As I reflect on my travels to over 20 cities in 2011, I am struck by a conversation I’d like to share with you.  Upon arriving late one evening in Las Vegas to speak at a credit union conference, I asked the cab driver “how’s business?” I heard a profoundly sad story.  His face is seared in my brain as a reflection of the impact of the contracting and de-leveraging in our country that began in 2008.  Eight years ago, he moved to Las Vegas and purchased a home for $180,000.  A global financial institution provided him with a line of credit and he proceeded to build a new deck and buy large new cars every year as his home value increased to $400,000.  Today, his home is valued at $120,000.  He is 67 year old, hopeless, with no possibility of retirement and stuck driving a cab to pay off his mortgage obligations.  His obesity is obviously being fueled by his frustration.

I am sorry to say that this contracting and de-leveraging will probably last at least another 2 to 5 years.  Once the normal standards of lending were discarded, everyone felt entitled to own a home and live beyond their means.  The system broke down.  For stabilization to take place, the regulatory system will continue to play a major role in attempting to correct this financial systemic breakdown.

Despite this, I still believe there are still great opportunities if one is smart and agile enough to capitalize on them.  But it’s a very different, changed world.  Continuing to learn and developing strategic business solutions in today’s highly complex, hyperconnected and fragile environment is our biggest challenge.  The information technology revolution over the last few decades has created complexity in most everything we do and in the credit unions we serve as employees or directors. Complexity makes decision-making significantly harder.

Complexity, by definition, means that things don’t behave in logical patterns.  Complexity is disrupting business ecosystems and competition is coming from unexpected players.   It takes different skill sets to navigate complexity – understanding outliers, gathering data, identifying risks over the horizon, thinking strategically and leading people who are distracted and fearful. Having the confidence to allow people to think, which ultimately increases their productivity and encourages a culture of innovation and collaboration, is hard to do, but is what’s needed to create sustainability and growth.

As I’ve said before, the member is in the driver’s seat today.  Those credit unions that continue to maintain their member focus are those that will win.  Truly understanding what they want and how you add value to them will keep on the right issues.  Adding value means knowing how your credit union creates value for the member and how you fit in; understanding the financials of your credit union; focusing on the things that are important to adding value; caring passionately about your members; continuously improving your skills so that you can keep finding new ways to add value and coming up with and testing new ideas.

Our consulting firm has been in business for 16 years based upon our values as well as being value-driven.  Addressing real member needs becomes a powerful tool and competitive advantage.  Having a moral compass while you build relationships with members, creates long-term sustainability.    One visionary credit union leader that we were fortunate to meet many years ago in one of our leadership learning programs, came to us and asked that we helped him and his organization to achieve what we did for another CEO in the healthcare world.  His vision was to become number one in customer satisfaction in the region.  We helped him to achieve that vision and he has maintained that position over the last several years.  His focus was on how to create value for the organization and members that he served.  We are passionate about working with leadership who strive to exceed their member’s needs and continue to do the right thing for their employees and the communities they serve.

A willingness on the part of credit unions to invest in learning becomes a strategic weapon.  One client of ours recently told us that based upon the work we had done with them on developing clear, smart implementable strategies, succession plans for their leadership and board and best practice governance standards, they are in a position to compete against larger entities, bigger in asset value, but lacking in this intrinsic value that they are using as a strategic weapon.  Their bench strength and culture which is articulated each day by each and every employee in their actions, provides them with the capacity to think clearly and base their decisions, whether it be to merge or acquire new companies, on the right issues that focus on value creation for members.

Creating a culture founded on values becomes even more important in a complex world. Creating a future in a complex world requires creativity and innovation.  In a complex world, values and adding value are two concepts that enable creativity and innovation to take place?   By asking the right questions, new solutions and opportunities will arise.  Why do members need you?  Why do you do what you do?  What is at the heart of what makes you unique and why do people do business with you?  We are fortunate to work with the most innovative, value-driven and ethical CEOs who are passionate about improving their businesses.  They are willing to take risks and emotionally invested in what they do – focusing on the member and not themselves.

Redefining productivity in a world that is hyperconnected is not easy.  It’s often counter-intuitive.  In working with a global technology company, we helped them to increase innovation, by learning how to think strategically.  This required time for thinking, learning and renewal. New ways of thinking strategically led to increased collaboration of ideas and creative solutions.  Technology people, who are most often at the heart of innovative, need to learn these new skills.  Building the characteristics of an innovative culture requires character, taking risks, the commitment to learn new things and the ability to articulate in a clear, crisp manner.  And having the CIO at the table for strategic discussions with the CEO and the board, will create increased value for the organization based upon how technology is now driving innovation.  But the CIO needs new skills sets to be able to articulate strategic concepts in clear, crisp terms that management and the board can understand.

With increased regulation, changing demographics and the new reality of the consumer in control, combined with this era of global contraction and de-leveraging, it’s even more critical to understand these trends.  People and organizations who adapt and embrace these new realities through learning and new ways of working together to create innovative solutions, will be the winners in this new and complex world.

Stuart R. Levine is Chairman and CEO of Stuart Levine & Associates LLC, a strategy, leadership and governance consulting firm. For more information, please call 516-465-0800 or visit