Lessons to be Learned from the University of Iowa
Posted by Denise Wymore on March 2nd, 2007
This post is a synopsis of the story as told by a member of UICCU—for complete and I mean COMPLETE coverage please visit FromDC2Iowa with additional commentary by me (Denise Wymore, Culture Consultant) at the beginning and the end.
Commentary
Like many credit unions have been doing lemming…I mean lately, the University of Iowa Credit Union converted to a community charter. And even though the credit union has grown steadily for 69 years, they were convinced that to REALLY grow (bigger than $544 million) they should adopt a new name.
Begin Synopsis
They spent $250,000 to come up with Optiva. Yup. October 4, 2006 they held a meeting at which the plan had been “approved” by a vote of 198 to 192 with some irregularities in voting.
A petition was presented to the board calling for a meeting to revisit that “decision.” Instead of remembering that they are owned by their members and the board represents their interests, they fought it. They refused to make public the minutes of their secret board meetings and the “study” that they said supported their decision. They fought the petition for the February 28th meeting as somehow legally defective, but lost.
They were forced to hold the new meeting but they (the CEO and board) circled the wagons and started shooting in all directions.
They took out full page ads in the local papers – tellers were wearing buttons to urge the vote for Optiva. A cab driver reported that they’d contracted with his cab company to carry SUPPORTERS of the name change to the meeting.
On February 28th, 2007, 1437 Iowans came out on a stormy winter night to vote 806 to 631 to keep the University of Iowa Community Credit Union name.
Here are some highlights from the meeting:
Q: Did the University demand this change?
A: Well, not really.
Q: Why are you doing this?
A: We need to grow. That requires marketing. That requires a non-geographic name.
(snotty sidebar: I hope Navy Fed is reading this, maybe they can grow too)
Q: Putting aside the fact there are reasons NOT to grow, why couldn’t you get that with a name like “Hawkeye CU?”
A: No answer (sound of crickets)
A: But later: People think they can’t belong if they don’t work for the University. (But, as they also mentioned) During the past few months we’ve had our greatest growth periods ever in deposits, loans and membership.
Q: (or rather obvious but never articulated rebuttal) But hasn’t your name remained UICCU throughout that time? Apparently it didn’t slow up that growth.
A: (to unarticulated rebuttal) Ah, but this controversy is what has let folks know that they are free to join.
Q: Well if this is all about marketing, and letting folks know they don’t have to be affiliated with the University of Iowa, don’t you have a marketing director?
A: Yes.
Q: Well, then, why hasn’t he taken on this marketing task with something like “UICCU is open to all?”
A: Blink, blink. (end synopsis)
Commentary
Instead UICCU has spent $450,000.00 (or about 10 dollars per member) in this process. Imagine if they had used that money on PR in the community? Creating awareness that the benefits of membership in the University of Iowa’s financial cooperative is now available to all Iowans!! Go Hawkeyes!!
Entertainment Weekly magazine just published a visual timeline of the fall of Britney Spears. From Mouseketeer to Bald Drunk.
I can’t help but think that these moves are a “Cry for Help” too. What are we becoming? Campaigning for a name change? Why? Break up my club…..why?
The lessons learned from this process?
1. Don’t cheat on your sponsor if you don’t have to.
2. If you DO have to – be honest with them. Don’t sneak around behind their back.
3. If a name change is forced upon you (because now your sponsor has had it and they are wanting a divorce) for the sake of the kids, can’t we get a name that at least acknowledges the union? We did have 69 great years, after all.
Whats in a name?
The Royal Bank of Scotland announced a profit of 9 Billion of our UK Pounds this week. No need to drop the Scotland location/geography from the name to make money around the globe so why this CU thought they needed to puzzles me.
Admittedly they do use RBS as a shorthand and they do own quite a few other wee businesses such as The UKs National Westminster Bank. They also have strategic links with the Bank of China.
Whats in a name? Not as much people think….its the team behind the company that make the difference.
Just a further thought…..any body fancy setting up Credit Union China Direct?
alex
BTW, mad props to Tate Linden for his ongoing coverage of all this.
Alex, great comment!
Alex,
Have you ever seen the rock video of Blind Melon’s song “No Rain?”
The music video begins with a young girl (Heather DeLoach) wearing a bee costume, tap dancing. When she finishes, she is met with laughter, to which she reacts by crying then running off the stage.
The song begins to play and the video switches in between a narrative of the innocent Bee Girl (performing her routine in various urban settings for whoever will watch) and footage of Blind Melon performing in a field of emerald green grass against a clear blue sky.
