The four cornerstones of successful and continuous innovation for credit unions
Innovation defines our age, but it is more than an overused concept or throw-away buzzword. .
What is innovation? The word has become practically synonymous with ‘new’. I recently saw a quote from author and business professor Oren Harari that illustrated this perfectly. It read “Edison’s electric light did not come about from the continuous improvement of the candle.” In my view innovation is anything that adds value to existing systems to the benefit of all stakeholders and is primarily achieved in the form of new processes to create better user experiences.
In the case of credit unions, the member experience must be the focus of all innovation efforts. This is due to the nature of their relationship with their members. Credit unions are responsible for the financial futures of their members and their innovation efforts must be geared towards improving the ability to provide a simpler, enhanced and more enjoyable experience while safeguarding the trust already earned. But where do we begin?
Innovation is not a project – build it into your culture
Innovation is not something you tick off the ‘to-do list’ after the launch of a new project, service or product. When companies innovate, they need to work hard to do this on a continuous basis, not as a project but as part of their daily routines. A culture of innovation must be woven into the way people work.
There are four innovation principles business leaders should keep in mind. Think of these as the four cornerstones of successful and continuous innovation.
1. Innovation comes from focus
First, your objectives need to be clear to everyone and defined as narrowly as possible. Innovation must start with the right purpose. For instance, if your purpose is to be the ‘best card issuer in the world’, you’ll have a hard time looking at the interaction at the point of sale. You may come up with innovative products and services for your cardholders, but your goal will be limited and won’t change the way your members interact with merchants, as the word ‘issuer’ there will limit your ability to find solutions for your merchant customers and therefore create a great experience at the time of shopping.
The right focus will help you change the existing process. Ask the following questions: Which areas indicate more growth potential? In which areas can we predict less competition? Which areas can we improve, and which are good in terms of internal resources? After going through this in-depth analysis, define its areas of focus for the next years. To innovate and dominate, narrow it down as much as possible and communicate it clearly.
2. Innovation emerges from limited resources
When people have limited resources, they work harder, but more importantly – smarter. There are two resources where less can drive more innovation: time and people. Time should be everybody’s most valuable resource. The world is full of smart people – if you work on something, chances are others are working on it, too.
Small teams are essential to create. If a company has a thousand IT people, it doesn’t mean they must all work together to create something. It simply can’t be done. Instead, we need task forces, agile teams, work groups and project teams. But please, no innovation departments! You need a P/L and customer pressure to innovate.
3. Innovation is a matter of culture
Innovation departments suffocate real innovation. On the most basic level, they demotivate employees by putting some people in the ‘business as usual’ camp, while others are part of a specialized group. Organizations can’t change with a single department – change has to come from culture. The whole organization must be your innovation department.
To go from strength to strength, credit unions need to introduce the ‘startup spirit’ – a unique corporate culture and structure that facilitates continuous innovation and serves as the fundamental operating principle for every startup-like, small, semi-autonomous unit within the company.
4. Timing is crucial
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Innovation defines our age, but it is more than an overused concept or throw-away buzzword. .
What is innovation? The word has become practically synonymous with ‘new’. I recently saw a quote from author and business professor Oren Harari that illustrated this perfectly. It read “Edison’s electric light did not come about from the continuous improvement of the candle.” In my view innovation is anything that adds value to existing systems to the benefit of all stakeholders and is primarily achieved in the form of new processes to create better user experiences.