The Prospects of Change

This is graduation season. Over the past two weekends, I’m proud to have had the opportunity to celebrate college graduations for my youngest two daughters.  It has certainly been hectic, as these graduations were at two different schools — in two different states, but it is truly a blessing to know that I have completed my work, as all five of my kids have now graduated college and are pursuing the next chapters of their lives.  As exciting as this time may be for me, I can only imagine the excitement that my two daughters have as they look into their future.  However, it also causes me to reflect on a couple of things…

The first thought I’d like to share is on the subject of prospects.  Specifically, the prospects that change offer us.  For my two daughters, there are many unanswered questions.  Where will they find work?  How much will their employer pay them?  Will they succeed?  The answers to these depend on the amount of effort and planning they contribute.  Credit unions face similar unanswered questions.  Will we grow?  Will we be profitable?  Will our strategies succeed?  The dependencies are the same, effort and planning.  Yet, as I interact with credit unions across the country, I find that there are varying levels of willingness to apply these two primary factors.  One thing is certain, the credit unions that are succeeding, no matter their size, are those who do invest in these two contributors of success.

Nearing the end of this summer, two things will likely happen; my daughters will have found gainful employment and your credit union will have entered a time of planning.  It is my hope that this year, your credit union will go beyond setting goals related to incremental member, deposit and loan growth.  More importantly, you should be discussing how your credit union is going to use business intelligence to improve decision making and asset and liability management.  You may not have the internal resources to accomplish this goal and may want to seek outside assistance, which CU Direct’s Advisory Services provides.  Or, you may want to handle it all in-house, for which you will require the right portfolio management and analytics technology, such as Lending Insights.  Either way, you will need a plan.  For that reason, you should start researching your options today.

The second thought that comes to mind is to question what we know about this new generation, Generation Z.  This year represents the first year that those born between 1994 and 1995 will graduate from college. Generation Y, or the millennials, have been well studied. However, Gen Z, often mistakenly grouped with millennials, has some interesting characteristics:  as a group, they collectively are expected to have a higher debt load coming out of college than any generation before them.  Research also indicates that females tend to have higher debt than males.  And, economic growth has been somewhat stagnant over the past several years.  So, will this be the first generation to graduate from college and not be better off financially than their parent’s generation? What will be the opportunities and challenges for credit unions to serve this segment of our population, as they begin working and establishing homes? These questions should also be a big part of your planning for the future.

This is the business of Business Intelligence, asking and answering questions.  It is the beginning, not the end; like graduating from college, if you will.  The real question is what you will do with the intelligence you gain.