[00:00:35] The Digital Banking Podcast is powered by Tyfone is the creator of Infiniti, a ally better digital banking platform for community financial institutions, as well as several platform agnostic revenue generating point solutions. Our highly configurable platform and broad ecosystem of third party partners ensure our entire suite is scalable and extensible to meet the needs of any FI.

[00:01:02] On our podcast, you will hear host Josh DeTar, discuss today’s most pressing financial technology topics with seasoned industry experts from every possible discipline.

[00:01:22] [00:02:22] Josh DeTar: Welcome to another episode of the Digital Banking Podcast.

[00:02:25] Josh: My guest today is Kirk Kordeleski, partner at PARC Street Group. You know, I absolutely love the unabashed enthusiasm for life that Kirk wears on his sleeves. I had the pleasure of meeting Kirk and his equally, although he would probably argue more amazing wife, Kathleen, at a conference.

[00:02:47] Josh: And I still remember walking away from that first interaction feeling, you know, it may not be perfect, but life is truly wonderful and really special. That’s just the way Kirk makes you feel. He once told me, life is about choices. You have lots of choices to make in a day. And yes, there are things that stress him out, that he worries over, that concern him.

[00:03:14] Josh: But he said, when you wake up in the morning, you get to make your first choice of the. How am I going to react and respond to the things that come my way, and will I choose the positive path or not? Sure. At some level, we all know that statement to be true. Sure. Sometimes that’s easier said than done.

[00:03:34] Josh: What’s really beautiful about Kirk is his ability to time and time again, choose that positive path and he said, well, honestly, it’s just a lot happier and more fun of a path. You know, at his core, Kirk has always had both this passion for life and a few other traits that really make him who he is. He has a deep curiosity for what’s out there.

[00:03:59] Josh: Maybe we’ll get him to weigh in on aliens today. I don’t know, throwing it out there and what the world has to hold. He has a strong gravitational pull towards a value system that believes in cooperation, collaboration, and helping people sound like the framework of something else you might know of. It’s for those reasons.

[00:04:19] Josh: You can see the clear alignment for Kirk to the credit union industry. This brought him to spend over 25 years, 15 of which as CEO at Bethpage Credit Union, not someone to ever be able to fully retire. Though Kirk now spends his days looking for ways to build up and support the next generation of credit unions and their leaders, including currently mentoring over 40 different individuals in the credit union space.

[00:04:49] Josh: We have some super interesting topics to discuss today that haven’t really been topics I’ve discussed on the podcast previously. Everything from how mergers and acquisitions and executive comp plans play into the credit union industry’s future to how to grow a not-for-profit without stock is a mechanism.

[00:05:07] Josh: I’m super excited to welcome Kirk and his enthusiasm for life to the show, and I hope you walk away from this conversation as uplifted and as inspired as I know I’m gonna be. So, Kirk, thanks for joining me today, sir.

[00:05:21] Kirk Kordeleski: Josh, thank you, man. that was so kind, overly kind and and generous. I appreciate it and, and I appreciate what you’re doing here in this, in your podcast and what Tyfone does.

[00:05:34] Kirk: And so, you know, thank you for the, this opportunity. I could talk about, having been around the industry for 50 years, the half life of credit unions. I could talk about this forever. but I appreciate the opportunity. and I think we do have some very cool things to touch on that, you know, yeah.

[00:05:52] Kirk: Hopefully will help some people think about why credit unions matter and maybe about leadership out of as well.

[00:06:00] Josh: I agree. You know, and thank you for saying that, but I think it’s just, you know, they gave some idiot the mic and I haven’t given it back, and we’re here now. so now it’s kind of hard to get it away from me, but no, it’s really cool. And I think, you know, anybody who’s been a, especially a long time, you know, listener or watcher of this podcast knows, I’d like to think I’m pretty unabashedly dorky about the community financial institution space and just the impact that it has for the good in people’s lives, right?

[00:06:32] Josh: Like, love it or hate it. The fact of the matter is, is that money is a huge part of our world and our lives, right? And, to quote the great theologian, love him or hate him, Joe Rogan money doesn’t buy happiness, but it vice freedom. Right. And giving someone freedom is pretty incredible and pretty powerful.

[00:06:49] Josh: And so it’s really neat to see the impact that this industry has. And so I just get super excited to talk to people like you who, I mean, Kirk serious, that’s impressive to keep up this level of energy and enthusiasm. 50 years in, I mean, I met you at that conference and I walked away going, holy crap. I don’t have as much energy as this guy.

[00:07:10] Josh: Like, this is cool. so I mean, talk me through a little bit of that journey for you. how did you get into the credit union industry and then how did kind of that, just like you said, core like value system that you had. How did you kind of notice that alignment with the credit union industry and then just continue to double down throughout your career on that?

[00:07:32] Kirk: So that, you know, like so many people’s stories, I fell into credit unions, right? there are very few people sit around college thinking, uh, I’d like to be a credit union, CEO or a credit union executive, a a little more of that these days. We could talk about that later about how some cities, and you see this with your, your connections and your support of the industry in many ways, conferences and, and products and tool sets is that credit unions and, community banks are often the advertisers, the main retail banking operations in communities today.

[00:08:05] Kirk: But that wasn’t the way when I came outta college in 70, in 1980, and, started at credit unions in 78. So literally, I am, uh, 68 this year, so it’s, it’s been a long. Great run, for me to, to be in the industry. but they were very small. They were tiny organizations that only had a couple products, a personal loan and a savings account.

[00:08:27] Kirk: Didn’t have checking accounts, didn’t have a lot of things. And, I had a, girlfriend whose mom worked at it, a credit union at the World Bank International Monetary Fund. Now, that was a cool place, right? Yeah. the World Bank IMF, just like the UN 70% Foreign National for this, you know, young guy out of Alexandria, Virginia, who had not had the opportunity.

[00:08:50] Kirk: We were lower middle income father was Air Force, you know, we traveled a little bit, but, not to Europe for the summer. Right. So this exposure to this, what are, some of the smartest people in the world, they’re recruited from the best universities and being at the World Bank IMF band was cool, right?

[00:09:07] Kirk: it was seeing things in a way that, that I had no, other opportunity too. And, and to learn and talk to people. I mean, the board members that were recruited from, um, you know, these amazing schools, Hartford and Princeton and, just every place. And, and they’d sit down with me and they’d talk to me, and that was just very cool.

[00:09:26] Kirk: And so, anyway, very small quarter 25 people, $25 million, tiny thing. but, the employees of the credit union almost always were spouses. The employees at the World Bank and IMF.

[00:09:43] /: Okay.

[00:09:43] Kirk: And so 70% foreign nationals, they would go to home leave. Home leave would be six weeks, typically during summer. ’cause they had kids.

[00:09:49] Kirk: Right. And, and I was summer employee, I was still in college and they would vacate those positions and I got to do every one of those jobs early on. So I got

[00:09:58] Josh: That’s so

[00:09:59] Kirk: feeling how to do each of these businesses. Yeah. By the way, I sucked as a teller. I talked to people instead of looking at the pennies so that, that they, they were, I was fortunate.

[00:10:10] Kirk: That they didn’t have very high standards. They, uh, but uh,

[00:10:14] Josh: what’s your cash counts, Kirk?

[00:10:17] Kirk: Yeah. I would’ve concerts that I wanted to go to and I’d have to be there counting the damn dollars out again. But anyway, they, uh, but so it was a great experience. And then there was a very cool secondary or massive change that happened.

[00:10:31] Kirk: Two of them actually deregulation, that which allowed credit unions to do checking and have mortgages and credit cards. And I got a chance to do each of those as a new CEO came in who was a banker from Bank of America in San Francisco at the time, not the Charlotte based one at old time. And, um, he taught me about banking.

[00:10:50] Kirk: And so now. I had this opportunity, because technology starts to come in, deregulation occurs, all these new products, technology comes in to help solve it for community institutions. I happen to have been studying technology and, in school and everybody else was afraid of the system. Still some truth to that, to this day, yes.

[00:11:10] Kirk: and so they gave me the opportunity to do a conversion. And during that conversion I had to teach everybody how to use the system so I learned their jobs. So I got built all of this up from this, this beginning path of this very kinda smart organization. And so I, I got to sit at the table as they made decisions about finance and investments and technology and marketing and operations that, a 20-year-old or 21-year-old just doesn’t get a chance to do.

[00:11:38] Kirk: And then I got to present to these world class leaders at board meeting. So that, that was an education that you couldn’t design better. I just happened to be in the right place at the right time.

[00:11:50] /: The

[00:11:50] Kirk: story of my life in many ways. And then that evolved to working for that computer company. I led their customer service.

[00:11:57] Kirk: by the way, that computer company failed, which was great lessons and, leadership, which we can talk about at some point if you’d like. was hired back by the credit union, so that was cool. They didn’t hate me and

[00:12:08] Kirk: I went quickly back to, working there for another decade. And so I just spent my time, did all these projects, all this stuff. And then I met, the CEO of Bethpage credit union guy, a gentleman named Pete Sites who made my career great guy. And he was recruiting a, a succession plan, somebody to follow him.

[00:12:28] Kirk: And there were three choices, all of which were on this sort of advisory council. By the way, anyone that’s listening wants to become a leader, wants to do something. Join as much as you can. Man, if I hadn’t joined those groups, I would’ve never been exposed to CEOs. And if I hadn’t been exposed to CEOs, I’d never been hired for this job.

[00:12:45] /: Yeah.

[00:12:46] Kirk: But he, there were three of us, two were much more, talented, experienced, whatever than I was. And, but neither one would move to Long Island, New York. They wanted to stay in Indiana and California. So I’m left standing, right. So,

[00:13:01] Josh: last

[00:13:02] Josh: man standing.

[00:13:02] Kirk: there it is. Sometimes, you know, you’re just

[00:13:05] Josh: Kirk.

[00:13:05] Kirk: Mason man.

[00:13:06] Kirk: And so I go in and then, I start to really, Think about the business in very different ways. And I, go and, I hope this is one trait that, that matters, that has always mattered to me and I hope it matters to others. And that was the curiosity in the, that you mentioned. So I started going to, and studying and really thinking and reading and studying about what a future might look like for an institution.

[00:13:30] Kirk: And then hopefully we led it that way.

[00:13:33] Josh: You know, couple of things I have to call out. You said you got the opportunity to do a conversion. I don’t think everybody thinks that way. I just wanna throw that out there. Um,

[00:13:48] Kirk: by, the way, it is an opportunity in every business. I, most people don’t think of it, but you get to reconstruct the entire operations of the business if you do it well.

[00:13:57] Kirk: And it, that, that alone can change the, the trajectory of the company for the next five years.

