collaboration as a business template collaboration workshop cu*answers ceo strategies week december...

Collaboration as a Collaboration as a Business TemplateBusiness Template

Collaboration WorkshopCU*Answers CEO Strategies WeekDecember 8-12, 2008

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A Tale of 3 Credit Unions Collaborating

• 3 credit union CEOs get together to talk about how they can collaborate on serving their members, collaborate to serve each other, or potentially even merge

• They decide to build a network and think about how the network might act– Direct Services

• Funded directly by each CU to serve their own members– Shared Services

• Serving members through co-funded resources– Managed Services

• Services provided by one CU for the another CU– Merged Services

• Consolidation or formal power exchange where the surviving organization now is the responsible party to both sets of members

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CEOs in a Networked World

• The key for growth today is understanding how to build a network that crafts all four of these ideas across multiple enterprises with the recognition of politics, marketing style, and with a real sense of the power of aggregation and network effects

• If I were a credit union CEO I would want to have dozens of these in play at once, across as many organizations as possible

Are you trying to grow in as many ways as possible?

Strategy Internal (Standalone) External (Network)

Retail Growth

Direct member banking, direct service origination

Direct member banking, network service origination

Shared Services Growth

Create direct revenue from selling excess internal capabilities to the network

Create bottom-line savings through purchasing excess capabilities from the network

Corporate Services Growth

Consolidate market share growth through acquisition and marketplace expansion

Consolidate market share influence through collaboration and marketplace expansion

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CEOs in a Networked World

• The key for growth today is understanding how to build a network that crafts all four of these ideas across multiple enterprises with the recognition of politics, marketing style, and with a real sense of the power of aggregation and network effects

• If I were a credit union CEO I would want to have dozens of these in play at once, across as many organizations as possible

Are you trying to grow in as many ways as possible?

Strategy Internal (Standalone) External (Network)

Retail Growth

Run your credit union with your direct services

Offer more to your members through partners

Shared Services Growth

Start a business to sell your excess capabilities to fund your internal competency

Buy core competency at a lower cost from a network partner

Corporate Services Growth

Grow through merger Grow through network effects and influence

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A Big Goal

An excerpt from the CU*Answers 2008 Business Plan... a mission for the next 10 years

From the perspective of a credit union owner:

“What if we could value our independence, nurture our specific member bases, enrich both our members and our independent staffs, while defining a network of a million

members, performing unlike anything we see today?

“What if we were known as the ultimate peer-to-peer credit union opportunity?”

From the perspective of a credit union owner:

“What if we could value our independence, nurture our specific member bases, enrich both our members and our independent staffs, while defining a network of a million

members, performing unlike anything we see today?

“What if we were known as the ultimate peer-to-peer credit union opportunity?”

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Are we architects of our own future, or simply nurturers of existing models?

• How far down into the stack will you cooperate?

– Sharing a marketplace?– Presenting like products and

services?– Sharing resources (branches)?– Sharing team members?– Coordinating multiple Boards?– Doing business with multiple

memberships?

Products and Services

Resources

Teams

Senior Team

CEO

Board of Directors

MarketplaceMarketplace

MembershipMembership

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Stress Tests• Throughout today’s session we will push each other to identify

network effects and to develop ideas that will allow us to declare examples of how we act as a network: Stress Tests

• The goal is to measure our activities• Track to attack

– In 2009 CU*Answers will lead the effort to identify and track cross-enterprise activities within our network. In other words, how many places do credit unions do things together? How many standing contractual relationships do we have that are credit union to credit union? Are there any businesses that have been built credit union to credit union within our network? How often do we interact?

CU*Answers University and this very session could be counted as a cross-enterprise network event

Strategic Aggregation DesignsStrategic Aggregation Designs

How can credit unions aggregate for success?

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Improving On Standalone Concepts

• Organizations who network their capabilities can gain a competitive advantage

• They need a network with 3 key components:– A technical “highway” that coordinates transactions and interactions– Organized and rich content that is accessible and actionable by all– Sufficient aggregation to create a formidable market presence

• It all starts with the idea that a business will leverage its commonalities with partners for everyone’s advantage

It’s simple: be more, do more, and appear larger than you could as a standalone player

10A Hub

What is the opportunity, and

where is it focused?

Peer-to-Peer BusinessesWho is “we”?

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A Network



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A Network



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• Which is bigger? The opportunity of one, or the opportunity of all?

• A network multiplies the work of one into an opportunity for all of its participants

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You Know You Have Arrived...

• Ultimately, this network business design works when the environment (ecosystem) creates the belief in the minds of its participants that their very participation in the network gives them a competitive advantage by

– Helping them harvest the benefits of scale that were previously beyond their reach

– Surrounding them with accessible innovation that is easily actioned at a lower cost

– Magnifying their opportunities and creating the potential for positive (though unspecified) new directions

Simply put: the business designer believes this is the place to be...this is my connection to the

crowd that will take me to the next level

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Stress Test #1• Can you name 3 competitive advantages you have gained

through network participation?– Where you have harvested the benefits of cooperative scale?– Where you have been surrounded with accessible innovation that is

easily actioned at a lower cost?– Where your opportunities have been magnified with the potential

for positive new directions?

