PHOENIX–The CEOs of two significant CUSOs yesterday outlined for their respective member credit unions what their roles are, where they are investing and what’s ahead.
In Phoenix, Todd Clark, CEO of CO-OP Financial Services offered an update on how the company is progressing with digital initiatives aimed at both CU members and its own credit union clients, while 2,300 miles away in Fort Lauderdale, Fla., Tom Davis, CEO of Trellance, shared a message stressing how the company is focused on being an “unbiased advocate for credit unions.”
CUToday.info has coverage here and elsewhere from both meetings. Here is what each of the CEOs told the respective gatherings.
CO-OP: ‘Digital is Raising Consumer Expectations’
During its THINK 18 meeting here, CO-OP’s Clark told attendees they are now starting to see the results of the big investments it has made in several areas. As CUToday.info reported here, during the meeting Clark introduced the largest technology investment CO-OP is making in 2018, called COOPER, a machine-learning based initiative to identify and stop fraud.
Keeping with the theme of the meeting, Clark addressed how “digital is raising consumer expectations” and how CO-OP is not just looking to keep up with but actually lead change in a new digital market. He noted that:
- 76% of people expect their financial institution to understand their individual needs
- 68% anticipate organizations will harmonize their experiences
- 82% of people have stopped doing business with a company after a bad experience. “I had a hard time buying that, until about three months ago I was at an airport and I called Uber and I’m an Uber VIP, and it said, ‘No cars available.’ It was clear they were having a system issue. So, what am I doing? I’m downloading Lyft. One bad experience and I was ready to go.”
Clark cited one forecast that predicts by 2020 the customer experience will overtake price and product as a key brand differentiator, which is the driver behind banks “doubling down” on their investments in tech that enhances the consumer experience. Clark pointed to how Bank of America had 445,000 digital appointments in Q1 of this year, for instance.
The Importance of Ecosystem
The concept of an “ecosystem” was noted by a number of presenters during the meeting.
“I want to stress that just because we talk about how that ecosystem reaches out to your channels, it’s not omni-channel. Omnichannel is 10 years ago,” he said. “You need to think about your channels as an ecosystem and then how to wrap security around that.”
What is an ecosystem? Clark cited a definition from McKinsey that “an ecosystem is an interconnected set of services through which users can fulfill a variety of needs in one integrated experience.”
McKinsey has also forecast that over the next eight years or so the marketplace will evolve into about 12 ecosystems, such as health, housing, travel, education, etc.
“What’s common to all of them is one, they are open, but also that payments is important to all of them,” said Clark. “We want to make sure that as these ecosystems form, your ability to put your card out front and deliver revenue is there.”
Clark cited another forecast, this from Accenture, that by 2030 banks/FIs will play three primary roles: Bank as Advice Provider, Bank as Value Aggregator, Bank as Access Facilitator.
“You are to be the trusted advisor. This could mean going to the credit union for a recommendation in the health industry, for example, something credit unions are currently not accustomed to doing,” observed Clark. “We want to build ourselves so that when this happens, we’re ready for it.”
Inside CO-OP, said Clark, an enterprise transformation is also taking place, including delivering on ways all the talk around “digital transformation” can actually be applied within credit unions.
“Inside CO-OP, everything we’re doing is to humanize the experience,” said Clark, pointing to four pillars around which it is focused: Client Centricity, Digital Ecosystem, Data Informed Intelligence, and Continuous Improvement.
“We are forming a single integrated experience, so we can put you everywhere your members are,” he said.
That includes looking at everything through two lenses, he said, one aimed at CU members, the other at its own client CUs.
“We are getting close to having every single piece of data that flows through CO-OP in one place. Then we are looking at what members want to do through the products and services we offer, and also looking at how they want to obtain services and earn rewards. And we want them to feel and be secure.”
It’s all organized beneath a layer of what Clark called “unified engagement.”
“Everything will be informed by data. For instance, if a member starts using cardless cash, it indicates they may be more forward-leaning and open to other offers,” he explained.
The Client Lens
Similar to the member engagement model, CO-OP also wants to be digitally engaged with its client CUs, according to Clark.
That process is beginning with the rollout of MyCO-Op this year. hat solution offers a single log-in that opens to a full reporting engine for all CO-OP services.
Fraud Monitoring and Prevention
In introducing COOPER, Clark emphasized again the company’s focus on improving security and fraud prevention. The company now has a CISO in place and a staff working on data security, which it didn’t have previously.
When it comes to consumer perceptions, “Financial institutions are 100% responsible for cybersecurity,” said Clark, “Everyone believes you are responsible, that you have to take care of them and you are the most secure. They are looking to you to solve their problems for them, so it’s how can we help you do that. Fifty-two percent would be willing to pay more in order to buy from a company that had strong cybersecurity. People are willing to pay up for these types of services.”
Trellance: An ‘Unbiased Advocate for Credit Unions
Meanwhile, in Fort Lauderdale, Fla., credit unions were given a clear understanding of the direction of Trellance at its annual meeting—and a key message shared with attendees is the CUSO’s objective is to move its member CUs forward.
“We are truly an unbiased advocate for credit unions,” said President Tom Davis, who opened up the immersion18 meeting. “Trellance will bring talent, Trellance will bring collaboration, vision and data to the services we provide our credit unions.”
Davis emphasized to the meeting that Trellance works for its credit unions and that its staff is an extension of credit unions’ staff.
“We are CUSO, we all work for Trellance and Trellance works for its members,” said Davis. “It’s not just something we say. We work for our credit unions and our intent is to serve our members in a manner that they would expect from someone who works for them.”
In late December, Trellance announced it divested CSCU, the CUSO's payments processing business. The newly formed Trellance retained CSCU’s Optimize card growth solutions offerings.
Davis focused on what’s next for the company, including 17 new products this year.
“We will do the same things we’ve been doing before, but they will have lot different feel because of our independence,” said Davis. “As I said, we are an unbiased advocate for credit unions. When we were selling processing, we were not independent and it sometimes was a challenge to be unbiased.
Preparing for Outcomes
“When it comes to our vision, it’s hard to predict the future,” continued Davis. “But it means being able to see multiple outcomes and know how to prepare for those outcomes. And with collaboration, we will help credit unions collaborate like never before.”
Davis told the meeting that Trellance is committed to bring actionable data analytics solutions to credit unions.
“We know there are lot of hidden answers within data, but also a lot of hidden questions—questions we are not asking,” said Davis.
Davis closed by saying that the pace of change, while fast today, will never be this slow again.
He said that Trellance’s independence allows the CUSO to be nimble.
“This new structure allows us to move more quickly,” he said. “There are fewer parties involved, fewer contracts to sign. If credit unions’ needs shift, we are not bound by a relationship with a provider. Nimbleness comes out of our independence.”