March 2005 - Enterprise Magazine

... March 2005
Little fish
In the competitive waves roiling credit union
seas, sonie wony· that mergers are occuffing
justfor the halibut. Alliances can be a
mutually beneficial alterna live to avoid
or delc~y being gobbled up b,y a bigger.fish.
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We help you see what m ight otherwise go unnoticed.
uara=in
CREDIT APPROVED PROGRAM
CUETS
ENTERPRISE
Editor
Roberta Staley
Enterprise is published by
Credit Union Central of British Columbia.
AttDirector
John Ngan
Production Manager
lzobel Naval
Contributing Editor
Laureen Griffin
Contributing Writers
Gregory Hamara
Dave Leid!
Richard Littlemore
Diane Luckow
Laurie Stephens
Judy Waytluk
Contributing Artists
Christy Hill
CREDIT UNION CENTRAL BC
Board of Direc.tors
Cllairperson
Jack Whittaker
Vice-Chairperson
Lorne Myhra
Christine Brodie
Valerie Gauvin
Pearl Graham
Henry Jansen
Ed Macintosh
Catherine McCreary
Ross Montgomery
Jay Strong
Michael Tarr
Managing Editor
Gayle Stevenson
BC CREDIT UNION SYSTEM
Peer Group Exec.utives
For information concerning
Enterprise contact:
Credit Union Central of
British Columbia
Creative Services
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Vancouver BC
Canada V6J 4s7
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Fax
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Group One (Nortilline)
North Country - B. Bentley'
Williams Lake - F. Wagner
Terrace & District - V. Gauvin
Group Two (0/1arragarr)
Interior Savings - D. Grant•
Osoyoos - J. Whittaker
Revelstoke - R. Holland
Salmon Arm Savings - M. Wagner
Summerland & District - l. Campana
Valley First - L. Goodlson
March
2005
~
Volume 65, Num ber 2
Group Three (Kootenoy)
Castlegar Savings - L. Myhra
Castlegar Savings - B. Gerrand'
Columbia Valley - L. Johnson
Creston & District - L. Eckersley
East Kootenay Community - 0. Holt
Grand Forks Oistric.t Savings - C. Man son
Kootenay Savings - W. Bottcher
Nelson & District - S. Gilfillan
COVER STORY
We're big enough to create a career
Group Four (Vancouver /stand)
For subscriptions, contau lzobel Naval:
604 730 63s8 or inaval@cucbc.com.
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The opinions el(pressed In articles In Emerprlse are
the authors' and not nccessarl!y 1hosc of EnltrprlJe or
Credit Union Central or British Columbia {~Ce11l1a1·).
In ilddition, the lntluslon of an advertisement docs
not Imply an endo1semenl or the product or seNice
by Enterprlst or Central. Enttrprfse wm not knowingly cauy false or misleading advertising. Enrerprlse
reserves the right to fl'!fusc any advertisement. Both
Enterprise and Centtal dlsclalm any and au warranties,
whether expiessed OI' lmpl!ed. lncludlng (without limitation) any Implied waminties of merchantability or fitness for a pa1·ticular pu1pose and neither Enr1upfise nor
Cent~I witl accept any responsibility for the reader's
use of the lnfOl'madon and/Of opinions presented In
Ente1ptise or ;my loss arising therehom.
The contents of £nce1pdse are covered by copyright and all rights are rcnrved. No m;1terial in this
pub\icatlon may be rep1oduc.ed In any form without
permission.
Coastal Community - 8. Bennie
Coastal Community - R. Grundison
Coastal Community - R. Allen
GreaterVictoria Savings - B. Bittner
Island Savings - P. Graham
Island Savings - S. Service•
Quadra - S. Halliday
more professional and career-minded
people.
Group Five
Coast Capital Savings
Envision
North Shore
Prospera
Vancouver City Savings
Westminster Savings - R. Montgomery •
Group Six
Aldergrove - N. Ranson
CCEC - S. Murdoch
Community Savings - D.R. Parkinson
Greater Vancouver Community - P. Moore
Gulf and Fraser Fishermen's - E. Macintosh
V.P. - R. Hoffman•
Van Tel/Safeway - M. Aubert
•oenotes Chairperson
ISSN 0319- 8626
for people, so we're going to attract
Richard Davies, CEO, Gulf and Fra ser
Fishermen's Credit Union
28
Big Fish, Little Fish
Alliances between credit unions can be a
viable alternative to mergers.
Roberta Staley
FEATURES
Be's BU SINE SS
8 The Big Makeover
DEPARTMENTS
ATLANTIC CANA DA
6 Editorial
26 The Wight Way
Vancity has taken a brand that wasn't
PEI Central's new CEO, Nick Wight, is used
broke - and f ixed it.
to being in the driver's seat.
Credit unions in Top 50 list, higher heists,
Dave Leid/
Laureen Griffin
d irectors feel liability bite and say "cheese "
ONTARIO PERSPECTIVE
MANAGEMENT FILES
7 Small Talk
for t he cam era.
12 The Sweet SME of Success
34 Humility, Hubris or High-jack
42 IT GIRL
Ontario credit unions are hip to commercial
Control the process of democratic
Nifty new gadgets make ATMs vi rtually
lending.
decision - making.
impregnable to crooks.
Laurie Stephens
Eli Mina
Diane Luckow
PRAIRIE VIEW
The Player
16 No Staff Crunch Here
On - t he- job t raining at credit unions for new
Vancity becomes a capital player.
Sara Holland
immigrants.
Judy Waytiuk
OFFICE AFFAIRS
38 Talking 'bout My Generation
GLOBAL AFFAIRS
20 Tide of Misery Begins its Ebb
Doing the sam e job year after year will
bore anyone t o tears. Make work exciting
Canadian Co- operative Association
again for older workers.
representatives report on trip to tsunami-
Laureen Griffin
rava ged Sri Lanka.
Roberta Staley
IT rs
BELIE v ED
that the Internet's 24/7 window on the world was
instrumental in helping spur individuals and governments to donate billions
of dollars to tsunami relief efforts in south Asia. People from around the
globe had an intimate view - via personal computers and Internet cafes of the destruction caused by the Dec. 26 earthquake-churned tsunami in
the Indian Ocean. The 'Net allowed citizens as well as tourists affected by
the 1nonster waves to communicate with loved ones through email and
'blogging: This latest in Internet co1nmunication involves little more than
keeping a journal on the web. Its popularity lies in its simplicity; little or no
technical savyy is needed to update and maintain a blog.
When such tragedies happen, people naturally gravitate toward an
authentic human voice. Following the tsunami, which killed more than
300,000
people, many of the homeless and injured were instantaneously
able to relate their experiences through blog sites. It also allowed those from
outside the region to try to track lost loved ones. The pleas for help moved
millions of strangers, who read of the harrowing experiences of survival
and loss, to give what was needed the most - money.
Blogging also allows donors to monitor the effectiveness of relief efforts.
For those credit unions and their members who donated to a variety of
relief agencies, from the Canadian Co-operative Association and Oxfam,
to the Red Cross and UNICEF, blogging will help them keep track of the
success of the rebuilding efforts in Southeast Asia, as well as open a window
on the possibility of new, international friendships.
R 0 B ER TA ST , \I. E Y
rstaley@cucbc.com
Small Talk
BEST IN THE WEST (AND EAST)
HEISTS HIGH I N LOTU SLAND
MACU ATTACK
Report on Business' sixth annual 50 Best
Bank robberies across Canada are dropping,
The Marketing Association for Credit Unions'
Employers in Ca nada 2005 included several coop-
except in Vancouver, which holds the dubious
(MAcu ) 15th Annual Strategic Marketing
eratives and credit unions. The Co-operators of
honour of being the nation's bank-robbery
Conference w ill be held Jun e 2- 3 in Vancouver.
Guelph, Ont. came in 16th, Reg ina's Co-operators
capital. Last year, there were 203 robberies, up
This popular strategic marketing conference
Life Insurance Company was 23rd, Desjardins
from 70 in 2001. Lax sentencing is being fingered
event draws credit union marketing professionals
from across Canada for two days of presentations
Group was ranked 30th and Envision Credit
by law enforcement as a culprit in the spike in
Union in Langley, BC 34th. Sta ndings were based
robberies, while drug addiction is regarded as t he
and networking, as well as the popu lar AIME
upon employee su rveys, a human resources
great motivator. Most heist s net less than $1,ooo.
Awards Gala.
practices survey and leadership t ea m survey
for top executives.
----------===========f-~
OH, YOU COLOURED YOUR HAI R
North Shore Credit Union of North Vancouver
has implemented the first- ever photo identification anti- fraud fraud program in Canada. The
credit union's frontline staff view the photograph
when making transactions, eliminating the need
for members to show photo identification such as
a driver's license. The program was implemented
t o try to protect members from an increase in
identity theft. BC has t he second highest rate of
identify theft complaints in the country.
LIABLITY CHANGES I N THE WIND
FOR DI RECTORS
I~
Blame it on corporate wo rld's rogues, w ho led
the likes of Enron and WorldCom . Directors'
insurance will not protect directors of either
entity. In January, WorldCom's directors agreed to
p ersonally pay us$18 million, while Enron 's board
was hit for u s$13 million to help pay lit igation
settlements. Some pundits are applaudin g these
developments as the first steps in reform that
f'/"/l~
''It's very important that you try very, very hard to remember where
you electronically transferred Mommy and Daddy's assets."
w ill hold boards of directors personally liable
for incompetence.
MAR. 2005 • ENTERPRISE
7
BC'S BUSI NESS
The country's largest credit union, Van city,
has opted to take a brand that wasn't broke
and fix it. by Dave Leid/
the
BANKER s s TR IDE into m eetings in blue
pin-striped suits with red ties, env ironmentalists and community activists tiptoe about in
Birkenstocks baring their hairy to es while good
neigh bours schlep around in aprons or overalls.
When an entity describes itself as a "damn good
banker;' green, devoted to the community and
neighbo urly, what, oh what, does it wear?
In the late i96os, when Vancouver City
Savings Credit Union was just a neophyte
trying to look big in a big city, the capital C in
the VanCity logo, topped by three red skyscraper
silhouettes, inscribed its aspirations. Tod ay,
the big C seems geographically limiting, says
Kari Grist, Vancity's vice-president of marketing.
And those red buildings appear cold and austere,
while Vancity is approachable and friendly.
Two years ago, Vancity's top management
turned a simple review of the old, cold logo into
a complete metamorphosis. The goal: create a
8
EN TERPRIS E • MAR. 20 05
consistent, visually friendly, integrated look to
attract new business while underlining Vancity's
personal commitment and financial astuteness
in guiding its members through the 'intersections' of their lives.
