Notes from Humanidei

Earlier this month, Geezeo announced the sale of their company to Jack Henry and Associates. Financial executives across the industry took notice. Something big had happened: The continuing consolidation of technology providers is an industry-changing event for financial services. It was also a life-changing event for the executives involved. People were equally curious about how the acquisition might impact the operations of their organizations and what the next steps might be for the executives from Geezeo. 

This high-profile acquisition presented an incredible opportunity: Many credit unions tout their solutions based on consumers’ life stages and meeting members wherever they are in their financial journey. Any financial institution could have taken note and used this news to reach out with a highly personalized financial solution. It would not have taken sophisticated artificial intelligence or big data solutions. All that was needed was a high-touch human, genuinely interested in the lives of consumers, and able to connect the dots between this life-changing event, the need for trusted financial advice, and the products or services that financial institution could offer. 

Bryan Clagett, Chief Marketing Officer and Investor at Geezeo is one of those executives facing a different life in a post-acquisition world. He is an active, connected social media influencer. A brief internet research session could lead a curious financial executive to understand a great deal about his life and his values. When Geezeo’s sale was announced, he did not hear from his credit union. He did not hear from his bank. He heard from a big bank that saw the news, but did not already have Clagett as a customer. 

Clagett posted the anecdote to his LinkedIn page with this message: “You can have the best technology in the world, but if you don’t have the people that connect the dots and take action, you’re going to fail. Eventually.” 

When a FinTech executive pronounces that technology is not all it takes for financial institutions to thrive, credit unions should be listening. Humans are the unique differentiator that will help credit unions stand out in a crowded, commoditized financial services marketplace, but our industry must be more strategic with their human capital. Technology is not enough. Teaching people how to use technology is not enough. Credit unions must attract, develop, and retain talent that thinks creatively, brings unique gifts to work, and is motivated to make an impact. 

I have nearly two decades’ experience working with credit unions for strategic growth and have become concerned about a persistent theme: Strategic planning processes heavily emphasize growth through technology advances or field of membership expansions, but rarely incorporate human capital strategies. This realization served as the impetus for founding Humaidei, a human capital strategies consulting firm designed to help credit unions build workplaces that fit today’s diverse and changing workforce. 

Credit unions are well-positioned to be the workplaces and volunteer causes of choice for engaged individuals who want to use their talents in a meaningful way. They are also organized around values that demand diversity, equity, and inclusion. A strategic, intentional approach that develops executives, volunteers, and cultures will create talented, diverse teams that represent and connect well with your members and your community. 

While the Geezeo example is a story that was thrust in front of us as an industry, there are opportunities like this in your credit union every day. Your team members know which community leaders are retiring, whose kids are heading off to college, which non-profit just secured a significant grant, and myriad other life milestones. Have you built a culture that teaches them how to think about that information? Or are you still advancing your technological capabilities, then powering them with basic order takers? 

If you aren’t sure your team could have connected the dots– or would have felt empowered– to help a member in Clagett’s position, it is time to get more strategic with your human capital. Don’t let another strategic planning season go by without including this focus.

It’s almost 2 p.m. and I’m still in the running clothes I threw on first thing this morning. I haven’t run, nor have I showered and “gotten ready for the day.” Being in a different time zone means that colleagues and clients on the west coast of the United States were responding to pending project requests while I slept. By 6 a.m. local time, new opportunities awaited me and I was ready to jump in. Eight hours later, I hadn’t gotten around to my usual morning routine, but had accomplished a lot.

I never dabbled in the world of “location independence” with a few days of working from home to see how it would go. I made summer plans before finalizing my new business partnership, and it happened that I launched a U.S.-based consulting firm while living in Spain. By the end of the second week, I had secured about a dozen clients, published two articles, and been interviewed by two industry media outlets. I had also taught my 8-year-old how to find his way around Europe’s oldest city, adjusted him to an entirely new daily schedule, and learned a few Spanish words and traditions. 

It was a balancing act that did not match the glamour I had imagined of wifi-enabled, seaside cafes with endless cups of coffee. It was not even the work-from-home scenario that I anticipated would allow me to do loads of laundry between conference calls.

