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“Mergers.” They can sound cold, and there’s a tendency to treat credit union mergers or mergers between community banks like business deals without any deeper meaning to them.
But what if I told you it didn’t have to be this way? It might sound crazy, but mergers should put the deeper meaning first. Meaningful mergers will become partnerships between two aligned credit unions, which means members of both credit unions receive better service.
Here are four ways to make good partnerships happen.
Let’s start with strategy. This is your all-important “why” behind the merger, and it needs to benefit both credit unions. A common purpose gives both credit unions strong motivations to complete the merger process.
For example, imagine two hypothetical credit unions on opposite sides of a river. One has a larger scope and wants branches on the other side of the river. The other is smaller and would like a larger scope as well.
In this case, joining forces creates a partnership which gives each credit union the larger scope it wants.
Credit union mergers, and mergers between community banks, are like relationships - you’ll want a good match to achieve success in both.
Ask yourself: Do both credit unions have similar definitions of success? Do they both have similar members? Do they both believe the same things?
If one credit union serves teachers and the other serves military members, it may be more difficult to merge. On the other hand, two credit unions helping people in similar communities already have a common brand.
One merger communications project our team here at On The Mark Strategies worked on was between Quantum Credit Union and Equishare Credit Union. They both served people in Wichita, Kansas, and their CEOs had a personal friendship. These factors made for great brand alignment.
A healthy culture is the bedrock of keeping merged employees onboard.
An MIT study showed start-up employees merged into larger companies left quickly because they felt the culture was too different. Over one year, only 66% of merged employees remained compared to 88% of normal new hires.
A merger might feel like a transaction to merging employees, which can cause anxiety. If you confirm their assumptions about being “outsiders,” they’ll run for the door like the employees in the MIT study.
Help merged employees know they’re family. There’s no longer an “us” and “them.” There’s only “us.” And make this an authentic effort you live out every day.
When it comes to mergers, you definitely want to overcommunicate. Transparency (and a lot of it) will help employees and members adjust to change before it even happens.
Talk to your employees first. How will their lives change? You’ll need to clearly answer this question for them. Once you do, see who might cause friction and smooth things over in advance.
Then, talk with both credit unions’ members. Here, there’s really no such thing as too much communication. Use physical postcards, videos and social media to remind members of the merge every month. Make all information easy to find and create an FAQ. Quantum Credit Union did this when they created a webpage dedicated to merger information so members could get questions answered.
These steps should give a bigger meaning to every part of your merger process. Always remember, a merger is way more than a business deal.
Are you worried your merger is missing a deeper meaning? On The Mark Strategies can help with merger strategy and communication so everything goes smoothly. Contact us today!