[00:14:03] Josh: I mean, that’s so true. It it’s really, really hard sometimes in the moment. I mean, we’re all guilty of this, right.

[00:14:10] Josh: We get stuck in a rut, we get comfortable, and you know, I’m gonna say it very bluntly, but comfortability breeds mediocrity, right? And so if we want to be exceptional, we’ve gotta break outta those ruts.

[00:14:24] Josh: And sometimes it’s just really hard to get out of the rut. But once you do, you’re like, oh, you know what? This isn’t so bad. We’ll figure it out. I’m a smart person. I’m dedicated. I’m capable, right. Like, we can do this. And to your point, like that’s where the real growth happens, is we say, Hey, you know what?

[00:14:41] Josh: We’re gonna do this conversion and we’re not excited about it. And then you get into it and you’re like, you know what? Actually I’m pretty excited about this. Like this is a huge opportunity for us to transform, to maintain our relevancy in a changing world. Like these are all things that we, we’d have to do.

[00:14:57] Josh: We really do. And to your comment from earlier, like you get to wake up and make the choice of, am I gonna be bitter about this or am I gonna be excited and embrace? What’s the opportunity that can come from this?

[00:15:10] Kirk: I I, think leaders have to be somewhat shortsighted and, when I think about that task, that huge project, right, of a conversion or, cultural change or changing markets where you’re gonna go into as a credit union or as a business, I think you have to, to be able to, to put out of your mind the pain that’s gonna happen in the middle, and be able to have your vision about what the great success could be, and then have your vision on what you’re executing today and tomorrow.

[00:15:42] Kirk: Mm-hmm. Uh, that sort of agile environment in the, in the early stages. And if you can do that, you can stay positive about it, not be frightened by it, and still be invigorated by the, the end result. The biggest challenge in any of that is to really have a vision that’s broad enough. To what greatness or real success, or, or brilliance looks like, so that you keep trying to achieve that in this day-to-day t tr trudge of, you know, doing a conversion or, or whatever that work might be.

[00:16:16] Josh: Kirk, I, I know you probably never take it off, but put on your mentorship hat and, you know, gimme some advice. So, you know, you talk about having to be able to kind of forget the pain in the middle. Right. See your vision, be able to get through. I think one of the things that is important as leaders is to be, very open, very transparent.

[00:16:41] Josh: admit faults and admit problems, but how do you, especially in the face of something really big, like a conversion, how do you do that at the same time as maintaining positivity? Like how do you navigate that path? And, I think for, for leaders, especially if you’re the one that made the decision, right?

[00:17:00] Josh: Like, we’re gonna, I’m deciding we’re gonna do a core conversion for these reasons, it’s really easy for you sometimes to be like, Hey, the pain’s gonna be worth it. Here’s my vision. I’m not actually doing the data migration as somebody else’s. They’ve got that pain and they may not see the value of the vision.

[00:17:23] Josh: So how do you kind of address and, I don’t know, I guess validate and, and accept the pain that they’re in and the negative side, while maintaining a positive outlook for yourself and your staff.

[00:17:38] Kirk: Yeah. Well, well, I think it first comes down to a, to something that happens before that. And that is that, that you have to communicate and completely communicate meaning over and over and over again the vision of the organization, the, the, where the company’s going, and then the conversion is a part of that vision.

[00:17:57] Kirk: It’s not a standalone, it’s not to do it just for technology. It’s not to do it for a, a piece here or a piece there that improves it, but is a clog a significant strategy in the overall, goal of the company. It has to be in context if it’s in context. And I think importantly now, this is my own experience, so this isn’t true of all leaders.

[00:18:21] Kirk: You’ve gone through it yourself before, you’ve been responsible for the, the magnitude and the challenges and the details that are required to do a project of that size. You can, create a very trusted environment where you understand where they’re walking and the challenges of it. You support it in many ways by acknowledging the talent that you’re gonna need to get that done, you acknowledge that there’s some compensation that should be there to help, people stay aligned and motivated.

[00:18:49] Kirk: it becomes holistic in how you design that. and then I would argue to when a project is as large and was one time as something like a conversion, you use outside resources to help to have a constant feedback loop that is independent from the organizational’s. Uh, internal communications.

[00:19:09] Kirk: So you have to, you have to design this whole model that that creates a, a reason that, that shows the purpose of the reason that builds out the truth of how much work it’s going to be that, accepts that truth by putting resources around it and compensation. And then you do a great job of communicating all of those pieces, but also the heroes, right?

[00:19:32] Kirk: The people that are putting in the effort and the energy and you never make it about yourself as the leader. It’s successful. It was about the team. If it’s a failure, it was your decision.

[00:19:41] Josh: yeah.

[00:19:43] Kirk: You know,

[00:19:43] Josh: that’s a hard pill to

[00:19:44] Josh: swallow.

[00:19:45] Kirk: Yeah. Classic stuff, right? But that’s the only way people will trust youyou know, you have to walk that walk and, you know, leadership

[00:19:52] Kirk: when you’re talking about a conversion’s, a great example is that it’s, it’s life, right?

[00:19:57] Kirk: If you’re a CEO. The COO or whatever those positions are, you know, you’re accepting a balance in your life that is,

[00:20:06] Kirk: significantly about your role as a leader. you can’t leave it at, at a time, you can’t leave it at a time of day or a day of a week or any of those things. It, it’s just what you think about and who you are and how you, you’re responsible, you know, when I left that page, responsible for a thousand employees, right. You know, pretty, pretty awesome responsibility. you have to, that requires, that energy and time and you have to be very thoughtful about how the steps you took,

[00:20:34] Josh: uh, that goes back to one of the other things that you said. That again, I think, you know, we all kind of recognize at some base level, right? Which is you were at the right place at the Right. time. And what’s interesting is I think a lot of us are at the Right.

[00:20:48] Josh: place at the right time, a lot of times.

[00:20:52] Josh: and we don’t necessarily seize it or we think that this is the right place in the right time and it really isn’t. And we’re trying to force something that isn’t, how have you kind of navigated that right place, right time in life and what would be some of the recommendations you would make for people?

[00:21:09] Josh: And, and I think the reason I say, you know, kind of in the vein of this conversation is, you know, thinking about, Hey, we’re coming into whatever. we’re gonna do a core conversion, we’re gonna do a cards conversion, right?

[00:21:21] Kirk: Right.

[00:21:21] Josh: How can somebody see that as, you know what, this might be my time and my place.

[00:21:28] Josh: This shifts everything and I can choose to take the positive path. how do you kind of manifest those into, you know, actually being something real? It’s the right place at right time and you know, a lot of times, sorry, I, I add one point and then I’ll stop to get your thoughts, but you know, I think a lot of times you yourself included, you know, you said some of it was a luck.

[00:21:49] Josh: I just don’t know if I necessarily believe that, right? Like I think you create a lot of that luck and Yeah. I mean you could have looked at any number of those opportunities in your life and you could have absolutely found it negative element to it and you could have attached to that negative element and it would’ve never turned into anything.

[00:22:10] Josh: But because you just always said, whatever the situation or circumstance I’m in now, what’s the positive path? What’s the negative path? Okay, I’m going that way.

[00:22:19] Kirk: Right.

[00:22:19] Josh: That manifested some of that luck, I think, right?

[00:22:23] Kirk: It without question, right. You know, I, you do manifest or make your own luck by consistently applying yourself to what’s going on.

[00:22:35] Kirk: I mean. I don’t know if this is true of everybody, but if, if I look back to what, you know, I literally started working at 10 as a paperboy, 14 as a busboy stuff, right? It never occurred to me to not work really hard, and what did that mean? They, ah, people gave me more chances to do stuff, right? Mm-hmm. You know, because they admired, they wanted you to show up and, and do the effort.

[00:23:01] Kirk: it never occurred to me that the small tasks didn’t need to be done or didn’t need to be done as well as I could. I think that’s what manifested the luck. I, I think that’s what put me in the positions. You know, you were talking about computer operator. I’m a part-time teller, computer operator.

[00:23:17] Kirk: In those early stages of, of what I did. Nobody else wanted to be there two o’clock in the morning to run backup tapes. Right. but to me it was cool. I was learning something new. it was interesting. I like the independence I was studying at the same time, it kind of worked in my life, you know?

[00:23:33] Kirk: And, but it is, I think that you do make your own luck by the energy and the effort that you put in, but it is energy and effort. and that, you know, through that you, you get better opportunities than others. Mm-hmm. And you know, this positiveness that sometimes is, thought of as, as being sort.

[00:23:54] Kirk: current psychology or, or business act, you know, business self-help books really matters. I mean, people want to be around an organization and people that are looking at the world in a positive way. If you look at, one of the things I, I’d love to talk about as we go through this, is about why it’s so important to have a truly winning culture.

[00:24:15] Kirk: And I don’t mean a moderately winning culture, but a truly winning culture in a company. Because with that, you create this energy and this success and this will to go through very difficult times or to reach very complex and difficult challenging goals because the pride that you have in what you do, and it’s very hard to separate that from success.

[00:24:41] Kirk: And, so I think that makes success. I think it makes opportunity, and I think that builds luck. I’ve had plenty of times though where I chose. Paths that did not work out.

[00:24:51] /: Yeah.

[00:24:52] Kirk: Some of those things you gotta learn from. Right. You know, some of those, there was a, a time when I was with that, with the computer company and was leading, before I was chosen as my first real leadership job.

[00:25:04] Kirk: there was a, a group of people, it’s a great company, energy Young. It was making money. It was fun to be around. but there was a group of people that were really negative, just kind of complaining about people and doing stuff and, you know, it was very easy to fall into that group.

[00:25:19] Josh: Yeah.

[00:25:20] Kirk: I woke up one day and said, this sucks.

[00:25:23] Kirk: You know, this is not what I want to be a part of. I don’t want to get up, you know, disliking everybody around, including I made a conscious choice not to dislike management, not to fall into this concept of, you know, us and them, but. To want not only to want to be part of that, but to see the positives in what they were trying to do.

[00:25:45] Kirk: Hmm. And not look at it negative. Those things mattered a lot and I think that made the luck as well.

[00:25:50] Josh: You know, I think there’s another element that, you kind of touched on in that too. And you gotta actually do the work. Right. And I think one of the traits that you see kind of time and time again of people who’ve really accomplished cool things and that we a lot of times like look up to and aspire to, right?

[00:26:09] Josh: There always seems to be a common trend of they’re willing to do the hard things. And what’s funny is, is that you almost see that in multiple different facets of their life. Right. I don’t think you intended to give me this idea when you mentioned it, but you know, you mentioned earlier what you’ve been a like 35 year like runner, right?

