KENT, Wash.--Driven by the need for scale to gain critical mass and stay on top of disruptive technologies, mergers will play dominant roles shaping the landscape of credit unions five years from now, particularly among very large credit unions, according to Glenn Christensen of CEO Advisory Services.
Christensen offered his insights as part of CUToday.info's "Credit Unions 2020" series.
Christensen’s firm assists credit unions in finding merger partners. But he points out that mergers, even among “mega-credit unions,” will play a central role in credit union growth – especially as large and strong credit unions become even more dominant forces in the communities that they serve.
“Credit unions should develop a strong strategy and proactive approaches to mergers rather than relying on an occasional bid for a troubled credit union merger,” Christensen said. “Credit union leadership should have open discussions about how mergers can be beneficial to the membership. Whether the credit union is looking to acquire or be acquired they should have a strategic merger plan in place.”
On the horizon for service delivery, Christensen sees abandonment of such long-time credit unions staples as monthly statement newsletters -- and adoption of web and mobile approaches to regularly communicating with members. “Credit unions that have not invested in advanced online marketing place a ceiling on their growth and lose the opportunity to acquire new pools of members,” he said.
Part and parcel with that, he added, is and will be use of Big Data and analytics. “Data analysis will become ingrained in the culture of high performance credit unions,” he noted. “Statistically driven marketing will fuel growth. The transformation to digital and mobile banking, data analysis, and enhanced member experiences will require large investments in infrastructure and talented employees.”
A key tactic for bringing these approaches to bear: Collaboration among credit unions. “With the innovations in technology, big data and user experience, credit unions will benefit from banding together in CUSOs in order to provide a competitive value proposition,” Christensen said.
--Pat Keefe