Operational efficiency is a critical competency for credit unions in this downturn. In A Road Map for Credit Union Back-Office Collaboration, Michael Taylor of Schellingpoint interviewed 150 senior credit union system executives to identify key areas to decrease operational expenses through collaboration agreements. The report maps hazards, a range of suitable routes, and advises credit unions on how to collaborate strategically.
The road map includes the following steps:- Make the business case: Even though a burning platform does not currently exist for large-scale credit union collaboration, certain areas such as compliance, card services, and bulk purchases were identified as prime candidates for collaboration because of the clear business case.
- Design the collaboration: The report describes the various collaborative business model considerations, including choosing the right organizational structure and models to scale a collaborative venture, dealing with loss of control concerns, and selecting suitable partners.
- Conduct the collaboration: The most common issues to arise from the credit union interviews conducted include partner competency concerns, development of the right metrics and measures of success, fostering and maintaining partner relationships, and specific technology barriers/enablers
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Your researcher missed some of the best collaborative efforts within the industry! The greatest successes emerge from credit unions collaborating on strategy development…and then determining that they have common interests…and compatible business environments. The greatest cost savings won’t necessarily come from merging back-office operations. There are tremendous opportunities short of combining back-office operations.
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Thanks for your comments Rae. The scope of the research was only on back office collaboration based on input from a panel of credit union CEOs. We have some other ideas notably from CU Tomorrow and i3 which directly address other collaborative opportunities for CU’s. Keep in touch.
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Hi, I just wondered are there any current figures on the number of CUSOs in the US. Regards,
Noreen.
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