Sure, it sounds like feel -good fu zzy, but
there is real fire behind it: Vancity says it wants
to take market share from the banks, pull in
new members and up its share of the Lower
Mainland's financial business pie. Banks are not
its only competition . C oast Capital Savings
Credit Union now rivals Vancity as the largest credit union in assets and has, at times,
usurped its number one sp ot in membership.
La Federation des caisses pop11laires Desjardins,
the behemoth from Quebec, has leaped into
the fray outside of the province with Desjardins
Credit Union in O ntario. With changes in
legislation, there is little to stop Desjardins from
moving to BC.
Vancity
JUll\\\~
VanCity
It's right here.··
The new Member Cards s howing
Vancity's colour gradients to differentiate between retail, business and
community banking.
Vancity's 'new look' extends to
employee name tags and business
cards and stationery.
BC'S B US INE S S
With such competition, Vancity felt it needed
a makeover. Between 2002 and 2004, its total
assets increased by 28 percent to $10.5 billion.
But Vancity wants to be more than a bank and
more th an a credit union; Vancity must have a
look that reflects its current aspirations.
When young professionals want to convey
their education, experience and ability to get
the job done, they go to an image consultant
to create the right look. Vancity didn't want to
convey an image, it wanted to expose its soul.
To do that, it hired outside third-party specialists.
Rather than use a one-stop shop, the process
was split into four steps, each handled by a
specialist firm. Call it cherry picking. Grist
does. "We wanted to work with the best here
and the best there:'
The first step: dig and scour masses of
research information to get a feel for just how
members and non-members perceive Vancity.
More than 100 one-to-one interviews were
conducted to go beyond 'product and service'
and into perceptions.
"One of the things we fo und out pretty
quickly was there was this 'disconnect' about
how people viewed Vancity and how we
projected Vancity through our corporate identity;' says Grist. The face didn't match the body.
A second concern. As Vancity grew, new
employees were less aware of the 'Vancity difference' or couldn't articulate and internalize it.
And if they couldn't, how could they possibly
present a consistent message and attitude to new
members? "It was not about 'changing;" explains
Grist. It was, apparently, about crystallization.
Staff has to crystallize it internally so they could
"crystal it externally" and convey the Vancity
soul, righteously.
To rip open its shirt and find the right words
to expose heart and soul, Vancity brought in
Envisioning + Storytelling Inc. Based in West
Vancouver, E+S specializes in, yes, 'envisioning
and storytelling' a client company's 'soul' in
written and verbal form. For Vancity, that meant
a two-day belly button picking session where
Vancity executives, select members and staffers discussed the present, past and the future.
Prior to that, more than 100 staffers from every
department had held their own 'story-driver
sessions' to help discover the credit union's
true identity.
The result was 'The Story' in two versions:
the 28-pager for members, the expanded version
for Vancity departments and staffers. In two
booklets, Vancity personified and personalized.
TI1e next step, says Grist, "was to bring some
of the stories and personality ofVancity into the
physical presence and location. Make the hidden
more visible:'
Enter Karacters Design Group. James
Bateman, associate creative director, taps the
keyboard. The 'signature design' pops up: looping lines intersecting over the 'colour gradients' red for personal banking, blue for business/
commercial and green for community/environment. The effect is eye-catching and yet not
jarring. Vancity's 'triple-bottom line' on a palette.
"Vancity is a very unusual institution but
visually, from our point of view, their brand
didn't match what they did;' explains Bateman.
To match appearance to the soul in the new logo,
the Karacters staff memorized the E+S storyline.
The resulting logo, or word mark, no longer has
a capital C. It is still red but the initial V is now
softer and shaped more like a vase.
The wardrobe change didn't stop there.
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10
ENTERPRISE • MAR. 2005
"It's about considering every single 'customer
touch point:" says Bateman. Some changes are
small. For example, employee name badges are
now rounded and 'friendly'. Other changes are
large. For example, the outside. Vancouver is
home to dog-lovers and healthy types. Bateman
and Martinez designed distinctive 'street sculpture' bike racks and gently humourous 'dog
tie-up' points featuring the silhouette of a canine
brooding on financial thoughts ("Why can't dogs
get credit?"). Each pooch minder is thoughtfully
equipped with a water dish.
The front entrance will have a cheerfully
bright portico. Over the top, an optimistic,
organic phrase such as 'things grow here' or
'ideas grow here' or the like. Instead of plain plate
glass, the door treatment takes the intersecting
line motif and runs with it. One line is marked
'Vancity; the other is 'me' and the intersection
or nodule says 'us'. Depending upon security
and privacy requirements, certain windows
will become 'story windows' fitted with replaceable finely perforated panels (outsiders can't
see in but insiders can see out) carrying the
'us' message.
Step inside. The reception rotunda has a
circular 'hello' raft above it. (Part of the Van city
story is a language revolution aimed at overthrowing jargon and acronyms.) Behind the
teller area, the colour gradients provide what
Bateman calls "visual points of reference" to pull
people through the branch and visually direct
them to the right teller counter.
Depending upon the specific branch, there
might be a modular free-standing 'community
wall' equipped with a small chalkboard, and
Vancity's 'famous book-sale table' which will
double as a desk when the manager delivers a
talk on, say, pensions. The idea is to tidy up various disparate yet important parts of the member
experience in a way that isn't stilted or staged
but instead comes across as flexible, friendly
and professional.
The tone of the signage is meant to be more
colloquial than the banks, the branch experience
more inclusive and open. But it also must not
be seen as overly chummy or na'ive. The design
and tone must hit what Bateman calls "the sweet
spot" between serious and sincere. Damn good
bankers with compassion. "You've got to get to
the space in the middle, otherwise it fails."
The changes will be gradual. After all, it
wouldn't be environmentally politic to destroy all
the original letterhead just because of a change
in logo. Likewise, the branches will be changed
over time, as each comes due for renovation. But
the change in advertising will be abrupt.
In the world of media agencies, one of the
more powerful strategic tools is 'disruption;
shake up a somnolent and/or complacent industry and show the public it benefits them. Jim
Southcott, chief strategic officer for global media
agency, TBWA/Vancouver, has long wondered
why Vancity wasn't getting much notice.
However, as Vancity's new agency, TBWA and
Southcott are out to change that.
"Vancity is already a very disruptive brand;'
says Southcott. ''"This is not something that's
an advertising invention. Our challenge wasiit
so much to find how it can be disruptive but to
channel that energy because it tends to be doing
so many different things. The only challenge
for Vancity managers is that they haven't talked
about it, they haven't really let people know
what's going on behind the scenes:'
Set to launch this spring, the media campaign
is meant to wake up the sleepwalkers - people
who have banked with 'their' bank but have
never asked 'why?' It is an industry truism
that people spend more time researching their
shampoo than their first bank. However, when
they change banks, it's done deliberately, fo r
a conscious reason. It is these people Vancity
hopes to target. How? Southcott believes that
'disruptive' companies can target hearts, minds
and wallets. The trick is to hit all three targets
at the same time.
The new campaign that will, for the first time,
include television ads, plans to lever on society's
awakening demand for social responsibility and
transparency and couple it with the very human
wish to make good returns on one's money.
Social good, plus good returns.
The campaign will be directed to people who
recycle but are financially conservative. "We
have to not only overcome any fear that they are
giving something up, but actually tell them they
could be doing more; that their money could
actually work harder than at the traditional
banks;· says Southcott.
As Vancity tells its story through advertising, booklets, signs and branch design, the rest
of the fina ncial world will see what a corporation that defines itself as a damn good, green,
community conscious, neighborly banker looks
like. It includes a blue colour gradient (banker
blue), a green line (for the environmentally and
community conscious) and a red line (personal
banking). Will the public see Vancity's soul, or
a clash of cultures? g
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Fax: (604) 682-4405
MAR. 2005 • ENTERPRISE
11
ONTARIO PERSPE CT IVE
SME
Service, service and more service is behind Ontario credit unions'
growing success in the commercial lending market. by Laurie Stephens
KEV FINDINGS OF " STRENGTHENING ONTARIO COMMUNITIES"
l T's
No s u RP R 1 s E to commercial members
that credit unions are outpacing the banks in
small- and medium-enterprise (sME) business
lending in Ontario.
Talk to Peter Jensen, C EO of Creekside Estates
Winery located in the heart of the Niagara
wine region, and he practically gushes when he
describes the service he receives from staff at
Niagara Credit Union. "They're friendly and
happy to come and meet us at the winery;' says
Jensen. Most importantly, "they understand the
wine business. They become an active partner
in the business:·
Ontario's 258 credit unions account for
only five percent of all deposits in the province.
However, in the past five years, the credit union
system has doubled its commercial loan portfolio to $3.4 billion, in many cases by luring business away from other financial institutions in
their communities, according to Credit Union
Central of Ontario.
An Ontario Central-commissioned study
by A. Michael Andrews and Associates revealed
some surprises. Titled "Strengthening Ontario
Communities:· the study found that almost one
in every five dollars on deposit at Ontario credit
unions and caisses populaires is invested in loans
for small- and medium-sized businesses and
agricultural endeavours.
Cre dit unio ns have a disproportionat ely large sha re of agricultural credit, 12 pe rce nt of the total
provide d by a ll de posit- taking
institutions.
Ontario cre dit unions and
ca isses populaires provide fin ancing for more tha n 39,000 sma lland medium-size d bus inesses
in Ontario.
Almost one in every five dollars
on deposit in Ontario cre dit unions
and caisse s popula ires is invest e d
in financin g small and me diumsize d bus inesses and agriculture
in the province.
Ontario credit unions have a
disproportionately large s hare
of commercial loans of le ss than
$1 million - 18 perce nt of t he t otal
provide d by all depos it-taking
institutions. Chartered ba nks'
comme rcial loa ns under $1 million
in Ontario are about 3 percent
of deposits ra ised by t he banks
in t he province.
Further, credit unions have a disproportionately large share of the small business market,
grabbing 18 percent of loans of less than
$1 million in the province. In total, 80 percent
of all credit union commercial loans are under
$1 million, compared to 27 percent for banks.
"Credit unions think like a small business:· says
Ontario Central CEO Howard Bogach. "We
understand what they deal with. It's a natural fit."
