This is the third in an exclusive CreditUnions.com 5-part series on implementing strategy. Over the next few weeks we will explore different theories of execution, culminating in an interactive, live seminar on November 7 th where credit unions will be sharing their approach and results. Follow this series on CreditUnions.com and in our biweekly CEO Strategy e-newsletter (update your registration here to include this e-alert category).
While much strategy research focuses on defining a unique strategy or identifying new markets, Thomas Powell, a business professor at the University of Oxford, looks at execution as a fundamental driver of performance. In particular, Powell’s research focuses on a theory of x-factors: solvable by unsolved problems that hold companies back from true greatness. According to Powell, “Although execution is relegated to “operational” status in current theory, and is less spectacular than creating sustainable advantages, it may be the more typical (and reliable) path to superior performance.”
One of the greatest sources of x-factors are execution holes. What are execution holes and how can you avoid them? One source of an execution hole may be your organizational culture. This can include issues such as:
Power and politics
Dominant functional area
Resistance to change
Lack of empowerment
CES Credit Union ($103M), the fastest organically growing credit union in Ohio, is addressing organizational culture and employee empowerment as drivers of success. In a recent interview, Kelly Schermerhorn, CEO, talked about their strategy to “ask members for their business.” However, strategy is one thing—how many credit unions do you know that sing this same tune?—but getting employees to actually ask is another.
According to Schermerhorn, “competence inspires confidence” and with confidence comes the ability to ask. Rather than dictating this policy from the executive suite, Schermerhorn lives it. Every single credit union employee, from Schermerhorn to the newest hire, attends monthly training. In addition to training, getting employees to understand the value of the credit union’s products in their own lives is critical. In a recent visit to one of his one branches, Schermerhorn asked every employee if they were using e-statements. To his chagrin, only the branch manager was. First item on the agenda that day—sign everyone up so they can truly appreciate the benefit and start evangelizing the one delivery channel that Schermerhorn believes “truly delivers on its promise of better efficiency at a lower price.”
While CES may be a star performer in Ohio, Schermerhorn is careful to honestly assess their performance and continually drive for better results.