When Tom Ryan became CEO of Langley Federal Credit Union ($1.9B, Newport News, VA) in the summer of 2012, he succeeded a CEO who had been with the credit union 58 years. Ryan previously served as executive vice president and chief operating officer for Digital Federal Credit Union ($5.6B, Marlborough, MA) for more than 26 years, and the new position offered him the chance to embrace big change on several fronts. In this QA, he discusses how Langley transitioned to a new era of growth and what other credit union leaders who are facing a culture change can learn from its journey.
How would describe Langley Federal Credit Union’s culture when you took over?
Tom Ryan: Culture is like an organization’s personality, and Langley’s was long established, having been formed over decades and reflective of the style of the previous leader. The credit union had a successful track record, so it was doing a lot right. It was one of the top 100 credit unions with a strong capital position and positive brand awareness within its community.
However, the traditional top-down approach used in the past wasn’t going to be conducive to the type of organization we wanted to be in the future. The organization was ripe for change, and this included everything from product design and pricing to organizational communication and alignment of organization goals to management and staff’s actions. The credit union needed to transition from a place known for savers to an institution that borrowers and savers alike could rely on.
Tom Ryan, CEO, Langley Federal Credit Union
With so much to update, where did you start?
TR: I was fortunate that Langley had a strong core group of managers and senior executives in place. They had good ideas and there was a pent-up demand to put those ideas into action. They also knew the organization inside and out as well as the employees and processes, so I wanted them to drive the decisions.
We began to hold weekly senior team meetings and broke down the silos to create a more collaborative environment. Through these meetings, we were able to discuss and define what success at Langley would look like and set priorities. This process was the beginning of our strategic plan and included our new, three-pronged strategic focus on: members (building a strong brand and value proposition), growth (aggressively growing members, loans, and core deposits), and culture (building an environment based on empowerment, trust, and professional development).
Tell me more about the cultural aspect. How did you communicate that with the staff?
TR: We had more than450 employees and 19 branch locations at the time, so it took several weeks for me to personally visit each area and shake hands with individual staff members. But I began right away using email to get my message out.
After we finalized our strategic plan, which was about three months after I joined, I held a series of town hall meetings. We were able to reach 100% of our staff members through 10 sessions. This was grueling, as it was a series of one-man shows, but was vital to ensure that every staff member had a clear understanding of where we were going.
You can’t mimic what you had at your last credit union in a new organization no matter how successful it might have been. It’s not something you can force.
During those sessions, I discussed who Langley was past, present, and future. We introduced everyone to the new culture firsthand by breaking them into sub-groups to brainstorm how Langley could best achieve its goals. We wanted them to know their voice mattered and they were going to play an important role moving forward.
Since then, I have continued to use the intranet and email, and we hold regular all-staff meetings. Lastly, we rolled out a new company-wide incentive plan in 2013 that is centered on member participation and ensures every staff member has the same goals.
Where there any challenges in introducing the new culture?
CU QUICK FACTS
Langley federal credit union
data as of 6.30.14
- HQ: Newport News, VA
- ASSETS: $1.9B
- MEMBERS: 197,072
- EMPLOYEES: 434
- 12-MO SHARE GROWTH (ANNUALIZED): 1.4%
- 12-MO LOAN GROWTH (ANNUALIZED): 35.07%
TR: There are always challenges along the way. Although many were excited about the new direction, some employees preferred the old culture. In any transition, you’ll have early adopters, those who become engaged as they learn more, and some who are just uncomfortable with the change. You have to embrace that and understand everyone might not share your excitement.
We worked closely with people to show them where they fit in the new organization, but overall it is a faster-paced environment today. There is a sense of urgency in what we do here. Early on we were almost apologetic for how busy it was becoming, but now we are clear that this is the new Langley.
It will always be a busy place to work that is part of our culture and we want a workforce who likes it busy. We are always looking for ways to help our staff work more efficiently and will continue to do that moving forward, but the faster pace is not temporary.
Did the culture change impact the way Langley communicated with its members or advertised to the community?
TR: Absolutely. The Langley brand was already strong within Hampton Roads, but we were known primarily as a place for depositors. There was some debate internally about how long it would take to change that perception, but the response from members to our new value proposition was almost immediate.
In the past two years, our loan portfolio has grown 84%. We’ve done that primarily by making consumer loans to new and existing members while unwinding loan participations. Many of our members had loans elsewhere, so we launched an aggressive auto recapture program to steal those missed opportunities back. We stopped running general branding ads and included specific calls to action so current and potential members knew we wanted their business.
What advice would you give a credit union executive who is going through a similar transition?
TR: Several things come to mind, but the most important is: Don’t force it. Come in with an open mind and listen. Rely on the people who know the organization best and assess things for yourself objectively. One of the traps we can fall in as leaders is trying to re-create the culture we came from, but that can be a mistake. You can’t mimic what you had at your last credit union in a new organization no matter how successful it might have been. It’s not something you can force.
For me, I couldn’t bottle Digital Federal Credit Union’s (DCU) culture and take it with me. You have to foster an environment that allows the new organization to take on its own personality. Not everything at Langley needed to be changed. There were a lot of positive things to build on here. As a leader, it is your job to guide an organization and make sure it becomes the culture you want it to be, the culture that will allow it to be successful.
Relying on the people who are in place and resisting the urge to fix everything yourself is also important. For example, I heard from several people on my first day in fact about Langley’s dress code. I could have just reviewed it myself and issued a new one or copied DCU’s more casual dress code, but instead we put together a cross-functional team and it came up with its own proposal.
Lastly, it doesn’t hurt to have some early wins to help you establish momentum, so look for the low-hanging fruit. At the end of the day, a new dress code might not have been my first priority but it was important enough to the staff that it was something we needed to address. And through that process we were able to show everyone firsthand how we were going to open communication and collaborate.
Today, we’re two years down the road and the culture is still being shaped at Langley. We’re proud of the environment we’ve created, but there is much more work to be done.
As told to Sharon Simpson