BY KENNETH C. BATOR
Since publishing my book, The Formula for Business Success = B+C+S, one of my top five past times is meeting with fellow authors and thought leaders. No one can truly understand the trials and tribulations of writing an entire book word by word yourself than another author. The stories of the journey of writing are both humorous and painful, as is my favorite one on how I accidentally erased an entire chapter I had just finished. That’s a story for another day.
The story for today is the incredibly enjoyable lunch meeting I had with Sheri Nasim, author of Work On Purpose: How to Connect Who You Are With What You Do and CEO of Center for Executive Excellence, Inc. Both of us have worked in the financial services industry for some time. Also, her foundation of “The Strategic Power of People, Purpose, and Performance” has a number of similarities with my B+C+S Formula. So I couldn’t wait to tap into her wisdom and perspective on leadership within credit unions today.
The first question I posed to Sheri was on culture – the “C.” I offered my opinion that fortunately the credit union industry has come a long way where there are more and more leaders stepping into the CEO role that truly understand the value of a strong culture. However, there are still many that are great at numbers but not very skilled at cultivating a true passion among their staff. How do you work on culture building with an executive that is only interested in the hard and fast ROI? Sheri answered, “Because culture really does eat strategy for lunch. Research shows that culture has a dramatic impact on the bottom line. In their 1992 book, Corporate Culture and Performance, Harvard professors John P. Kotter and James L. Heskett established a direct link between a company’s culture and key financial metrics. When they compared companies with strong cultures to those without, they found an average of four times higher revenue growth and over 700 times higher growth in net income over a 10-year period.”
I nearly stood up in the restaurant and applauded Sheri’s response as I often stress when facilitating strategic planning sessions for credit unions that net income is a more important metric than asset size or number of members. When people remind me that they run a not for profit institution, I retort that they are also not for loss.
Sheri continued, “The best leaders know that financials are lagging, historical indicators. They’re fascinated by the leading measures, they drill down to the root causes that impact the financials. If a person wants to lose weight, stepping on the scale will give you a number. But that number is the aggregate of leading things you’ve done since the last time you stepped on the scale. How many calories did you eat? How much exercise did you get? Those are the leading indicators that will impact the number on the scale.”