Industry veterans are retiring at an increasing rate, and credit unions are proactively preparing with in-depth succession planning, talent management strategies, and leadership development programs.
Montana Federal Credit Union ($336.5M, Great Falls, MT) welcomed a new chief financial officer, Pat Woodall, in August 2021 and a new president and CEO, John Hageman, in 2023. Here, the duo shares their internal and external perspectives on the credit union’s recent executive transitions.
How did the credit union prepare for the latest CEO transition?
John Hageman: The way I prepared is probably a little different from how the organization prepared. Specifically, I focused on building different skillsets and went through a leadership training program to help me shorten the learning curve. I previously served as the chief financial officer, but I was also afforded the opportunity to move into the executive vice president role prior to the transition. This allowed me to work closely with our retiring CEO, Steve King, and bounce ideas off him while he was still here. I was fortunate to be able to do that.
In terms of the credit union in general, succession planning is a work in progress. At our size, it can be difficult to stretch the org chart vertically, so we tend to be more horizontal. We’re trying to cultivate leadership in all positions — from supervisors to our leadership team — by providing more training.
Montana CU’s new CFO comes from outside the industry. What are the benefits and drawbacks of taking an external versus internal approach?
Pat Woodall: Most of my experience was in healthcare and other industries, and I was able to come into the organization with a different viewpoint. As an outsider, it can be more challenging to jump in at such a high level and be productive immediately. However, John did a great job training and mentoring me for the first six months I was onboard. He lives and breathes this, and it made me decide this is somewhere I should be.
JH: You want to cultivate your staff and put them in positions to succeed. There are tons of pros for internal hires. They know the culture and the experience of working at the credit union, and they understand how they fit into their new role. However, external recruitment brings in a fresh perspective and allows you to tap into skillsets not currently present in the credit union. It all comes down to time and place and what’s best for the credit union when it comes to internal versus external hires.
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John, please talk more about your transition to CEO.
JH: Our board did not look externally, but there was a definite process, and I wasn’t officially promised the role in the beginning. So, I focused on trying to learn as much as I could from Steve and put myself in a position where the board would have confidence in making that decision. I think the most important thing is maintaining open communication. I let people know that becoming CEO was something I’d be interested in at some point in my career and asked for development opportunities to help prepare and prove myself.
How are both of your new roles going so far?
JH: The first four months have gone by fast. As prepared as we were, it’s still different. However, I feel fortunate that I already know our culture and don’t have to work through that adjustment period on top of all the decisions that have to be made in an interesting economic environment along with the various projects, conversions, and potential field of membership expansions we have going on.
CU QUICK FACTS
MONTANA CU
DATA AS OF 03.31.22
HQ: Great Falls, MT
MEMBERS: 24,331
BRANCHES: 3
EMPLOYEES: 72
NET WORTH RATIO:9.8%
ROA: 0.71%
PW: It’s going well. Shadowing John in the beginning was helpful. This is the job he had, and he did it well, so I have a playbook there and a coach. I’ve been at other organizations where that’s not the case. I’m still learning and asking questions. Every day is a new challenge, but I can’t imagine having any more support than I’ve had here since my very first day.
What advice do you have for others?
JH: Don’t discount the effect change has on an organization and on teams and staff members. I don’t always know the complete answer, but I try to be mindful of what change means to everyone as a team and individually. Everything takes time, but if you focus on why we’re here — to serve the members and one another — then things will fall into place.
Also, there’s a lot of opportunity, which isn’t always recognized. Executive positions need to be filled in the industry, and it’s exciting to think about the scale of opportunity that is out there for people who have been working toward those goals.
This interview has been edited and condensed.