Creating a Technical “Highway”Creating a Technical “Highway”

Adding a New Connection in 2009: Networked Intranets

A new business opportunity, a new network opportunity, a potential new business for your credit union

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Technical HighwayCreating community architecture for major thoroughfares

InternetInternet

It’s Me 247 It’s Me 247 Web ServicesWeb ServicesRetailer DirectRetailer DirectMicroLenderMicroLender

InternetInternet

It’s Me 247 It’s Me 247 Web ServicesWeb ServicesRetailer DirectRetailer DirectMicroLenderMicroLender

Core ProcessingCore Processing

CU*BASE GOLDCU*BASE GOLD

Core ProcessingCore Processing

CU*BASE GOLDCU*BASE GOLD

IntranetIntranet

Private Workgroup Private Workgroup CU ToolsCU Tools

IntranetIntranet

Private Workgroup Private Workgroup CU ToolsCU Tools

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Technical HighwayCreating community architecture for major thoroughfares

InternetInternet

Servicing Your Servicing Your MembersMembers

InternetInternet

Servicing Your Servicing Your MembersMembers

Core Core ProcessingProcessing

Servicing Your Servicing Your Members Through Members Through

Your StaffYour Staff




IntranetIntranet

Servicing Your Servicing Your Staff &Staff &

Corporate Digital Corporate Digital IntelligenceIntelligence

IntranetIntranet



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Community ArchitectureA Ready-made Place To Be

• It all started with developing an ASP online core processing solution for credit unions

• The first shared solution where we developed a standing capability to combine CUs for shared businesses was Xtend







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Community ArchitectureA Ready-made Place To Be

• Preparing for an explosion of shared businesses offered by cuasterisk.com and credit unions alike







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A New Network IntelligenceCommunity architecture could be orange, blue, or red

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The Power of a PortalA standalone technical solution for every business

IntranetIntranet



IntranetIntranet



https://passageways/

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The Power of a CommunityA new community architecture

IntranetIntranet



IntranetIntranet



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The Power of a CommunityA new community architecture

IntranetIntranet



IntranetIntranet



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New Passageways Plan

December/December/JanuaryJanuary

CU*Answers to convert its portal to

P4

January January 20092009

CU*Answers to capitalize on P4

graphic template capabilities

January/January/FebruaryFebruary

Convert cuasterisk.com

partners to Community Portal

concept

March 26, March 26, 20092009

As part of the CU*Talent CEO/

Chairperson meeting, unveil the new

Community Portal concept and sign up

credit unions for CU*Answers-

delivered intranet services

This is a work in progress...if you need to move now, and have the funds and the staff to do so, we encourage you to talk to

Passageways and get started(Just remember that we told you we’re going to do some big things in the future!)

Organized and Rich ContentOrganized and Rich Content

Leveraging Talent

CU*Talent: Evolving on social aggregation as a business strategy for getting the most out of human resources

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Rethinking Human Resources at the Organizational Level• “How many people work for you?”

– What has changed that might influence how a CEO in 1989 would answer that question, compared to a CEO in 2009? Networks and the mindset of employees who know how to use them

• “How do you see the talents available to your organization?”– What has changed that might influence how a CEO in 1989 would answer that

question, compared to a CEO in 2009? Networks and the mindset of employees who know how to use them

• So have networks and the mindset related to using networks for access to talent and people changed the way your organization thinks about human resources strategies and tactics?

Think about your personal contacts...they might add up to more talent than a large company in 1989

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Rethinking Human Resources at a Personal Level• How will tomorrow’s employee react to classic career challenges? • They will bring their network to work with them every day

– When the boss asks them to find a new solution to a constant challenge...they will use their network

– When they need an edge to get that next promotion...they will use their network– When they need a new opportunity...they will use their network

• So when employees bring their network to work and truly understand the advantages they have at being adept in using networks, will your business plan leverage this new perspective?

How do you make 25 employees look like 2,500 vested contributors to your business plan?

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Rethinking Human Resources

• Imagine the revolution in trying to get organizations with top-down control thinking to embrace social network concepts

– Open environment with little governance– Easy, quick communications– Rich user identities (personalization, vanity, etc.)– Reputation/ranking mechanisms– Cliques– New social network metrics (betweenness,

closeness, centrality, clustering coefficient, etc.)• How can we translate these ideas

into winning business models?

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CU*Talent

• At CU*Answers, we are anticipating using our business network design to enhance both our participating organizations and their employees’ situations by leveraging a new mindset about HR and the collective talents of a network

• Goals for CU*Talent– Connecting people – Creating opportunity – Sharing knowledge– Source of intellectual capital – Collaboration, collective exchange of ideas– Alternative resource allocation– Individualized career development– Potential for reduced people expenses

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CU*Talent:Transitioning Leadership• What could be more important than understanding how network

thinking might reshape the way credit unions think about their leadership resources?

• What can we learn from working together?

