By Sarah Snell Cooke, Principal, Cooke Consulting Solutions

“Cooperation is hard!” retiring COOP Financial Services EVP Sarah Canepa Bang stated emphatically during the opening session of the 2017 Underground Collision. “Any idiot can go alone and run an institution without cooperating.”

BALANCE CEO Kathryn Davis, CU*Answers CEO Randy Karnes, COOP Financial Services EVP Sarah Canepa Bang, and Host Brandi Stankovic, senior partner in Mitchell, Stankovic & Associates had a little fun before serving on the opening panel, discussing Only-If-I-Win Collaboration.

Bang continued, “The challenge with the people you’re trying to collaborate with people is you think they are stupider than you. The enemy of cooperation is ego…Yes, you have to put your members first, but there’s no members if there’s no cooperative.” And that means you don’t necessarily win. In fact, you need to be willing to take less away from the collaborative effort in the hopes that you may get something more next time or be comfortable with the fact that it’s for the best for the credit union community.

“I wouldn’t be very self-aware if I didn’t know I have a reputation that I want to win,” Randy Karnes, CEO of CU*Answers, commented but went on to explain how he believes collaboration is possible. Everyone has self-interest, but if everyone clearly defines what a win looks like. If that win is not being disruptive—providing access to something new and sharing execution—then you’re just trying to win market access.

For successful collaboration, Karnes asserted, the solution must be the reward, like finding the answer to a riddle, then share that and create competition. He also added:

·      Don’t invite people who’ve solved the riddle before;

·      “No lawyers. Lawyers are designed to predict conflict and predict winners;”

·      Accountants want to predict revenue and how it will be split; and

·      “You have to find the capacity that you have that has no marginal cost.”

Kathryn Davis, CEO of BALANCE, suggested credit unions may have lost his way, and fintech may be picking that piece up. “What collaboration has the industry produced that benefits the credit union movement and benefits the member?” She pointed to disruptors, like SoFi (short for Social Finance) which has made $1 billion in loans. It boasts efficiency and convenience for its members—yes, members—and it’s attracting investors to the tune of billions. The startup valued at $4.3 billion—a feat only a handful of credit unions have achieved in more than 100 years.

These are credit union members and potential members, Davis emphasized, so why aren’t credit unions collaborating on the backend for similar results.

“We’re not going to win the battle in DC,” Bang said, “if we’re just going to be poor man’s banks.” She added that credit unions were not formed for poor people, not that credit unions shouldn’t serve them, but it was for average people who couldn’t afford access to financial services.

Find a way to make cooperation cool, Bang urged. She pointed to credit unions’ work with the Children’s Miracle Network as a successful example of collaboration. The secret to its success has been allowing local fundraising decisions, whether its wine auctions or rummage sales, she said. So where else can the credit union community provide a basic infrastructure that everyone can use to benefit their members in the way they see fit?