The Recession Lessons learned by Pacific Crest FCU: Credit expense control cannot be an end unto itself.

After years of working towards greater utilization of the resources at hand, finding efficiencies, and cost control measures to improve the bottom line, a shift was needed in our mental process. We finally reached a point where holding the line on new hires and technology investment did not make sense because service to our members was being affected negatively. Yes, we still want to make the best and most efficient use of resources as stewards of our members' money; yet, we know that investment in our employees and technology are critical to ensure the future of our credit union. That is not to say that we don't have thrift embedded in our core; we do, but we realize we have to 'spend some to gain some.'

We must have a plan. We must be ready to ditch the plan. To quote Eisenhower: 'In preparing for battle I have always found that plans are useless, but planning is indispensable.' And, 'Going into battle without a plan is foolhardy. But as soon as the shooting starts, the plan is useless.' Strategic Business Plans are necessary, and they have a life. When the unexpected happens, sometimes the plan evolves and is transformed, sometimes it dies and a new plan rises from the ashes to take its place.

Stay focused on the core. We found that we had to maintain a sustained focus over a longer period of time on what we perceive as our core strengths, or what we would aspire to be our core strengths, in order to make an even greater impact or an inroad in the eyes of our members.

Be nimble. Be flexible. Keep an open mind. Especially in decisions that involve an individual member, or a staff member. We found that stress levels are elevated when times are difficult, so be ready to act quickly with innovative ways to resolve issues.

Silver linings. Let's face it, if we are passionate about credit unions, we are passionate about helping people. The recession offered a chance to really help our members and satisfy our higher impulses through financial counseling and loan modifications, which at times included principal reductions. And we did this with a speedy turnaround time and the minimum amount of paperwork to keep the regulators satisfied.

Outside of our feeling of being part of a higher purpose, the second silver lining was to gain our members loyalty. Members who had always paid the credit union on time were affected by job lay-offs and reduced hours. The credit union offered assistance, in a manner which allowed our members to save face and be treated with respect. The result: grateful and loyal credit union members.

Our payback: word-of-mouth referrals to their friends and family. And philosophically, it was a reminder that bad things happen to good people.

Our mission is to help our members prosper. We chose to accept our mission, even in the face of a debilitating recession.

Kathie Philp
Janet Buckalew
VP Member Advocacy & Business Development.
Pacific Crest FCU
Klamath Falls, Ore.

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