Like most top talent, good software developers are hard to find. That’s why last year, Maps Credit Union ($464.3M, Salem, OR) turned to a college intern to design a mobile app for its Buy Local program, which rewards shoppers at area businesses with discounts. The internship was so successful that Maps is raiding the computer science and engineering classrooms at nearby universities for four more interns this year to work on a slew of other projects the credit union’s full-time developers never have time to tackle.
Often overlooked, local colleges and universities offer credit unions a ready source of available talent from students who need real-world experience. That talent typically comes in one of two forms: undergraduate internships or a graduate-level course in which students act as consultants for a client on a specific project. Although different, both approaches have merit.
CU QUICK FACTS
MAPS CREDIT UNION
data as of 12.31.14
HQ: Salem, OR
12-MO SHARE GROWTH: 5.20%
12-MO LOAN GROWTH: 17.21%
Internships, for instance, offer potential as a recruiting tool, says Loren Paulsen, a software development manager who runs the intern program at Maps.
“The credit union industry needs to build a better on-ramp for college grads, and this is a great way to attract specialized talent from different majors, especially computer science and business,” he says.
Tapping into student talent can also infuse a credit union with fresh ideas from outsiders that cooperatives would never otherwise hear from. This is particularly true of many MBA students who get consulting experience through a course project.
“These are people who would not want an internship at a credit union, so you’re attracting a different type of person you wouldn’t ordinarily get,” says Stefanie Norvaisas, who leads a graduate course that offers students hands-on experience as problem-solving consultants at the University of Wisconsin’s School of Business. Her students brainstormed ways for UW Credit Union ($1.7B, Madison, WI) to market student loans on campus.
“For a pretty low investment, credit unions can get a high rate of return,” she says.
The Down Payment For Innovation
Student labor doesn’t come free, but it is priced at a discount, with time as much a part of the investment as money. Interns, for example, typically need some mentoring and training. Paulsen brings on new interns twice a year in the spring and fall and usually devotes the first few weeks to getting students up to speed. Although the students are bright, they typically know little about credit unions and lack certain technical skills, such as familiarity with a specific computer language.
“The whole point of college is to learn computer science concepts, but schools don’t focus on any particular tool or technology because it’s likely to be obsolete in five or 10 years,” Paulsen says.
Consequently, longer durations for internships offer credit unions the best value, with six months being the optimum.
“If it’s three months, you’ll burn out your managers because they have to keep training new people over again,” says Gary Peterson, executive director for the Multiple Engineering Cooperative Program (MECOP), which supplied interns for Maps Credit Union. The nonprofit pairs computer science, engineering, and business students from multiple Oregon universities with participating local employers.
Even graduate-level consulting projects require at least a few hours each week from a credit union manager or executive who can provide students with information about the organization.
Money will also need to change hands. MECOP requires participating employers to pay interns 75% of the hourly rate for an entry-level developer, and business schools offering consulting services as part of the coursework sometimes charge companies a nominal fee — a bargain compared to what professionals would ask for.
“The students doing these projects are three to six months away from graduating and potentially going to work for a major consulting firm,” says Robert Sicina, a professor at American University’s Department of International Business. “Although our students are going about the work in a very similar way, we charge $5,000 while consulting firms like Booz Allen might charge $500,000.”
The competition to be a client for a consulting class can be fierce, and professors typically handpick the businesses and projects for the course. Sicina looks for mid-size organizations that lack the resources to address a clearly defined objective.
Reaping The Rewards
Norvaisas actively sought out a credit union the first year she taught her consulting class because nonprofits, with their limited resources and manageable size, were a natural fit for the program. Originally established as the University of Wisconsin Credit Union, UW also already had a connection with the school offering student loans. But the credit union also had communication problems with its borrowers.
Many students didn’t realize they needed to join the credit union to take out a loan, creating an extra layer of paperwork that they sometimes failed to complete, Norvaisas says. As a result, students thought everything was in order when it wasn’t, and UW employees were spending a lot of time chasing down the students. Finding a solution to better educate, market to, and follow up with the students became the course project’s goal.
Over the 16-week-long course, the students analyzed the problem and brainstormed creative solutions. One idea included a welcome kit that educated students about credit unions, complete with coupons for area businesses like the local pizza joint. The kits would be waiting in every dorm room when the kids arrived. Even though UW had branches on or near several school campuses, the students also suggested a credit union bus that drove around to different spots making it easier for students to follow up with any missing paperwork. Other suggestions called for kiosks placed in high-traffic areas around campus.
Although not for credit union clients, other course projects that Norvaisas or Sicina have led involved product branding, business plans, corporate restructuring, or fund-raising. The advantage of course projects over internships is that you get “a lot more brains at work,” Norvaisas says. Sicina’s students typically devote 600 hours to a project.
For work that requires single-minded focus from one individual, internships are especially valuable. Because Maps also has a subsidiary that sells software to other credit unions, Paulsen occasionally hands his interns a bunch of data and asks them to develop a marketable program with it. Maps already sells the Buy Local app an intern developed last year.
Besides designing the interface for mobile apps, Paulsen’s interns have also worked on a bond valuation program or analyzed work processes that the credit union could streamline or automate. In fact, MECOP’s Peterson believes industrial engineers who make processes more efficient may be especially useful interns for credit unions.
Perhaps the biggest advantage of interns is that they plow through projects quickly.
“If you have a list of things that will keep students busy for six months, double or triple it,” Peterson says. That’s because unlike other employees, the students aren’t being pulled into meetings and can focus on a project exclusively. “They don’t have 50 things pulling at their shirt sleeves.”