A Common Sense Approach to Credit Union Core Processing Reviews

When it comes to credit union core processing reviews and conversions, remember the best technology is the kind we can all understand.

As featured in the Credit Union Times article: "Maintaining a Common Sense Approach", we learn that when it comes to credit union core technology "when seeking a new core system be vigilant in reminding yourself that no one understands your needs better than you and none are going to look out for your interests more than you."

In 1946, American writer Gertrude Stein said, “Everybody gets so much information all day long that they lose their common sense.” One can only imagine Ms. Stein’s assessment of our day. We are buried under an ocean of information. The challenge, of course, isn’t obtaining information but separating it into something useful.

The task of reviewing a new credit union core processing system can be overwhelming. In my nearly three decades of working with credit unions, I’ve seen many credit union executives turning to others for direction. Although it may feel safe to seek advice, it is also wise to question the veracity of the information received and the motives of those that are giving it.

databytes002-1Trust Yourself

When confronted with the burden of a core processing review, I often see highly trained and experienced credit union personnel surrender their review process to others when there are no better people to execute and evaluate potential solutions than those that use the system most. Although advice from IT personnel might be important, the credit union’s operational business experts should be the people spearheading a core processing review. I have always maintained that the best technology is the kind that we can all understand. If any core product earns the endorsement of your operational business experts, then you should be confident that the technology behind it is likely pretty good. I say again, trust yourself; you and your people are your best authorities.

Question Consultants

Credit unions that entertain the use of a data processing consulting firm should understand that most are in the business of mitigating risk instead of finding the right long-term solution. In my experience, many consulting services create a time-consuming process designed to project value while yielding a predictable brand name result in order to achieve a risk adverse objective. Consequently, many highly-qualified core solutions are not extended an invitation to participate. Limiting your field of potential vendor candidates is a common consultant strategy of distancing credit unions from seeing and selecting any vendor beyond the consultant’s small pool of preferred core systems. Due diligence demands that you discover any pattern of behavior or practice that may undermine a complete and thorough review.

Data Processing CUSOs

They are often sold under a banner of community and oneness. Ironically, many who are drawn toward a DP CUSO rarely ask what they can do for the CUSO but rather, what can the CUSO do for them?  In the final analysis, a solution offered from a DP CUSO may be your best option. However, DP CUSO’s are frequently sold as something more than can be realistically delivered and serve as an example where people may begin to lose their common sense. Rather than make product the focal point of their review, it mutates into a seductive narrative outlining the benefits of ownership and collaboration. These tenets can benefit only so many before the natural laws of critical mass impose significant diminished returns. Moreover, prior to reaching this point of critical mass or economies of scale, credit unions that are vested will likely spend far more than expected in order to achieve this end, generating even greater pressure on its executives to realize a return on that investment.

Design a Holistic Approach

Your credit union’s business experts are your most valuable resource. Organizing those resources into a unified institutional objective should be your goal. Each system possesses its respective strengths and weaknesses. The credit union’s core review team must recognize and maintain this global objective while resisting the temptation to pursue the one that best serves their individual needs. Don’t forget that the most important person in this equation is your member and the level to which they must navigate various technology channels without confusion.

When seeking a new core system be vigilant in reminding yourself that no one understands your needs better than you and none are going to look out for your interests more than you.

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