[00:26:30] Josh: And you’re now, you’re unfortunately facing the, the decision of knee surgery and, all of that. But. You know, 35 years of running, look, I’m gonna be honest and I’m gonna, I’m gonna call you a liar to your face if you tell me otherwise, Kirk. But nobody loves running like it is painful. It’s brutal.

[00:26:47] Josh: Like, come on, nobody loves it.

[00:26:52] Kirk: goals of a company, right? You love the outcome.

[00:26:54] Kirk: You love

[00:26:54] Kirk: the outcome, right?

[00:26:55] Josh: So you do the hard thing,

[00:26:57] Kirk: right? You love the outcome and there are journeys along the way in running where you’re seeing new things and you get to experience stuff.

[00:27:05] Kirk: So you now learn to, to. Accept the pain or accept the mm-hmm. You know, but it’s, you know, everything is about, I wouldn’t say everything. A a lot of success is about being able to, to envision an end result that is highly motivating, that really fricking matters. And, and running is part of that, right?

[00:27:28] Kirk: I get to eat ice cream all the time. I’m 68. It’s not such a bad deal.

[00:27:35] Josh: Now that’s motivation. No, but I think you’re right, right? I mean, it’s kind of that mindset of I’m doing this to, to make the hard things easier. I’m doing this to, to learn, to have new perspectives, to put myself in new positions, and it doesn’t have to be running right? Like, this can look very different for other people.

[00:28:02] Josh: but I do, I find that to be a, a pretty common trait amongst folks like yourself is, there’s some other elements in their life where you’re like, you, you’ve chosen to do the hard thing, even though you didn’t need to, you didn’t need to get up in the morning when it’s cold and wet in New York and go for a run.

[00:28:19] Josh: Right? But you did, and it probably made the rest of your day easier.

[00:28:25] Kirk: it does it, and, you know, it’s, it does, it has a hundred benefits, right? And it all exercise does, it clears the mind. it allows you to think about things in a different perspective while you’re doing it. you feel physically better, you know, leading a company.

[00:28:40] Kirk: in a very serious note about exercise, leading a company, it takes an amazing amount of energy and to lead a company that is outgrowing everybody in the industry. For those 15 years, and this is a brag, I apologize, but for those 15 years, uh, Bethpage was, number one to number four, never below fourth, and growth in the country.

[00:29:05] Kirk: And it was all organic, mergers and not without mergers. So we, performed at a very high level. But what does that require? That requires every, we doubled our size every five years. I want to, I hope we get a chance to talk about why that’s so important

[00:29:17] Josh: I actually wanted to talk about that Yeah.

[00:29:19] Kirk: unions. At this point, it’s about that.

[00:29:23] Kirk: That means that the company completely turns over in five years. So that requires changes in leadership, changes in strategy, changes in market conditions, changes in technology, a lot of hard decisions. And in order to do that, you have to have the energy, you have to have the curiosity, you have to keep learning because the company will only change at the rate that the leaders learn.

[00:29:51] Kirk: It’s a Jack Welch quote, but it’s, I think, really viable. so you have to, get to that ex, to get to that point where you want to get, where you think is essential for the, to achieve you, you have to have the energy to do it. So some of that is just essential parts of the ingredients of being a successful leader.

[00:30:11] Josh: side note, I think you might find this interesting if you haven’t heard of this before, but there’s actually this group of guys who have, you can actually follow them and you can invest alongside them. And it’s a group of guys who have an investment strategy that the one single pillar of their investment strategy is they only invest in companies that the CEO can deadlift at least three plates each side.

[00:30:42] Kirk: Nice.

[00:30:43] Josh: That’s it. And they’re like, Hey, look, if that CEO can do that, they’re willing to do hard things. They’re willing to run a company and make sure they get to the gym and not just like, go to the gym to check mark the box. Like You gotta work hard to build up to being able to deadlift over 300 pounds. And they’re like, so that’s a certain level of dedication.

[00:31:05] Josh: That we know, will transfer over to, they just will not, they will not let the company fail. It’s just not in their DNA. And if you look, their portfolio success is through the roof.

[00:31:19] Kirk: Yeah. You

[00:31:20] Josh: of fascinating.

[00:31:20] Kirk: it’s so fascinating, right?

[00:31:21] Kirk: Because there are these attributes that really matter in, in leaders and they, sometimes they sound a little cliche, but they’re, they really matter. this getting up each day and learning and curiosity and pushing yourself and those things are essential. When the, we talked a little bit about, or we meant, you meant you were kind enough to mention the 40, mentees that I have, I can pretty well assess early on, how driven they are to become a CEO.

[00:31:54] Kirk: How to, they’re going to take the next step. Part of it is not all of it, but part of it. Are these points? do they really learn? Do they get out and they, are they really thinking about broader subjects than just what their responsibilities are? And are they, they learning across a broad bus.

[00:32:12] Kirk: And it’s not just reading or audio. Now it is what you watch. It’s what you read on a daily basis. It’s how you absorb material, how fast you could absorb material. but then it’s also physically, it’s also comfort zone stuff like getting out of your comfort zone, communicating, you see classically and, and financial institutions, there will be people that get the next opportunity to be the CEO and a large percentage aren’t ready because they’re very, very good at their skillset.

[00:32:43] Kirk: But the actual skillset of leading is about communication and about vision and about putting and seeing patterns and those types of things that are not executable or operationally executable as you come up, but essential to the next level of, performance. And you have to learn those. You have to put

[00:33:02] Josh: Hmm. So I want to come back to, you mentioned the success that Bethpage had. Right? And again, you know, folks who’ve listened to this are no stranger to, I’m really passionate about the credit union space in particular, right? And something that absolutely scares the crap outta me, Kirk, is if you look at the national average.

[00:33:25] Josh: Of growth of credit. Unions gonna say it. It ain’t good.

[00:33:31] Kirk: Sucks.

[00:33:31] Josh: It’s not good. So I will absolutely say there are outliers, right? There are some folks out there.

[00:33:38] Josh: that are kicking ass and taking names and I love to see that. And you know, you touched on something, about just, there’s an interesting dynamic when you’re a not-for-profit, right?

[00:33:49] Josh: And you don’t have investors in the traditional sense, you don’t have stock as a mechanism to incentivize growth. And so you look at the credit union industry and in all reality, nobody’s gonna get mad at 2% year over year growth. Right? That’s great. We’re growing, we’re still able to do the good in our communities.

[00:34:14] Josh: And I would argue that to some degree, you know, we don’t want credit unions to grow so fast that they lose their nucleus. Right? That what makes them special and the value that they’re supposed to add. So it’s a balance. But at the same time, if credit unions aren’t growing, someone else is, and I guarantee you that somebody else who is, is not providing the same level of financial services to the American people the way a credit union, or I would argue some

[00:34:45] Josh: good community banks would.

[00:34:48] Josh: Right? And so we wanna incentivize those types of institutions to grow and to be the ones providing those services. So how did you do this at Path Page, and what do you see as some of the reasons that the industry as a whole

[00:35:04] Josh: isn’t?

[00:35:04] Josh: and what are some of your concerns around that?

[00:35:06] Kirk: So I’m gonna start there because I think that’s foundational.

[00:35:09] Josh: Okay.

[00:35:10] Kirk: when you look at the industry, and this, I’m gonna have a hypothesis that for you, that that growth for growth’s sake is the essential ingredient.

[00:35:18] Kirk: and there are a reason to create a center of gravity of growth is critical to, sustain an organization and mimic in my view, stock valuations. And we’ll get to that, the details of that. But the important question, I think the important part about what you’re asking is these foundational issues of why growth is so, slow.

[00:35:39] Kirk: Why is it so alien? Why doesn’t it fit the model? And so if you, you look at the, all the pieces of the puzzle board governance, and a regulatory environment, credit union, Risk appetites, and market share. They all go very, they’re very clear, clearly related. So without stock price or, and stock price and measurement of peer performance, others that are very similar to you, particularly in a commoditized business that credit unions are in, that you have no outward pressure to create performance and growth.

[00:36:18] Josh: Yeah.

[00:36:18] Kirk: So people can very easily become comfortable with 2% and, and with that 2% growth, they’re matching their peers, They’re keeping their capital strong. So the regulator is fine, and the board is comfortable because there are not a lot of risk oriented decisions and they aren’t getting paid for a lot of risk oriented decisions, right?

[00:36:42] Kirk: You know, there, there’s mo, 90%, 95% of the boards in the industry are not paid. So there, there’s no, there, there’s nothing in it for them, to promote that growth. So everybody falls into a, a conversation that I find ineffective and that is that we provide great service. I’ll, I can explain that better, later on, but I don’t wanna get off this particular, strategy for the moment.

[00:37:07] Kirk: so if those are the challenges and if you look back over all of these years that we sustain this slow growth and that we’re less than 10% market share, then what is it that’s going to take it to. Move over that to get to a 20, 25% market share to change the way we do business and, and I think you have to then go back to this root cause of without stock.

[00:37:33] Kirk: Without board pressure and organizational compensation pressure to perform at a high level, what are you gonna do about that problem? So the problem isn’t that you’re gonna grow, you’re gonna, you’re gonna grow too much. It just isn’t right. You could, there’s history. It just, that isn’t the problem. The problem is we’re not growing enough.

[00:37:54] Kirk: And so how do you create a world where there is a center of gravity, like stock price that creates the constant learning, constant change, constant motivation and alignment on all products and services and execution to grow substantially in grab market share. So we, what we did at Bethpage, this isn’t the same fit for everybody ’cause it depends on the market you’re in, but it, but the same concept works and that is that we do, we created an outward goal broadcast that we were gonna double our size every five years.

[00:38:30] Kirk: 1 billion to two, two to four, four to eight, and now 14 billion. By the way. We went from 47th largest in the country to 15th largest in the country during that time. And it, it wasn’t that just 13.5% was so substantial. It was the rest of ’em were growing at 3%. Right. there’s two aspects to that.

[00:38:49] Kirk: But what it did was it fricking amazing, right? It creates this momentum internally about learning and change and exposing poor performance and highlighting great performance and creating an environment of a winning culture. And that winning culture fricking matters. People are proud, they’ll sacrifice.

[00:39:11] Kirk: It’s a team, right? You know, and when you’re in it. When you’re with a company that that has it, we were talking about your firm and how you guys have achieved that now or pulling it together. It is a, it is unique. It is amazing. It doesn’t last forever, but it, when it’s going on, man, can you do great things and great things really personally and corporately matter to people?