At the point in the song in which Shannon Hoon repeats the line ‘escape’, the Bee Girl has discovered a green field behind a large, imposing gate. When she opens the gate, she’s met with the happy sight of other “Bee People” like herself, dancing carefree and she joins in. Thus the Bee Girl is no longer a misfit. Like the song indicates, she ‘has it made’
I had that feeling when I visited your site. Where have you been? Oh, that’s right – across the pond. I am so supportive of creating an online credit union and reconnecting the “bee people”
I will respond appropriately on your site. Thank you, Denise
Trey,
Let’s not forget our friends at PopWink!
Optiva and the Law Professor
This is great coverage and some really lively comments from the creator of Optiva.
Enjoy. D.
Hi Denise,
it’s getting late here so there is a real chance I wake up in the night thinking I am a bee trying to deposit honey into an online Credit Union. (I’ll thank you now in advance for waking me up screaming at 4am, my wife will be mad as….)
I havent seen the video – I’ll do the You Tube thing tomorrow.
In the meantime thanks for describing me as a Bee Girl, I think that is positive though sometimes the USA and UK talk a different version of the english language.
In short I think the UK need to learn a lot from the USA when it comes to the CU world – but I’m a novice at this stuff so disclaimers apply.
Thanks for the support – so keep blogging, commenting and watching videos that inspire.
alex
Ah – the name change debate…
I’m with the Hawkeye’s on this one -> Optiva (unless that’s the name of a river or something I don’t know of since I’m not an Iowa resident) probably has no meaning for any current CU members.
Now a marketer can try to breathe meaning INTO that name, over time, for the CU… but it isn’t easy.
Particularly if the members don’t like the name in the first place.
http://www.everythingcu.com/discussion/index.cfm?fuseaction=viewtopic&DiscussionTopicID=9283
Here’s a post on everythingcu.com from the marketing director.
Interesting.
The concept that members-at-large are “owners” with “rights” has diminished quite a bit in recent years.
Iowa is one of the very few states with a statute specifically vesting ownership of the CU in members-at-large. In some states like Washington, CU “regulatory reform” laws enacted in recent years have diluted, or eliminated, the “rights” of members to be anything other than depositors and borrowers. C’est dommage.
I’m not 100% sure of your synopsis is completely accurate, but I won’t nitpick. As someone who was moderately in the thick of this (credit union member, local reporter – great excuse to be a little nosy, by the way), I think you’ve hit some great points with your “lessons learned.” But I will comment, nonetheless
1. Don’t cheat on your sponsor if you don’t have to. Comment – This is a story that has changed, and that was muddy the whole time. When I went to the first meeting (198-192), the implication was pretty clear that the University was encouraging this move, including a UI VP speaking in favor of the name change. The implication at the time was that this was at the behest of the UI, mainly because of other financial institutions who wanted the ability to market without the UICCU having the clout of of the university name. This – if true – and nobody ever laid out what’s true, for sure, despite the media’s best attempts to ferret it out (See #2), shows the foolishness of changing the name.
2. If you DO have to – be honest with them. Don’t sneak around behind their back. Comment – Shouldn’t this be a good business practice no matter what you do? In order to have loyal customers – be straight up with them, sell a quality service at a reasonable price, and let the chips fall where they may – and let the world beat a path to your door.
3. If a name change is forced upon you (because now your sponsor has had it and they are wanting a divorce) for the sake of the kids, can’t we get a name that at least acknowledges the union? We did have 69 great years, after all. Comment – One thing missed by all the “Hawkeye CU” comments, and similar is the realization that those names are a dime-a-dozen out here (I can think of dozens of banks and other businesses that use the name “Iowa _,” “Hawkeye _,” or “Old Capitol _.” Many people underestimate the challenge faced by Jeffry Pilcher & team, and I think that’s why he’s gotten such flack on blogs, and has felt the need to defend himself. Trying to establish a unique name without using UICCU would be difficult. I tried in a thread over at stokefire, and didn’t do all that well – when I read it now.
Other lessons:
1.) When dealing with a membership organization name change – let the name come from the ground up, if at all possible. I think one of the initial reasons for the rejection was that the first people heard of this process was a letter sent out by the credit union saying “We’re changing our name, everybody get on board.” Maybe this process would have functioned better: 1. Dear membership, we are considering changing our name for reasons x, y, and z. Please give us your input. 2. We’re holding a public meeting to discuss the name change, and we’ll accept suggestions for names there. Everyone can meet our directors, the marketing team, the CEO, a naming consultant, etc and ask whatever questions you want. It’ll be informal and fun and they’ll be free food. 3. Here’s the name (or 4 finalists with a vote?), come tell us what you think, and whie you’re there, if you like, cast your vote in support. Just what I think.
