Does your CEO Feel Safe Enough to Admit Failures?

Does your CEO Feel Safe Enough to Admit Failures?
(Psychological Safety and the Board/CEO as Team)
By Tim Harrington & Kevin Smith

It sounds kinda weird to say that we hope the CEO of your credit union fails. But in a way, it’s true. (We’ll qualify this. I swear.) More importantly for credit union board members: Does your CEO feel confident and safe enough to readily share any failures with you?  A few weeks ago we wrote about Google’s research into what makes teams perform at the highest level. The number one indicator: psychological safety, the ability to be vulnerable and know that this would not be used against you by the other team members. Does your board and CEO operate at this level? You are a team after all.

Here are two scenarios that we see as radically different:

1. The board asks the CEO to report on the progress of strategic project X. The CEO responds saying it will take some time to gather data to adequately address that project. He/She requests that this be an agenda item for next month’s board meeting. At reporting time there are a flurry of statistics, qualifications, points of context and a lot of use of the passive voice (i.e. “assumptions were made,” “benchmarks were missed,” “due diligence was done”).
2. The CEO calls the board chair and says, “I need to give you an update on strategic project X. We missed the benchmarks and a few things have gone wrong. I don’t want you to have any surprises. I will update the rest of the board more thoroughly at the next board meeting. In the meantime, can you give them a heads up and send them my way if they have any questions?”

Both of these are reports on a failure. The tone of the two are polar opposite. In scenario 1, the CEO comes off as defensive, covering tracks, diverting blame, delaying accountability, etc. In scenario 2, the CEO is proactively addressing the issue, before being asked, in plain language and leaving the door open for further information which is a higher level of transparency. Which one of these two CEOs has the trust of the board, and vice versa?

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What Credit Union Directors Should Look for in a Board Portal

by Kevin Smith, TEAM Resources

Recently I had the opportunity to spend some time with a 100+ credit union board members and volunteers thanks to Terri Murphy and the New York Credit Union Association. During a discussion of best practices the use of board portals came up and there were quite a few questions. So I thought this might be a good opportunity to relay those questions along with the “wisdom of the room” that came together.

First, let me say, I’m not exactly an expert at this technology. But over the years I have reviewed quite a number of the products available out there as professional research. And at onepoint I was offered a job by one of the (clearly savvy) providers in the market. I do know many of the features, and the things that I like and don’t like. In fact, I’m a supervisory committee member with a Madison credit union using such technology. I have also gathered anecdotal information from a range of volunteers along the way. So take that for what it’s worth – a relevant and informed opinion that is not coming from a provider’s sales team.

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Extra Steps When you Have Time … are Okay?

by Kevin Smith, Publisher, TEAM Resources

On a recent trip to a credit union event, I was actually surprised by an airline customer service effort that was positive. (I know, right?) It wasn’t a big thing, but it was enough to make me notice and jot a note. The airlines aren’t getting a lot of good press these days for their customer service. And I’ve certainly gotten my share of “meh” service over the last couple of years.

For example, last spring I got to fly over my destination … twice … over an eight-hour period … without actually getting to land there because of weather. So, I never actually got to where I needed to go. I missed the event. But I also didn’t get the miles towards my loyalty program status, presumably because I never landed there. There’s not much the airline can do about weather issues, but I did feel doubly disappointed when I didn’t even get credit for my own efforts. Jeez.

Ok, moving on to the better story. (I can’t seem to let the miles thing go.)

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You’ve Got the Right to Fight: Healthy dissent in the boardroom leads to better outcomes for your CU.

by Kevin Smith, Publisher, TEAM Resources
(A version of this post was originally published in the July CUNA Directors Newsletter.)

I’m here to start an argument. There. I said it. I mean it.

What I’d like to see is more arguing among credit union board members. What I am seeing is a bit too much harmony for my taste. And no, this isn’t about shadenfreude (no matter how much I like to say that word). This is about board engagement, and avoiding complacency. In general, I’m seeing and hearing about too much complacency.

Now, don’t get me wrong. Harmony on a board of directors is a good thing, to be fostered and cultivated. But if there are only unanimous votes, too much harmony, too much kumbaya … that’s a red flag for me. It usually means there isn’t enough thought going into the discussions and material at hand.