[00:39:36] Kirk: Yeah. They’re proud. Pride matters and so that’s why we put in this doubling, that’s why we created a center of gravity. We realized that without it. We would meander as the credit union had meandered for the previous two decades. And, we went through, so this is luck. Challenge, opportunity moment.

[00:39:57] Kirk: The credit union was, Grumman Corporation. Grumman Corporation created all the planes for the Navy. Great story about how that screwed up. You ever want to hear a funny story of about how they screwed up a monopoly? I, I’ll be glad to tell you.

[00:40:09] /: Oh, I’m curious. But

[00:40:10] Kirk: we woke up one day. We woke up one day in 97 after having the largest employer on Long Island.

[00:40:16] Kirk: Long Island being 110 by 20 miles, seven and a half million people. largest employer on Long Island. Gets sold to Northrop, goes from 40,000 employees down to 2,500. Whoa. That’ll rock your fricking credit union. Right? Dang. in that, it was an awakening for me. This was two years before I became CEO, that if we were gonna remain independent, we had to create our own self.

[00:40:42] Kirk: We couldn’t just be connected to something else that may or may not be successful.

[00:40:46] Kirk: Yeah.

[00:40:47] Kirk: and so that’s why growth became essential to me. ’cause I studied and you, you made this point just a moment ago, and it, I studied the community banks in our marketplace. Which ones were the successful ones? Which ones created community, which ones grew, which ones had built a brand, which ones had, were connected to the business leaders?

[00:41:08] Kirk: How did they do that? And, I just modeled that their, what I thought was their key points with this idea of doubling our size. I will tell you that while it is now a much more accepted position, when I first put that into the strategic plan. There weren’t two people internally and there was no one on the board.

[00:41:29] Kirk: I got written up by the,

[00:41:30] Kirk: NCUA for being too risky.

[00:41:33] Kirk: and

[00:41:34] Josh: Good for you. You get that on, a plaque somewhere, please tell me you have that like on a

[00:41:38] Josh: plaque in your office somewhere.

[00:41:40] Kirk: And every credit union in the marketplace, uh, wrote letters and, and pushed against us. wow. but to me, the end result, right?

[00:41:48] Kirk: This future, this big thing, this doing greatness for our members and their community, that was the path. That was the way we could get the organization to do the things that needed to change and evolve and learn and move and provide. And, otherwise we’re gonna be mediocre. You can survive as a credit union, CEO, as mediocre for a very long time.

[00:42:09] Kirk: it just never was satisfying to, me

[00:42:12] Josh: Well, so, okay. I wanna go back to, you put a lot into that. you were talking about creating this winning culture and that you can’t just necessarily rest on your laurels of like, we provide great service. So talk me through like what did that mean to you and how did you have to create Again, I think the, the interesting point to all of this is.

[00:42:39] Josh: You know, you’re in a not-for-profit industry, right? And so to your point, like you’ve made it multiple times, like there’s, there’s not necessarily the same pressure on a publicly traded company or a company that’s owned by a big VC firm, right? Or in a super highly competitive growth market. How do you create a winning culture when that is the industry that you’re in?

[00:43:07] Kirk: So it’s, you know, the first, the point is you have to think about it, right? You, you have to kind of dissect the challenge and not just accept, you know, too many people I think accept that we’re just gonna operate like a for-profit institution without any of the underlying motivators or, or risk promoters within the, the organization.

[00:43:26] Kirk: So if, if you don’t dissect the challenge, then it’s, it’s just so easy to fall back into what everyone else does or how everyone else looks at it. The service interest service is such an important part of this conversation because it’s one of those things that everyone accepts, which I think is wrong.

[00:43:48] Kirk: so everyone accepts that credit unions should be this. The member value proposition should be about service. I would argue that it should be about price and then followed by service. And, and here’s, so service without any benchmarking, without any real criteria, without anything is just self-congratulatory.

[00:44:11] Kirk: Right. You just, you know, you, you’re nice. People respond to that nicest. It’s cool and everyone says, we do a great job. I don’t buy that, but, I understand it. The problem is that it’s not necessarily truly quantifiable. So do you, are you really doing a great job and are you really growing the organization?

[00:44:32] Kirk: I would, but more going back to fundamentals. If you look at what the value proposition is for credit unions in general, we don’t pay taxes because we return great value to consumers and we don’t have outside stockholders, which allow us to plan for long term and have multiple relationships with members before we return a profit.

[00:44:51] Kirk: If you accept those foundational pieces, which I do, then it is your job to run the company as a business that that also manages expenses and innovation, not one or the other, but manages expenses. So that tax advantage does not get thrown away on inappropriate expenses, and you return it as the best price in the marketplace.

[00:45:11] Kirk: You then you win on price to get the first product, and then you sell on service going forward from there. By having extraordinary service, Bethpage in its three fundamental measurements. First, we beat 10 banks, 10. We didn’t compete against credit unions, 10 banks on five products every year. Best price.

[00:45:33] Kirk: Every day got, got occasionally two. we then measured service in every aspect of every transaction that we did. We ended up under JD Powers being the th the third highest service, level provider or the quality of service in the nation. a third we ran our expenses at below 2%, expense to assets down to about one seven that allowed us to price our products to win that first one and to gain the momentum for the second one every day.

[00:46:03] Kirk: So it has to be an integrated strategy, and it has to be something that is motivational motivation to take those risks was that we had to double every five years.

[00:46:13] Josh: I wanna get your take on, because you mentioned earlier, Right?

[00:46:17] Josh: also a big part of that growth that doubling every five years was you kind of had to reinvent Bethpage every five years. And it wasn’t just because you doubled in growth, it was also that the market changed in that five years.

[00:46:31] Josh: I would say that there’s a big change happening in the market today too. And I want to credit, Andrew down in the CEO of OB Credit Union in, uh, Olympia, Washington for this. I, you know, I sat in on a presentation. He gave it a conference recently, and, you know, I think, I think he startled a lot of board members, who were sitting in the room when he said we were, this conference was in Vegas.

[00:46:56] Josh: He said, you know, the first thing I did when I landed here in Vegas, he said, I pulled up my phone, I opened up ChatGPT. and I said, if I’m a Nevada resident and here’s a little bit about me, go find me the five best CD rates that I can apply for, not just in Nevada, just period. Just the five best CDs that I would qualify for.

[00:47:18] Josh: Not only did it go find him the best five CDs, it said, would you like help applying for the best one? I’ll put you into the workflow. Right? So now when we talk about competing on price and things, man, the ability for consumers to shop based on price has, it’s no longer just like I’m driving down I five and I see the billboard for A, B, C Banks CD at 5% and A, B, C credit unions is 6%, therefore, they win.

[00:47:51] Josh: Right now I can go to chat GPT and I’m like, Hey, go use AI and go scour the entire world and go find me the best product based on price.

[00:48:02] Kirk: and so what’s so interesting about that is that most people that. in the industry would immediately say, well, that’s why we can’t, we’re, we can’t compete on price.

[00:48:12] Kirk: ’cause the other organizations are so much bigger than us, or they have more scale and they have the ability to, to use all of that against us. I, I’ve never found that to be actually true. Hmm. And here, here’s a couple reasons why. One is they’re profit motivated, so they’re just, there’s only so much that they’re willing to do price wise, right?

[00:48:34] Kirk: Yeah. You know, they’ve gotta, they’ve gotta a return to profitability. They may undercut you for a short period of time, but ultimately they’ve gotta go back to their margins and they will, they, they disciplined about it. It’s how they’re compensated. The organization is aligned around it. The board demands it.

[00:48:50] Kirk: They’re going that, you know, a 25 to 30% advantage on the bottom line of not paying taxes is fricking important.

[00:48:58] Kirk: Yeah.

[00:48:58] Kirk: the second piece is that. If they wanna attack a particular credit union. Now let’s talk about a credit union in a market space. That means for most of these big banks, somebody would often say to me, well, chase could certainly outprice you.

[00:49:14] Kirk: And I said, they’re, they would never do it. Why? If they had to reprice their home equity loan to what I was pricing it and attacking the marketplace, I had inside knowledge to the marketplace, which they didn’t have, and I had a specific subset of the market, they were gonna have to reprice it. Uh, a trillion dollars, that’s an exaggeration.

[00:49:33] Kirk: A hundred billion dollars in home equities to price to my half a billion dollars in more in home equities wasn’t gonna happen. Right. Yeah. So, you know, that’s, it’s, it’s those kind of things that you have to keep dissecting and thinking about because there are real advantages to it. Don’t make the excuse to throw away.

[00:49:52] Kirk: That it’s too hard or it’s commoditized or it’s, uh, that you can’t win at it. Keep figuring it out because when you have real material advantages in your business, when you’re substantially advantaged over others, it means you should win.

[00:50:10] Josh: You know, that brings up something else too, Kirk, that you mentioned earlier about kind of the three things that you focused on at Bethpage, and one of ’em was kind of this ruthless operational efficiency so that you could price those products. It’s funny that you bring that up because I recently reread a case study that I’d kind of forgotten about and, and for whatever reason, you know how it is, you, you read something again or you see something and all of a sudden you’re like, oh my gosh, I’ve used this example like seven times this week.

[00:50:37] Josh: So this is my eighth time of using this example this week. But, you know, the story of the Ritz Carlton, right? And if you look back at the, kind of the genesis of what made the Ritz Carlton so special. Right. For anybody who’s ever stated a Ritz Carlton, I’m not one wrong tax bracket, but you know, if you’ve stated a Ritz Carlton, you come to expect a certain level of service and almost an an experience that you’re hoping to have at a Ritz Carlton.

[00:51:08] Josh: Right. And it’s the reason people go back to the Ritz or like me, long to stay at a Ritz, right. Is so that I can experience that magic. Well, you know how that magic was created was they ran the business with ruthless efficiency and I mean, ruthless on something like 90% of the business. Right. And they would give examples of like, Hey, if it was supposed to take you 26 minutes to clean a room and you took 27, you’re outta here.

[00:51:41] Josh: Like you gotta figure out how to do it in 26. But they did it all with data, right? And they wouldn’t say like, 26 wasn’t just thrown a dart at a wall. It was very data driven. We know you can clean the room in 26 minutes. You have got to clean it in 26 minutes, right? Hey, if you’re 10 cents out of budget, we know you should have been in budget.

[00:51:59] Josh: You’re outta here. And so people knew they had to align to this ruthless operational efficiency. But what it gave both the business and the individuals was they said, if you do really well with that 90%, what you get is the 10%. And the 10% is where you get to be special. And they had a budget for anyone and everyone in the company that you could do whatever without reproach from the organization.

