How To Beat “No Way” With “Know How”

Being a small credit union hasn't stopped West Virginia-based Element FCU from developing solutions to better serve its members.

 
 

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Chartered in 1978 as the West Virginia Department of Welfare Employees Federal Credit Union, $26.6 million Element Federal Credit Union was among the first financial services institutions in the nation, bank or credit union, to offer remote capture. The multi-SEG, low-income designated institution has a reputation within the state and the industry as an innovator. This is bolstered by the fact the credit union’s CEO, Linda Bodie, prefers the title Chief + Innovator.

We’re a pretty small credit union, but we don’t let that stop us from going the extra mile to develop solutions for serving our members better. Cost is an issue, so we gather ideas wherever we can. My inspiration comes largely from companies outside credit unions such as Apple, Google, and Amazon. But those are only examples. I draw inspiration from any place I feel has a new and better way of serving members or that is communicating with members in a new and meaningful way. For example, I’ve been inspired by restaurants where I’ve witnessed outstanding service to customers.

But let me go back a bit. I came to Element 16 years ago when it had $2.3 million in assets and three employees in a small office of a state building. Obviously it was limited in what it could do, and technology was not yet what it is today. Vendors, especially the technology vendors, did not want to deal with us because they were after bigger customers and orders. That got me a bit piqued, so I began to look outside the industry. We looked for ways to go paperless and for better ways of communicating with our members who were living all over the state.

CU QUICK FACTS

ELEMENT FEDERAL CREDIT UNION
data as of 03.31.14
  • HQ: Charleston, WV
  • ASSETS: $26.6M
  • MEMBERS: 4,621
  • EMPLOYEES: 13
  • BRANCHES: 3
  • ROA: 0.85%

When Check 21 passed we wanted to develop a way of enabling members to make deposits by means of their computers, so we developed an FTP [file transfer protocol] so members could send check images to us. We were one of the first in the nation to make remote check deposit happen.

When smartphones came along, we were already a long way toward being ready to take deposits from member smartphones. For example, we already had the security pretty well in hand. In this case, we happened to be lucky. We had an IT man on staff that was passionate about technology and serving members, not merely managing a network. He learned the Apple iPhone system and developed an app that would deposit checks by smartphone. After that, we went retro and set up deposit from fax machines because lots of our members did not own a smartphone or scanner but did have access to fax machines. This was a big hit. Now we accept checks by fax, smartphone, and computer, and members do not have to mail in the checks later. We also accept cash by remote deposit.

Other ideas we’ve pursued over the years include a 5 cent swipe fee donation to one of four charities, round up credit and debit card totals donated to charities, remote deposit and financial services through our Facebook page, and artificial intelligence online chat on our website.

I tell people to break away from the notion that you have to take your ideas from a traditional and large credit union vendor. Instead, look at more ideas and vendors, talk to people, play with solutions for a while, and go with the ones members will like. This is basically what we have done. I search for solutions and take the ones that are affordable, easy and secure, and fit what we are looking for.

You have to get outside your own environment and see how other people are innovating and creating. Then you have to ask yourself: 'How can I innovate? How can I create?'" — Linda Bodie, Chief + Innovator, Element FCU

It’s too easy to get caught up in the idea that we run credit unions, that we run our business trying as best we can to accommodate laws and regulations. That kind of thinking is inside the industry. You have to get outside your own environment and see what’s happening, how other people are innovating and creating. Then you have to ask yourself: “How can I innovate? How can I create? How can I differentiate from every other bank or credit union?”

Credit unions can make the best financial services segment in America, but if we are not creative thinkers, we will not be able to meet the needs of people a few years from now. You have to get outside. Putting yourself in a place where you are a bit uncomfortable is critical to this process — I make myself uncomfortable every day.

Of course, there will be times when you get ahead of members. It’s happened to me a number of times. But generally in a year or so they’ve caught up. We’ve found we had a proper product or service, we just introduced it a bit early. For example, our card-swipe charity donations were a bit early for our members but have now caught on. And we’ve suspended our artificial intelligence chat until the technology gets better.

Putting yourself in a place where you are a bit uncomfortable is critical. I make myself uncomfortable every day. — Linda Bodie, Chief + Innovator, Element FCU

It’s an educational experience to fail because then you keep trying until you find something that fits. And it’s not just technology; it’s product innovation. You can’t be afraid to fail. More things will probably fail than succeed. If you think you have a good idea, never give up.

Anytime you are trying to innovate or roll out a product or service, you are making a set of assumptions. When you see the results, you often see that some of those assumptions were wrong. You have to drop the incorrect ones and replace them with more appropriate ones. For example, we use a debit card round up program. People were slow to embrace it, but we thought it was more an understanding and an ease of entry problem than a philosophical one, so we worked on communicating what this product does and making entry easier. This made the program successful.

If something doesn’t work right away, look for the barriers to communication, understanding, and usage. Tweak. The solution is probably not throwing more money at it but rather understanding the problems and tweaking to resolve them.

When we have a product we think will benefit our membership, I normally play with it first, and it usually takes a bit of time for me to feel comfortable with it. Then I take it to the staff. Sometimes they tell me they think it is stupid, but generally I insist they work with it for a while.  Sometimes they go for it and sometimes they don’t. If the idea gets past this stage, then we send it to a group of members who like to test things for us. We tweak it until we think it’s ready to go and then it’s out to the full membership.

When we roll out a product we try for rapid feedback. We have an informal process for feedback, the better to perfect the product out there. We don’t want to lose the speed to market.

Of course, we absorb ideas from within the credit union industry as well from without. We have a reputation for innovation, so I get calls from people wanting to pick my brain. That’s fine, and in the process I pick theirs, too. Ideas spring from that. One idea begets another and is a nice demonstration of the collaborative nature of credit unions.

 

 

 

May 26, 2014


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