Jensen agrees with Bogach's assessment,
noting that, when he started business about
six years ago, Niagara Credit Union already had
a good reputation as the financial institution
of choice among wineries in the region. What
sealed his relationship with Niagara was the
Credit unio ns e mploy more
than 6,ooo individua ls , wit h over
So percent of these jobs create d
outside of the Great e r Toront o
Area (GTA) ; the rest of the fin ancial
sector concent rates over 60 pe rcent of jobs and most head- office
positions in the GTA.
Credit unio ns dire ctly co ntribute
$375 millio n t o the Onta rio
eco nomy of with m ore t han
t hree-quart ers of t his gene rate d
o utside of the GTA.
For many thriving credit unions, the
Andrews study confirms the wisdom of developing growth strategies that are increasingly geared
to the small-business market.
Windsor Family Credit Union is a case
in point. Ten years ago, banks in the WindsorEssex area of southwestern Ontario were shying
away from issuing new commercial mortgages.
Windsor Family jumped on the opportunity.
The credit union developed a commercial lending strategy that focussed on the service gap
and soon saw growth of $20 million a year in
that area of business alone. Windsor Family, a
$475 million institution with more than 2 2,000
members, now has $200 million in credit
[Niagara Credit Union staff] are friendly and happy to
come and meet us at the winery. They understand the wine
business. They become an active partner in the business.
• Peter Jensen, cm of Creekside Estates Winery
member-service package: long-time, knowledgeable staff, an account manager who regularly
visits Creekside Estates and lends a hand in the
yearly business planning. (Niagara is Ontario's
largest affiliated credit union, with $1.5 billion
in assets.)
authorizations, $133 million of that out on loan.
Roughly 35 percent of the credit union's total
loan portfolio is devoted to commercial enterprises and non-profit organizations.
The credit union tends to hire and hold
experienced account managers whose workload
MAR. 2005 • ENTERPRISE
13
ONTARIO PERSPECTIVE
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• Responsive Service & Support
• OffPremise Opportunities
• Cash Loading Sen1ices
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Financial Institutions
888-870-9780 (Ext. 290)
1640 Oak Bay Ave.
Victoria, B.C.
llTritan
>
11
14
DOVER )
COMMNT
ENTERPRISE • MAR. 2005
allows them to pay a lot of personal attention
to client needs, says Mike Scott, vice-president,
credit and commercial services, at Windsor
Family. Decisions can be made quickly because
"we don't have to go to Toronto for credit
approval;' says Scott. "Service is the driving
force, not profits, and that differentiates us from
the banks:'
Windsor Family is also open to trying
creative marketing strategies to lure new business. Its latest campaign borrows from both the
auto sales industry and the residential mortgage
industry; a member can get up to $10,000 'cash
back; depending upon the size of the commercial loan and other criteria.
Heartland Community Credit Union,
with $167 million in assets, is another credit
union that J:ias experienced strong growth in its
commercial lending side over the past few years.
It now invests about 48 percent of its deposits
and capital in loans out to small businesses and
agriculture enterprises.
Formed 53 years ago to support rural farmers and small businesses in Huron County in
southwest Ontario, Heartland began a rebuilding
effort six years ago to adjust to changes in both
the regulatory environment and rural communities. The replacement of small family farms
by larger enterprises afl:ected rural communities in a number of ways, requiring expanded
lending limits and strategic alliances with other
organizations.
Fortunately, says Heartland CEO Jim Lynn,
the credit union's three locations serve a region
that is not only diverse in terms of farming activity but in other economic activity. Located near
the shores of Lake Huron, Heartland's branches
also support small retail entrepreneurs and the
hospitality trade. Lynn says the credit union has
invested heavily in training and recruiting staff
to ensure it has the right mix of knowledge and
experience to serve its commercial and farming
members. In its newest location in Listowel, a
town of 6,ooo, Heartland goes head to head with
five major banks. Yet the three-year-old branch
already has 700 members and is on target to be
profitable this year, says Lynn.
To deal with the changing agricultural
landscape, Heartland has partnered with other
credit unions and organizations, such as the
Farm Credit Corporation and the Agricultural
Commodity Corporation, to share lending risk
and issue loans that are beyond Heartland's lending limits or portfolio constraints.
In this "controlled-growth" environment,
says Lynn, the investment in people and partnerships has paid great dividends for the credit
union. From 2002 to 2004, Heartland has grown
its small business loan portfolio to $34 million
from $22 million and its agriculture portfolio to
almost $45 million from $32 million. And a 2003
member survey found that 96 percent of respondents would recommend or highly recommend
Heartland's service to their neighbours.
Ruthann O'Connell is one of those satisfied
clients. As president of Shipco International, a
storage and distribution centre, she was first
attracted to Heartland 10 years ago when it was
known as Clinton Community Credit Union and
she wa.s starting out in business with $15,000 to
her name. Such a business does thousands of
transactions a year and O'Connell chose Clinton
Community, which at the time didn't charge
service fees for individual transactions.
A year ago, O'Connell decided she wanted
to expand and establish a 3,200-sq. foot flagship
store in Clinton. She was "absolutely petrified"
to approach a bank or credit union for financing
because she had never applied for a loan or
line of credit in a decade of operation, despite
the fact that Shipco International had grown to
a $4 million to $6 million annual enterprise.
Heartland embraced the expansion and staff
went out of their way to get to know her business .
and make sure all of her needs were met. When
the flagship store celebrated its groundbreaking
last November, Heartland staff was in attendance.
"TI1e one thing that my credit union has above
everything else is that they want to know who
you are;' says O'Connell.
Bogach is the first to admit - and the
Andrews study confirms it - that credit unions
are enjoying much more success in communities
beyond the boundaries of the Greater Toronto
Area (GTA) . Part ofresponding to that challenge
is to use the Andrews survey strategically to
send the message to media and government officials that credit unions have the capacity to be
equal players in any market. "The intent of this
study was really to send out some strong signals
about the credit union system and to gain some
credibility;' Bogach says.
At least one target audience has been
impressed. "We've had incredibly positive feedback from government people;' says Bogach.
"We're seen as the good guys. I think this is just
a big win for the credit union system:' g
Masters of Management - Co-operatives and Credit Unions .
2005 Application deadline; May 31
Finding a program that meets your needs as worker or manager in a co-operative business is a challenge.
Consider the Masters of Management - Co-operatives and Credit Unions (MMCCU) - a distance-learning
program designed to allow you to study and work. Created through an agreement between Saint Mary's
University and the Co-operative Management Education Co-operative (CMEC).
he MMCCU is designed to provide you with
the management learning and skills you need
to run a successful co-operative business.
Throughout the curriculum , each management issue
and function is explored within the context of the
unique co-operative business environment
created by the values and principles of co-operation.
T
An international program, MMCCU draws its
students, faculty and research from around the globe.
You may study with managers from
different types of credit unions and co-operatives
from around the world linked by information
technology and face-to-face learning encounters.
The program is based on the premise that
co-operation among co-operatives is not only 'nice'
but is essential to ensuring that globalization does not
leave co-operative business on the periphery of the
economy.
Management students will examine how co-operative
values and financial success are not mutually exclusive
goals, but complementary and interdependent
elements of co-operative business success. "The cooperative and credit union values and principles are not
a sea anchor dragging behind the ship a11d impeding
its progress, but rather are the mainsail that should
provide its power and ensure its business success."
MMCCU Program Courses
• Philosophical Origins and Historical
Evolution of Co-operative Governance and
Business Practice
• The Emerging Global Economy and
Society from a Co-operative Perspective I
• Comparative Co-operative Practice I:
Variety and Range of Co-operative Business
• Co-operative Financial Analysis and
Management I
• The Emerging Global Economy and Society
from a Co-operative Perspective II
• Field Research: Study Visits to Exemplars of
Excellent Co-operative Business Practice
• Comparative Co-operative Practice II:
Co-operative Innovations and Best Practice
• Technology, Communication and Co-operation
• Marketing the Co-operative Advantage:
Co-operative Education, Member Relations
and Marketing
• Co-operative Financial Analysis and
Management II
• The Co-operative Management Approach I:
Governance, Planning and Strategic Analysis
• The Co-operative Management Approach II:
Leadership, Personnel and Management
Style
• Thesis: Co-operative Management Audit
"I view this Master program at Saint Ma1y'.s as an
outstanding opportunity for co-operatives, llteir
employees and their directors, to gain additional,
credible practical education at a higher level.
Tliis is a truly remarhable i11te111atio11al calibre
effort that will serve co-operative business well!"
Peter Podovinikoff
Chair, The Co-operators, Canada
The MMCCU is supported by: Co-op Atlantic; Envision Credit Union; Van City Credit Union; The Co-operators; United
Fanners of Alberta; Credit Union Centrals of Prince Edward Island, New Brunswick, Ontario, Alberta and British Columbia;
Hepco Credit Union; FredericlOn Direct Charge Co-op; Northumberland Co-operative Dairy; Gaylea Foods; Scotsbum.
0 N A FR o s TY Winnipeg January morning,
the queue for the teller windows is longer than
usual at Assiniboine Credit Union.
They're a testy bunch. The latest blizzard
finally quit blowing and members have slogged
through snowdrifts to get to the St. Mary's Road
branch. To make things worse, the flu is making
16
ENTERPRISE • MAR. 2005
its virulent round, and the credit union is short
a few member service representatives. But the
tellers who have made it in are working the
crowd with aplomb, especially a new fellow, a
smiling young man with an Eastern European
accent thick as a home-cut slice of rye bread.
When I reach the front of the line, Aleksandr,
according to his nameplate, is my guy. Pausing
before whisking off to collect my cash withdrawal, he asks ifl'd prefer any special bills.
"Nope, surprise me;' I reply. The smile broadens
into a wide grin. "I will do my very best to
surprise you;· Aleksandr says.
Some Manitoba credit unions are addressing
the looming employee shortfall with an
innovative new program to train immigrants
on- the - job in partnership with government.
by Judy Waytiuk
Aleksandr Krioukov hails from the Republic
of Belorusse. Once part of the former Soviet
Union, Belorusse tragically received most of
the radioactive fallout from the 1986 Chernobyl
nuclear disaster. Krioukov is one of 225,000
immigrants who made their way to Canada
last year (7,000 of them to Manitoba). He was
sponsored by his mother Irina, who moved to
Canada six years ago. Both mother and son
are part of a steady flow of newcomers who
now account for 70 percent of Canada's annual
net labour fo rce growth. According to federal
projections, by 2011, new Canadians will account
for all of it.