[00:52:26] Josh: And they gave examples like, a table busser at one of the restaurants in one of the ritz’s. Is busing a table, right? And overhears a family. And the mom is telling the family about how once when she was a child, she got to stay at a Ritz in Paris and she had this croissant that was so magical and it like brought her to tears, thinking about like her kids, maybe one day getting to try this croissant.

[00:52:51] Josh: That was her childhood memory, that Buser bought a ticket to fly to Paris that night, went to that property, got a croissant and brought it back. And the next morning when the family came to breakfast, he had the croissant there for them, right? That would never fly without the other 90%. But because of that, that family, not only is that family lifelong Ritz, like they’re gonna go outta their way to try and stay at Ritz after something like that.

[00:53:23] Josh: But can you imagine how many people they went and told that story? And then you’re sitting there going, man, I hope I have my croissant moment at a Ritz. Right? And so, but kind of to your point, like you can’t go compete on the special and the price if you don’t have everything else so incredibly on

[00:53:44] Josh: That’s

[00:53:45] Kirk: right?

[00:53:45] Kirk: That’s

[00:53:45] Kirk: right. And, and, and there’s another piece to it that is really cool, and that is that as you become more efficient, your service vastly improves. Because you don’t have the drop offs, you don’t make mistakes. It is, it’s executed. And so it affects this other piece of it.

[00:54:04] Kirk: But to your, to the core question that, that you’re asking and the point that you’re making is that, it has to be run as a business. And if it’s run out as a business, not just as, oh, well maybe we’ll make our goals, but as a business, then you have to have trade-offs, strategic trade-offs, operational trade-offs, and, and understand the underlying foundations to the business.

[00:54:28] Kirk: And so you have to have this expense management, this execution, this efficiency. Southwest Airlines did it, you know, now it’s an old case study because Southwest is imploding on their technology and some other things. But it was their turnaround time at the gate. That changed the business model that allowed them to get a third more flights out that allowed them to have the, the least expensive price.

[00:54:50] Kirk: Huh. That’s classic, right? Classic to what you’re describing. Classic to what I’m describing is that you do it. So here’s some interesting things that we did that others have not been willing to do. we created a technology QSO and a backroom operational QSO where we, the areas that we did not add value, meaning they weren’t member contact areas.

[00:55:14] Kirk: Right. You know, so they were, the stuff you have to do to run a financial institution. so we took the price off of Long Island, moved it to a less expensive area, long Island and California, the highest prices in the country to, to have labor. We created scale within the business because it’s, if you have an operational center that has a hundred people, you have much better expertise and operational effectiveness and negotiations with contracts than if you do, if you have 10.

[00:55:43] Kirk: And, we did that with two other credit unions and we lowered a cost by $20 million a year. those are tough decisions, but they’re not, if you believe in this other stuff, doubling your size, maintaining the expense ratio to be able to win on price and win on price and winning on service.

[00:56:01] Kirk: ’cause how many companies get to choose to win on price and service? Only credit unions, right? Only not-for-profits. But you don’t do that. You don’t execute on that unless you have some discipline around the rest of this stuff.

[00:56:14] Josh: So I wanna take a little bit of a, a tangent and then I wanna kind of come back to, you touched on very early, and this is something I just, I, I never really had exposure to until really talking to you is, you know, how the executive compensation package for a not-for-profit can actually impact all of this stuff that we’re talking about and this winning culture.

[00:56:37] Josh: But before we do, because I think it, it also plays into this next part of the conversation about talking about how we structure compensation packages and things. But going back to, mergers and acquisitions. And that’s a big part of the strategy for a lot of community financial institutions right now.

[00:56:53] Josh: I mean, we’re seeing more consolidation over the last 10 years than we did in the previous 50. Right. So why is that becoming a big part of the strategy for a lot of credit unions? I’m not gonna ask you to make a blanket statement of is it good or bad, but maybe some examples of where it’s good versus bad, and what do you think that means for the industry?

[00:57:16] Josh: And then you use that to kind of tee into, how does that play into growing a credit union in the way that you think the credit union industry really needs to grow?

[00:57:25] Kirk: Yeah, so it’s a fascinating question and there isn’t one answer to, to your point, there are good and bad, there are, uh, strategic choices and there are some things that, that just don’t seem to be strategic choices.

[00:57:38] Kirk: They may have been, we just don’t know the details of them, but that’s a good point. Um, but on the surface, they do not. The, the, the first issue is the masses of those mergers have been smaller institutions, right? Uh, they’ve either gotten together or they’ve, they merged up, traditionally have been merged up into two others.

[00:57:57] Kirk: And, that’s, you know, three macro trends that are very, very difficult to fight against if you’re of the very smallest. I will give you an example of how to fight against it though. So it, it’s not bleak, it’s just, art, the, uh. First is the, the product. You mentioned it with the chat, GBT example of the cert.

[00:58:17] Kirk: to have the product mix and the technology mix and the skills to manage that product mix and technology. It needs some substance, right? It needs some, it needs partnerships, it needs opportunity, it needs strategic thought, but it’s not just, you know, doing car loans and, and being able to sustain with a single seg unless that particular single select employee group SEG is such a substantial, group, hospital, university, state government that allows you to sustain yourself.

[00:58:49] Kirk: Typically, they’re not that small. Those credit unions have grown because it goes hand in hand. So the smaller credit unions have the, the, first of all, they have this, this product and technology challenge that is now broadly available in the marketplace. So their members are choosing everybody else, not choosing them anymore.

[00:59:06] Kirk: Two is, um, their leadership is maturing out, right? So the, the people that were passionate about it, that built the company that loved it, they’re my age, right? they’re, it’s hard for them to sustain it, and there’s not a lot of compensation there. So they can’t, you know, it’s hard for them to just get up and, and do it.

[00:59:25] Kirk: Yeah. so all of, for all those reasons, and particularly the leadership, vacancy, they’re emerging and there makes good sense. A lot of those make good sense. Now, counter to that, the 20%, 10% that are, you know, there are some amazing leaders out there that are running these small institutions, and the work that they do is tough, man.

[00:59:45] Kirk: Yeah. They gotta be a teller. One day they gotta answer the regulator. The next, they gotta invest in technology. The third day. It’s a mammoth, the massively tough job. at Bethpage, I, we all had. Talent to do all of that, right? Yeah. You know, it wasn’t, I had to do it, but in their cases they do.

[01:00:02] Kirk: Yeah. so in, in order to maintain those, keep those leaders, having them not move up to the next level or not merge with somebody so they can move up to the next level, you have to compensate them better than they’re doing and, and you have to put into some retention tools, which are available to that marketplace.

[01:00:19] Kirk: But, you know, it has to, the board has to become educated and they have to be broad-minded enough to be able to do it. Otherwise, that group will continue to merge and continue to merge away. I, I don’t know how to fight. The only way you’re gonna fight that, that trend is with great leadership, the only way you’re gonna get great leadership.

[01:00:37] Kirk: you have to be fair to them. You have to give ’em a market, right?

[01:00:40] /: Yeah.

[01:00:40] Kirk: And so, that’s a massive number of, of mergers that are happening now. The, the, what we’ve seen in the last five years and, and this year particularly, is middle-sized and middle-sized, like sized asset credit unions merging, and then big credit unions merging.

[01:00:58] Kirk: And you know, once you get to above some number, call it 15 billion, call it 12 billion, maybe 20. There, there is research would say there’s not a lot more of efficiency and scale that you’re going to get. Now you do get, you do get moderately increases in scale and you get product diversification and you get market diversification.

[01:01:21] Kirk: So those things make sense, right. You know, there, there’s logic to that. There’s business reasons. But on a pure scale basis, they’re probably not getting much more outta that business, particularly for credit unions. ’cause here’s what credit unions, you have to challenge that. Some of those thoughts about, so many of them promise to keep everybody in the company when they do the merger.

[01:01:43] Kirk: That is important to the boards, it’s important to the senior teams. None of that makes sense, right? You can’t have two CFOs, you can’t have two CIOs. You can’t have this sort of group, this two cultures ultimately. So, So those are the challenges at, at the largest ones. but you do see, I, we were, we mentioned a couple of the large ones earlier, Cal Coast and, and San Diego makes perfect sense, right?

[01:02:11] Kirk: They’re, and they’re the classic merger opportunity. They’re in LA and San Diego. You could see the operational effectiveness of being able to move to those markets, by having branches and and operations in those two places. so there has to be a real reason for a real thoughtful reason rather than just, it seems like a good idea or I’d like to have a larger institution that I lead.

[01:02:36] Kirk: but, you know, we’re in the middle of it. and you know, the one thing that I would, would slightly disagree with you, if you wanna look at two other trends historically. One is, this merger trend that happened in all small banks, regional banks, and, in the late nineties, the nineties and the early two thousands, massive.

[01:02:58] Kirk: I mean, bank America merged in hundreds of, of it, right? So there has been this, this trend in the industry to, to do that over time. And we’re seeing it in credit unions now. and the other is that the importance of looking at how the savings and loan institutions and savings banks went away at some point in time.

[01:03:21] Kirk: and that’s a whole interesting study about taxation and mergers and risk taking that they weren’t prepared to do. so it’s a really complicated world, right? And some of those mergers make absolute sense. Some of those seem to be a stretch. but I think we’re gonna continue to see a.

[01:03:38] Josh: Yeah, I agree. You know, I wanna go back to something I, I really appreciate that you said though, personally, which is, you know, for a lot of these small institutions it’s hard, but it’s not bleak. I, I like that you said that, It’s funny, we, Ken McCarthy, who writes for us and does a bunch of different, just journalistic reporting and things.

[01:03:58] Josh: He wrote an article, goodness, probably, it was probably about a year ago now. and I gotta give him a little credit. He had a little bit of fun with the title, got a little clickbait maybe, and the title was No Joy Under 10 billion. And what’s funny is, is that it got some people riled up and, and that was kind of the, actually the intent of it, was because we don’t, we don’t believe that at all.

[01:04:26] Josh: I know Ken doesn’t believe that at all. Right. And if you actually read through the article that that was really his point was, is that, you just have to find joy in doing the difficult things because it’s difficult to be a small credit union anymore. and what was cool was I, I wanna give a shout out to somebody who’s become, I consider a good friend, Ryan Roberts, the CEO of Great Meadow.

[01:04:46] Josh: Great Meadow Credit Union in upstate New York. And, Ryan’s the CEO of a small shop where, to your point, like one day he’s the CEO. The next day he’s the janitor. The next day he’s the teller, the next day he’s the IT professional. Right now he’s got a little bit larger staff than that, but I, I think that principle still applies and man, Ryan will be one of the first ones to tell you.

