How Patelco Credit Union Aligned Its Leadership Team Around Strategy, Language, And Framework

The California credit union gained the framework for team collaboration on innovation through the Callahan Leadership Team Development program.

 

By Callahan & Associates, Inc.

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When Erin Mendez became CEO of Patelco Credit Union ($5.2B, Pleasanton, CA) three years ago, she built a new leadership team at the organization. Although everyone on the team had extensive and relevant backgrounds, they didn’t have a history of working together and didn’t speak a common language to develop and execute the organization’s strategy.

To address this, all nine members of Patelco’s C-suite — including the CEO, chief financial officer, chief human resource officer, and chief lending officer —participated in the 12-week Callahan Leadership Team Development (LTD) course, Disruptive Strategy with Clayton Christensen, offered in collaboration with HBX, Harvard Business School’s online learning initiative.

Delivered through the HBX platform and Callahan-facilitated interactive webinars designed specifically for credit unions, the program provided Patelco’s C-suite with a team-learning experience.

“A key takeaway was ‘how do we organize to accelerate and support innovation?’” says Susan Makris, senior vice president and chief human resources officer at the California credit union. “We have competing priorities as a leadership team. We needed to carve out time to work on developing ways to allocate resources, devoting time to innovation, and looking at what’s getting in the way of focusing on important initiatives.”

According to Makris, the concept of disruptive innovation was a key learning Patelco took away from the program.

“If we want to engage in more disruptive innovation, we would need a separate cross-functional team with different performance and reward metrics,” Makris says. “It would need to be more agile and 100% dedicated. There are pros and cons to that.”

Makris says the LTD interactive webinar setting was just as impactful as the HBX platform content.

“The learning format was conducive to interaction,” Makris says. “Learning from other people’s responses is a value you don’t get in a classroom environment or in other courses.”

The Patelco team credited Callahan partner Jay Johnson for his work helping them apply what they were learning to strategic challenges they were facing in their organization. This reinforced the learnings and provided an opportunity to practice employing the tools on a real Patelco use case.

“The first module set the stage — it was a big ‘a-ha’ moment for us,” Makris says. “We’re sustaining innovation, setting the groundwork for the different types of innovation. The second module was our top takeaway: identifying members’ jobs to be done, what they’re trying to accomplish by using us as their financial services provider. And a real differentiator was the case studies, which helped us refine our focus.”

As a credit union that is trying to live its mission, Patelco credits Callahan’s LTD program with brining home how the credit union can do that.

“It changed our lens,” Makris says. “It helped us hone in on the true needs of the membership and examine whether our products and services are meeting members’ needs. We’re not just looking at participation, we’re taking a closer look at the members’ jobs to be done and how we capitalize on that. It was a breakthrough moment for our leadership team — and that was only the second module of the program.”

Now, Patelco is rolling out the program to its vice president group. This level and above is charged with championing major, positive changes at Patelco, so it’s important all of these leaders are speaking the same language and working from a common framework. The LTD program provides that to the leadership team.

“As an HR leader, it was valuable to look at how we can optimally operate organizationally,” Makris says. “Disruptive, sustaining, low-end market — it’s all critical because of the investment of both money and resources involved in driving innovation. Our CEO wants to make innovation part of our DNA, but we all need to have shared experiences.”

The Patelco leadership team is preparing for its upcoming board planning session, and as part of that preparation, leaders are looking at the credit union’s five-year strategic plan.

Thanks to the Leadership Team Development program, those executives are now looking at things through different lenses. They’re not just looking at how they’re performing against the five-year plan — of which they are currently wrapping up the second year — they’re now also considering whether they’re progressing from an innovation perspective.

“Post-program, we’re trying to remove every barrier so we thrive in innovation, including what we need to do organizationally to achieve our innovation goals,” Makris says. “We have an innovation budget with metrics and reporting, and we plan to present new ideas to the board and share lessons from the LTD program to drive this strategy conversation.”

Makris believes LTD is a game-changer for Patelco.

“Is it our primary strategy to continue to drive innovation from a sustaining perspective?” the Patelco HR executive asks. “The management team says that’s status quo for us. Or do we continue to partner with some niche companies and startups to drive innovation? We need to understand how that would be organized and the pros and cons. This program is driving this conversation with the board during our planning session. When you can create context and apply these learnings around strategy and innovation, that’s a big deal.”

Makris says she already sees a variety of improvements at Patelco as a result of the LTD program. The executive team is now speaking a common language, executing consistently, and knowing what to expect from one another. Additionally, leaders have a better evaluation of risk and a better framework for thinking through resources —people, technology, and processes.

“There’s a section in the program where Jay asked our leadership team a question —how do you measure success at Patelco Credit Union?” Makris says. “We discussed the easy answer — core member participation — and then we had a great conversation about not forgetting what the members are seeking to accomplish in their own lives. Are we truly meeting member needs in terms of their financial health, and how do you measure that? There was no disconnect between the executive participants on how we’re going to measure success going forward — we’re all in alignment now, and the importance of that can’t be understated.”

Makris praised the credit union-specific bent of the LTD program as well as the interactive webinars led by Callahan. She also appreciated the wealth of information, including business case studies from the online modules and others regularly posted at CreditUnions.com, which she thought did an outstanding job of looking at external and internal factors.

The learnings focus on the marketplace from all angles — the consumer, and how companies are organized and who they’re competing against. This valuable background, combined with the credit union-specific information and interactive Callahan-facilitated webinars, made the experience a win for Patelco.

“I’m a strong proponent of the program,” Makris says. “It’s one of the best learning experiences that I’ve been a part of.”

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Are you interested in bringing this type of team learning to your credit union? Find out more about Callahan's Leadership Team Development program today. 

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September 19, 2016


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