By 2025, these new Canadians will account
for the nation's entire annual net population
growth. Yet immigrants with p rofessional, technical or educational credentials are notoriously,
often permanently, underemployed, their skills
and training wasted. "If we're going to integrate
people fa irly and utilize the skills that people
MAR. 2005 • ENTERPRISE
17
l
I
\
PRAIRIE VIEW
have;' says Ximena Munoz, director of settlement with Manitoba's Department of Labour
and Immigration, "we're going to have to make
a lot of changes to our systems, because our
systems haven't kept pace globallY:'
The Cambrian human resources vice-president was also painfully aware that all Canadian
business and industry will face increasing shortages of skilled workers in coming decades, partly
because Canadians just aren't having enough
e ve sa1cl there s no point in training a lot of peop1e jor
things we thinh are a good idea if there isn't an attachment
to actual jobs.
Ximena Munoz, Manitoba Department of Labour and Immigration
Krioukov's mother is one of the wasted
talents. In Belorusse, she was a senior banking
official. In Manitoba, she's a health-care aide.
Her 26-year-old son holds two degrees and
worked at a comm ercial bank in Minsk for two
years as a senior economist before coming to
Winnipeg. But his future promises to be different
than his mother's because of a unique training
program hatched by Manitoba's Cambrian and
Assiniboine credit unions and developed by the
Manitoba Labour and Immigration department
under its Immigration Integration Program.
"There are other programs in other provinces
that train people to do similar kinds of work;'
continues Munoz, "but they don't necessarily
have as the main product the actual job, because
they're not tied to any employer. We've said
there's no point in training a lot of people for
things we think are a good idea if there isn't an
attachment to actual jobs. That's what's unique
about this:·
Designed to prepare qualified immigrants
for careers in Canadian financial institutions,
the Manitoba program's initial pilot sessions
produced 10 immigrants, pre-screened for
compatibility and ready to go to work as credit
union Member Service Representatives.
The program was sparked, as such things
sometimes are, by serendipity. Cambrian
vice-president of human resources Christina
Semaniuk, whose parents were immigrants,
is a member of the Manitoba Ethnocultural
Advocacy and Advisory Council. At one of
the council's meetings last year, a government
representative gave a talk on immigrant integration programs.
Semaniuk had just finished doing an analysis
of current and potential Cambrian employees.
"We saw a very strong correlation between our
employee base and immigrants, especially with
regard to education levels. Forty percent of
immigrants come in with university education,
60 percent with post-secondary:'
18
ENTERPRISE • MAR. 2005
children, partly because the vast segment of
the population is poised to retire, taking decades
of expertise out to pasture.
Semaniuk enlisted the support of Michelle
Manary, Assiniboine's director of human
resources, to propose a program to the province
that would allow immigrants to go through
a customized pre-training program for credit
unions that would give them the skills needed
to succeed at the orientation program.
The credit unions' proposal fit the funding criteria for Manitoba's federally funded
Enhanced Language Training programs,
designed to help professional immigrants
'
'
re-enter their original professions. The idea
fit beautifully with the program's requirements because the credit unions' immigrant
trainees would re-enter professions connected
with financial or customer services, says Lynn
Campbell, coordinator oflanguage training
for employment with the province's labour
and immigration department. (The province
allocated $22,000 in pilot money to cover development of the Enhanced Language Training
program.)
The credit unions would be active partners
in the program, capping off the new governmentfunded, five-week training period for immigrants with the standard credit union week-long
orientation program, followed by three-month
paid-work placements.
The first 10 to go through the pilot were
selected from a pool of 60 people referred by
employment service providers in Winnipeg and
by the province's own assessment centre. Initial
criteria required a background in customer
service, teller or finance, a minimum of Grade
12 equivalent from their own country, and upperintermediate language skills. Each credit union
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took five of the 10, who hailed from nine
different countries.
Alicia Castaneda, married with two children
aged three and nine, is a Cambrian recruit.
Originally from Oaxaca, Mexico, Castaneda
finished school, married, and embarked on a
financial services career in commercial banking
in Mexico City. Her husband is an industrial
engineer. But although the working professionals were among Mexico's comfortable middle
class, the couple wanted out. "We came here
looking for hopes and dreams and better lives for
us, especially for our children;' Castaneda says,
noting the differences between Canadian and
Mexican economic and political stability.
Shortly after arriving in Canada two years
ago, Castaneda was diagnosed with thyroid
cancer. During 18 gruelling months of surgery,
chemotherapy and radiation treatment, she
studied English. Cured, and now working at
Cambrian, Castaneda still attends night school
to polish her language skills.
"This is a great way for us to expand our
employee base;' enthuses Semaniuk, who hopes
to fill 50 percent of two dozen new positions
that open every year with newcomers.
•••••••
•
"We know that there is an untapped marketplace with regard to professional immigrants
in this province and this country;' Manary adds.
"We don't necessarily have, through normal
recruitment processes or employment agencies, access to this talent pool. They may not be
presenting themselves to us, or may not be at the
point where we could hire them immediately:'
The first pilot was a learning experience for
both sides. Participants, says Manary, found
large differences between financial institutions and products and services in their home
countries and those in Canada. There were little
things, like counting out money, where they
had to overcome the natural tendency to count
in their native tongue.
The second pilot, which began last month,
has new participants: Portage la Prairie and
Astra credit unions. The training module should
be easily portable to credit unions in other
provinces, says Munoz, whose concern during
the second pilot was to secure longer-term funding from various federal programs and possible
employers. In the future, Munoz adds, future
applicants might have to pay fees. But there's
little doubt in her mind that the program has a
Grow relationships
with your members.
solid future. All 10 trainees in the first pilot are
now permanent credit union employees. And
permanence is something both Kriukov and
Castaneda deeply value. "I feel safe in Canada;'
says Castaneda, who, as a member of the bourgeoisie in Mexico City, was a possible target
for kidnapping by organized gangs. "In Canada
there is more stability. I could not guarantee
my safety back home."
Krioukov hopes one day to be a personal
account manager with Assiniboine, and he'll
probably get there. He easily converts my cheque,
made out in American dollars, to the Canadian
equivalent, runs through the paperwork, his '7s'
revealing European schooling with tiny horizontal strokes th rough the spines, and counts out
my cash in flawless English.
And when I gather up the bills and congratulate him on his new job with the credit union,
he beams, thanks me, and blushes a thoroughly
happy, embarrassed beet-red. ~
~
De La Rue
MAR. 2005 · ENTERPRISE
19
Top:
Bottom, from L to R:
II
rlly brulHd from h\juriH 1U1tained in
th• Doc. 26 tsunami In Sri L-"a, M.I. Rafamf'IUI
stM1d1 on tlM alt• • f the Al- Hut ho Womon'1
CrHit Union. whidl vanished in the 9iant
wan.!. 01
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PHOTO: DAVID S HAHJ:S
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A M1rviv1 ~
n
P HOTO: ARKO
CAMERA AR o u No his neck, Ottawa's David
Shanks hopped off the concrete foundation - the
only thing left of the Al-Hutha Women's Credit
Union in the village of Sainthamaruthu on Sri
Lanka's east coast - and wandered among the
ruins of homes and goods, snapping photos
as he went. The Federation of Thrift and Credit
Co-operative Societies (SANASA) field representative calmly but insistently hailed him back,
waiting until Shanks was safely on solid ground
to explain that he was at risk oflosing limb - if
not life - to a displaced landmine.
P-4 anti-personnel mines have been one of
the lethal weapons used by both sides in a 20year civil war between the Sri Lankan Sinhalese
government and rebel Tamil Tigers, who are
fighting for a separate state in the northeastern
part of the island nation, located off the southern
tip of India. The Indian Ocean tsunami that
struck Sri Lanka on Dec. 26 churned up army
mines buried in the ground and deposited
them across whole villages, while ripping away
warning signs and fences cordoning off mined
areas. Shanks, Kathleen Speake and The CUMIS
Group's senior vice-president Jim Barr were in
Sri Lanka for seven days in February for the
Canadian Cooperative Association (ccA) to
assess the tsunami damage to the country's
credit unions. Initial estimates were Boo credit
unions wiped out or damaged. As SANASA
field workers were able to reach the affected
areas, it was determined that 300 credit unions,
called 'societies: were damaged or destroyed.
Often the only economic driving force in poor
communities, these credit unions function
cooperatively as SANASA. Many are tiny; the
average membership is lOO, altl1ough some have
as few as 15. SANASA is staunchly apolitical and
includes credit unions throughout the country,
even in rebel-held Tamil territory. TI1e CCA has
links with SANASA going back more than two
decades. (At press time, another CCA team was
in Indonesia evaluating tsunami damage there.)
Sri Lanka's coastal areas, along with
Thailand, Indonesia and opposite sides of the
Bay of Bengal, took the brunt of the tsunami
that followed a 9.3-magnitude earthquake, the
second largest ever recorded. Whole fishing
villages were swallowed by 30-metre-high waves
that killed people as far west as coastal Africa,
8,ooo km away. The death count is more than
300,000. Last month in Indonesia, 500 bodies
a day were still being found. More than 30,000
Sri Lankans, 40 percent of them children, died
in the disaster. Millions were injured and remain
homeless, while thousands of youngsters were
orphaned.
SA NASA staff and volunteers reacted immediately to provide emergency shelter, bury the
dead, find medical help for the injured and
distribute aid. Canadian credit unions and
cooperatives were part of the sweeping, worldwide humanitarian response. By mid-February,
the CCA, through its fundraising arm the Cooperative Development Foundation of Canada,
had sent $100,000 in donations from credit
unions here on emergency relief. CCA's goal is
1 •~,._
4 h1 m In c It •
•'1 was one of
....
the giant
PHOTO: F UU FAUZ l/• t:UTU S
" J1 • '"•Id tents.,
1d In
L lttr th• di1pl ted
DATTA I R[UTUIS
0
1;
to raise $1 million dollars over the next two years
to help members reestablish livelihoods, take
care of their families and redevelop communities
in Sri Lanka and Indonesia. Reconstruction
in Sri Lanka is estimated to take up to 10 years.
Gestures of generosity spanned from coast
to coast. Envision Credit Union, based in
Langley, British Columbia, pledged $70,000
early in January to the CCA while East Kootenay
Community Credit Union in BC's Rockies
donated $1 for relief efforts for each of its 9,500
members. Vancouver City Savin gs Credit
Union raised $335,000 from members and
staff for Oxfam Canada's tsunami relief efforts.
