Success breeds success, which is why credit unions are well advised to recruit executives who have had some of their own.
“We look for demonstrated success when we identify candidates,” says Janice Shisler, executive vice president at D. Hilton Associates in The Woodlands, TX. “We want to make sure they don’t come from failing organizations.”
Shisler and other veteran credit union recruiters also say when it comes to executive recruiting, “innovation” and “creativity” are not just buzzwords.
“When we talk to boards or hiring managers, we find a lot of them are looking for people who have a vision, people who can bring new ideas to the table,” Shisler says.
Further, a senior executive’s strengths need to align with the organization’s strategic directions. That’s why boards need to work out what they are looking for in both areas before the search gets too far.
“The board of directors needs to precede any recruitment process with an in-depth strategic plan discussion and agreement,” says James This, president of The Paragon Consulting Group in Olympia, WA.
This recommends the decision-makers consider factors such as the value of the credit union in its specific marketplace and where they want to invest, for example in asset or member growth, delivery systems, or products and services.
The Paragon Consulting Group president advises boards to reach a consensus on the competencies required in the next leader, including whether the organization needs someone with a strong marketing background, a strong IT background, experience in business lines that would be new to the credit union, or experience building community relationships.
Stay The Course Or Change The Course?
The best candidate can come from inside or outside the credit union, with necessary traits and experience dependent upon what the credit union sees as its primary need: staying the course or changing the course.
“You need to think about what you’re trying to achieve,” advises Jay Johnson, executive vice president at Callahan & Associates.
The institution’s leaders might believe it’s time for a complete change or maybe they want to deal with stagnation and are looking for a new dynamic and renewed vigor.
Either of those scenarios are good times to look outside.
“Even if it’s not necessarily a turnaround in the sense of things really going downhill, it’s important to bring in someone from the outside,” Johnson says.
Of course, if things are going well, it’s an appealing time to consider internal candidates — people who have been part of that success, people who understand the culture from the inside.
There To Help
Even in turnaround scenarios, however, an internal candidate can get the job done; it’s just going to be harder.
“There are relationships between management and the board and the whole staff,” Johnson says. “Depending on how long that person has been there, they could be really invested in the system.”
So how can a credit union give familiar faces a fair chance?
“My recommendation is normally to have internal candidates go through the same recruiting process as external candidates,” This says.
That process can also identify an ideal inside candidate. If not, at least such candidates get a fair hearing and some growth, such as identifying their strengths, areas that need development, and professional goals.
Changes in executive leadership often cause anxiety within the organization’s staff and board of directors, says Mike Juratovac, CEO at O’Rourke & Associates in San Francisco, CA. That anxiety can significantly disrupt the credit union.
“A well-managed process, with clear timeline objectives communicated throughout the organization is essential,” Juratovac says. He offers these best practices on how to hire the ideal candidate:
Plan sufficient time for due diligence, candidate profile development, and market exploration.
Clearly establish a candidate profile, then engage the entire board around the recruitment process.
Conduct the search process in a manner that protects the organization’s brand externally in the community and across the broader credit union industry.
Align executive compensation and benefits with market conditions to attract and retain talent.
The reality, especially in the turnaround scenario, is that a lot of organizations are looking for talent beyond what exists internally, says Shisler at D. Hilton.
And to find those candidates, credit union decision-makers are maximizing their own networks, looking beyond the usual LinkedIn and industry job sites, and using objective third parties.
Using a variety of channels helps a credit union identify what Shisler calls “passive candidates,” people not necessarily looking for a new job but who other credit union and banking executives think are worth considering.
“We can seek out people who didn’t even know they were interested in a new position,” the D. Hilton EVP says.
A protracted process might cost you the best candidates.
As for people to avoid, the recruiting experts advise avoiding people for whom it’s all about money, title, and pride.
“If they say things like ‘I’m not going to make a move for a 15% or 20% jump in salary’ and they don’t seem to be motivated for other reasons, then they probably are not in it for your members,” Shisler says. “You want to make sure they are key stakeholders and contributors within the organization and want to make an impact as part of an organization that is prospering and growing to the next level.”
That said, This advises credit unions to have a backup candidate and strategy when they make the offer. “More frequently than you might expect, your perfect candidate declines at the last minute.”
He also says to keep things moving because highly qualified people have many opportunities, adding, “A protracted process might cost you the best candidates.”