“ Providing Strategies for Success ”

1. “Providing Strategies for Success” 3Rxs for Future Effective Credit Union Boards:“Recruitment/Retention/Revitalization” Utah League Annual Meeting March 14-15, 2014 Presented by: John A. Vardallas CAE,CUDE Founder/CEO TheAmericanBoomeR Group, Madison, WI www.theamericanboomer.com 1

2. Welcome Utah Credit Union Leaders!About Today s Program… We Will Be Discussing How To Prepare for Succession and Development of Future Credit Union Volunteer Leadership

3. Today s Learning Objectives… • To understand the challenges of Recruiting future CU Volunteers. • To explore the key strategies for identifying & recruiting the right new “volunteer blood” for your credit union. • To review methods of Retaining volunteers (training/reward/recognition programs) . • To review the key characteristics of Revitalized High Performing Credit Union Boards.

4. About Me…. Chevy’s The Green Bay Packers Credit Unions Chevy’s The Green Bay Packers Credit Unions

5. My First Car…….

6. My Team…….

7. My Credit Unions… • UW Credit Union ($1.7 Billion) • Summit Credit Union ($1.9 Billion)

8. Trends/Challenges for Boards -- Boards will be smaller with emphasis on “warped speed” decision making -- Directors will serve as on “call consultants” to the CEO/Organization -- “Integrity” of boards will be at a premium -- More Knowledgeable (Ditch the Gut-Dig Into the Data) -- Time/Litigation Issues -- Keep Up with Learning/Change/Diversity

9. What Do CU Boards Do?Lets Check Your CUs Dash-Board Dials 9

10. The Leadership Challenge… List the key Top 3 challenges that you face today as a Credit Union Volunteer Leader . --1) --2) --3)

11. Rx 1) Recruiting Volunteers 68% of CUs say its harder to recruit-- Why? -- Keeping up with “Blur” speed of change -- 7x24x365 Member Expectations -- Demanding Careers/Volunteer Positions -- Lack of Time -- Lack of Interest/Loyalty to CU Philosophy

12. Why Do People Volunteer? -- To support a cause (CU Philosophy) -- To connect with others who believe in a cause -- To express themselves creatively -- To seek challenges/personal satisfaction -- To seek recognition/personal growth/achievement

13. Recruiting Questions for Your CU --What is your Real Mission? -- How is your CU perceived? -- Is there an allegiance/loyalty that still exists? -- What is the distinction between us/them? -- What persuades people to join your vision? -- Is there a compelling reason to volunteer?

14. Group Task-Write A Compelling Appeal (one/two liner) for Recruitment… Your 30 Second Elevator Speech to a Prospective Volunteer!

15. Recruiting Strategies--Research Your Needs…

16. Research Your Needs/Create an “On Boarding” Process for New Directors -- Review Current Profile of the Board ( Does it reflect your current FOM based on Shared Member Ownership) -- What does the Board Need to better Represent the current & future membership? -- Determine Talents needed by the cu– What does the Board need to better understand the future products/services of the credit union? -- Develop Attributes/Skill profile of new board member – Focus on Diversity NOT Sameness. (community rep, finance, human resources, business owner, marketing person, educator)

17. Determine Your Talent Needs… • What kind of person does the Board need to better understand the future direction/ products/services and financial situation of your CU to help meet the needs of your members? • Develop Attributes/Skills profile of new board members (Community Rep/Human Resources/Finance/Marketing/etc)

18. Know Where Do We Find The Next Generation of CU Directors… • Task current Board/Committee members to Profile/Recruit Potential Volunteers Stage A “Volunteer Round Up!” • Utilize CU Web Site as a recruiting tool • Look to your SEG groups for persons interested in serving • Appoint to specific Task Groups/Committees • Look for Boomer Age Group Members? • Look for Members who express themselves about your credit union KEY: Focus on Diversity versus Tokenism

19. Utilize Creative Recruiting Approaches… Consider using more of a sales approach…. -- Planned -- Proactive -- Develop Profile of Board Member Competencies -- Based on needs of your CU Caution… Do not use the “Old Buffalo Approach”

20. “Super Volunteer Recruiters” Recruiters should be able to Answer 5 Basic Questions? • What do you want me to do? • What information or assistance will I have? • How will I know if I’ am doing it right? • Why are we doing this? What difference will it make? • How much time will it take? (Best recruiters are satisfied volunteers)

