GLASGOW, Scotland–How can senior leadership at credit unions attract and empower the next generation of CU leaders—people who “have not yet hired to do roles you have not yet created?”
Two young leaders—including one who nearly left credit unions as the result of poor leadership—have some ideas and recommendations, including a checklist of questions to ask.
The question of future leadership is critical, according to Amanda Wantke, talent attraction manager, and David Kropp, agile coach, with Langley, B.C.-based First West Credit Union, because the battle for new talent is intense and in many cases credit unions are “losing.”
Wantke and Kropp shared their insights with an international audience in attendance at WOCCU’s World Credit Union Conference. They concluded by posing questions they said every senior leader at a credit union should be asking him or herself.
“Your organization is in trouble. Big trouble,” said Wantke. “It’s not due to the effects of the pandemic. It’s because there is a battle taking place that you are all well aware of, maybe unprepared for and are maybe losing. That is the battle to recruit and retain talent.”
Kropp urged credit unions to imagine their offices prior to COVID and post-COVID and the people who were in them. “I’m willing to bet you’ve seen significant change over the past few years,” he said.
Kropp noted research shows 22% of professional service employees will retire in the next two to five years, and yet despite that looming talent vacuum, one-in-three Millennials in most organizations is “actively disengaged.”
“This means they are seeking opportunities outside of your credit union. The average tenure of an employee under 40 is less than three years,” he said. “That means you are at risk of losing 55% of your workforce in the next five years. If you combine with that the pace of change in our organizations, that tells an even (more compelling) story. The success of your organization is actually out of your hands. That five-year strategic plan you worked so hard to create is out of your hands. The success of your organization depends on employees you have not yet hired to do roles you have not yet created.”
Where to Find the Answer
According to Wantke, the answer to that conundrum lies within, and the time to act is now. She cited data showing on average it costs six-to-nine months of an employee’s salary to recruit and train that person. Meanwhile, the average time it takes to fill a position is 42 days, and all those days represent lost productivity.
What does all that add up to?
“If you are not empowering the next generation you are putting your organization at risk,” said Wantke.
Where Not to Find an Answer
While the answer to the talent challenge may lie within a credit union, Kropp said there is a problem.
“The research shows that many organizations are out of touch with what the next generation is looking for,” said Kropp. “Programs designed to attract the next generation don’t appeal to them. These programs focus on climbing the corporate ladder and job security. That’s not what young workers are looking for.”
And what are those workers looking for?
“It’s not about the money,” said Wantke. “Throwing money at the problem is not a solution and it’s not sustainable. Don’t get me wrong, pay and benefits are important to young people. But you’re not going to be able to retain them for very long if the other (aspects of the job) don’t add up. The next generation of leaders is looking for three things: connection, opportunity and meaningful work. Connection creates opportunity, and opportunity creates meaningful work.”
The Connection
Kropp noted everyone wants to feel connection, in fact humans “crave” it.
“We want to be part of something and we want to be understood,” said Kropp. “Empowering your next generation of leaders starts with values alignment.”
When values aren’t lived out, 46% of U.S. and U.K. workers said they will consider leaving, while 56% said they would not even consider a job at a company if they do not agree with its values.
Both Wantke and Kropp on several occasions praised the support both the Canadian credit union system and their own employer, First West CU, have provided to young leaders.
An especially critical key to making that support work, they said. Has been empowerment. Young leaders, they said, are often given the authority to innovate and make decisions, with specific development goals identified throughout the process.
Kropp said the nature of connection and the opportunities to create it changed during the pandemic, and remain changed, and the fallout has been especially pronounced for the youngest generation of workers.
“They are less likely to participate in large strategic planning sessions. They felt the impact of working from home,” he said. “So, at First West our young leaders took it upon themselves to solve that problem.”
Those employees did so by creating a program that uses Microsoft Teams to randomly connect people within the credit union across all departments. With some, 1,300 employees, it has meant new experiences and viewpoints for many.
“I’ve had chances to connect with and explore the organization in ways I wouldn’t have been able to do in my day-to-day work,” Kropp explained. “It’s given me more perspectives. And I’ve forged genuine human connections. This program has been successful because young workers were empowered with the gift of time. Our existing leaders gave them the freedom to simply connect. There were none of those boring HR forms. Our leaders are also very smart because they know creating connections also leads to opportunity.”
