Attract. Develop. Retain.
Those three words are a common refrain at credit unions. As consumer expectations of retail service continue to rise, a capable, knowledgeable staff whose members also understand how their role supports the credit union’s larger goals is key to organization success.
Talent management has always been important, and competition today is as intense as ever. The national unemployment rate has hovered at or below 4% since March 2018. Some markets have even dipped below 3%. But the scarcity of workers highlights a deeper need — credit unions aren’t looking for just anyone to fill open positions; they’re looking for the right skills and fit.
Skills that are desirable in front-line staff, specialist roles, and executive positions are continually evolving. So, how are credit unions tackling the challenge? There’s no single answer. Instead, credit unions are deploying multiple, ongoing initiatives. No credit union claims to have it all figured out, but the range of approaches indicates the industry is doing what it can to keep up with changing demands.
Employment Growth At Credit Unions
Credit union employment has expanded 29% in the past decade. More than 305,000 full-time equivalent employees (FTEs) served credit union members at year-end 2018. Those employees provided the foundation for some remarkable success: Credit union loan originations have more than doubled in the past 10 years; loan and share balances have increased 83% and 78%, respectively; and the number of checking accounts have jumped 65% to 68 million.
In addition to the number of employees rising, the diversity of roles they fill has expanded as well. Positions in risk management, compliance, and analytics have emerged in the past decade. The convergence and integration of new delivery channels have underscored the need for a seamless member experience. Credit unions have named chief innovation officers to keep up with changing consumer needs and have formed agile development teams to enable faster time-to-market for new products and services.
The business of banking is more complex today, forcing credit unions to address a series of questions. Should we promote from within? Do our existing employees have the skills we need? How much do we want to invest in training? If we bring in an external hire, how well will they fit with our culture? Is our onboarding process effective? Can we support remote employees?
The answers to these questions can vary by the role or even the location of the credit union.
Finding the right skill set and fit is difficult enough, but credit unions face another challenge in differentiating their “employer brand.”
In many markets, credit unions are standing out by raising their minimum hourly wage for starting positions or paying signing bonuses. Creative incentive programs also are playing a role. Community First Credit Union of Florida ($1.6B, Jacksonville, FL) designed an incentive program that rewards employees with experiences like dinners, bowling, laser tag, baseball games, and trips to Disney World rather than cash.
Benefits beyond pay are important, too. Strong health care and retirement options are proving to be a real asset with prospective hires, as are student loan repayment programs. Jeanne D’Arc ($1.4B, Lowell, MA) and Credit Union 1 ($1.1B, Anchorage, AK), to name just two, are going beyond traditional benefit programs to also offer onsite daycare.
Culture and work environment are other key differentiators for credit unions. A number of credit unions rightly tout the recognition they’ve received through “Best Places to Work” programs. And more often, credit unions are providing volunteer hours for staff to get involved in the community and raise the credit union’s visibility. Everyone benefits from this. Still others are leveraging social media — including Facebook, LinkedIn, and Glassdoor — and encouraging employees to engage with and post reviews to help the credit union build its employer brand. Even reviews that aren’t positive give the organization the opportunity to address gaps.
For credit unions that find their local market lacks the talent they need or the cost of hiring is beyond their budget, remote staff for member-facing call centers to back- office development and finance are emerging as hiring alternatives. By connecting regularly via video as well as periodically in person, a credit union can integrate remote employees into just about any team and culture.
Retaining And Developing Talent
Although attracting the right talent is essential, an even bigger focus in the industry is on retaining and developing existing staff.
That starts with new employee onboarding. Credit unions have typically scheduled the majority of onboarding activities during the first few weeks of employment; however, some are now spreading that out over the first year. Quarterly trainings about corporate culture enable new hires to focus first on integrating into their new role without losing important lessons about the organization’s overall goals.
Sponsored education and tuition reimbursement programs also are becoming more widespread. A number of credit unions reimburse employees for professional development classes. Some put limits on reimbursement amounts, but one credit union based in Washington, DC, pays 100% of tuition for employees that are pursuing either a bachelor’s or master’s degree. Some credit unions even allow staff to pursue coursework that does not tie directly to their professional work, reflecting a philosophy that the organization is willing to invest in the individual, not just the institution. Employees give their all during work hours, and credit unions are reciprocating by investing in employees during off hours.
Wellness programs emphasizing that employee health is important to the health of the organization plays a part in retention, too. Employee committees lead these initiatives at some shops; at others, third parties assist. Organized activities and point systems with rewards often serve to incent employee participation. Of course, fiscal wellness is a part of overall health, and a number of credit unions provide financial planning resources, too. When staff members can navigate financial challenges and forge their own paths forward, it benefits employee and employer alike.
But one of the most significant factors in retaining and developing talent is coaching. Employees at every level of the organization benefit from coaching. The credit union benefits, too. Effective coaching requires a different skill set from what managers use for daily tasks, and leaders should benchmark the time they dedicate toward developing their staff. It is not unusual for credit unions to expect their executives to spend one-third to one-half of their time developing others. Some credit unions also have implemented mentoring programs. Most of these programs are led by seasoned employees, but in some cases, executives partner with leaders from outside the organization.
Regardless of whether a credit union incorporates all or some of these elements into its staffing strategy, employee development plans of any kind — sponsored by the credit union or assembled by employees themselves — emphasizes the value the institution places in continued learning.
A Priority For 2019
Talent management is a key component in the plans of many credit unions in the months ahead — and with good reason. Success in this area is an advantage in today’s market.
As credit unions evolve, so does the challenge of maintaining a strong team. The skills required to succeed are expanding at a time when the competition for talent has never been stronger. For credit unions to continue their momentum in 2019 and beyond, they must focus not only on the needs of members, but also on the needs of those serving members.
Wait, There’s More!
This is just one section of the discussion that appears in Credit Union Strategy & Performance. Read the whole discussion today.