Establishing and defining strategic objectives holds a crucial position in shaping a prosperous and member-focused future for a credit union. The process of setting goals is not an optional exercise but an essential foundation. Within the realm of customer experience (CX) or member experience (MX) management, credit unions, like other organizations, encounter distinctive obstacles while striving for distinction.
This article will delve into the intricacies of goal setting for credit unions, address your challenges, and provide insights to help you chart your course. For context, let's take a moment to reflect on the industry averages of our clients as of YTD 2023. As of October 11, our data reveals that Consumer Loans stand out with an average Net Promoter Score (NPS®) of 89.96 and an average Member Effort Score (MES) of 6.57, with Mortgage Loans coming in second, having an NPS® of 87.00 and an MES of 6.47. These figures reflect the tremendous potential within the credit union industry when achievable goals are set.
So, get ready as we explore the intricacies of goal setting, equipped with data, strategies, and a shared commitment to empower your credit union to achieve greatness.
In the ever-evolving world of credit unions, the pursuit of excellence begins with a well-defined destination. The art of goal setting, often regarded as the compass that guides your credit union's journey, is an essential facet of your strategic roadmap.
For credit unions, the importance of setting goals cannot be overstated. A specific set of objectives to work toward provides a sense of direction and equips credit unions to overcome these challenges systematically. Without a clear roadmap, institutions can easily drift aimlessly, making it challenging to measure progress or make informed decisions.
To excel in the ever-competitive financial sector, your credit union needs to tailor its goals to its unique performance data, member demographics, and industry benchmarks. An excellent starting point for this customization is to analyze industry averages.
For example, as of Year-To-Date (YTD) 2023, based on data from our valued clients, we can draw insights demonstrating what is achievable within the credit union sphere. Consumer and Mortgage Loans may be performing well, but we have uncovered that the lowest-scoring experience is Online Banking, with an NPS® of 53.71 and an MES of 5.87. Using this information, there is an opportunity for credit unions to focus on improving their digital channels.
This data paints a vivid picture, showcasing areas where credit unions have excelled and, in turn, serves as a foundation for setting realistic KPI targets. Utilizing this data to align your goals with industry best practices is integral in setting strategic goals.
The intricacies of setting goals within a credit union are multi-faceted, involving not only the overarching objectives but also the granular details at the individual employee level. To systematically address these layers of goal setting, we have identified three primary levels:
As we navigate the intricacies of setting goals at these three levels, remember that the journey toward success is underpinned by data, strategy, and a clear understanding of where the industry stands.
Goal setting in the world of credit unions is not an isolated endeavor but a group effort, with Key Performance Indicators (KPIs) at the center. These metrics are the essential instruments that allow credit unions to measure performance, monitor progress, and improve member experiences.
KPIs reflect an organization's dedication to continuous improvement and unwavering commitment to its members. By employing the right KPIs, credit unions can make data-driven decisions that enhance operational efficiency, bolster member loyalty, and, ultimately, drive financial success.
To set realistic and achievable goals, we often turn to industry benchmarks and historical data. Year over year, we have seen two areas of improvement in our credit unions:
These industry targets provide a realistic yardstick against which credit unions can measure their own performance. It's not about replicating the success of others but understanding the art of the possible and setting your unique goals accordingly.
In strategic goal setting, credit unions recognize the pivotal role played by individual team members and the significance of the collective effort. Key Performance Indicators (KPIs) offer a clear path toward excellence at both individual and team levels.
For individual goals, KPIs should align with specific roles and responsibilities. These may include the individual performer score, which evaluates aspects like member interactions and product offerings. Customization is essential to ensure KPIs reflect the credit union's unique characteristics.
Moving up the ladder to team or department goals, KPIs like the individual or team performer score, follow-up time saves members at risk for leaving the credit union, and follow-up time on cross-sell opportunities foster teamwork and shared responsibility. Credit unions can customize these KPIs to align with their strategies and member needs, aiming not just to meet but to surpass industry averages and set a standard of excellence.
At the highest level of goal setting, credit unions define their overarching objectives that encompass the entire organization. These objectives integrate various aspects of member experience and operational performance, reflecting the credit union's vision for the future. To set these encompassing goals, it is paramount to consider KPIs that provide a holistic view of performance. Here, the individual team performer score, Net Promoter Score (NPS®), and Member Effort Score (MES) take center stage.