Familiarity with the term, “location independence,” and the style of work have both grown significantly since Lea Woodward founded a remote work consulting firm and coined the term in 2007. Just over a decade later, this lifestyle is trending, with Instagram accounts filled with pics of poolside laptops and hashtags about #digitalnomads and #workfromanywhere. It hasn’t swept financial services, though. After all, how can transactions be completed when the tellers are all in Fiji? The traditional (and current) delivery of mainstream, retail financial services does not support an environment flexible enough to allow for location independence. In most cases outside of senior positions, it is even difficult to offer customized hours that allow scheduling flexibility for team members who care for aging parents or dependent children.

As the world considers a response to the threat of a pandemic spread of the Coronavirus, though, the discussion around remote work has risen to heightened relevance across many industries, including credit unions. When forced to consider it for the sustainability of the organization in a time of crisis, it seems that financial institutions can find ways to make remote work a possibility, after all. The reality is this, though: Financial institutions have been in a talent crisis for far longer than COVID-19 has threatened us and this crisis also merits an urgent response. 

Last summer, a PWC study “Preparing for Tomorrow’s Workforce, Today,” showed that financial services has fallen behind most other industries in responding to the demands of a changing workforce. This is especially prominent in the industry’s (lack of) priorities involving the people experience desired by today’s top performers. The financial services industry is not known for cultivating an intentional focus on work-life balance, for providing employees the opportunity to feel the positive impact of their work, or for actively working to develop and foster diverse and inclusive teams. 

As financial institutions strive to stay relevant, highly skilled workers will bring the innovative ideas, creativity, and strategies that move the organization to a place of heightened relevance in a crowded marketplace. In order to compete in the war for this level of talent, tremendous effort must be put forward for credit unions to become desirable places of employment. For many, this will mean significant philosophical and strategic shifts in talent acquisition, performance management, and even structure of the work day. 

Institutions that do not meet the new workforce’s expectations must be prepared to lose talent. Today’s workforce will handle their dissatisfaction with the action of walking away. They have seen- or experienced- a lack of loyalty from companies or the effects of burnout. In an always-on world, people use their scarce (and highly demanded) time differently. They hack their days to enable them to be at the most important events; responding to emails from soccer games, taking conference calls in the parking lot before walking into the meeting to discuss in-home care for aging parents, hitting Orange Theory in the middle of the day and wrapping up details for a new project launch from home after. Technology has enabled the extension of the work day, as well as the ability to flex it further, and people are happy to use this to their advantage. Is your credit union willing to give them that opportunity?

As a relatively new remote worker and manager of a remote workforce, and a recruiter who has placed candidates in remote workforces, I have learned a great deal over the past nine months. Members of my team and my clients span the United States. This past year, I have worked from nine different countries and in every U.S. time zone. My experience has enlightened me. I see the value of remote work in talent attraction, and how critical it is to build deep trust with a remote workforce; how I can use it to be more present in all areas of my life, and how intentional I must be to separate work and home; how much obligation sits with employees to communicate effectively, and how much an employer must work to cultivate culture in this environment. 

There are many paradoxes in the world of remote work that require a high degree of intentionality and effort to navigate, but the need for remote and flexible work options is clear. What are you willing to do to introduce these options in your organization as a talent attraction tool and not just a business continuity plan? If you are unwilling or unable to build a workplace that meets the demands of today’s changing workforce, the threat to your relevance may be greater than you imagine.

Imagine a time when you felt like you didn’t belong: Maybe you were new to a group of people who had known each other for years, you were visiting a family who spoke a different language, or you were attending a service in a faith that observed traditions you didn’t know. Uncertainty intensifies feelings of not belonging. Other people’s long-standing jokes seem exclusive, not being able to engage in conversation is alienating, following a step behind what everyone else is doing creates fears of being judged. 

In times of global uncertainty, everyone is more vulnerable to feeling disconnected. Fostering an inclusive workplace becomes more important than ever; however, during times of crisis, investing in culture can be quickly set aside, chalked up as “nice to have” rather than “needs to have,” with focus on this delayed until the “real” business issues are addressed. Inclusive workplaces are much more than a luxury to make employees feel good, though. They are key to surviving challenging times where better decisions are made, employees are more engaged in building to successful outcomes, and consumer needs are better understood (and therefore met). 

In our current state– with disrupted shifts, remote work, and not enough information– employees may feel less like they belong than ever before. If you are not intentionally including team members, you may find that just when you need employees to come together for the greater good, they disengage. Or, they stay through the crisis, but as soon as things start to return to “normal,” they leave for an environment that is more welcoming—one where inclusion is a priority all the time, not just when it is convenient for the people in charge.

