Client Results Achieved by Haines Centre for Strategic Management
Industry Type | Location | Public/Private | Annual Revenue | Length of Engagement |
Credit Union (P) | California | Public | Not-for-profit | 5 years (on and off) |
From: A bankrupt credit union with no sponsor. | To: A profitable credit union with a promising future. |
Business Problem | Solutions | Major Results |
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Testimonials
“No testimonial yet”. CEO of Credit Union
In the late 1990s, this credit union was losing money with no game plan for recovering. Expenses were out of control and no real plans or budgets were in place. Their sponsor moved out of the geographic region they were in and merged with another organization Their Audit Committee was only minimally functioning and the board was passive and submissive to an autocratic CEO. Market share was minimal and many customers were paycheck cashers only.
Strategic Thinking was introduced, as was the ABCs of Enterprise-Wide Change Model. It was agreed the organization was in a survival mode, yet they were in serious conflict with their board over their future direction. What was needed was a new Clarity of Purpose and direction that both groups supported.
Steve facilitated a retreat for the management team, and surprising consensus emerged on the future vision. It was decided long-term success must focus on only their one home state (despite three branches in other states). This turned out, in retrospect, to be the trump card in the entire process with the board. Despite the conflict and disagreements, the session ended with an initial vision and strategic plan. The board recognized their unprofitably and lack of clear positioning, and reluctantly agreed to a set of measurable financial goals.
The CFO constantly developed and updated simple, one-page economic documents during the transformation process. He used them to constantly remind the board of the enormity of the situation. He also kept data in front of management and the board regarding the customers being poorly served in the branches in the other states where their market share was miniscule. These documents were extremely valuable in every Board meeting as well as in all the management sessions.
With the assistance of Steve and the efforts of the management team and the board, the company decided to divest itself of its branches in other states, as well as several other money losing divisions. It was a significant win as it immediately eliminated money-losing branches, streamlined costs and provided them the capital to amortize the newly built branch’s excess construction costs over its value. It also gave them the capital needed to begin planning for new branches and aggressive marketplace advertising and awareness of their new brand name. Their capital ratio soared into the proper range.
It was a win for the customer (member), a win for the affected employees, and a win for the new credit union. Now they are able to actually work to acquire a presence in their chosen marketplaces. The transformation to a new credit union was assured with the sale of the branches and the capital infusion, and a profitable future is now a possibility on the immediate horizon.