[01:05:07] Josh: He’s like, look, yeah, it is. It’s really hard. Like it’s really hard. And unfortunately we have to make some decisions sometimes because of our size that I don’t want to make. And it’s hard. He’s like, but man, am I having fun because this, this, there’s value in this, this matters like what I’m doing matters.

[01:05:27] Josh: And. I mean, he’ll be one of the first ones to tell you like, you know, the small credit unions merging out just because the CEO had no succession plan or there was no compensation alignment to growing the credit union organically was there. And so mergers just the easy out.

[01:05:48] /: Yeah.

[01:05:49] Josh: And unfortunately, I think you would agree when those happen.

[01:05:53] Josh: I would absolutely agree. Like you said, there are times where mergers make all the sense in the world, right? And, and we can say, Hey, I see the value that members will gain in this merger. But there are a lot of times where I’m like, no, no, no. Who’s losing in this Is the membership. Like they are losing representation.

[01:06:12] Josh: And the more that we see that happen, the more we’re gonna see the individuals who need the representation the most lose it.

[01:06:20] Kirk: Yes.

[01:06:21] Josh: And that scares me, Kirk.

[01:06:22] Kirk: Yeah. I think it does cut two ways though. and first of all though, I agree with the concept, right. So I’m, I’m 90% of the, in, in your corner. the one thing that I would disagree with, and this has been a, a contextual argument between the large credit unions and, and other credit unions for a long time, is that sometimes the, the really believers, and I’m thinking Suncoast and BCU and, I hope Beth, page four Leaf now, and others, do this well, is that they being so large, they are able to serve the underserved communities better because they can put branches, they can, they, if they believe, then they have the resources to do it in a way that is effective.

[01:07:03] Kirk: So it’s not quite as, once you get big, you don’t do that. Once you get big, there’s a portion of credit unions that don’t do that. But there, but there is a portion, great point. And I would argue the most successful ones in the country still do it. They still believe, but to your point, the smaller credit unions that, that leave a marketplace that no one else is serving, it will never be recovered.

[01:07:26] Kirk: Right. It, no one else is going in there that that’s just not gonna happen. And so the loss of them is real. they’re their connection to the, I have a theory on urgency and I have a theory on, the, for small institutions, which I include almost every credit union, this side of Navy, that they’re, they absolute strength is, if is.

[01:07:47] Kirk: Building urgency and being able to attack market opportunities faster than others and to, to recover from crisis faster than others. And that is maybe the only two attributes that they have. And, but the foundational to that is that they’d understand the community that they’re serving. I can give you examples of billions of dollars of business at Bethpage built off of those two concepts, but.

[01:08:12] Kirk: The point you’re, that loss of that credit union that you described into a merger that goes someplace else, is that then you lose that urgency and that connection to that community to understand how to serve it. Exactly. And, and that is essential. That is huge. The problem is that, uh, so much of this rests with board issues and tr and the entire industry or movement issues of not identifying what are the real challenges for those small crans.

[01:08:41] Kirk: The real challenges come down to that. You need the right leaders and to have the right leaders, you’ve got to, you have to allocate the compensation that is going to keep those people there. Uh, otherwise they grow up, they do a great job. They move off to someplace where they’re gonna be able to take care of their families.

[01:08:59] Kirk: Who doesn’t?

[01:09:01] Josh: yeah. You know, Kirk, so I think people are probably sitting there going, man, it took you guys over an hour to get into what I

[01:09:06] Josh: was really curious to hear you hit on, like, everybody wants to hear us talk about CEOs and how much they get paid. Right. but. but I do think that this is a really important topic, and it’s something that I’ve, I’ve kind of found fascinating as I’ve kind of understood more just as I’ve grown, Right. I think some people may know. a handful of years ago, my wife and I started a, a nonprofit and, you know, I started doing more research into this. I now sit on the board of a credit union And all of these different experiences. I remember thinking back to there was, uh, it was headline news for a while. I don’t even know, Kirk, maybe a decade ago or so where somebody broke like all the salaries of some of the major nonprofits, CEOs.

[01:09:50] Josh: Right. And it was like United

[01:09:52] Josh: Way story.

[01:09:53] Josh: Exactly. And you’re like, holy crap. You mean to tell me that like one 100th of a penny of every dollar I donate actually goes to the cause I donated. And meanwhile the CEO has, you know, four Rolls Royces, one for each of their penthouse locations of their company owned homes.

[01:10:13] Josh: Like, I don’t know if I can get down with that. Like I struggle with that. And so I think that there is a certain level where you’re like, I just, I don’t know if somebody should be compensated that much if they’re supposed to be doing something that they’re doing it because their heart’s in the right place.

[01:10:28] Josh: But at the same time, what I came to realize was, let’s just take, let’s take credit unions outta the equation. Let’s take some non-profit that is, you know, feeding hungry school children. Right? I think we can all argue that’s a pretty noble cause we want kids to get fed, right? Well, if that organization never grows in scales, no kids get fed,

[01:10:54] Kirk: No

[01:10:55] Josh: right.

[01:10:56] Josh: As that organization grows and scales, more kids get fed.

[01:11:01] Josh: To be able to have that mindset, you’ve gotta have somebody at the helm who’s gonna say, no, I am gonna work my ass off day in and day out to make sure that every freaking kid I can possibly feed gets fed, And you know what? That person, yes, there’s gonna be hopefully a large portion of them that says, I’m gonna do this because I want to feed hungry kids.

[01:11:25] Josh: Right? But man, the pressure is real when all of a sudden then for-profit organizations, or maybe another non-for-profit is like, Hey, you’re killing it over here. We will 10 x your salary and give you a stock options package and this and that if you come join our organization. Man, to your point, like it, it’s not even necessarily about greed, but it’s like, oh, you mean to say I could like pay for my kids’ college tuition if I took this job instead of that job?

[01:11:52] Josh: Like, ah. That’s, that’s pretty powerful for me. That’s a, That’s

[01:11:56] Josh: a motivator, right.

[01:11:57] Josh: So how do you balance those things, Kirk? Like how do you create a fair and equitable environment that also rewards top tier talent to say, Hey, we really want our credit union to double down on its efficiency, to double down on, you know, its innovation and scale so we can serve more members better.

[01:12:20] Josh: And we need an incredibly qualified leader at the helm to do that and to get that talent, we gotta pay the piper. Like how do you balance all that

[01:12:31] Kirk: Yeah. So let’s, let’s start with foundational, challenges. First and foremost, and this is crucial to the, to anyone’s world, but particularly in what we’re talking about in compensation for not-for-profit leaders and credit union leaders.

[01:12:48] Kirk: Intellectual honesty. And what I mean by intellectual honesty is that if you’re going to get paid at the top performing, uh, percentages in the marketplace, ’cause there’s plenty of market data, right? We all accumulate market data. There’s, even though federal credit unions don’t report, compensation, there’s a lot of surveys, there’s, the data is clear.

[01:13:09] Kirk: What people are paid, data is clear. so now if you’re going to pay a significant bout for that talent, the intellectual honesty requires that you actually measure benchmark to extraordinary performance, to exceptional performance to top 10% performance. So first of all, you’ve gotta be able to define within yourself and with corporately that this is justified, right?

[01:13:36] Kirk: That it, that, so I’m going a little bit of a different way than yours, but if, if you’ll bear with me, I’ll, I’ll get to it. the point is that. There. You can’t have just sort of this salaries that increase and performance doesn’t, it has to be you, you have to serve more school kids, right? You have to effectively school more school.

[01:13:57] Kirk: You have to benchmark that those school kids are actually performing better at school now, or, you know, or, or getting fed three times a day. Whatever that benchmark is, has to be measured, and you have to have substantially shown success for that. without that intellectual honesty, all of this falls apart.

[01:14:14] Kirk: It just evaporates into, discussions about whether it’s fair, whether people should get paid that much for what they do, stuff like that. Second is that you, and you made this point, man, it’s a complex world as you grow, and it, and the organizations will, will only go as far as the leaders take them. It does.

[01:14:35] Kirk: They don’t magically perform to more school kids or to more members. So it is the, the leadership has to be, uh, the talent level that is building strategy, is building vision, is performing, is executing, and, and that costs money. It, it. That’s just the way it is, that that talent is rare and important. Third point, if you don’t pay the CEO now, this is now going to the mid tier, not so much the smaller, but the mid and larger.

[01:15:08] Kirk: If you don’t pay your CEO, you’re not gonna pay the rest of the talent within the company that you need to compete. You’re not gonna have the digital, you’re not gonna have the ai, you’re not gonna have the, the technical tools. You’re not gonna be able to do the lending. You’re not gonna be able to manage the risk because somebody else is gonna pay for that talent in the marketplace.

[01:15:26] Kirk: So it all has to come together around performance, alignment, strategy, and then compensation fits that. And when it does, then you can ju, you can look anybody in the eye and tell ’em why you’re, why the board is paying that much money or, or that person if you can’t justify it and you don’t have that intellectual honesty.

[01:15:49] Kirk: I’m not sure how you justify any compensation, but you certainly can’t justify the toped.

[01:15:54] Josh: You know?

[01:15:54] Kirk: point to make before I, I, you know, and that is just simply, there are some significant salaries that are happening in the industry now, but think about how big credit, I mean, Navy is gonna be a, and I don’t know Navy’s compensation structure, but Navy’s gonna approach $200 billion.

[01:16:11] Kirk: That’s a pretty massive company, right? You know, pen Fed’s pretty massive company. it’s not you, you know, you know that part of it has to be taken out of just the context that it’s a not-for-profit and put into the context of how big it is and what it does effectively.

[01:16:25] Josh: one of the things I’ve always found interesting too, Kirk, is again, there’s all the things. It’s like you read it in the leadership books, you know it’s to be true. But then how well do we actually follow it? Compensation is a very interesting and very dynamic beast within an organization.

[01:16:43] Josh: And I think this goes back to what you were talking about earlier about the, you know, creating a culture of winning. The fact of the matter is winners expect to be compensated for winning. So I hate to say it, but if you have a bunch of losers, they shouldn’t be compensated very well. If you’ve got a bunch of winners, they’re gonna expect to be compensated well or they’re going to leave to go somewhere that has a winning culture and rewards winning culture.

[01:17:09] Josh: It’s just the facts of life, right? It there. Yes, there’s absolutely outliers in everything, right? I mean, we have, I’ve come across plenty of people in my life where I’m like, you are getting paid that to do what you like. Wow. You are underselling yourself. And they’re like, look, there’s other value that I get other than just the paycheck that makes it worth it to me.

[01:17:29] Josh: Right? So, you know, park all of that aside and let’s just look at it at a very like macro level and you know. As we think about, Hey, we want to build a winning culture, we’re going to have to expect to compensate that winning culture. But to your point, then you have to be kind of ruthless about measuring and evaluating that.

