Credit unions and community banks are closing on an almost daily basis. Through a merger, acquisition or sale we lose approximately one non-mega financial institution per day. Whether for economic, competitive, regulation or some other factor the numbers are lowering.
When conducting strategic planning sessions for our clients one of the pre-session questions we typically ask participants is “The financial industry is consolidating. What are you going to do to ensure you are one of the survivors?”
But let’s be clear: survival is not a strategy.
The best way to survive is to grow organically. While you can certainly succeed through acquiring other financial institutions, that type of acquisition strategy takes strong partnerships. The cliché is true: it takes two to tango. I asked multiple girls to my senior homecoming dance and it wasn’t until the third try that I actually got a yes. You can want to merge all you want, but actually doing so is somewhat out of your hands.
So when developing a successful strategy for the next three to five (or even 10) years look for strategic initiatives that move your credit union or bank forward with solid actions. In other words, be proactive and not reactive.
Examples of strategic initiatives that emphasize organic growth include:
- Build a lasting brand
- Increase product penetration with existing members/customers
- Develop better technology platforms
- Transform from traditional “brick” branching to the online platforms
- Penetrate a particular geographic community
- Create products and services to reach the younger generations
As a credit union or community bank, you don’t just want to survive. You want to thrive.