The Benefits Of A Remote CEO

In this Q&A, Terry Settle of Old Ocean FCU talks about serving as a remote CEO, the range of opportunities the model has presented, and the similarities with the models of larger credit unions.

 
 

Top-Level Takeaways

  • Secure technology and face-to-face communication play a mjor role in Old Ocean FCU's remote CEO arrangement.
  • For CEO Terry Settle, running the credit union from more than 400 miles away is not unlike running a much larger institution with an expansive branch footprint.  

During Hurricane Harvey, area flooding and road closures made Old Ocean Federal Credit Union ($33.5M, Old Ocean, TX) physically inaccessible to staff and members.

The small cooperative is located in Sweeny, TX, a community of nearly 4,000 people situated near the Gulf of Mexico, approximately 50 miles south, and a little west, of Houston. The credit union originally served employees of the oil refineries in the Galveston area. Membership now is open to Texas residents who live, work, or worship in Brazoria County, an area that faced mandatory evacuations as the Category 4 storm came ashore and rivers flooded.

Despite the inclement weather and resulting operational complications, the CEO of this Gulf Coast credit union, Terry Settle, maintained uninterrupted access to critical systems, coordinated with key vendors, and communicated with staff, members, and the NCUA.

 

 

 

This built-in disaster recovery back-up is just one of the benefits Old Ocean has discovered in its distinct staffing model — one in which Settle runs the credit union from his home office in Wichita Falls, TX … located an 8-hour drive away.

In this Q&A, Settle talks about the benefits and drawbacks of serving as a remote CEO, the range of opportunities the model has presented, and the similarities with the models of larger credit unions.

Terry Settle, CEO, Old Ocean FCU

How did the idea to try out being a remote CEO come about?

Terry Settle: It is a little unusual. I was approaching 60 and initially planned to retire and move to another city. But for several reasons, my timeline moved up. Instead of simply retiring early, though, I started thinking about all the things I could do without being in the office.

Before I presented my remote work proposal to the board, I mapped out the pros and cons and tested what I could do from home. I consulted my staff for any reason they could see not to do this, any reason it wouldn’t work. Staff didn’t see a problem with it — they wanted me to stay on rather than retire early and leave a gap for the credit union to fill.  

My board chairman felt the same way, and he supported the proposal at the next board meeting. I gave the board members all the information and asked them to take their time to make a decision. I reiterated that they could change their mind at any time with a three-month notice. They discussed it and made a decision by the third board meeting to ensure all of the board members were present and had a chance to review the information.

How quickly did you make the transition?

TS: I didn’t leave immediately. We were in the midst of remodeling the credit union. I thought it was important for me to oversee that project, which had another six to eight months left, so I stayed on until it was finished.

My family moved before I did. I stayed in town for another full year and worked remotely for a week or two at a time. This helped ease the transition, and in August 2015, I moved for good.

How do you stay connected as a remote CEO?

TS:We use a VoIP phone system, so as long as I have an internet connection, I can take my phone with me and use the same telephone number and extension as if I were in the office. It’s the same with employees — they can buzz me directly just like when I was sitting in the credit union.

I hold management meetings via Skype twice a week. We talk face-to-face and share screens to look at spreadsheets and other reports.

In my situation, I started to delegate responsibilities to my team. It built loyalty, gave them higher levels of authority, and pushed me farther away from the day-to-day management. 

Terry Settle, CEO, Old Ocean FCU

We use Zix mail for secure emails. We use e-signatures, so I can sign things and send them back securely. Because I’m connected to the network, I can save documents in our optical storage system and staff has immediate access to them. And I have a scanner in my home office.

We haven’t had an issue in terms of staying connected and getting things done.

Has your interaction with your board of directors changed?

TS: Not really. I go back to the credit union one week per month, and I schedule that around the board meetings. Before I left the area, we saw one another in person once a month and we still do.

The board has said, though, that we can conduct the meetings remotely because we have video in our board room and can see one another. I have a secure website on which I load the board packages the week prior to the meeting and the board can review all of the documents in advance.

What are some of the management challenges?

TS: It’s not as easy to get a feeling for what’s going on with the employees. That is one of the reasons I like to go back once a month to see what’s happening versus getting feedback solely from my management staff. I talk to the managers daily, but employees don’t see me every day.

I put a lot of responsibility on my management team. I give them authority to take care of problems. If they want my opinion, they call me directly. So, in that way, being remote is no different from when I was there.

Even with personnel issues — unless it’s serious — I let the supervisors take the lead. If we have to terminate someone, I step in.

You mentioned retirement. Does the credit union have a succession plan?

TS: Yes. In September of 2015, I used the majority of our planning session to discuss succession.

CU QUICK FACTS

Old Ocean FCU
Data as of 06.30.17

HQ: Old Ocean, TX
ASSETS: $33.5M
MEMBERS: 3,025
BRANCHES: 1
12-MO SHARE GROWTH: 4.2%
12-MO LOAN GROWTH: 2.1%
ROA: 0.96%

We developed a strong plan, especially for a credit union of our size. Even the NCUA had positive feedback about it. It provides specific steps for different situations that could arise — from an emergency event or health scare to normal retirement. It outlines what the credit union would do, who would be in charge temporarily, who to contact, what resources to use to find a replacement, etc.

In addition to me retiring at some point in the not-too-distant future, we’ve had some of our other experienced people retire as well.

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Would the board consider another remote CEO?

TS: The board might want to consider another remote CEO or even look at someone who is running another credit union to have a shared CEO.

3 Credit Unions. 1 CEO? It can be done. See how this trio of cooperatives have put a shared-staffing strategy to the test. Read now.

Alternate models like this open a lot of opportunities for greater efficiency and more experienced candidates at a lower cost. After all, if you have multiple branches, you’re already remote in many senses. A CEO can’t physically be at 20 or 30 branches, so you are working remotely from the headquarters building. You rely on the local, branch managers to make decisions and resolve issues on a daily basis.

If you have a good management staff, that model can work well. The CEO should be helping guide and support the management team while monitoring and influencing the positive financial direction of the credit union.

In my situation, I started to delegate responsibilities to my team. It built loyalty, gave them higher levels of authority, and pushed me farther away from the day-to-day management.

What’s the biggest challenge of being a remote CEO?

TS: I don’t have face-to-face contact with members. Although, honestly, I didn’t have much direct contact with members even when I was on-site because of my strong staff. The staff resolves most issues directly. If a member wants to talk to me, they can call me or schedule an in-person meeting for when I’m in the credit union.

What advice do you have for a credit union that might be considering high-level remote employees?

TS: Don’t be scared just because something is different or just because that person isn’t there.

With the technology that’s available today, being at the physical location is just not as important. It’s still nice to talk face-to-face, but you have the ability to communicate via technology. For example, we already had remote access for emergency purposes.

Another important piece of advice, for CEOs in particular, is not to push your board. Present your board members with all of the information, be straightforward about the reasons behind your request, and give them time. In my case, it was either going to be a remote CEO or a new CEO. Everyone was glad I presented them with the first option.

This interview has been edited and condensed.

 

Sept. 25, 2017


Comments

 
 
 
  • I believe working remotely is necessary no matter what size you're credit union is. It provide you (ceo) with the flexibility and options to be more productive as well as give your staff opportunities to excell just as Terry explained. In fact, I think we can get in the way of building their confidence and work when we are there all the time. Thanks for sharing Terry.
    John iglesias
     
     
     
  • Thanks for reading and commenting John. I couldn't agree more and appreciated Terry sharing his story, especially as he juggled other priorities after the hurricane!
    Sharon Simpson