[01:17:52] Josh: And so you say, Hey, look, we’re gonna, we’re gonna, you know, have these expectations and then we’re gonna measure meeting those expectations. And if you don’t meet those expectations, you will not be a part of this winning culture. So we will never have a place of mediocre or mediocre salaries because we will never have a place for mediocre people.

[01:18:15] Josh: Again, I wanna be really cognizant of you have to choose what style of business you want, right? And, and if you want, and there is value in a slower growth or, or whatever it may be. I, I don’t wanna use mediocre as the term to apply to that, but just. Hey, this is the path that we want to be on, and we want people that are on that same path, and great, you will compensate based on the path that you want to be on.

[01:18:39] Josh: You just have to make the conscious decision, like do we want to grow at the industry standard or do we want to grow more than that? And it doesn’t matter whether you’re a credit union or a tech company or anything in between. If you want to grow above the market or if you want to grow aggressively, or if you wanna grow impressively, you’re gonna have to have top tier talent that accomplishes that, and you’re gonna have to compensate the top tier talent, but then you’re gonna have to hold them accountable to the expectations you have for that.

[01:19:11] Kirk: Yeah. you know, and And, so this is where most companies get it wrong, right? Particularly in a industry like credit unions, that is pretty protected. You know, deposit, insurance, protection of the, uh, the business model in many ways getting attacked in different ways than it ever has.

[01:19:28] Kirk: But, but over the years, pretty protected and so modern. If, if you’re not intellectually honest, if you’re not setting your goals to the top three performers in every segment of the market that you’re competing against, and that’s what you have to do. And if you’re not benchmarking your business across the operational excellence, and you’re not measuring service in real ways, not just once a year surveys, then you have the grounds to show that you’re, that those things are a, an alignment of the strategy and that you’re outperforming by far the market and by outperforming that market, then you should be paid pay follows the performance, not the other way around.

[01:20:14] Kirk: And the, uh, and it’s essential that you get that equation correct. Be otherwise, you end up in this, what all industries are accused of. And credit unions are no, no different. Where survey data on compensation just continues to escalate compensation for the mediocre. And because, with all the job changes right now with all the maturity people, retiring, compensation has been pressured up.

[01:20:41] Kirk: there’s demand for talent. Demand creates price, but so much of the middle level then starts to get salary increases without a real connection to the performance. And at, when you start, when that starts to happen, it erodes the entire organization’s performance. Nobody is really, everybody inside a company knows how the hell they’re performing.

[01:21:06] Kirk: Right. Yep. You know, nobody, no one’s confused about whether they’re great or or average.

[01:21:12] Josh: I think you’re right Now, you know, I think there’s one element to that though, Kirk, that I wanna press back on. And you said, you know, the compensation has to follow the performance. I would argue that there’s one part of, you know, if you’re on this trajectory today and you want to change your trajectory to this trajectory and you want to grow faster or more aggressively, or you want to do more impressive things, there is also a time where you have to have some faith, right?

[01:21:39] Josh: And you’ve gotta decide, like, we are gonna hire some talent that says they can do the great things that we need to do, but they’re not coming over for what we’re currently offering because of our current performance. And so there is that little bubble area too, where you almost have to decide like, are we willing to make the investment in the people.

[01:22:00] Josh: To do this, and then if we have talent inside that is propelling us forward, how do we motivate that up? Because our cost of attrition is a heck of a lot higher than just paying somebody another 20 grand a year.

[01:22:16] Kirk: Yep. So, boy, it, it’s such a great, great point. I, I had a theory that as we set strategy in place to grow as substantially as we were, that I would, every time I had a key vacancy, and now you’re talking about VP and above, that I would hire for two years out the performance that I would be hiring for two.

[01:22:36] Kirk: So if I was a billion dollars and I was needed to be, and I was gonna be 2 billion in two years, then I was hiring the executive for the 2 billion. So to your point, I was over, I was overpaying for current conditions. Yeah. On the theory that I could get to that 2 billion in a year rather than two because I now had the talent.

[01:22:54] Kirk: So I agree with you that there is, When you have a, a real aggressive position laid out, then you’re hiring talent to always fill gaps or you’re hiring talent before that you reach it. Yep. where I would maintain the strategy point, the compensation and and alignment point is that if you don’t achieve it in some of those years, then you need to have enough at risk that you’re able to not pay those people.

[01:23:21] Kirk: And we had years where people did not get, you know, we, we set our salaries at 50%, at base at 90% because we were top five for, for all those years. at 90% of total comp. But there were years for economic reasons, our own performance, whatever the hell it might be, right. That we didn’t achieve. 90 percentile performance.

[01:23:44] Kirk: And so our annual compensation, mine was base at 50%. I had 60% at risk. Maybe I got paid 30% at risk that year. Right? But that’s alignment, right? that’s saying that, we appreciate what you do, but you didn’t hit your goals, so we’re gonna hold it. you can’t massage that.

[01:24:02] Kirk: You can’t start saying, well, there were these external conditions. Sure, there were, but there were also external conditions when you got the bonus. Right? There were things that happened in the economy that put you in the position to double your size. So you can’t, when it goes against you, you can’t suddenly say, that doesn’t matter.

[01:24:20] Kirk: All of that is business and all of that’s tough, but that’s intellectual honesty and performance that you have to do on both sides of that equation.

[01:24:29] Josh: Yeah, that makes a lot of sense. so I, I wanna come back to even just addressing, you know, very bluntly talking about, how do you take all of these things that we talked about and create in a world of not-for-profits at credit unions, where again, you don’t have, you know, stock options as a lever, you don’t have the aggressive growth mindset of a VC firm or something like that.

[01:24:50] Josh: How do you create a compensation plan for the CEO that encourages the credit union to only merge if it really and truly makes the right strategic sense for the membership? How does it encourage the next generation of leadership? How does it encourage growth? how does it do? All of the positive incentives that we want to see.

[01:25:15] Josh: While to your comment from earlier, maintaining that intellectual honesty, like how, how do you as a former CEO, like think about grooming the current and next generation of CEOs of credit unions? F using compensation as a.

[01:25:31] Kirk: Yeah, the first part about grooming and, and creating the environment for the next generation of leaders. The, the great news is, at least in the group that I have the privilege of, of helping is it’s there. they believe and they, their, their frustration to almost a person.

[01:25:50] Kirk: There are a couple exceptions always, but almost to a person, is that their organization isn’t being aggressive enough, isn’t growing enough, isn’t, doesn’t have goals That are really performing. And, that’s encouraging to me. That’s, that’s a, i I love that. And, and again, it may be self filtering, right?

[01:26:08] Kirk: Those are the people that may choose to talk to me ’cause of my past, right? But any case, there, there is a group of ’em out there, God love ’em. And they’re out there to attack. and attack is the right word by the way. It is to just, it is to destroy the competition. It’s to attack it’s words like that matter.

[01:26:23] Kirk: but to your, to the question about, aligning the compensation and you said this earlier, and it’s never going to be just about the compensation, right? It has to be an environment that you are really engaged in. ’cause I would argue, now this sounds silly and it’s an exaggeration, but I would argue that a CEO doing.

[01:26:46] Kirk: The right amount of work, even getting paid seven figures, you know, I was working for a lower hour hourly salary than most people in the company, right? Because you’re working literally a hundred hours a week. You’re working seven days a week when you’re on vacation. You know, what did I do on vacation?

[01:27:02] Kirk: I’m not trying to get a pat on the back here, but what did I do on vacation? This was a time of, of, uh, improved branches or improved branding techniques. You know, I’d walk into a competitor’s branch, right? I just lived it. And so that, you know, part of it is the acceptance in the role that, that kind of dedication is required to the performance and, and so you’ll never get paid.

[01:27:26] Kirk: You know, you’re not gonna get paid for what a stock companys, you’re never gonna get as wealthy as, you’re gonna get with stock options in another firm. So there has to be some intrinsic value that, that you go. So it’s a combination of philosophy and compensation.

[01:27:39] Josh: I think to your exact point, right? I think that’s why you see the types of personalities, I mean, when we started the podcast, right, like you were talking about how as soon as you got into credit unions, you were like, I see this deep rooted alignment to my value system, right?

[01:27:59] Josh: When you say crap like that, Kirk, you know, somebody’s bought in. And yes, like if I had told you, Hey, I want you to run Bethpage the way you ran it with all the success you gained, I wanna give you 25 bucks and a half of a hotdog every year is your compensation. You’d have been like, you know what? This probably isn’t for me.

[01:28:17] Josh: Right? So there’s a little bit of a balance, but I mean, I would argue you probably could have gone out and gotten a CEO job at a different company and made yourself wealthier. But for you, you said, I saw that intrinsic alignment to the value systems and that meant so much to me. This is where I poured my focus.

[01:28:40] Josh: And I think because of that, that’s why you find so many people like you leading credit unions, right? Is they’re like, Hey, look, I, I could totally go and kill it somewhere else, but I care about being here. And so that’s why you find all these people who are nerdy levels of passionate about credit unions is ’cause you kind of have to be,

[01:28:58] Kirk: gotta have to be That’s right.

[01:28:59] Kirk: Yeah. And, and it’s also why. we’re going to, we’re gonna briefly touch on these macro trends of the larger credit unions where they’re acquiring talent from outside of the industry, often bankers or, or financial, expertise. And, you know, it’s not always a fit for them, right.

[01:29:15] Kirk: Be, you know, I would say 60, 70% are successful, but 30 40% aren’t. And the reason is they don’t really buy into the, to what we just talked about. Right. they have been very used to making a ton of money when they re reach high levels of performance. and if you, and I won’t name the credit union, but you can look at this pretty easily.

[01:29:39] Kirk: If, if you look at some of the highest performing credit unions in the country, they’ve had some turnover at CEOs and it isn’t because they haven’t achieved great results. I would suggest that part of it was a, Disconnect on the compensation that those executives thought that they should have gotten in an industry that’s never gonna pay that much money.

[01:30:00] Kirk: Mm-hmm. And so, you know, you have to have this belief system, you have to have this philosophy, by the way, when you do get the marriage right, the compensation fair and long term as well as as compensation that’s fair. And allows you to live a lifestyle. And you do have the, the values that connect to the business.

[01:30:19] Kirk: those trade offs are beautiful and they make a great life. They make a great life, not just a, a good life. They make a great life. and yet, you know, you’ve got a bunch of boards. I deal with them all the time. You know, I’m, my, my role often in, in the, in my company is to go into board situations where it is a difficult situation for them to compensate or provide, executive benefits, ERPs.