Ontario credit unions quickly raised a half
million dollars for Can Help, the credit union
disaster relief program, with proceeds going
MAR . 2005 · ENTERPRISE
21
GLOBAL A F FAIRS
to the Canadian Red Cross Asia Earthquake
and Tsunami Relief Campaign. Saskatchewan
credit unions added another $260,000 to that
campaign. More than $500,ooo was raised by
credit unions in Manitoba. Desjardins Group's
Developpement International Desjardins
will oversee expenditure of $1 million from
the Quebec system. In Atlantic Canada, New
Brunswick credit unions raised $25,000. (Figures
were not available for Alberta, BC, Prince
Edward Island, Nova Scotia or Newfoundland
and Labrador.) The Co-operators and The
CUMIS Group raised $91,000 and $25,ooo
respectively. The World Council of Credit
Unions (woccu), based in Wisconsin, raised
more than USs340,ooo. Ottawa, meanwhile,
plans to spend $425 million assisting tsunami
victims over the next five years.
Despite graphic media images, few
Canadians can fathom the horror of the tsunami
or the agony of watching children suffer due
to a lack of food, water or medical care, while
hoping for the miracle that will reunite lost
family members. Shanks, Barr and Speake, who
is ccA's regional director for Asia, came face- toface with the pain as they visited some of the
worst-hit areas along Sri Lanka's east coast. The
..
trio's week- long tour included a 300-km trip
from Sri Lanka's largest city, Columbo, to the
east coast, an eight-hour drive up and down
steep mountains along switchback roads, past
checkpoints manned by arm ed soldiers.
The threesome was accompanied by SANASA
representatives, including 29-year-old A.M.
Sheham, who is working to help 25 credit
unions within his jurisdiction reconstruct
financial records lost in the tsunami. When
the group visited the coastal city of Kalmunai
and the seaside village of Sainthamaruthu, the
devastation, even after six weeks, was shocking.
A 250-metre-wide strip from shore to village
"looked like it had been bombed:' says Shanks,
ccA's manager of media relations, who spoke to
Enterprise by telephone from a Bangkok hotel.
The group met with Al-Hutha Women's representatives at the concrete slab that was once
the foundation of the credit union. Remnants
of the once bustling fishing village - automobiles, carts, bicycles, bits of clothing, broken
porcelain plates - surrounded them. Members
described how all the credit union's passbooks
and records were washed out to sea. Of the
credit union's 15 members, nine were killed. M.B.
Rafamma, 40, dressed in a blue d ress and still
heavily bruised from injuries she sustained in
the tsunami, described to Shanks how she clung
to a tree while keeping a desperate grip on her
i9-year-old daughter Hameema. It wasn't enough,
however, to prevent Hameema from being swept
to her death. People were "still traumatized over
the loss of friends, parents, children, but they
were so stoic. Everyone had a story; little kids
came up to us to tell us who died, to tell us they
lost 8 people, 15 people in their families, that
they lost their parents:' says Shanks.
Speake, Shanks and Barr continued one
kilometre south to Al-Falah Fishermen's Credit
Union where there were more tales of tragedy.
Credit union president Adha Bawa was doing
accounting in the Al-Falah building, located
25 metres from shore in the middle of a fishermen's yard, full of nets and boats. Bawa was
startled by the sudden pounding on the door by
credit union vice-president Aboo Kar Ahmed
Ledde, who yelled at him to flee. By then, the
giant wave had crashed onto the yard, killing
i50 people, including Bawa, who was lame and
could not outrun the wild waters. His daughter,
however, survived by scrambling into a tree. The
water swept 400 metres into the village, killing
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ENTERPRISE • MAR. 2005
I
3,500. Of the credit union's 25 members, three
died and many were injured, Shanks relates.
Despite the devastated infrastructure, people
are trying to bring some semblance of normalcy
into their lives, Shanks says. Jameela is a member
and secretary of the Al-Hutha Women's Credit
Union. She was able to escape the tsunami
and went to a refugee camp for four days before
returning to her ruined village. Jameela's school
was destroyed, but she has resumed teaching at
the refugee camp; 92 charges aged six to 12 are
under her tutelage - many are orphaned. Seven
of her former pupils are dead.
The needs of the remaining members of
Al-Hutha are seemingly small, but overwhelming given the circumstances, Shanks says. One
member needs a sewing machine to resume her
trade, another needs a rice mill. One woman
needs a modest loan to start a small shop.
SANASA, says Shanks, is committed to helping
their members by rebuilding the credit union
movement by reconstructing credit unions,
restoring livelihoods, rebuilding homes and
sponsoring orphans. "The priority is to get the
credit unions functioning again, to bring back
a sense of normalcy;' says Shanks.
Rebuilding lives and communities in southeast Asia will take decades. In much of Sri
Lanka, the infrastructure has been washed away.
Orphans will be vulnerable to sexual exploitation, recruitment into paramilitary groups and
slave labour. Not only are the local economic
tools, such as fishing boats, gone, but cities and
villages have lost important intellectual resources
like teachers, nurses and doctors. Fields are
steeped in salt water, making them infertile, and
landmines continue to be an insidious danger
to the innocent.
Canadian credit unions have generously
opened their wallets to organizations like the
CCA, which is but one cog in a close-knit wheel
of international cooperative development agencies from around the globe that are affiliated
with the International Co-operative Alliance.
CCA's senior director of international development, Jo-Anne Ferguson, attended a two-day
meeting in late January in Germany where the
agencies discussed collaborating on reconstruction of credit unions and cooperatives in Asia to
ensure that donations are used in the most effective way, while reaching a maximum number
of people who might otherwise not receive assistance. "The challenge is to sustain interest and
commitment by donor governments, agencies
and donors:· Ferguson says. "The impact of the
tsunami is overwhelming:' g
10.0
MAR. 2005 • ENTERPRISE
25
ATLANTIC CANADA
Car buff Nick Wight, PEI Central's new CEO, can't wait to start tinkering under the
hood of the province's already purring credit union system.
Ev ER Y Y E AR of his adult life, Nick Wight has
rebuilt, on average, at least two cars. He rescues
wrecks that the insurance companies have written off, strips them down to their steel bones,
cleans and shot-peens the cylinders, hones the
cam bearings and magnafluxes the crankshaft
for cracks. When he's done, he spins around
town until another wreck catches his eye. He
hesitates about naming a favorite of the 100 or
so cars he has resurrected. After all, they are
all coaches pretty enough to convey Cinderella
to the ball once he's finished with them, but
he finally names a Ford Crown Victoria that
served a sentence as a police cruiser before being
knocked off the force with only minimal damage.
"I used dark blue paint. It was beautiful;' Wight
nearly whistles.
As the new CEO of Credit Union Central
of Prince Edward Island and Gerard Dougan's
replacement, Wight will be focusing on a
retooling of a different sort. It is an enviable
job. Like the Crown Victoria, the credit
unions in PEI are in good shape. Between 1999
and 2004, assets increased by 59 percent to
$594 million. Membership in the same period
grew by 15 percent, and now 45 percent of
the entire population of PEI belongs to one
of its 10 credit unions.
26
ENTERPRISE • MAR. 2005
Wight has a good sense of what's humming
under the hood in PEI. The only child of a
welder and hospital worker, he grew up in Deer
Lake, Newfoundland. "Islanders have their own
innate personality traits. I don't find PEI very
different from Newfoundland. All the people
are so very nice and enthusiastic:'
With his easy grin, Wight looks like the
nice boy next door, but like Newfoundland and
Labrador Premier Danny Williams, he knows
when to say no. The Bank of Montreal snatched
him for its accelerated management training
program when his BA in Economics from
Memorial University was still shiny and new,
and sent him to earn his wrinkles as an administrative manager in various branches throughout
the province. Five years later, they told him that
Toronto the Good was for good administrators.
Wight said no. He would stick to The Rock like
lichen, thanks anyway. It seems a good administrator can also be a good branch manager and the
bank promoted him to increasingly larger posts.
Along the way, he gathered some of the tools that
have catapulted him to his present position.
For instance, he learned that a polished exterior tells you nothing about the engine. On his
second assignment, he was sent back to where
he had started - Deer Lake. "It was a defining
by Laureen Griffin
moment;' he says. "Many of the perceptions I
had about people were wrong. People I always
assumed had money had none, and people I
thought didn't have any had lots;' he laughs.
"It was quite an eye opener:'
If the homecoming to Deer Lake taught
the young man to be wary of facades, the next
transfer to Cornerbrook, 30 kilometres away,
gave hin1 a lifelong sense of the isolation of rural
communities and the reliance it breeds among
inhabitants. "My wife and I intended to keep our
home in Deer Lake but, on my first day as the
new administrative manager in Cornerbrook, it
snowed. I had to change to winter tires, the car
fell over and my hand got caught between the
tires and the quarter panel of the car:' He arrived
three hours late with a hand as red as his face.
The family moved to Cornerbrook.
After more than a decade of jumping from
bank branch to bank branch every year or two,
Wight was finally able to give his family a sense
of permanence by moving to Newfoundland &
Labrador Credit Union, where he stayed from
1986 to 1996. He was manager of the St. John's
branch for four years and then manager of credit.
He also travelled the province, training the staff
on business development sales. But, finally, it
was time to move on.
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Cut to downtown Calgary, where Wight
became CllO of Hydro Savings & Credit Union .
It was a far cry from Newfoundland, even the
city of St. john's. Although Newfoundland is
regarded as Canada's poorest province, Wight
had never witnessed such poverty. "I had never
seen homeless people in such numbers nor
had I ever seen hookers on a daily basis;· he
says. Focusing on the business at hand, Wight
took Hydro from a closed bond to a community
bond with a new name, Key Savings & Credit
Union . He loved the sense of accomplishment.
Nevertheless, when the call came last year from
PEI, he and his family happily packed the car
and returned to the Maritimes.
Although the PEI credit union system is
thriving, the island itself has its share of dents
and wrecks. The pristine cradle on the sea that
Jacques Cartier first glimpsed in 1534 has lost
70 percent of its 10,000 year-old virgin forests,
over-fished its ocean and thrown toxins into
much of its water. This year, over-production
and low prices led to the destruction of
65 million kilograms of potatoes, the island's
most prolific crop. Unemployment hovers
around 11 percent and the tourism industry has
been disappointing since 9/11. Yet manufacturing
has increased substantially and new industries,
like aerospace, renewable energy and bio-science
are being encouraged with recently announced
tax credits. PEI is home to many cooperatives
including ACORN, a leader in organic farm ing,
and farmers are debating with the government
about being the first province to ban genetically
modified organisms. Wight is too new to the
system to specify exactly what role it will play
in helping the province transform its environment and economy from one strictly based on
natural resources, yet there is no doubt that the
credit unions will be there to help. "The credit
union movement does so many positive things
for the community; it's involved and is part of
the com munity. O ur enthusiasm is limitless;'
Wight says.