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Board Communication and the Staff

by Tim Harrington and Kevin Smith, TEAM Resources 

A credit union board chair recently contacted us with some questions regarding board communications. One issue had to do with the board’s communications with the staff. Now ordinarily, this is the kind of discussion that we try to shut down immediately with a simple cliché of “all communications to the staff should come from the CEO.” It’s a cliché that’s easy to trot out because it holds up pretty well under almost all conditions, sun, rain, snow, wind…. But it got us to thinking about where that cliché would begin to break down, because they all do at some point, right? (Thanks. We knew you agreed with us.)

So, the rule of thumb (let’s see how many cliché’s we can get in here) is that the board has one employee, the CEO. And the board speaks with one voice, communicating with the CEO. Individual directors do not give any direction to the CEO, officially or unofficially. The board operates as a unit, within the boardroom, deciding its strategy and communicating that when finalized to its one employee with a unified voice. The CEO then directs the leadership and staff of the credit union with their marching orders.

Board Communication with Staff

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Take Responsibility for Your Financial Literacy

Take Responsibility for Your Financial Literacy

(This post is also available in the March 2017 edition of the CUNA Directors’ Newsletter.)

Regulators hold volunteers accountable for understanding key measures and ratios that indicate a CU’s health.

Picture this scenario: 

It’s time for the annual exit interview with credit union regulators. You’ve been told they finished your regulatory exam and have requested the entire board’s presence. If this development hasn’t already alerted you to an issue, the six regulators awaiting you in the board room does.

You look around the board room and see anxiety in the CEO’s face, urgency in the regulators’ faces, and a bit of confusion and concern in your fellow directors’ faces.

Houston, we have a problem: Your credit union is losing money. Your net worth ratio is taking a plunge, and you’re losing assets. “And,” they say, “it’s your fault.”

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A Book Review: Transformational Governance: How Boards Achieve Extraordinary Change. By Beth Gazley & Katha Kissman

Guest Post by Kevin Smith, Publisher, TEAM Resources

“If you truly want to understand something, try to change it.” Kurt Lewin, often referred to as the father of modern Social Psychology.

If you’re anything like me (and I assume that you are), then you have too many books piling up literally and virtually, too many articles saved, too many emails with links to information that you’re supposed to keep up with these days. Sometimes I feel like I’m drowning in it. So I shouldn’t have been surprised when I stumbled across Transformational Governance: How Boards Achieve Extraordinary Change by Beth Gazley and Katha Kissman a full year and a half after it came out. But I’m sure glad that I found it. (Full disclosure: I hired Katha Kissman to speak at a CUNA Volunteer event several
years ago. She’s cool, yo.)

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The Governance Spectrum: Balance Between Too Strong & Too Weak

(From the forthcoming TEAM Resources publication: A Basic Credit Union Governance Guide for Credit Unions, by Tim Harrington and Kevin Smith)

In our experiences, there is a range of board member behavior, from too weak to too strong. This represents the Governance Spectrum. The left side of the spectrum represents boards that are too strong, too involved and not making the best use of their time. On the right are boards that are too weak. They have abdicated their responsibility and their authority. What you want to strive for is a balance of oversight and forward thinking. This is a tightrope to walk sometimes, looking for the Goldilocks moment where your actions are “just right.”

Governance Spectrum

Governance Spectrum

(Click the image above to download a copy of the Governance Spectrum for your own use.)

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Mind the Gap: Communicating the Strategic Plan

We’re headlong into planning and budgeting season, and after reviewing a few plans, a couple of things have occurred to me about communicating the strategic plan.


Communicating the Strategic Plan

Have you ever noticed that no one ever has a new strategic planning document that simply says, “Just keep doing what we’re doing. Things are going great”? And rightly so, I guess. I mean, you don’t hold planning sessions to envision what you’re already doing. But too often credit unions get caught up in the concept of the planning session and the idea that this is the one place where we come up with new, different, and forward thinking. We all want to be innovative and feel like visionaries. And no doubt our industry is dealing with dramatic change and an environment that often feels like quicksand shifting beneath our feet.

My point is that there are often a couple of large gaps between the plan and the people that derail the process. Read more

Board Leadership: Preparing the Chair



In a recent survey of nonprofits, 51% of board chairs said they “did nothing specific to prepare” for the role of chair. That’s a pretty staggering number. The survey “Voices of Board Chairs” from the Alliance for Nonprofit Management reported on the experience of 635 nonprofit board chairs from across the United States. throneOf course, this survey isn’t specific to credit union boards and chairs, but we fit in the nonprofit area. And the results of this report align with what I see anecdotally across the credit union industry.

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