attends each […]

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Help Members Stay on Track

The right credit card program can keep life from derailing them. By Bart Scott Sponsored by LSC There’s an old philosophy that goes something like this: “If I don’t have the money for something, I just don’t buy it.” In many, if not most scenarios, that is smart, practical thinking. Irresponsible spending gets many of us into trouble. Especially when we’re young, and particularly when we get our hands on our first credit card. As a credit union that builds relationships with its members, you need to do your part to counsel members about responsible money management. Prudent financial advice like the adage above seems fairly sound and straightforward. What about those times, however, when members don’t have the money for something . . . but they have no choice but to buy it? For instance, the day the furnace gives out, or the hot water heater decides it won’t heat the water anymore. You and I both know these things are more likely to happen in December or January than in July. Does your credit union have a plan to help? These are very realistic scenarios when a credit card can be not only a good thing, but a […]

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Voting for Organizational Change

Electronic balloting is a business decision-making tool. By Lisa Hochgraf Voting is an important tool that sometimes helps my family of three decide what to do on Saturday. Tomorrow, citizens of the United States will use it to choose a new President. Likewise, some businesses use voting to help make all kinds of important change decisions, according to Deepak Prakash, vice president of eBallot (formerly Votenet Solutions), which powers CUES eVote: Elect and Educate. Electronic ballots “are ideal instruments to ensure change is installed in a fair, easy, secure way in an organization,” Prakash explains. Merger ratifications, bylaws changes and board member elections—all events when a lot of people need to weigh in—are typical times that credit unions use electronic elections now. But Prakash suggests they could also use electronic voting for internal decision-making done by smaller groups. Members of credit union teams “can vote on multiple issues or positions using one credential and have all the tracking and accountability benefits that electronic balloting provides in larger elections,” he explains. “This makes it as easy as buying flights online. You click on it. As an added advantage, an internal team can set up a decision-making ‘election’ so a key expert’s […]

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Leadership Mindset Assessment

Here’s a way to measure the primary obstacle standing in the way of achieving your strategic objectives. By Hugh Blaine It seems that an epidemic of negative thinking has swept through corporate America and is infecting the ranks of employees at all types of organizations—from IT and healthcare to financial services and higher education. The mantra we frequently hear nowadays is, “We don’t have enough resources to get it done.” It is true that most businesses are strapped and this has become the new norm. But what’s more concerning is that organizations lack the resourcefulness to achieve strategic objectives—and they’ll never realize them without a dramatic mindset change. The truth is that executives and their teams have the ability to transform adversity into opportunity, creating powerful solutions to seemingly impossible problems. Since the primary obstacle standing in the way is what is going on in between each employee’s ears,  how can leaders assess mindset? To help answer that question, I created the 10-question “Leadership Mindset Assessment.” Rate yourself one to 10 on the 10 questions below. Choose one if you either don’t have this item or don’t do it, and 10 if you do this regularly and or have it […]

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Does It Need to Be a Scary Day for CU Leadership?

The brain trust model can help credit unions succeed in good, bad and uncertain times. By Jay Murray It’s Halloween—a day that celebrates all things scary. While credit unions don’t fear ghosts and witches, they have plenty of other things they can worry about, including the future of our economy, the results of the upcoming election and the impact of technology. Can credit union leadership really be successful in uncertain times? My life experience makes me think they can. In my hometown of Middletown, Pa., I survived a flood, a near nuclear meltdown when the Three Mile Island power plant heated up too much, and the demise of the local savings and loan where I had my first real job. The financial crisis of 2008 hit in my second week as the new CEO of a credit union. As the old saying goes, never waste a good crisis. I’ve survived. I’ve learned much. Similarly, credit unions can be successful whether it be good, bad or uncertain times. The three key ingredients of the “brain trust model” are important supports to success, whatever the outlook. First, the model directs finding the right “brains” to sit around the board of director table, […]

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Market Your Auto Loans Like a Rock Star

Three ideas that will help make your program sing. By Victoria Penn Sponsored by SWBC Marketing is a critical aspect of the vitality and growth of any business, and credit unions are no different—particularly when it comes to auto lending. Competition for credit unions is significant and consumers know that in a low-rate environment, they have the flexibility to shop around and find the lowest rate possible. To help your auto loan stand out from the rest of the competition, finding creative ways to market your loan program is critical. While you’ll likely never get away from traditional media like billboards and in-branch signage, consider these three ideas for your auto loan marketing efforts. 1. Get social. For better or worse, social media is here to stay, and credit unions should embrace this venue as an opportunity to connect with members and potential members. Consumers use social media for far more than simply being “social.” In fact, 46 percent of consumers rely on social media when making a purchase decision. Those are some big numbers for your credit union to leverage in your marketing efforts. Some examples of great ways to promote your auto loan program on social media—Facebook, in […]

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Learning Leadership From Watching TV?

11 traits of great leadership demonstrated by Madam Secretary. By Lisa Hochgraf While my son is excited about Supergirl starting up again this fall, I look forward to Sunday nights when I can watch Madam Secretary. The show stars Téa Leoni as Secretary of State Elizabeth McCord, who drives international diplomacy, battles office politics and circumvents protocol as she negotiates global and domestic issues, both at the White House and at home. To do what is often a very tough job, McCord demonstrates over and over that she is smart, able to inspire and motivate her team and tireless in her pursuit of a better world. A slide show on the CBS website describes 11 key leadership traits you can observe in McCord’s actions. Which of these do you already successfully practice? Which of these do you need to practice? 1. Be passionate about what you do. 2. Pay attention. ” You can’t lead if you don’t know what’s going on around you, whether that means what your co-workers are up to or what the people on the other side of the table are up to,” the slideshow caption asserts. “Take the time to listen, watch, and learn—you never know […]

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