21. Board Duties (Job Description) Setting Strategic Direction/Goals Hiring/Evaluating CEO Performance Managing CEO Accountability Monitoring Financial Soundness of CU Community Sponsor Representation Identify Prospects Suggestions from Nominating Committee Newsletter/Newspaper/ Web site announcements Members of other committees/Members who have interest or complained Sponsor group recommendations Identify Tasks/Prospects

22. Community Pools of Potential Candidates… • Chambers of Commerce • Existing SEG Groups • Local Campuses • Business School Programs • Military Bases • Church Groups/Religious Organizations • Local Chapters of Service Organizations (Rotary/Kiwanis International/Lions Clubs)

23. The “Recruitment Sales” Approach • Schedule a meeting with the prospect (do not ask casually) • Determine the best person to make the contact • Gather a “prospect materials packet”(info about cu, volunteer job descriptions, etc) • Know the key facts about the person

24. Tips to Remember When Delivering the Message! • Give the volunteer the “Big Picture” including CU mission/vision and a compelling message to Join! • Clearly define the task/be direct/communicate the benefits of volunteering. • Describe the expectations/time required. • Offer “Episodic Volunteering” option. • Assure support and training opps/staff assistance. • Be prepared to respond to stated/hidden objections (legal/time/politics/embarrassment/fitting in). • Convey excitement/fun/the opportunity to help make a difference/Focus on the CU Philosophy. • Follow Up (Thank you, send info, re contact).

25. Thoughts For Attracting Younger Board Members… • Recruit from family members of existing CU Members. • Create an Orientation Program for younger members covering products/services of interest to this gen. • Create an Board Internship Program and actively recruit younger members to participate. (Participants would attend board meetings, participate in discussion but would not be allowed to vote). • Work with local Colleges to be able to offer Class Credits/Extra credits for serving on Board. • Focus on Gen Yers who are well educated and ask Y! They can understand the needs of younger members and be tech-savy. • Promote the importance of Resume Building/Travel to educational venues. • Form a Youth focused Committee that works within the community to bring awareness/education to members.

26. Johnny Vs Boomer Volunteer Profile…. -- UWCU - Member/Marketing Relations Committee -- American Cancer Society -- Upward Bound Disadvantaged Minorities Teaching -- Inmate Counselor Alabama Prison System -- Board Member: Madison Assumption Greek Orthodox Church -- United Way of Dane County -- Greater Madison Chamber of Commerce -- Wollershiem Winery– Grape Harvest Picker

27. Rx 2) Retaining Volunteers(Training Reward & Recognition Programs/Activities) -- Training/Travel Opportunities -- Recognition Dinners -- Resume Builder Exposure -- Community Leadership/Service Representation Opportunities -- Longevity Awards -- Photo/Bio in CU Newsletter/On Web Site -- Director Emeritus/Volunteer Mentors -- State/National/International Movement Involvement

28. Retaining Volunteers (cont)… • Continuous Learning • Evaluate Their Own Performance • Being Well Informed About the External Environment • Regularly Upgrade Governance Practices • Action Oriented/Results Driven Work • Create a “Director Career Ladder” to allow those who wish to seek leadership roles.

29. Top 10 Checklist for New Directors… • Know your Credit Unions history and bylaws. • Review written policies/minutes of your Board/Committee meetings. • Study your Credit Unions financial reports • Make sure management keeps you fully informed about the Credit Unions operations. • Come Prepared to Board meetings. • Identify areas in which you are challenged and work toward enhancing your knowledge/skills.

30. Top 10 Checklist (cont)… 7) Avoid letting personalities get in the way. They can cloud decision making/judgment. Focus on the facts, make data based decisions and strive for consensus. 8) Read Trade magazines/publications/websites for self improvement and keeping current on events. 9) Attend state and national conferences. Network with Volunteers for other Credit Unions. 10) Act professional and model the behavior you expect at all times.

31. New Director Training Is Essential (Example) Review of New NCUA Fiduciary Rule 701.4: Requires FCU Directors to be in compliance with Financial Literacy Requirements. As part of financial literacy compliance, all FCU directors including existing directors , must have the ability to read and understand a credit union balance sheet and income statement. In addition to the Financial Literacy requirement, Section 701.4 requires that all FCU Directors carry out their duties in good faith and in the best interest of the CU Membership.

32. What A Director Should Know… • A Director should be able to examine the CUs balance sheet, income statement and be able to answer the following questions: • What does this line item mean? • Why is this important to the CU? • Is the value of the line item changing over time? If so, what does that change either + or – mean? • Is the change important to the CU? It is essential that directors understand the 7 Categories of Risk found in depository institutions: Credit, Liquidity, Interest Rate, Compliance, Strategic, Transaction/ Reputation.

