ROCHESTER, Minn.-First Alliance CU here seems to have found a way to balance work and home life for its employees, and it says the ROI is clear to see.

"What we've come to find," said Kelly McDonough, CEO of the $127-million credit union, "is that if you give people a situation where they're not conflicted about taking care of their health or their mother or their kindergarten child and getting their job done, they are more committed to you as an organization, they are more productive when they're here, they're less likely to turn over in that position, they give you 110%, and they're happier, less stressed, get sick less often and you have all together a more productive and more cohesive staff."

McDonough was named CEO at First Alliance a decade ago, and since that time the 11,745-member credit union has since won multiple HR awards, including the Alfred P. Sloan Award for Excellence in Workplace Effectiveness and Flexibility, which it has received four times.

For many of the same reasons First Alliance was recognized, McDonough was also named Extraordinary Rochester Business Woman of the Year for 2012 by Rochester Women magazine.

Full-time First Alliance staff are allowed (with approval) flextime and condensed work weeks, and employees' children are also welcome at the credit union, whether that means nursing mothers bringing infants to the office, parents leaving to pick up sick kids or make it to a doctors' appointment, or keeping kids occupied in the conference room after school while mom or dad works. New fathers are also encouraged to take paternity leave.

"Places talk about being a family, but we really do have a family feel here," said McDonough. The key, she said, is helping employees do what they need to do to take care of their personal lives.

The CEO noted that First Alliance is the third credit union she's worked for, and it has far less turnover than others where she has served and suggests the more flexible approach is the reason. Non-teller turnover at First Alliance averages about 8.5 years, she said. Full-time teller positions are the only jobs where the credit union has not been able to implement those flexible work hours, although it has worked with part-time tellers.


Meeting Needs Of Employees, Business

"We have to meet employee needs, but we still have to meet the business needs," said McDonough, noting First Alliance won't hire an extra employee just to make flex-time situations work.

Even with the flex time and condensed work weeks, First Alliance has a ratio of 281.78 members for each full-time employee, McDonough reported.

She also noted that there are no cost control issues at play; as long as the employee can get his or her job done without overtime, the credit union is willing to be fairly flexible about whether that time is completed in four 10-hour days, five eight-hour days or six 6.5-hour days.

But all arrangements are done on a case-by-case basis, and sometimes the credit union has had to revoke flex-time when it no longer works for specific departments or situations.

McDonough recalled that after a change to the credit union's accounting system, it no longer worked to have flexible scheduling in the accounting department, and employees had to return to a standard Monday-through-Friday 40-hour work week.

"The understanding was that this had to work for both the employees and the credit union at the time it was undertaken, and the time came when it no longer worked for the credit union, and people understood that and went back to it without any bitterness," she related.


Flex Time Fears Unfounded

McDonough said that initial fears about decreased productivity and increased expenses proved unfounded. But she noted that for a system like hers to work, the board of directors and staff all have to be on board, as it often means a significant change to the organization's culture.

"This was a gradual revolution," McDonough explained. "You can't just go from a culture where all these rules were in place about fixed hours and work weeks to just opening the doors and letting people do whatever they want."

While it may be somewhat easier to implement some of these changes if it's part of a changing of the guard at the credit union, new leadership still needs to understand and respect the existing culture before making any radical changes.

"Coming in as a new CEO, you've got to know the culture of the organization you're in before you can change the culture of the organization and let it evolve to one that more closely resembles what you want," McDonough suggested.

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