We hope you will join us on Thursday, March 26, 2009, from

10:00 a.m. to 2:30 p.m. at the Centennial Country Club in

Grand Rapids, MI

Register online today!

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CU*Talent:An Ecosystem of Interaction• We need to design a network that can capture the power of talent

—no matter where it is in our network—to innovate, execute, and earn beyond anything we’ve ever seen

• Build an expectation of leveraging both employees and their peers and contacts

• Our Passageways partnership gives us the potential to design a unique environment for credit union professionals that will be compelling, contagious, and a place where they will want to do business

We plan to leverage the power of a single Intranet against the Intranets of a hundred organizations and let 3,000 employees be visible to each other

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CU*Talent Network

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CU*Talent Network

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CU*Talent Network

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CU*Talent Network

• Ideally, the community servers create an environment where employees inside a credit union are partnered with employees anywhere in the network

• The community server represents a common environment, set of tools, and business concept that facilitate a shared activity – a ready-made ecosystem to facilitate a new shared business

– It will start with CU*Answers at the center of new business initiatives– It will come to fruition when any participant feels empowered to go

into business or sell their talents throughout the network

Is your business ready to extend services to your peers? Are you digitally defined, connected, and

ready to bring on your first client?

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CU*Talent Network

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You Know You Have Arrived...

• Ultimately, this network business design works when the environment (ecosystem) creates the belief in the minds of its participants that their very participation in the network gives them a competitive advantage by

– Helping them harvest the benefits of scale that were previously beyond their reach

– Surrounding them with accessible innovation that is easily actioned at a lower cost

– Magnifying their opportunities and creating the potential for positive (though unspecified) new directions

Simply put: employees and leaders believe this is the place to be...this is their connection to

the crowd that will take them to the next level

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Stress Test #2• Can you identify 1-3 areas where you have expertise, excess

capacity, and the wherewithal to sell talent to your peers?– Have you documented your processes well enough to create a

statement of work and a contract warranting your services?– Do you know the difference between “good enough for who it’s for”

and the liability of doing things for others?• As a group, can we identify 10 potential businesses that we

might start based on the talents and resources of our network?

Potential Templates for These Potential Templates for These BusinessesBusinesses

Playbooks that you might borrow or copy to start a business tomorrow using the talents within your organization

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Our network is ready to be the foundation for the network that all of you may build

More importantly, we’re excited about your starting to build in a new direction and finding out what that

will mean for our network

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A Place to BeSometimes the Customer, Sometimes the Vendor

• One of the most important principles in building shared businesses within our network is that we avoid duplicating services and capabilities that already exist (think about credit card servicing or our real estate servicing)

• Therefore, should we always find ourselves adding more at the hub (CUSO) instead of drawing from the nodes (participating CUs), we may not find the best economic model for increasing the net return to all of the network participants

• When should you pick up the ball and run with a game plan to provide services to the network?

“A place to be” may be based on our network creating a marketplace of value exchanged instead

of a simple vendor-customer experience

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cuasterisk.com: The eBay Network for Credit Unions

• If we can create an environment where CUs can exchange value without an expensive middleman layer, can we achieve an eBay effect?

• Let’s consider an automated shared lending capability within CU*BASE and the cuasterisk.com network

What if you could pick partners to share lending opportunities, and those

applications could seamlessly interact with

your CU*BASE loan origination system today?

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Configure your loan opportunity partners and use this dashboard as command central for identifying new opportunities

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Drill down on the opportunity to decide whether this fits into your participation portfolio and whether you wish to buy in

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Check out the loan officer worksheet and see if the underwriting big picture makes this a viable opportunity

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With the click of a button, pull the actual application in for the in-depth analysis and member information you need to close the deal

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cuasterisk.com: The eBay Network for Credit Unions

• We’ll be holding an envisioning meeting on how we can build a cuasterisk.com shared lending network capability

• Targeted for April/May 2009...watch your email for an invitation• At the meeting we’ll present a more in-depth process flow, some

sample participation policies and procedures, and a business plan for moving forward

What other processes could be automated and workflowed into our current network capabilities that

would allow for elective auctioning and partner selection to enhance everyone’s business plans?

What else should we “eBay” out?

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Stress Test #3• What else should we “eBay” out?

• Can we list 5 processes that might fit with the shared lending network approach, within CU*BASE?

• Can we list 5 processes that might fit with the shared lending network approach, within It’s Me 247 online banking?

• Can we list 5 processes that might fit with the shared lending network approach, within a website approach?

• Can we list 5 processes that might fit with the shared lending network approach, within a networked Intranet approach?

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Conclusion

• As a collective, we have a great opportunity to leverage all that is available...if we elect to be creative an innovative about how we offer each other our services and resources

• We simply have to believe that patronage is investment, and that the yield on working together is driven by doing more as a network than we could as standalone entities

• This is true not only for credit unions but also for the CUSOs that make up cuasterisk.com...all of our resources need to be on the table and ready for constant evolution

collaboration as a business template collaboration workshop cu*answers ceo strategies week december...

Documents

network effectsif

membersshared services

credit union owner

peer credit union opportunity

team members

excess capabilities

excess internal capabilities

power of aggregation