Here are a few ways to stay focused on inclusion:   

1. Pay Attention to Who You Turn To: In tumultuous times, it is natural to seek the familiar. This might look like consistently turning to the one or two employees you know the best, have the most natural conversations with, or who share a similar way of thinking. While it feels like you are communicating frequently, by turning to the same employee over and over, others are left out of communication loops and you may miss key information or great ideas. If this happens in a newly-turned remote environment, it could result in days or weeks passing without direct connection to some individuals. While managing a team through crisis, intentional effort must be made to check in with every team member. Do not let out-of- sight become out-of-mind when there is physical distance between you and your team and do not assume they will contact you if they have questions or ideas.Schedule and adhere to regular contact with all team members, send summary emails about changing circumstances, and always ask your employees about their needs, what they are observing, and for their ideas. 
2. Acknowledge the Reality of Each Individual’s Situation: It keeps being said, “we are all in this together,” but the truth is that we are not. Sure, we are all in something together, but it is not the same thing: Some people are caring for newly at-home children, others are worrying about at-risk parents. Some have spouses working in healthcare with extended shifts and increased vulnerability, while others are married to restaurant employees and preoccupied by the lack of work. Your executives may be social distancing from home offices as branch employees greet coughing members in the lobby. We are all experiencing juggling acts we never anticipated, coordinating logistics with physical space and emotional and financial burdens. This is not business as usual. Leaders should assure employees that distractions and disruptions are understandable. On conference calls, dogs might bark, delivery drivers could ring doorbells, children will decide that the moment the conference call starts is exactly when they are starving to death and bored and need to know what will happen if they/grandma/the dog* contracts Covid-19. Tellers might need to step away from their work stations to take calls from home or deep breaths. It might seem obvious, but proactively convey that you recognize these extraordinary circumstances. Provide the opportunity for people to share what is impacting (and distracting) them and acknowledge you know they are doing the best they can. Offer grace and support to each human on your team and for the unique challenges they face.
3. Change Your Policies (Or Put Them On Hold): If you review your policies right now, you may find many areas where current practice is outside of policy. For example, many remote work policies state that if children are home, there must be another care provider present. As we practice social distancing, this option is impractical. Do not leave employees wondering what policies do and not apply. By identifying policies (remote work, sick leave, employee overdrafts, etc.) that can be put on hold and communicating this hiatus to employees, you convey your awareness that people are facing unprecedented situations, as well as your trust that employees will continue to contribute as fully as possible—even without a policy guiding their behavior. This message of respect is critical for fostering feelings of inclusion. 
4. Recognize (but don’t accept) That It is Lonely at the Top: In a crisis, it can feel even lonelier at the top. As a leader, you are in a position to care for your team, the long-term interests of your business, and all the unique circumstances arising in your life outside of work. With so many professional development and networking opportunities canceled, it may be hard to access the support network you would normally turn to. A culture of inclusion requires engaged leaders who bring others in, though, so do not allow this feeling of isolation to translate to how you connect with your team. Take care of yourself by reaching out to other leaders to share ideas and bolster one another and bring that leadership back to your team.

Intentional effort is critical to creating an inclusive environment. This remains so important in uncertain times. What are you doing to build a workplace that keeps all of your team members connected, respected, and included?

*Information shared by my 8-year-old in our household between conference calls: There is no evidence from the CDC that the dog can contract or transmit COVID-19. Please do not take this as fact-checked medical or scientific research.

How do you fix a broken pipeline? I’ll be honest: I’m not experienced in the fields of pipefitting or plumbing or natural gas distribution, but I can imagine that one accurate answer is, “It depends how and where it is broken.” 

A pipeline is a system that carries liquid or gas over a long distance to a designated area for use there. If a community at the distribution point of the pipeline finds they are not receiving the resource they expected, they might identify that they have a “pipeline problem.” From that point, they would diagnose the problem, recognizing the many points for potential compromise. The resource could have made it to the distribution point, but become stuck before it was distributed. There could be a leak somewhere along the way, causing the resource to seep out too early. Perhaps there was a challenge at the point of origin and the resource never entered the pipeline to begin with. When those working with the pipeline explore what has caused the malfunction, they can apply solutions specific to the problem. 