[01:30:42] Kirk: And so I, I deal. Face to face. I was recently called a, used car salesman. That was the first time in my history the, uh,

[01:30:52] Kirk: uh, badge honor,

[01:30:52] Kirk: but, you know, badge of honor. That’s right. I I took it. Well, I did. You got that shut.

[01:30:57] Josh: the t-shirt now? Yep.

[01:30:57] Kirk: Yeah. I’ve, you know, I’ve been, I’ve been fortunate to be in a lot of board meetings, as you described, on both sides, right.

[01:31:03] Kirk: Board members as well as employee, and, you know, some of those emotions are just okay. Right. You know, you just deal with them in, in a way. But anyway, I, I deal with this complexity of balancing a not-for-profit mentality and a misunderstanding of the data in the marketplace with the need of this executive to run an organization that’s effective.

[01:31:27] Kirk: And where I think it meets in the middle is this point that we’ve made over and over again, is that you have to set a center of gravity and aggressive enough goals, and you have to show real success within those goals to be able to pay. And if you do that, then it’s incumbent upon the board to do the right thing.

[01:31:44] Josh: Yeah. No, but I think to your point, right, it’s, it’s, this is an industry especially where when you do get all of these millions of variables we’ve talked about in the last hour and a half, right? Magic does happen,

[01:31:59] Kirk: Magic happens,

[01:32:00] Josh: right? Like Magic happens. Like you look at the impact that credit unions have on people’s lives and you will see truly magical stories.

[01:32:08] Josh: You look at the impact that it’s had on the lives of employees, of those institutions that are just thriving. It’s magical. And you look back at someone like you, and I think I can put the words in your mouth, you would look back on your career at Bethpage as magical, right? Personally and professionally.

[01:32:26] Josh: So that’s just, that’s winning across the entire spectrum. But it takes getting all of those variables right and alignment to what are the objectives, what are the variables, and what is the definition and the outcome of success look like for us? And when you get all that right, it’s pretty cool.

[01:32:43] Kirk: But that is why it’s the hardest job in retail banking because you have to almost self-motivated to get to that center of gravity and build it outright because the rest of the world, the board, executives, regulators, industry, some common ideas about how people should be compensated, all that stuff you have to push against in a lot of cases.

[01:33:08] Kirk: And so you have to be highly self-motivated. You have to take some risks, right? and you have to, um, be willing to live with very hard decisions. But that’s true of any CEO. That’s not true. That’s not special to credit unions. yeah. But all but the outside. Value proposition, stock ownership, that kind of thing isn’t here in credit union.

[01:33:28] Kirk: So you to get that all right, that’s where the hard part comes and that’s where you to motivated. But when you get it right, it is fricking magical because winning, being successful, serving communities in ways that no one else can, uh, changing people’s lives in both members and team members as you, as you expressed changing the industry in some ways, you know, man, you just don’t get a chance to do that a lot.

[01:33:53] Kirk: And, and so those are special. And you know, the other point is right when you’re in a company that does that, with it as long as you can because it doesn’t happen every place.

[01:34:03] Josh: Yeah. Yeah, man, isn’t that the truth? I think it’s, it’s really cool when, you know, kind of to almost what you started with Kirk. Like, you could choose the two paths. every day I can wake up and I can look at the negative things about, you know, the organization I work for and I can find a hundred of ’em.

[01:34:21] Kirk: Yep.

[01:34:23] Josh: I’m gonna choose to look at the two that are really awesome

[01:34:25] Kirk: that’s rights

[01:34:26] Josh: and that make it really, really special to be a part of. And that remind me, I could probably go a lot of places. Would I really be as happy? I don’t know, like when you find something special. You feel it? You know it,

[01:34:41] Kirk: you feel it, you know it,

[01:34:43] Kirk: There it is. I spend my mornings reading books and, I actually listened to ’em when I’m doing my exercise.

[01:34:49] Kirk: But the, uh, today’s story was, was about influence and, about, a boss that, woman that did not wanna leave and she didn’t wanna leave because her boss had done all these small things, right. And, but it comes to this bigger point that you’re making, which is that the right organizations that do the right things are 10% of the market.

[01:35:08] Kirk: There, there are some small percentage of the vast number of companies you could work for. It is, they’re very special and staying with them and honoring that special and putting up with the 30 things that don’t work. Yeah. is maturity and it’s an understanding of the, of the broader marketplace.

[01:35:28] Kirk: and man, if you get it, stick with it because, the rewards are immense. They’re personally immense as well as financially.

[01:35:36] Josh: You know, uh, I think you would probably, uh, appreciate this and I’m gonna feel horrible that I can’t remember who to attribute it to. But I remember being a part of a CEO round table put on by the young credit union professionals in our area, and all the young professionals got to like, speed date all the CEOs and the CEOs rotated tables throughout, right?

[01:36:02] Josh: Super cool event. And one of the folks asked one of the CEOs like, how do I get to the next level? And his response was actually pretty cool in my opinion. And he said, you stop worrying about trying to get to the next level. He said, you know, if you’re in the right organization That’s special and you really kill it where you’re at, when you’re in the right place at the right time, things will happen.

[01:36:32] Josh: He said, now there’s a balance, right?

[01:36:34] Josh: Like, if you continue to like put yourself in the right place at the right time doing the right things and the opportunity never kind of comes of it, then yeah. maybe you should look for a change. He said. But, really just being in the moment and saying, I’m a part of something special.

[01:36:51] Josh: I believe in this, and while I think I should be a VP today, maybe I’m gonna be a VP tomorrow, and I’m okay with that because I know I’ve found something special and I’m gonna stick with it. And a lot of what we say, and I’m just gonna say it like in, you know, younger generation culture right now is people are only in one place for such a short period of time.

[01:37:13] Josh: You don’t actually get to build anything special yet. And you don’t get to be seen as something special yet.

[01:37:19] /: That’s right.

[01:37:20] Josh: And So sometimes, like you really do, you have to embrace the suck and, and, you know, be a part of it for a while.

[01:37:27] Josh: And

[01:37:29] Kirk: I was gonna say, so much of it is logical, right?

[01:37:32] Kirk: it’s emotional, right? When you’re in it. And, and, but you need to be able to take the step back, a step aside and say that every organization’s gonna have its problems. It’s cliche, I know that, but it’s real. It’s right. And so what you have today, if it’s very valuable, if it’s being successful, if the culture is winning, you know, they’re, they’re gonna be at the next company, a jerk boss, and there’s gonna be somebody you don’t get along with and then, and technology that you wish was updated or whatever.

[01:37:59] Kirk: It’s, but by understanding that, that there are challenges in every place, but there is also great productivity and success and good people and. Trust, and it’s, and it does come down to this, this point about values, about how honest the company is and how trust you get and those things, if you got those things, the other stuff, it’s gonna happen every place.

[01:38:22] Kirk: Yeah. It’s,

[01:38:22] Josh: Yeah,

[01:38:23] Kirk: those.

[01:38:23] Josh: yeah, yeah. Isn’t that so true? I mean, and that’s why, again, it sounds silly. It sounds cliche, but man, it has so much to do with the people.

[01:38:31] Kirk: Yep. Yeah. It has so

[01:38:32] Kirk: much

[01:38:32] Josh: to do with the people.

[01:38:33] Kirk: Yeah. it’s a team, right? It’s, and that world, of being able to trust and trade off and, be willing to, have joint accountabilities and, all that stuff.

[01:38:45] Kirk: hard work. And that, and the companies that get that right are special

[01:38:48] Josh: Yeah. Well, I tell you what, Kirk, after this podcast, I’m like really excited to go to work and do the work and go interact with our people. And, man, talk about a great way to fire me up. I usually don’t like doing podcasts in the morning because, they’re usually busy, but now I’m like all fired up for the day.

[01:39:04] Josh: So maybe I should do this more often with you. Kirk. I mean, just, I don’t even know. I’m at a loss for words for trying to find just how much I’ve appreciated this time with you and how special this has been to hear from you and, and your perspectives and the value that I’ve gained outta this has just been incredible

[01:39:20] Kirk: Well, Josh, you know, thank you so much. You’re, it’s an honor to be a part of it. It, it really is. You know, it’s when you get to my age, you, it’s always exciting to be able to, to think and share some ideas that have worked and hopefully help others. But I so appreciate the, the devotion that your company has done in doing the podcast and your work on it.

[01:39:41] Kirk: And thank you for the opportunity to be here. it’s been wonderful and, I can ever return the favor in any way.

[01:39:46] Josh: Oh man. No, the, the favor was yours given to me by being on this, that’s for sure. But before I let you go, I got two final questions for you, sir. so where do you go to get information? I mean, you said you’re a big reader, right? So how do you stay up to date on the industry?

[01:40:03] Kirk: you know, this is, this goes to this learning aspect of being the most important. Aspect of, uh, and curiosity, right? Of, of, of who you are as a leader. So I read Credit Union Times Credit Union today. I read credit unions.com, every morning and the Wall Street Journal, often the New York Times and the Wall Street Journal, and then spend an hour with a book.

[01:40:26] Kirk: it’s just the nature of it, I never let a day go by without all the emails being done. You can like that or dislike that, but it is, but it’s that level of discipline around learning that is essential. And so but I say I try to stay broader than just credit unions, but I start every day anchored in credit unions because if I can’t talk to you or can’t go to the next conference and talk to the, a potential,

[01:40:52] Kirk: You know, purchaser of our services or potential client or a potential partner what they accomplished recently or what the industry is going, then I become irrelevant quickly.

[01:41:01] Josh: Yeah. well, if people want to connect with you, which I’m sure you’re gonna get a lot of after this, how can they connect with you and, and where can they learn more about Park Street and, and what you all are doing?

[01:41:12] Kirk: Yep. Yeah. Park street partners.com is straightforward, right? Park Park is spelled PARC street partners.com. And, so that’s, that is a straightforward but in touch with me. and hopefully everyone can see on the, the screen my full name, just, uh, kirk korki@me.com is easy. Or k korki@parkstreetpartners.com.

[01:41:39] Josh: I love it, sir, you are just a, a treasure to this industry and to the people that get to interact with you and, I feel fortunate to have been able to spend this time with you today. So thank you so much for coming and being a guest on the Digital Banking podcast.

[01:41:53] Kirk: Thank you. Appreciate it. All the best, my friend.

[01:41:56] Kirk: I’ll see you on the road. Thanks, Kirk.

[01:41:58] Thank you for listening to the Digital Banking Podcast, powered by Tyfone. Find more episodes on digital banking podcast.com or subscribe on Apple Podcasts or wherever you get your favorite podcasts.