Wight is predicting that bank mergers
will give PEI credit unions the opportunity to
become even more important to their members.
He is already looking ahead to training new
managers because some of his staff is approaching retirement. He is juggling system changes,
looking for ways to improve board governance
and increase the return on surplus liquidity.
Under Wight's guidance, the credit union system
in PEI is revved and ready to hum along the
financial services highway. ~
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M AR. 2005 • ENTERPRISE
27
Embarking on a credit union amalga1nation is an ambitious
and often tough endeavour. Alliances can be creative alternatives
that, ivhile challenging, 1nay delay· or elilninate the need to
land a big merger.
•
byRobertaSta/ey
-----1tt e
s
COVER STORY
WHEN British Columbia credit union managers,
directors and executives converge on Vancouver
every April for the yearly chin wag, also known
as BC Central's annual general meeting, coffee
and croissants are served up with chit-chat, the
usual ribbing, as well as wide-ranging discussions about policy, dues and regulation.
Some quips are good enough to be recycled,
like the old adage about credit union mergers.
In the BC system, the joke goes, take the age of a
general manager, calculate the number of years
until he or she retires, and you'll know when that
credit union will merge.
This wry observation contains an element
of truth. As with the rest of the country, BC has
witnessed the incredible shrinking system in
terms of sheer credit union numbers, due in part
to the difficulty of replacing retiring managers
in small communities. Again, as in other regions,
a few titans hold the majority of the credit union
business, a bell-curve of credit unions constitutes a diminishing midriff and a handful of one
and two-branch institutions proudly wave flags
of independence. For many years, the number of
credit unions in BC has declined about 15 percent
annually. Today, there are only 54, compared
to 71 in 2001. There are similar trends in other
provinces. For example, Saskatchewan now
counts no credit unions, down from 130 in 2001,
while Ontario's 184 Credit Union Central of
Ontario-affiliated credit unions stood at 230 just
five years ago.
Dr Klaus Fischer, a visiting professor at the
University of Victoria's BC Institute fo r Co-operative Studies and professor of finance at Quebec's
Laval University, says that mergers needn't be as
inevitable as death and taxes. There are alternatives that can help sidestep the problems of aging
managers and the Triple Crown of credit union
cost challenges: rising salaries, ever-advancing
information technology (IT) costs, and cuttingedge products and services that can force a
30
ENTERPRISE • MAR. 200S
credit union on an exhausting race to keep-upwith-the-Joneses.
One alternative, says Fischer, is credit union
alliances, which can take on a variety of permutations. One of the best examples is la fedemtio11 des caisses pop11laires Desjardins, which
controls 45 percent of Quebec's financial business. Its unique structure - a federation serving
about 350 autonomous cooperatives - ensures
that a cooperative in the tiniest of communities
can still serve up a fu ll meal-deal of Desjardins
products, Fischer says. (The Desjardins mother
ship is responsible for a wide range of services
and strategic-planning functions.)
This unique structure allowed Desjardins
last year to expand its reach interprovincially
by affiliating with the caisses populaires systems
of Ontario, Manitoba and New Brunswick,
thus expanding the range of services available
to members in those provinces and opening
up new markets for Desjardins' products
and services.
The Desjardins model isn't necessarily a
template for future credit union amalgamations in English-speaking Canada, says Fischer,
pointing to American Credit Union Service
Organizations (cusos). However, Desjardins'
success is evidence that, given the right cast
of characters and circumstances, alliances
can provide credit unions with all-important
improved economies of scale, while allowing
them to maintain independence, Fischer says.
This is compatible with many credit unions'
opposition to becoming part of a larger organization. "They want to keep their local roots
and their feet in the community;' says Fischer.
As well, he adds, some larger credit unions, like
end, says Bentley, the group determined that an
alliance would not work, due to the challenge
of constantly seeking consensus. "We needed
strong governance:' Adds Bentley, "that's not to
say we wouldn't consider an alliance. As we go
forward and want to expand our products and
services, we might consider a joint-partnership
with specific companies." One example, he says,
is North Country's insurance arm, which is
partly owned by The CUMIS Group.
Down south in Burnaby, BC, $690-million
Gulf a nd Fraser Fishermen's Credit Union CEO
Richard Davies muses on some of the key points
that drove last May's merger with United Savings
Credit Union. Economies of scale, says Davies,
are making small suppliers "think twice about
servicing a small credit union. When we were
one of the smaller credit unions, we had suppliers say, 'we'd love to deal with you but we can't
afford to fund a sales fo rce anymore to serve a
credit union your size: Now that we've merged,
the opposite has happened to us:'
A small credit union has other problems,says
Davies. Before the merger, Gulf and Fraser would
advertise for staff and get no response, despite
its location in the densely populated Lower
Mainland. Now, says Davies, mailed resumes
are received daily. "Were big enough to create a
career for people, so we're going to attract more
professional and career-minded people:'
There are other considerations, Davies adds.
A critical mass of members is needed to support
wealth management services. For example, says
Davies, 10,000 members can't support a wealth
management broker and back-up support fo r
holidays and illness. However, 40,000 members
can support such a person. "You need more
[Many credit unions] want to keep their local roots and
their feet in the community.
• Dr Klaus Fischer, visiting professor, BC Institute for
Co- operative Studies, University of Victoria
many top-heavy business corporations, are
less efficient. Most importantly, Fischer warns,
members may feel disenfranchised when their
credit union is consumed by a larger organization.
Brian Bentley is CEO of North Country
Credit Union, headquartered in Prince George,
BC, which was spawned last June in a three-way
merger of Prince George Savings, Quesnel &
Dish·ict and Nechako Valley credit unions.
It took almost two years to complete the
merger, in which time the players considered
strategic alliances and amalgamation. In the
expensive tools and people. It gets to be a harder
and harder fight;' Davies says.
This begs the question: should centrals
provide more services, similar to Desjardins,
to ensure that credit unions, no matter the size,
play on a more even playing field, thus helping
avoid or at least delay mergers?
Davies disagrees with adding more to the
plate of BC Central, which provides back-room
functions like cheque clearing, online financial
services through Member Direct, as well as trade
services for the province's credit unions. "The big
J
credit unions are not interested in being charities; it's in their best interests that credit unions
have to pay their own fair share. If a small credit
union cant make it, they don't want to subsidize
it - maybe they'll have a chance to get them in
a merger;' says Davies.
Unlike BC's credit union system, Desjardins
has virtually eliminated competition among
its Quebec cooperatives, which, in turn, have
had to concede some degree of autonomy. It's
that autonomy that spurs creativity among BC
credit unionists, says Davies. "As time goes on;'
he continues, "the more different we're going
to taste, smell and feel. We will start competing
more and there is going to be less advantage to
being homogenous:'
Not all mergers have the same objectives.
Some are intended to increase market share.
Some are focused upon saving money and
improving economies of scale. Fred TownleyMcKay, CEO of Southwest Credit Union Ltd.
in Swift Current, Sask., says that last July's
merger with Frontier and Lancer credit unions
expanded services and cut costs by cutting back
on managerial salaries and eliminating headoffice service duplication. He anticipates many
more mergers in Saskatchewan - and welcomes
it. "Members will receive better service and a
broader range of products;' says Townley-McKay.
When it comes to credit union mergers, there
are still some proud hold-outs, big and small.
One is $35-million Mount Lehman Credit
Union, based in Mount Lehman, BC. General
manager Gene Blishen lists the things the credit
union doesn't offer. "We aren't for the price-cutter
types looking for a deal. We don't offer mutual
funds. TI1ere are limits to our lending; if you
want a $5 million loan, you have to go someplace
else:' What the credit union does offer, however,
is "exceptional service that the larger institutions
don't have that creates the relationship enabling
us to survive. We are a boutique;' Blishen says.
Personal lending, mortgages, and small, unsecured loans are available to the 1,800 members,
who, when they enter the credit union, are
greeted by their first name. Teller lineups are
nonexistent and, if a member ever has an overdraft, credit union staff politely alert them to
the oversight. Like so many of the finer things
in life, such small credit-union management is
"a dying art;' says Blishen.
North Shore Credit Union, which serves
an ever-growing blue-chip clientele in West
and North Vancouver as well as the luxury ski
resort of Whistler, is also staunchly independent.
Its last serious merger talks were in the i99os.
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31
COVER STORY
However, talks fizzled, and North Shore management was faced with restoring the confidence
and enthusiasm of mistrustful staff, says CEO
Chris Catliff. The failed talks, Catlitf continues,
sparked a realization that "a merger is not an
end in itself but the means to an end:' That end,
Catliff says, "is to have great member relationships and engage staff in a very financially sound
and profitable credit union:' This is what Catliff
refers to as 'value proposition; when "members
see value in what you're offering and are advocates of your services:'
Thanks to an array of products and services,
Nor th Shore's annual profits have increased
between 30 and 51 percent over the past four
years. To merge now, Catliff says, would slow
down this forward momentum fo r several years.
Sean Jackson, CEO, as of April 1, of $3-5 billion Meridian Credit Union, an amalgam of
Ontario's Niagara and HEPCO credit unions,
says the merger is more than just a nip 'n' tuck it is a total rejuvenation of an already strong
brand. One of the biggest mergers in Canadian
history, Meridian's reach now extends across
south central Ontario, including Toronto. This
sweeping expansion is backed by the creation of
St. Catharine's-based Meridian into "a phenomenal organization;' says Jackson. He'll be overseeing the "reinvention of neighbourhood
banking by significantly improving the level
of service members receive:' It is an ambitious
plan. This includes the doubling of employee
training to better serve i8o,ooo members. "Every
member will have one-to-one financial coaching
with the development of a long-term plan and
regular consultation to help them manage their
finances, improve their investment income and
build towards a more secure retirement;' Jackson
enthuses.
Meridian is also a part of the 'Affiniti alliance; a partnership that includes some of the
country's largest institutions: BC's Vancity
and Envision credit unions, Conexus Credit
Union in Saskatoon, Cambrian Credit Union
in Winnipeg and St . Willibrord Community
Credit Union in Ontario.
Over the past fou r years, alliance partners
have worked on a number of projects that
includes a wealth management model in partnership with Credential Direct. The group also
shares metrics on business performance and
strategies and pow-wows on legislation.
Closer to home, Envision has partnered
with Vancity and Coast Capital Savings Credit
Union in the Lower Mainland to create a small
and medium enterprise (sME) alliance with
Credit Union Central of British Columbia.