There is a pipeline problem in the credit union industry today. The evidence is in low output of female and minority leaders in key industry leadership positions at large credit unions; with state, national, and global trade associations; and in volunteer Chairperson positions across the industry. Today, women hold only 14% of CEO positions at credit unions over $1B in assets. A woman has never held the CEO position at CUNA, NAFCU, WOCCU, or CUES. Among the 36 currently serving CEOs at state credit union trade associations, four are female (approximately 11% of the total). 

Recent data from CUNA shows that approximately 5% of all credit union CEO positions (of all asset-sizes) are held by people of color. This number is consistent with representation in the 40 trade associations referenced in the previous paragraph, as well. Approximately 95% of those CEO positions are held by white people.

Staying with the pipeline analogy, imagine that the system of pipes is all the jobs in the credit union industry that might help someone advance to a top-level position. Initial hiring into an entry-level manager position is where a person first enters the pipeline. If a person leaves or becomes stuck in a mid-management position, even with ambition to rise to the C-suite, that would represent the mid-pipeline leak. A lack of diverse and highly qualified candidate pools for top leadership positions is like being at the end of a pipeline and not receiving the resource that was meant to be distributed. This could be a result of an issue at the distribution point, or anywhere else in the pipeline. Unfortunately– unlike people dealing with literal pipelines– often when industries experience the result of a talent “pipeline problem,” they meet it with a shrug, observing that the women or people of color “just don’t apply for these jobs.” Rather than recognizing a problem with the pipeline, the scarcity of diverse talent in candidate pools is blamed on the resource itself (the people who “just don’t apply for these jobs”). 

It is more likely that homogenous candidate pools are a result of something that happened much earlier in the careers of aspiring CEOs, though. A McKinsey study on Women in the Workplace (2018) finds that hiring and promotions at the first (entry-level) management position creates the greatest disadvantage for women. Even though women earn more than half of all college degrees right now (and have since 1999), for every 100 men hired into manager positions, only 79 women are hired. This disparate rate of advancement continues through further promotions, creating a situation where women never catch up: Today, women hold 38% of management positions. The study goes on to indicate that if current trends persist, the number of women in management will increase by only one percent over the next ten years. Simply by moving forward with promotions at equal rates (not forcing any turnover for those currently holding management positions), near parity could be achieved in 10 years, to women holding 48% of management positions. 

Credit unions are too important to meet our pipeline problem with complacency. Ten years from now, our numbers must demonstrate more parity than the 1% change that other workplaces are trending toward if we hope to have the leadership that will preserve our industry’s relevance and continue delivering on our unique value proposition. We are in a very real war for talent, and we must respond strategically: Unemployment is at just 3.5 percent in September 2019, leading many businesses to cite competition to attract and retain top talent as a major threat to business growth. Many sources inside the credit union industry estimate that as many as 50% of current CEOs will retire in the next decade. To face this challenge, credit unions must be positioned as attractive employers to today’s changing workforce.  

I ask again: How do you fix a pipeline problem?

In the credit union industry, we must do it holistically, looking at all the possible points where the pipeline might be compromised and providing solutions at each of these points. Today’s leaders must take personal responsibility for mentoring and sponsoring future leaders early in their careers (especially leaders who are different from them in demographics and skillset); organizations must invest in inclusive employee development programs that serve individuals with diverse backgrounds, experiences, and ways of thinking; and recruitment efforts must acknowledge implicit biases that may prevent attraction or selection of diverse candidate pools and work to overcome the effects of these biases. 

Humanidei is committed to coaching organizations beyond understanding why diversity and inclusion matter into action steps that will result in measurable impact. If you and your credit union are ready to fix the pipeline and win the war for talent, now is the time for action.

I was clueless the first time I spoke to an executive recruiter.

In my mid-20s, I was fortunate to have a job that connected me well to industry leaders. When a recruiter called to ask if I knew anyone who would be a great fit as the President/CEO of a trade association based in my home state, I assumed he was calling for a referral. I rattled off a few names before he stopped me: Listen. You’ve never worked with a recruiter before, have you? I’m calling to ask if you would consider applying.

I laughed out loud. My demographics did not match what I thought he was looking for.

While he acknowledged that I might not seem like a perfect match, he liked what he had heard and encouraged me to apply. He shepherded me through the experience, offering guidance about the process, the expectations, the members of the Board, and the qualities they were seeking. His commitment to his client was to uncover the best talent available, and he knew the only way to do that was to get to know—and help tell—the story of every candidate. At the conclusion of that search, even though I was not chosen for that job, I was confident that I had presented well as a candidate.