33. What A Director Should Know (cont)… Understand the Four Key Ratios Used for Credit Union CAMEL Ratings: • Net Worth • Delinquency • Loan Loss or Charge Off • Return on Average Assets Suggestion: Create a Board Training Policy and Program for your Credit Union including a paper trail for all Volunteer Compliance Training attendance.

34. Rx3) Board Revitalization… Exceptional Boards energize themselves through planned turnover, thoughtful recruitment and Inclusiveness. • Know their Roles and Function well as a group • Include important voice at the Board table. • Have a ready supply of new Board members. • Experience smooth Leadership Transitions.

35. Determine Your Board Profile… 1) Rubber Stamp (Weakest) 2) Middling (Scout/Watchdog) 3) Challenger (Helpful Advisors/ Tough Overseers) Source: Filene Research Institute

36. Board Revitalization… • Well Defined process for Recruitment/Board Competencies. • Recruitment/On going education is continuous. • Planned Succession Planning/Smooth Transitions • Use Term Limits to Revitalize. • Embrace Change/Practice Inclusiveness. • Be Distinct. • Come Prepared/Ready to Participate/Challenge Status Quo/Assumptions. • Periodic Board/Self Performance Evaluations.

37. Concerns/Challenges Old Election System (same candidates/annual meeting process) Lack of interest Retention of directors who have lost their effectiveness Liability exposure/ increased regulation Increased time/development/ expanded responsibilities Possible Solutions Consecutive Term Limits Expand Election System for more member participation (internet/mail ballot voting) Creating Director Emeritus/Associate director programs Ongoing Director Education/Recognition Succession of Qualified Directors

38. 7 Steps to a Board Succession Plan… • Assess your CUs Needs. • List required Attributes. • Assess current Board Members. • Provide opportunities for Development. • Develop a process to anticipate voluntary board member departures. • Build a Pool/List of Potential board members and start to orient them to the CU. • Develop a formal Board Member Succession Policy. • Annually Discuss/Review Succession Planning Strategy.

39. Keys To Being Effective Future CU Volunteer Leaders…. -- Have a Passion 4 What You Do. -- Make the CU Mission Matter. -- Model the Behavior You Expect. -- Value Diversity in your Members/BD/Staff. -- Bring you’re “A-Game” to Every Board Mtg. (be prepared to discuss/question/input to issues) -- Ditch the Gut---Dig Into the Data for Decisions. -- Speak with One Voice. -- Keep Yourself Growing & Learning. And Transfer the Higher Calling Passion to Serve to the Next Generation of Volunteers!

40. Our CU Higher Calling Difference… • We help member with financial well being • We put members in their dream house • We help members with their transportation • We help members finance their education • We help members plan for their mature lifestyle • We help members control and access their financial resources more conveniently • We help our members save $ by offering + rates • We contribute to socially responsible causes

41. I appreciate the work you are doing in giving back of yourself to your CU….. ALL OF US WORKING TOGETHER– IS BETTER THAN ANY ONE OF US WORKING ALONE!

42. Leadership Open Forum Time • Final Thoughts, Questions, Discussion Items Onward & Upward!

43. Thank You For Your Attention. I wish you Personal and Professional Success! jvardallas@aol.com www.theamericanboomer.com

44. About John A. Vardallas CAE,CUDE“Providing Strategies for Success” John A. Vardallas is an International Credit Union Business Consultant and Founder/CEO of TheAmericanBoomeR Group, a Madison Wisconsin based Speaking and Consulting Business. His work focuses on helping credit union leaders and organizations increase productivity and profitability.He conducts High Performance Leadership & Management Development, World Class Service, Change and Growth programs forstaff and directors. He also facilitates Strategic Planning sessions for a variety of credit unions throughout the US each year. For a free E-Catalogue of Programs & Services you may contact John/ Office (608) 221-4621 Cell (608) 577-8707/e-mail jvardallas@aol.com/ www.theamericanboomer.com

45. Lets Keep the Conversation Going… • Check out Johnny V s Blog/Website @ www.theamericanboomer.com Leadership Development/Strategic Planning/World Class Service/Subscribe Free to “Today s BoomeR” Digital Magazine • E-mail John Vardallas: jvardallas@aol.com • Check out TheAmericanBoomeR on Facebook • Follow TheAmericanBoomeR on Twitter @theamericanboomer