Connection at Personal Level
Wantke noted that several years ago she “took a leap” to lead change management for an organizational project knowing she was going to need some guidance outside of formalized mentorships and the people she typically worked with.
Seeing a connection, she emailed the (C) $15-billion First West’s CEO and asked her to be a mentor, even though she was unsure if the CEO even knew who she was. The CEO accepted.
“I showed up at meetings with agendas and quickly learned that wasn’t needed,” Wantke recalled. “The relationship was about pure connection.”
Wantke went on to be part of the creation of the First West Young Leaders Committee, and later moved over to the credit union’s operational risks team.
A Two-Part Disservice
“Young leaders, you are doing yourself a disservice if you are not reaching out to your senior leaders and requesting that time,” said Kropp. “And you senior leaders are doing your organization a disservice if you are not answering that call. I believe it’s about mentoring done right. It’s less about moving from role A to role B. It’s about creating that connection and recognizing someone is ready for that next opportunity. Our CEO is smart. She realizes that by mentoring Amanda she is future-readying our organization. Those investments really pay dividends for our organizations; it increases loyalty significantly.”
Kropp added that his current position, Agile Coach, didn’t even exist two years ago and that it was created with “no roadmap.” Now he is leading transformation efforts at First West and changing how the credit union delivers and assesses the work being done. But it’s a role he said has only been made possible due to senior management providing support and empowerment, including when he has made mistakes.
Wouldn’t Be Here, Except…
Wantke shared a story that illustrated the difference one leader can make with a younger worker. She noted she started as a teller 13 years ago before moving to the backoffice, unsure what her career might be at the credit union or whether she wanted to work in credit unions at all.
She said she “asked and asked and asked” for training and to try new roles, but unfortunately had a boss at the time whose only response was she needed more experience.
“It made me feel defeated and that I was stuck,” Wantke said. “And it made me look outside First West.”
And then she was moved to a new department with a new boss and “she was what I needed. She saw my eagerness. She gave me opportunities to learn and to fail, which I did a lot, and to learn from those failures. Fast-forward 10 years and I’ve had more roles than you can count. And all it took was one leader who listened to me and who empowered me.”
As Kropp summed up, “Young leaders will tell you with their actions what they think of your organization by walking out the door for opportunities elsewhere.”
The ROI
According to Wantke, the support for young workers at First West can be seen in the credit union’s own data. The internal movement rate is about 40%, meaning two-out-of-five employees took on a new opportunity in the last year.
She said the credit union has moved from a linear career path model in which everyone is looking to move up, to more of a skills path model.
The Meaning of It All
What percentage of employees find meaning in their work? According to Kropp, 50% of employees say their work is meaningful.
“That means every second team member in your credit union is not connecting what they do day to day with your vision and mission,” he said. “Disconnection is a really, really short walk to disengagement, and we all know where disengagement leads.”
As an example of a project that has brought meaning to the careers of many at First West, Wantke cited an initiative led by the young employees group that sought to identify, quantify and identify an external ESG rating for the credit union. She said those working on the project had a “passion for sustainability.”
“We did the research. We made the recommendation to the executive team and then we negotiated the contacts,” Wantke explained. “None of us had project experience nor had we ever led a project at this scale. We didn’t get it right right away. We missed stakeholders, We got information wrong. But we ended up with a very accurate and successful rating for our organization. That level of empowerment meant we got to lead a project that has been operationalized and is now driving our future strategy. I am pretty proud to have been involved.”
Kropp said that project revealed the credit union’s ESG rating is quite high, which helps to recruit and retain people with similar values.
“A leader’s success is measured by their team’s success,” said Kropp. “We’re lucky that our leaders highly value the next generation of leaders. Leaders need to be motivated and attuned to the ambition of young leaders.”
Questions for Current Leaders
According to Wantke, current leadership at credit unions needs to show the next generation that they matter.
“All the decisions you are making today are impacting the next generation,” she said. “And I’m willing to bet you are making these decisions with little input from them.”
To that end, she recommended senior leaders at CUs ask themselves these questions:
- How are you going to hold yourself accountable?
- How will you ask what matters to them?
- How will you invest in them, not with money but with time?
- What opportunities, new challenges and roles are you going to provide for them?
- How will you give them the meaningful work that will have an impact on your organization?
- What will you do for next generation of leaders to pursue connection, opportunity and meaningful work?