Who owns innovation at your credit union?
While many credit unions still can’t answer that question, a growing number are adding a new officer to the C suite: the chief innovation officer (abbreviated CINO to differentiate it from chief information officer’s CIO). The goal: making sure cross-departmental innovation strategies are being better defined and executed.
“I took the position in late 2016. It was a new position,” said Dover Federal Credit Union’s CINO Travis Frey. “The position was created and I was promoted from chief information officer to chief innovation officer, which had the marketing and facilities area report up through to me.”
To be able to effectively innovate, Frey said the CINO cannot take a back seat or be “hidden,” rather the role requires being involved and understanding the bigger picture. The $456 million, Dover, DE-based credit union supports 135 employees, seven of which are assigned to the technology department.
“You have to look at your capacity, your capability and maximize your team’s efforts,” said Frey. “Within my role as CINO, I am able to unite marketing and IT, so that the critical areas which impact a member’s experience work succinctly together, from the start of development to the finished product.”
In January 2016, Lindsey DeBartelo was named director of innovation at Blackhawk Community Credit Union. The $500 million Janesville, Wis.-based CU has 150 staff, including eight technology employees.
“The motivation for creating the new position arose from our strategic initiative: to provide the technology that allows members to choose how they want to do business with us and in whatever channel they prefer,” said DeBartelo. “To accomplish this, our credit union needed to capitalize on current technology infrastructure as well as continue to implement innovative new products and services.”
Executing collective goals
The job of CINO is to drive change while adhering to budgets and eliminating barriers, noted Frey. These barriers include technology and existing culture. As such, the driver of change has to be well-versed in not only IT back-office operations, but understand the culture and ethos of the credit union.
“Of the two areas above, the systems are easier for someone with an IT background. The second area, the people, is the real challenge,” said Frey. “You have to take a closer look at something many IT people almost take for granted – the culture of your credit union.”
In an effort to streamline operations, DeBartelo said on an annual basis, each strategic unit in the credit union provides a list of department initiatives and reviews them with the senior leadership team. This approach, she said, allows leadership to “adjust and gain interdepartmental support” for the start of projects.
“We decide on priorities as a team and budget and plan accordingly. On a weekly basis the senior leadership team reviews the status of goals/projects currently in progress,” she said. “They also review upcoming initiatives to ensure priorities have not changed.”
In Frey’s experience, organizational-wide campaigns—such as creating an “Apple Store feel” by eliminating traditional teller lines—requires many moving pieces from multiple departments.
“An IT solution would be to bring out some fancy ATMs, deploy them, maybe some teller cash recyclers and that’s about as far as the IT area would go,” said Frey. “The IT area is not thinking about the member experience, but making sure the system side is in good shape.”
As CINO, Frey has to ask questions: Who is leading the change for the tellers? How is training handling the additional duties? What limits must remain to create segregation of duties? How will facilities coordinate the retrofitting while not disrupting day-to-day activities?
“The absolute most critical key to making a project like this a success is not the ATM, not the ECR not the POD design. It is training. It is recognizing barriers and finding innovative ways to overcome them,” said Frey. “It is brainstorming. It is sloppy. It is not precise. It is not exact. That can become a challenge for a lot of IT-focused people who need precision, exactness and clarity.”
Does your CU need a CINO?
While every credit union requires innovative thinking, creating a specific role, such a director of innovation, might not be in the cards due to a number of variables, including budgeting. To this end, DeBartelo said C-level executives should be more concerned with accomplishing innovative initiatives and less about titles.
“Every credit union is unique and can be innovative. The senior management team can fill that role by encouraging new thoughts in all areas, developing a technology strategy, setting and adjusting priorities and developing cross-functional teams that are capable of implementing,” said DeBartelo. “Innovation cannot be accomplished by just one person, like any cultural change, it requires the entire team.”
Innovation is simply creating a new way to solve problems, said Frey. In many credit unions, he added that the IT department gets “stretched fairly thin” with security, regulations, data processing requirements, system maintenance (patching), help desk tickets, resetting passwords, back-ups, BCP/DR, supporting end users, among other tasks.
“Relying on the IT department to truly drive future change will become more and more challenging as more and more burdens gets placed on the day-to-day operations and regulatory requirements,” said Frey. “Innovation for me, takes the system and technology pieces, merges it with the people pieces and creates strategic and dynamic change.”