2.) In a membership organization, where you need the approval of the membership – don’t try to ram something through from the top down. At the first meeting reasons that were given to support the name change included: Trust the leadership, they’re awesome. If you don’t vote yes, we’ll be back, with associated expenditures to do this all over again. Oh, and trust the leadership, they’re awesome. When you need something from someone – namely a yes vote from your members – don’t tell them what to do, ask them.
3.) Try not to be shady – don’t push your employees to vote, don’t buy cabs (while I like and trust Prof. Johnson, that fact was not reported by any news organization) for your voters, no buttons, no organized letters-to-the-editor campaigns. These are all hardball political tactics, leave them to the major political parties, not for a “member-owned cooperative.”
Those are the lessons, I learned, at least. Maybe I’m completely off.
“Iowa” this, or “Old Capitol” that, or “Hawkeye Community Credit Union” – I don’t see the use of “Hawkeye” as trite at all. I don’t see the use of “Iowa”, or “Old Capitol” or “Hawkeye” as anything other than a reference to the proximity of a business to the University of Iowa community. The use of these three common identifiers is a tradition around the Iowa City area. The UICCU has a long tradition with the University, and it can continue to maintain that connection by using “Hawkeye”, while still marketing itself without the perceived ‘clout’ of the U of IA.
As far as “Optiva” is concerned – I would sooner expect a salesman to appear in the dental office with an attache full of “Optiva” toothbrush samples than expect a name like that to designate a community based credit union in Iowa City. UICCU member since 1977.
Scott,
I agree. Trite is not a word that I would use to describe a mascot, a community or a tradition.
Clearly the University of Iowa has al of that—community, tradition, and a cool mascot.
Optiva will always be the name of a toothbrush company in Seattle.
BTW—I saw in the CU Journal today that the name is up for sale. If a credit union actually buys that, I’m done. I give up.
. We saved the name, but we did not save the organization.
Hello…
My name is Tim Taffe, I am an UICCU member, in no way affiliated with University of Iowa and the person who coordinated with the State of Iowa Division of Credit Unions, got the UICCU petition drive going, did legal research, submitted the petition, and basically had the sling shot that brought down Goliath.
Thank You. We saved the name, but we did not save the organization.
As was evidenced by last week’s insider’s only annual board election vote, there are serious fatal organizational flaws at UICCU.
Jeff Disterhoft does a great job of running a highly successful “bank”, unfortunately, there is only a technical shadow of a “credit union”.
Frankly, I do not believe that the UICCU can be saved as a true and honest credit union. The management is dishonest and their meetings, objectives and directions are all clandestine and kept from the membership.
I am committed to credit unions, but I think UICCU has gone and is going in all of the incorrect directions.
As we said during the anti oooopstiVa campaign, “It ain’t just about the stupid name!”
I am actively pursuing some other avenues and concepts which hopefully will be best for the credit union members of UICCU.
Tim Taffe Iowa City
From: sinkoptiva@aol.com >>> To: >>> CC: ingrid@avalon.net >>> Subject: Re: I’m aboard….THANK YOU. >>> Date: Mon, 19 Feb 2007 >>> >>> >>> >>> Thank you so much. >>> >>> First, we love the UICCU, we want it to succeed. It is optiVa that >>> we want sunk. And the optiVa management! >>> >>> As you can see, a strange group of individuals are responding, we >>> do not know who they are but they do not represent the mainstream >>> of UICCU members. >>> >>> There will be a story in the on line edition of Credit Union >>> Journal next week/this week..it talks about credit unions that are >>> taken over by aggressive management with the intention to convert >>> them into banks, and therefore creating a mass of cash for >>> themselves, as the stock holders. This is what will happen here. >>> Just look at the big bucks board members, not normal members at >>> all. The article talks about UICCU. >>> >>> I am asking Saint Ingrid to write to you and suggest how you can >>> help save our member owned credit union. >>> >>> The most important, is to make sure everyone really does show up >>> to vote, and not think someone else will vote. >>> >>> Then we must replace the three designated candidates on the Board, >>> then we must fire the president….not that president..the credit >>> union president..Distlehort. >>> >>> Ok? >>> >>> Hope to meet you soon. Ingrid will put you on our HOT LIST. >>> T2