Organizational Development: Overlooked but Essential to Our Future

As credit unions like GTE FCU grow, says Bucky Sebastian, organizational development is increasingly essential because it is a credit union’s team and its culture that so often set it apart.

Turnover of staff is a problem all credit unions face. It’s especially troublesome in areas of the country where unemployment is low. Employees leave, taking a host of knowledge with them. Then it costs money to solicit, hire and train new people to the culture of your credit union.

Most credit union managers would say that their best competitive advantage is their employees: the people they have in place who are trained and who make the culture that keeps the organization gaining in a competitive world. So it is especially troublingwhen a part of the team leaves.

Many managers shrug their shoulders, rationalizing to themselves that turnover is endemic, something that has to be endured.

At GTE FCU, we weren’t so sure. A couple of years ago, we hired a consultant in organizational development to examine areas of our credit union, including the problem of turnover. We conducted employee surveys, and the consultant went to work onspecific areas and units of the credit union. He made good progress, and he also offered suggestions on a macro level. We could soon see that we needed this kind of contribution more than sporadically. We hired the man full-time and we gave him aposition among the senior management. His role is organizational development.

Growth Affects Culture as Well as Numbers

As credit unions grow, they do so in more ways than numbers of employees and figures on the balance sheet. They grow in complexity. If you plan to grow by 50% you can’t just add 50% more employees. With growth not only comes more interfaces withmembers and more employees, but also different ways of making decisions and different levels of management. In a word, there is a need for more sophistication. More sophistication is needed from employees and for employees.

Put another way, with growth come subtle shifts in the organizational culture, which nurtures the team that is so vital to so many credit unions’ advantage. These shifts are critical. Done poorly, they can devastate a credit union; done well, theycan invigorate one to new heights.

A Change in Mindset

Credit unions do not particularly value organizational development, at least not as large corporations do. Credit unions know they need a lending department, up-to-date IT, a marketing function and so on, but they do not well understand organizationaldevelopment or give it proper attention. Maybe this has to do with the fact that credit unions began small and had a way of dealing with their employees that was friendly and familiar. Growth was a matter of numbers and the balance sheet, and it wasthought the staff could always make do. Non-numerical adjustment was less obvious and so got short shrift.

We can’t remain in that mindset, or if we do, we’ll always be reacting to trouble rather than avoiding it. Nor can we bundle the issues and lay them at the feet of Human Resources. This is not strictly an HR function. Rather, HR is a factorof organizational development.

Seeing Them Whole

Growing larger is always going to have its growing pains. Indeed, business models predict identifiable inflection points along a growth curve (old levels of management have to change, new expertise is needed, etc.) with their attendant troubles. Whensmall, credit unions work these out on a personal level, but large they are going to be blindsided with agonies if they are not proactive.

Your team and your culture are your advantage in a competitive marketplace. Don’t take them for granted. You have to see them whole and pay attention to how they are going to develop over time. At GTE FCU, we are attempting to do so by focusingon organizational development at our highest level. All growing credit unions could benefit by the same endeavor.

To read more articles from industry experts Chip Filson, Bucky Sebastian, Ed Callahan, and more, subscribe to The Callahan Report.

April 13, 2015

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