These KPIs offer a panoramic perspective of the credit union's performance and its impact on members' experiences. By leveraging these indicators, credit unions can craft objectives that align with industry standards while pushing the boundaries of excellence.
Effortlessness in member interactions guides credit unions toward a destination where members feel valued and respected. This notion forms the core of the Member Effort Score (MES). This metric transcends the quantitative realm and delves into the qualitative aspects of member experiences. MES is not just another data point but a reflection of the credit union's commitment to ensuring that each interaction is frictionless.
One of the most illuminating aspects of MES is its strong correlation with wallet share, a pivotal indicator of a member's financial engagement with the credit union. Insights into MES reveal that the higher the MES score, the more members engage with the credit union, leading to a notable increase in product/accounts.
MES serves as a measurement to help credit unions gauge the simplicity and efficiency of member interactions. By enhancing MES, credit unions can effectively boost member engagement, increase wallet share, and foster a sense of loyalty among members.
Since we are all facing fierce competition, member retention is a cornerstone of success. The ease with which members can conduct their financial affairs is a crucial aspect of this retention. MES is not just a metric but a commitment to ensuring that every interaction with the credit union is as smooth as possible.
At the heart of member loyalty lies the Net Promoter Score (NPS®), a metric that delves into members' emotional attachment to their credit union. It reflects not just transactions but the relationship that members nurture with the organization.
NPS® asks a simple yet profound question: "How likely are you to recommend us to a friend or co-worker?" The score is a scale ranging from 0 to 10, with 10 being highly likely. This simple question encapsulates the essence of member loyalty and their willingness to be advocates for their credit union. This metric gives credit unions a holistic view of member loyalty, guiding them toward actions that nurture this loyalty.
It's important to understand that the figures from NPS® and MES are not just statistics; they are reflections of the commitment these sectors have made to their members. The connection between these metrics underscores that members find their interactions with these credit unions not only effortless but also worthy of enthusiastic recommendation.
Setting NPS® targets becomes paramount for credit unions aiming to achieve and surpass industry benchmarks. To set these targets effectively, credit unions need to consider the overall industry performance and their unique member demographics.
Leveraging industry benchmarks, you can define realistic NPS® goals. The aim is not merely to meet these benchmarks but to exceed them and become the gold standard for member loyalty and advocacy.
As we venture further into enhancing member experiences in credit unions, we come to a critical juncture - integrating Key Performance Indicators (KPIs). This section will unveil the importance of aligning member experience KPIs within the broader context of balanced scorecards, emphasizing the weighted significance of these metrics and the power of a combined approach.
Balanced scorecards are the cornerstone of performance management, providing a comprehensive view of how credit unions fare across various key areas. It's a framework that combines financial and non-financial metrics to gauge the organization's overall health and effectiveness.
Integrating member experience KPIs, such as NPS® and MES, into the balanced scorecards is the bridge that connects quantitative data with qualitative insights. It adds the 'human touch' to what can often be a numerical evaluation. By doing so, credit unions ensure that member experiences are at the forefront of their strategic objectives.
The strength of a credit union's member experience program lies not only in individual metrics but also in the harmony of a combined approach. By using both the MemberView Survey Platform for quantitative data and the Membershopper program for qualitative feedback, credit unions create a well-rounded program for improving member experiences.
When these platforms work together, credit unions gain a holistic view of members' experiences. They can identify where improvements are needed and why members feel a certain way. This combined approach empowers credit unions to make data-driven decisions, guiding their actions for more meaningful and effective change.
Integrating KPIs into Branch Balanced Scorecards and the combined approach of quantitative and qualitative data lay the foundation for a loop that should never remain open. It's a continuous journey of improvement. Credit unions are not just assessing member experiences but actively improving them, measuring the impact of these improvements, and refining strategies based on those measurements.
The power of a combined approach is not merely in data collection but in its application. It's in the ability to translate insights into actions, enhancing member experiences, and ultimately ensuring the credit union remains a trusted partner in their financial journey.
GoalsSetting strategic goals tailored to your credit union's unique performance data is crucial to its success. This is an ongoing process of continuous improvement that hinges on the application of insights. Credit unions are not just assessing member experiences but actively improving them, measuring the impact of these improvements, and refining strategies based on those measurements.
As the financial industry evolves, your role in retaining and engaging members becomes even more crucial. We encourage you to use the insights provided here, industry benchmarks, and best practices as you set and achieve your goals.
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Reference
*Net Promoter Score is a trademark of Satmetrix, Bain & Company, and Fred Reichfield.
