- If you want to keep up with the rapidly evolving tech landscape, you should leverage the cloud to help you take advantage of innovative tools.
- As a community FI, focus on technological innovation because that’s increasingly important to your accountholders. Make sure that your requirements suit your culture of innovation.
- Make smart decisions about the partners that you choose. If there’s no collaboration, they’re just taking your money.
Staying ahead of the technology curve can be daunting. That’s why it’s more important than ever for community FIs to choose their technology partners wisely. It’s important to seek out organizations that fit culturally and can add real value.
For example, AWS is creating innovation within the community banking ecosystem, while Think|Stack is empowering community FIs to take advantage of that.
In the latest episode of The Digital Banking Podcast, host Josh DeTar; Brian Murphy, Partner Strategist, Nonprofit Organizations at AWS; and Chris Sachse, CEO of Think|Stack, discussed credit unions and how they can use technology to build and strengthen communities.
Credit Unions Have Become Aggregators
As Sachse explained, a credit union identifies a membership group and understands the needs of that membership group.
“It’s bringing together products and services that meet their needs based on the brand or the specialization that the credit union is trying to create. And today, most of those solutions are more technology driven. So credit unions are kind of technology aggregators,” said Sachse. “If done well, they’re aggregating the right technology to build the experience that is going to attract the type of member that they’re looking to serve.”
Sachse said he conducted a strategic foresight exercise with a credit union and its board a couple of years ago, during which he realized that customers ultimately care about trust and security.
“That’s what excites me about the credit union industry. People would naturally prefer to work with an organization that understands them, that is small and local,” claimed Sachse. “I think most of us would do that. But you’ve got to come with the convenience and the experience that the big guys have. Otherwise, it’s just too easy to sit at home and use Robinhood or whatever other products you want to talk about.”
According to Sachse, the key for credit unions is being able to identify and build a brand around its membership group and then aggregate the right products and services. “Then govern those products and services to ensure that those vendors are delivering on the promises that the credit union is making to the members,” he added.
The Important Role of Partnerships for a Community FI
Murphy said it’s important for community FIs to partner with organizations that understand and, where necessary, can explain the full implications of a particular technology.
“That’s what I see a lot of our partners do, even if it’s non-technical people,” said Murphy. “Chris is selling concepts; he’s really pulling these aggregation points together and making them palatable for the consumer. You want to talk about building a contact center, I can show you five different ways to do it. And I don’t know a damned thing about the technology.”
He added that the right partner can bring a different approach, a different way to use technology, and a fresh perspective on what the consumer might need.
“It’s all an exercise in working backward,” added Murphy. “If you’re building requirements and you’re building capabilities — as opposed to building toward goals — find the partners that are going to build toward your goals.”
RFPs Need to Change
According to Sachse, RFPs (requests for proposal) do a disservice to all involved parties. “I’m starting to see people get a little more open about it but, by and large, most of the organizations are spending time to build an RFP or trying to fit people into a box, and people don’t fit in a box,” he said.
“If you’re telling somebody, ‘I need to do X, Y, and Z in the next 10 years,’ how are we going to get there? First is saying, ‘Hey, I want to accomplish this goal.’ You need your own brain trust to really work toward that goal,” added Murphy.
The two told DeTar of a project they worked on together for a credit union, with AWS supporting Think|Stack’s efforts.
“It was a very collaborative effort and approach to do something that probably wasn’t on the roadmap,” said Murphy. “They didn’t even know to ask the questions — if it was something that they needed to do. But now that it’s being talked about, now that it’s being supported, now that we’re at a point where we can really kind of talk through what that looks like — it’s cool, it’s creative, it’s something that not a lot of people are doing.”