The alliance has adopted an advanced on line
banking system called MemberDirect Bus.iness
Services that allows the credit unions to offer
tailored new financial services to businesses,
even those with hundreds of employees and
sales of $1 billion a year.
With this alliance, says Envision CEO Gord
Huston, "the thought process is, 'build a network
that allows the credit union to maintain its independence and yet join a group of credit unions
to obtain services, where all receive mutual
benefits:'
There is a new model developing, one where
credit un ions, if they choose not to entertain
a merger in the near future, enter into alliances
that help them adapt to ever-changing nuances
of the local marketplace. Says Davies: "The credit
unions left are going to thrive, be strong, and
serve their members well. There is a very bright
future for credit unions." ~
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ENTERPRISE • MAR. 2005
online banking
so lution s
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tor more into vis it ecommerce .cucbc.com
Can you meet the req uirements of dual signatory
Controlled by a sophi stica ted and flexible administration
accounts and still meet the onl ine needs of your
tool tha t manages multiple user access and approval
business members?
levels, MemberDirect Business Services ensures dual
D Yes
signatory an d approval level requirements are met.
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Is your credit union at r isk by provi ding inadequate
Designed specifically for yo ur business members,
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C redit Union Central .
MA NA G EMENT FILE S
.\
SHARED DECI s10N-MAKI NG
••
••
I
"
Let's agree to disagree. I'm right, you're wrong\ Let's discuss this over 9.brew. You have the floor. Than
... -···
and
Big-league
I
I
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I
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ElaY-e:rs
34
ENTERPRISE • MAR. 2005
r your input.
-
Humility, Hubris or High-jack
Makingjh!Lmost of democratic decision-making
means taking control of the process.
by Eli Mina
WHEN people ask me what makes a good
meeting, I usually describe a session where all
participants are actively engaged in discussion
and the organization benefits from the ir shared
knowledge and expertise. It's a scenario that
reflects today's participatory corporate culture.
But many of us remember a time when different attitudes prevailed. It wasn't unusual for the
boss's demeanor to suggest that "you just sit
quietly, listen and be grateful for the job:' In
such an environ n1ent, speaking out could be
career-limiting.
Fortunately, m ost organizations have moved
away from purely top-down decision-making.
It's tactical nonsen se to hire and pay staff for
their skills and experience and then exclude
their input on issues that affect their work or
the overall progress of the organization. Shared
decision-making (soM) is seen as a benefit of a
more inclusive m anagement style, a product of
the democratic o r ientation many organ izations
profess to encourage.
SDM m akes sense for two main reasons.
First, by engaging staff in exploring problems
and solutions, t h e range and quality of discussion will b e enhanced and decisions are more
likely to be balanced a nd sustainable. Second, the
fact that employees are involved in consensus-
building tends to boost their understanding and
support of decisions.
Based on best practices, the level of enrollme nt
in SOM should depend on the nature of the issue.
In some cases, it may be appropriate to solicit staff
input but reserve the actual decision for management. In others, it may work best to delegate
both the consensus-building and decision-making
to a specifically appointed team. And then there
are situations, such as hiring, firing or discipline,
when the manager should make the decision
unilaterally, with no input.
Nevertheless, as many managers have
discovered, SDM has its pitfa lls. If the process
isn't managed adroitly, SDM can easily morp h
from 'corporate democracy' to 'corporate anarchy: Here are 10 tips to help you maximize the
benefits of S OM process, while mi nimizing the
risks inherent in the process.
Regularity .. Make staff consultation the
norm rather than the exception. Engage staff in
consensus-building when issues are complex
and controversial or when thei r knowledge and
expertise will boost the quality of the decisions.
Early engagement .. Involve staff in consensus building at an early stage, rather than at a
point when the decision is all but final. Engage
them in defining the problem, brainstorm ing for
possible solutions, evaluating options and ch oosing the best one.
Clarity ,. At the outset of the process,
clarify whether staff input is advisory or binding.
For example: "I need your advice on something.
It is my decision to make, but I thought I might
benefit from your feedback beforehand:'
Merit-dri11e11 discussions .. The quality and
relevance of an idea is more significant than
its source. Set the right tone for discussions, so
that lower-ranking staff are not afraid to present
novel ideas, even if they contradict those in a
higher position.
Knowledge-based discussions ,. Staff will not
deliver optimal results if uninformed. Ensure
that participants understand the issues.
If the process isn't managed
adroitly, shared decision-mahing
can easily morf1h from corporate
democracy to corporate anarchy.
Collabomtio11 ,. When personal interests
compete, the group can stall. To avoid this,
establish the principle of collaboration, "you
and me against the problem :' Narrow interests
should yield to broad organizational interests.
Openness ,. Staff should feel comfortable raising difficult questions and concerns.
Demonstrate humility and a desire to learn.
Broad representation .. Don't let the process
be high-jacked by the inevitable 'mike-hog' in
the group. Ensure that you hear not only from
the 'talkers' but the 'thinkers; t11ose quiet and
insightful individuals who are often left behind,
together with their ideas.
MA R. 2005 • EN TERPRI SE
35
MANAGEMENT FILES
Efficiency .. There are times to consult and
times to move on. A good leader knows when to
stop the talking and start doing.
Follow-up .. Integrate staff input into
decision-making. If you decide not to implement
the group's ideas or suggestions, let them know
why, while expressing appreciation for their input.
TI1is is essential to team and morale building.
Eli Mina is a Vancouver-based author consultant, meeting mentor and registered Parliamentarian. His website is
www.elimina.com. He can be reached at eli@elimina.com
-
The Player
Vancity climbs to new heights l!:l
the_gQital marke~
by Sara Holland
For Vancouver City Savings Credit Union,
becoming a capital 'player' started with a business plan and a bold idea.
Early last year, Vancity's vice-president of
treasury, Ray Hama, felt it might be time to
boldy go where no retail credit union had gone
before - the national investment stage. Vancity,
Canada's largest credit union with $9.3 billion in
assets, had experienced white-hot growth for the
past several years and, if the business plan was
any indication, the corporate targets wouldn't
be scaling back any time soon.
Since its creation 59 years ago, Vancity had
been funding its lending activities based on
member deposits, while borrowing from Credit
Union Central of British Columbia and a
number of multinational financial institutions.
W/Jy would an internationally
respected credit- rating organizat ion such as t he Dominion Bond
Rating Service (oans) be interested
in a successful but Vancouverbased credit union?
a few ways to become a 'player:
You can hammer out a best-selling conspiracytheory thriller, go nightclubbing with Paris
Hilton, swap business tips with Bill Gates. Or,
if you're a credit union in a world of capital
markets, you can become publicly rated.
THERE ARE
Record growth meant that the organization was
reaching new levels of success, but it also meant
that it was time to look for new ways to raise
cash to fuel that growth.
Given Vancity's financial performance, would
there ever be a better time to secure a public
rating that would allow institutional investors
to buy-in? Ha ma knew that a rating would not
only give Vancity national exposure, but it would
also create an unmistakeable presence in the
capital markets as a prime quality investment. It
would enhance Vancity's financial sustainability
and enable it to continue growing its asset and
membership base, while competing with major
financial institutions.
Hama had no doubt that the organization
was well-positioned and its executive team was
ioo percent on board, but the process appeared
daunting. Why would an internationally
respected credit-rating organization such as the
Dominion Bond Rating Service (onRs) be interested in a successful but Vancouver-based credit
union? Would investors buy in? Did Vancity
have any Bay Street cred? It seemed a long shot.
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ENTERPRISE • MAR. 2005
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Last November, Vancity was
awarded the DBRS rating,
becoming the first retail
credit union in Nort/1America
to earn this distinction.
Charles Milne, associate vice-president,
treasury and lending services at BC Central,
convinced Hama that the process wouldn't
be as overwhelming as it appeared. So, on a
cold spring day in Toronto one year ago, Hama
and Milne dropped into the DBRS office in the
heart of the fi nancial district.
The DBRS senior management team was
intrigued by Hama's proposition and thought it
might be a good fit. They agreed to give Vancity
a preliminary assessment and Hama jetted back
to Vancouver to prepare for the next steps.
That fall, the DBRS team arrived for an all-day
meeting. Schedules were cleared as the members
of Vancity's executive team and Rowland Kelly,
BC Central's cro, took their seats around the
boardroom to support Hama in his efforts to
secure the coveted rating. "It gave us an opportunity to really help them understand the Vancity
story beyond the financials - o ur history and our
culture and what differentiates us:· Hama says.
1he DBRS team was impressed. It asked
provocative questions, pored through Vancity
publications and reviewed the website carefully.
While the credit union's regional focus was of
some concern for them, Vancity's national infrastructure through its subsidiary, Citizens Bank
of Canada, created reassurance that the initiative
had legs.
At the beginning oflast November, Vancity
was awarded the DBRS rating, becom ing the first
retail credit union in North America to earn
this distinction, following in the fo otsteps ofBC
Central, several other provincial centrals and
Desjardins and forging a trail for similar organizations. The rating was R-1 low, a prime quality
short-term Canadian rating. It generated ink in
the Vancouver business media, and impressed
members and employees.
Timelines were tight. Exactly one month
following the announcement, Vancity's first
commercial paper debt issuance was made for
million, selling out in 2 4 hours. For
Hama and his team, it was a sign of good things
to come.
Vancity is now pondering the idea of expanding the program to a long-term rating (comparable to a bond rating) and even considering a
United States rating.
'Tm proud of what we've all accomplished:'
says Hama. "Some people have said they're
worried that we're acting like a bank, but that's
not it at all. We'll never change our values.
We are only trying to increase our reach in the
financia l markets. I guess you could say that, in
terms of capital markets, at 59 years old we're
finally growing up:' :!::
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MAR . 20 05 · ENTERPR ISE
37
OFFI C E A FF A IRS
Talking 'bout My Generation
~
Long years behind the desk is a r ecipe for en nu i. When valued
elder staff members s how signs of low mor ale , s mart credit unio ns
are finding ways to r e-engage t hem.
38
ENTERPRISE • MAR. 2005
byLaureen Griffin
"G oo o u YE. I am leaving because I am bored;'
wrote the American actor George Saunders
when he quit this world. His suicide note could
be a template for the resignation letter of countless employees over the age of 55. After 30 or
4 0 years the security blanket of a well-known
job may be suffocating rather than comforting. David Jones, the former vice-president of
finance at Envision Credit Union in Abbotsford,
British Columbia, retired last April at age 61. No
one suggested that the affable but gruff guy leave
but, with enough money stowed away, he felt it
was time to go. Like countless retirees, he quickly
discovered that a li fe ofleisure, punctuated by
golf games, was not what he really wanted. He
realize it wasn't mental vacuity he had been seeking but the stimulation of change.