The next time I applied for a position with an executive recruiter, I did not get a call back.

I didn’t the next time either.

In fact, when I was ultimately hired as a first-time CEO, I had initially been excluded from the candidate pool. It was only after I mentioned my interest to someone on the search committee that I was considered, and only then because she demanded it. This was a frustrating experience for my eventual employer who had not been happy with the candidates initially presented. When they had asked about the lack of diversity, they were told they had been presented all qualified candidates the recruiter had reviewed. In this case, it was not that I was unqualified; it was that the recruiter had not looked at my application.

What was the difference in these starkly contrasting experiences? Had some mysterious algorithm locked me out of some searches, but let me into others?

The executive search experience can be frustrating for both candidates and hiring managers. Traditional search methods often lead to homogenous candidate pools that leave organizations wondering where the rest of the talent is and candidates uncertain if their applications were ever received.

While emerging technology has opened channels that allow for much wider reach, it has also depersonalized many elements of the job search. Some recruitment processes have struggled to strike the balance needed to maintain the human connection with the increasing number of candidates that technology brings. Overwhelmed with resumes, recruiters may slip into the habit of seeking the familiar: Candidates they know, who they have previously placed, or who have been referred directly. Exclusion from searches does not always stem from a systematically biased algorithm, but the persistent human bias of “in-group promotion.” Consideration comes down to who you know and who knows you, not progressing much beyond directly inviting people we know to apply for open positions. This method might seem safe, but often results in teams of individuals with similar backgrounds and ways of thinking, limiting the team’s capacity for innovation and deep understanding of diverse member groups.

If your organization is committed to attracting diverse talent and perspectives that will drive your organization forward, consider these four items before you kick off your recruitment process:

1. Set an intention for direct recruiting:It is still true that most people find jobs because of who they know. It is also true that humans tend to know people like themselves. Therefore, when your recruiter invites contacts to apply for a position, there is a likelihood that these candidates may be very similar to one another. Ensure your approach to direct recruitment goes beyond one individual’s network and is intentionally inclusive of broad demographics and backgrounds.
2. Consider where to post your position:Using typical social media channels and inside-the-industry advertising sources will lead to a full talent pool with a high number of applicants. This pool may not reflect the community you serve and may not bring in talent outside a more traditional bubble, though. If your organization is committed to vetting a talent pool that is likely to understand your community and your members, your recruiter should expand his or her search efforts beyond industry channels to reach into your specific community, too.
3. Be consistent with internal candidates: Organizations do not always know the full story of the latent talent already on staff, missing opportunities to promote well-qualified individuals. Long-time employees may end up with fewer opportunities for growth when assumptions are made about their skills, strengths, and ambitions. This is why many talented executives wonder if the only way to move up is to move out of an organization. Strategically recruit within your organization for promotions and new positions, at least as much as you would externally. The talent you already have on staff may surprise and delight you—and it comes with institutional knowledge!
4. Refine your requirements: One of the most common ways organizations inadvertently perpetuate homogeny in leadership is by assuming that the experience, traits, and background held by a successful incumbent should be replicated. When defining the ideal candidate profile, scrutinize why something is included as a necessary qualification. Must your CEO be a CPA when accounting and finance functions are delegated? Is there a correlation between holding a Master’s Degree and being a successful VP-Lending? Be careful, too, about the years of experience you require. If, for example, you want to hire a Chief Digital Officer with 10-15 years of experience in mobile banking, you will have a limited pool: The iPhone was not invented until 2007 and mobile banking was not ubiquitous until after that pivotal event. Engage in strategic conversations about what it really takes for a candidate to be successful in carrying out the objectives of a specific role, then remove any non-essential requirements from the job posting.

As unemployment remains historically low, the freelance economy attracts talented professionals seeking flexible options, and human capital remains the most important way credit unions can differentiate, the stakes have never been higher in the war for talent. Be sure your executive search processes are designed to attract and include the best of who is available.

In October 2019, O’Rourke and Associates became a division of Humanidei. This progressive change was made to reinvent the gold standard of executive recruiting in the credit union space, recognizing that organizations won’t be successful in attracting today’s talent with yesterday’s techniques.