CU Success Lies in Employees’ Ideas

CUNA’s E-Scan Newsletter
July 7, 2010 | COMMENTS

Whether your credit union's focus is expense control, membership growth, new business lines, or greater market share, good ideas are the key to a competitive advantage. Without those advantages, credit unions can only offer commodity products and rely on members' goodwill—not a winning strategy.

Improvement-oriented ideas are just as likely to come from the front line as from managers. But a new study from the Filene Research Institute shows that employees don't speak up often enough—and when they do, they may not be heard.

The report, "Employee Voice and (Missed) Opportunities for Learning in Credit Unions," follows an 18-month study by three university researchers under Filene's sponsorship.

Researchers solicited ideas from thousands of employees at 11 small to large credit unions, and examined how those ideas were treated by credit union leadership. The results are an in-depth analysis of employee "voice" at credit unions.

It's dangerous for leaders to assume they know who at their credit union has good ideas, say the authors. What's worse is that many leaders assume good ideas will find them—dangerous again. Credit union leaders looking for creative suggestions should:

• Spread a wide net. Among the employees surveyed, good ideas were simmering at all levels. Leaders who rely on a traditional chain of command, formal reporting structures, or only on fellow executives for new ideas are likely to miss out.
• Emphasize the importance of “voice” with midlevel managers. Local managers, especially branch leaders, are critical in getting good ideas to the top.
• Give all ideas a fair shake. Every organization has bottlenecks, and good ideas can disappear because they add to a manager's workload or because they may not offer immediate benefits. Insist on a process that gives ideas multiple evaluators at different organizational levels.
• Strive for consistency. Employees are too smart to be fooled for long by a supposed desire for input that is not put to use and offers no rewards for providing it.

Other findings:

• Age, gender, length of tenure, and education level do not correspond with idea quality. Good ideas come from everywhere.
• Sixty-one percent of employees surveyed indicated that they had more ideas than what they ultimately communicated to their supervisors.
• Formal upward-reporting mechanisms are less efficient at getting ideas to senior leaders. Instead, leaders who actively seek ideas, demonstrate openness, and follow up have more success.
• Employees may need coaching to guarantee that they present ideas effectively—for example, by "selling issues" in economic or stakeholder terms and by choosing effective tone and language.

In today's business environment, leaders need to be fully informed about problems and opportunities facing their credit union. Leaders generate success by going down the organizational chart is search of quality ideas, and personally following up to make sure they're implemented.

This article originally appeared in CUNA's E-Scan Newsletter. Reprinted with permission.