Barbara Jaworski is the director ofWorkLife
Solutions for Toronto's FGI, an Employee
Assistance Provider (EAP). She worked with
Canada's Association for the Fifty-Plus (CARP)
to develop the annual Best Employers for 50Plus Canadians awards. "Although health and
finances are two big reasons why people over
50 quit, others leave because of'job plateauing;
there is no place to aspire to in the hierarchy.
Even more leave because of'job-content plateauing;" says Jaworski. In less polite terms, they
crawl through the escape hatch before they
drown in the bog of boredom.
CARP gave out its first awards last year to
four companies: RBC Royal Bank's Global
Banking Service Centre, pharmaceutical
company Merck Frosst Canada, Home Depot
and Avis Rent A Car. The Royal Bank's division
was lauded for cherry-picking the best employees poised to retire from all divisions within
the conglomerate. Those employees dictated
their own terms fo r continuing to work in the
global centre. "Some people work only winters
or only summers. Others work two or three
days a week. It's their choice:· says Jaworski.
Merck Frosst developed a group RRSP for their
employees and created a retirees' club that sends
out information and plans special events. Home
Depot actively recruits older people, provides
training and evaluates their performance every
six months to determine what new skills or
hardware aisles the employee needs to learn.
Why are these companies developing longterm strategies to attract and keep older employ-
ees hanging around? Because they know that
there won't be enough younger people to replace
them. According to Statistics Canada, the 55+
age group increased by more than 22 percent
between 1996 and 2001, yet the 25-54 age group
increased by only 4.6 percent. When those baby
boomers leave, taking with them accumulated
experience and knowledge, they are leaving
millions of empty chairs with far too few posteriors qualified to sit in them.
Unfortunately there is no single plan that all
companies can implement to barricade older
workers inside the doors. "Each company needs
to develop plans for keeping these workers based
on their own business strategy;' says Jaworski.
"Too often;' she continues, "employers just stop
supervising and challenging older employees.
Instead companies need to help employees
develop career paths that go beyond the retirement age."
David Jones got lucky. Nancy Mathers, CEO
of Van Tel/Safeway Credit Union in Burnaby,
BC, called on Jones to mentor some of her rising
stars. "I like working with young people, teaching them to find creative ways of implementing
financial principles;' says Jones. He works about
10 days a month from 9:30 to 4:00 to avoid
commuter traffic. "It's perfect;' he says.
Boredom may be one reason older employees
can't wait to beat it out the door, but others may
be scrambling for the exit because of too much
stress. At the end of 2004, the WarrenShepell
Research Group issued a paper titled: The Aging
Workforce: An EAP's Perspective. The results
were startling and controversial.
I T WASN 'T MENTAL VACUITY HE HAD BEEN SEEKING
BUT THE STIMULATION OF CHANGE.
We thin k of older workers as the wise
greybeards who have figured out the proper
weights to attach to their private and business
lives, as the experienced generation that has
seen everything and can't be ruffled. According
to the report, the magi are getting crotchety a
little early. They are reporting slightly more work
relationship and conflict problems and more
workplace stress than their younger colleagues.
This findin g contradicts decades of research
showing that people become happier as they age,
feel less stress and are less likely to suffer from
depression.
The study, based on three years of Warren
Shepell data, discovered that older employees
find it increasingly difficult to put up with
colleagues. "We were very surprised;' admits
Gerry Smith, vice-president of organizational ·
health at Warren Shepell. "We went back,
COMPANIES NEED TO HELP EMPLOYEES
DEVELOP CAREER PATHS THAT GO BEYOND THE
RETIREMENT AGE.
checked and then rechecked, but the numbers
were right:'
Smith cites anecdotal evidence to back up the
data. "I've mediated between workers who have
laboured side by side for 20 years and can't stand
each other. It's almost like a marital conflict;' he
says, "just looking at the other person can set
them off:'
The differences between the generations
also crop up in workshops that Smith conducts.
"Younger people are resentful and impatient with
older people and don't show them much respect;'
Smith says. He believes that more employees
would stay in their jobs if employers were more
tolerant. "We are leading our wisest and most
valuable assets to the door and we're not going to
get replacements that are as good;' Smith warns.
It may be only a small group of older employees that are getting cranky with their co-workers,
but everyone agrees that older employees, like
everyone else, are feeling mo re stress at work.
For people over 50, that unhappiness and tension
is packed into a bulging suitcase of other overwhelming responsibilities that can include caring
fo r aging parents, financing the kids' university,
trying to save for retirement and feeling the first
hvinges of deteriorating health.
To add to the tension, employers are pressing for greater productivity, says Nora Spinks,
president of Work-Life Harmony Enterprises, an
international consulting firm based in Toronto.
"They are told to work faster, better, to motivate
others, to become more effective, to do more and
more and more;' Spinks says with machine-gun
delivery.
Within the credit union system, the wave of
retirements that will start in 2009 and continue
to rise until 2022 has lead to succession plan-
MAR. 2005 • ENTERPR ISE
39
OFF ICE A FF A IR S
It's like instantly having your people
call their people and having their people
contact some other peoples' people .
ning but not to organizational strategies that
will clutch some of those retiring sages to the
corporate bosom. The volume of mergers within
the Canadian credit union system may have
obscured the need to do so. Large credit
unions have often doubled or tripled younger
staff through mergers and are relieved when
the older folks depart, lightening the payroll on
their way out.
YOUNGER PEOP LE ARE RESENTFUL AND IMPATIENT
W ITH OLDER PEOPLE AND DON' T SHOW THEM MUCH
RESPECT.
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©2005. All rights reserved. Filogix is a registered trademark of Filogix Inc.
40
ENTERPRI SE • MAR. 2005
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filogix·
the poWt!f bthlrtd the dHI
Ken Hahn, senior vice-president of human
resources at Coast Capital Savings Credit
Union, headquartered in Surrey, BC, is 63 and
plans to retire within the next 18 months. "On
our senior management team of nine, three are
in their 6os and one is in his late 50s. We have
picked successors, but we have no plans for
keeping older employees on staff in a mentoring
or consulting role;' Hahn says.
Other credit unions are also starting to
realize the advantages to keeping older people,
especially in the branches. At Vancouver City
Savings Credit Union, Bo percent of the frontline staff used to be under 25 years old. "The
turnover in the branches was too high;' says
Suzanne Boyd, Vancity's team leader, attrac·
tion and recruitment. After placing posters in
community centres and grocery stores, and
rewording their ads to appeal to an older market,
60 percent of their branch staff is now over 30,
an age group much more likely to stay put in
their jobs.
At Powell River C redit Union in BC, Janet
Pihl, 60, job-shares with a new mom. Although
she has worked there for 14 years, Pihl recently
created her own job, combining her love of sales
with her desire to help people. "I go through
members' accounts with them, to see if they have
the right products:· Pihl and her husband travel
to Kelowna, Vancouver and Vancouver Island
on her days off. But she keeps working because
"it keeps me entertained:' As for her boss, CEO
Dave Craigen says, "I wish I had 100 employees
just like her:' £
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MAR. 2005 · ENTER PRI SE
41
IT Girl
ILLUSTRATIOll: C.Hlll.
ATM
ot-
R202?
ATMs are being outfitted with futuristic accessories to try to
make them impenetrable to crooks. by Diane Luckow
Au T O M ATE o teller machines (ATMs) that spit out Canadian Tire
money; bran ch ATMs t hat are 'doctored' with skimming devices to
st eal debit card information. ATMs. obviously, are an increasingly
attractive target for fraud sters. According t o the Electronic Funds
Transfer Associat ion, ATM fraud has reached about $50 million a year
in the United Stat es and is rising by 35 percent a yea r in some countries. In response, manufacturers and finan cial institutions are t rying
out new ATM designs, new technology and new security measures.
Biometrics, t he ability t o measure unique, biological characterist ics for identification purposes, is on e of t he latest anti -fraud systems to reach t he ATM. A bank in Colombia, South America has rolled
out new ATMs from Ohio- based NCR Corp. t hat give customers
t he option of using biometric fing erprint scanning and PINs instead
of debit cards . (The system was implemented specifica lly for a
t iny, select group of cof fee farmers whose account s are credited
by coffee buyers.)
While fingerprint scanning is reliable and relatively quick, entering customers' fing erprints into a database and then managing the
reference information and maintaining security is neit her simple nor
cheap. That's one main reason why experts don't expect biometrics
to become widespread at ATMs. "You ca n't co unt on only your customers using your ATM," says Jim Block, director of advanced t echnology for Diebold Inc. For biometrics to take hold at the ATM, all
financial institutions would have to implement the t echnology and
standardize on t he same typ e of biometric, for exampl e, fingerpri nt
or iris scanning.
42
EN TERPRISE • MAR. 2005
In the meantime, ATM manufacturers' newest products are beginning t o feat ure a number of anti- fraud measures to reduce the
like lihood of skimming. NCR recently unveiled a Fraudulent Device
Inhibitor upgrade kit t o prevent crimin als from attaching any type
of skimming or capture device to the ATM card reader entry slot.
ATM manufacturers have also introduced 'jitter' into t heir latest machines. Wh en customers enter th eir debit card into th e ATM
ca rd drive, it starts a jitter motion t hat distorts the mag netic stri pe
details so t hat t hey can't be copied accurat ely. As we ll, Diebold has
included anti- shoulder surfing measures, such as angled keyboards
and observation mirrors to permit cons umers t o check who may
be behind them.
A possible option for using biom etrics at ATMs in the future will
be the advent of smart cards loaded with intelligent ch ips t hat can
carry a lot of informati on, including your own ref erence fingerprint
or iris scan. Thi s will combat the infrast ructure problem, says Block.
"When t rying to aut henticate yourself you can say, 'here I am, take
a measurement, here's t he ref erence. It's like carrying around yo ur
own birth certificate."
Meanwhile, some credit unions are trying simpler options. The
Desjardin s Group in Montreal, for exa mple, now requires its customers to enter th eir birth date as well as PIN wh en withdrawing more
than $400 or depositing more than $ 1,000 at ATMs. A wrong birth
date cancels the t ransaction. This option isn't foolproof however;
it won't take long before crim inals find a way to capture the birth
date information as we ll as t he PIN.
As Block says, "We're just t rying to stay one step ahead." ~