The NAFCU Journal May-June 2020 - 12

LEADERSHIP DOWNLOAD

The Formula for
Successful Strategy

Visit www.nafcu.org/management
for details on John Spence's
leadership workshop planned
for NAFCU's Management and
Leadership Institute in the fall.

By John Spence 

I

have been teaching strategic
thinking and strategic planning in
an executive-level course for the
Securities Industry Institute at
the Wharton School of Business for
nearly 20 years, and I can boil down
everything I teach into one formula.

All effective strategy is: Valued Differentiation (x) Disciplined Execution. In
other words, you must bring something
to the marketplace that is: 1) unique
and compelling; 2) highly valued by
your target customer; 3) difficult if not
impossible to copy; and 4) delivered
with excellence.
Traditionally, businesses have focused
on four major areas to get a competitive advantage: product, price, place,
and promotion. Unfortunately, they
don't work the best for credit unions for
these reasons:
Product: Other credit unions and
most banks offer similar products.
■	 Price: Your products are highly
regulated and cannot be significantly differentiated from those of
your competition.
■	 Place: Your branch locations might
give you some advantage, but most
consumers today prefer the convenience of online banking anyway.
■	 Promotion: Marketing campaigns
and promotions can be easily copied.
■	

I have given a lot of thought to what
credit unions can do for a successful
strategy, and here are the areas I believe
you should focus on.
12

People. The success of your credit
union is 100% dependent on the
quality of the people you can
hire, grow and keep on your team.
If you genuinely have the most
talented people and they stay on
your team, that will give you a
competitive advantage.
■	 Customer relationships. If you
have fantastic relationships with
your members, you have created
a significant barrier that is nearly
impossible for your competition
to overcome.
■	 Brand. If you have built a strong
brand that is well known and highly
respected, it is impossible for your
competition to take that away
from you.
■	 Data. If you have collected proprietary data on your members and you
use it effectively, that is impossible
to copy.
■	

To me, this means you should focus
a significant amount of time on making your credit union a talent magnet.
Invest in developing your staff and
in becoming extremely close to your
members, so you truly understand
them. Work to build a superior brand,
and become an expert at using all of
the data you collect to create a definite
strategic advantage.
In its purest form, strategy is simply
the allocation of scarce resources. That
means one of the most important
strategic decisions you need to make is
what will you say no to? What products
and services will you not offer? What

member groups will you not serve?
Which projects that are not working
are you going to walk away from, even
though there might be a significant cost?
Several years ago, I was asked to give a
keynote presentation to 1,600 employees from a Fortune 100 company on
"The Essence of Excellence." I spent a
lot of time researching the topic, talked
to successful CEOs, presidents of universities and top thought leaders, and
in the end, I felt it all came down to
three key ideas.
Focus. You have to be insanely
focused on where you can win (target
market), how you can win (strategy),
who you want to play against (positioning), and how you want to play
the game (vision and values).
■	 Discipline. You have to have the
courage and fortitude to stick with
your strategy - unless there are significant changes in the marketplace.
■	 Action. The amount of effort you
apply will determine the amount of
results you get.
■	

There is not going to be less competition going forward; there is going to be
more. And it is going to be harder and
harder to stand out from that competition. Applying the Valued Differentiation (x) Disciplined Execution strategy
can make all the difference.  
John Spence is an international keynote
speaker, executive coach and organizational trainer who has been helping
credit unions for more than 15 years.
THE NAFCU JOURNAL  MAY-JUNE 2020


http://www.nafcu.org/management

The NAFCU Journal May-June 2020

Table of Contents for the Digital Edition of The NAFCU Journal May-June 2020

The NAFCU Journal May-June 2020 - Cover1
The NAFCU Journal May-June 2020 - Cover2
The NAFCU Journal May-June 2020 - 1
The NAFCU Journal May-June 2020 - 2
The NAFCU Journal May-June 2020 - 3
The NAFCU Journal May-June 2020 - 4
The NAFCU Journal May-June 2020 - 5
The NAFCU Journal May-June 2020 - 6
The NAFCU Journal May-June 2020 - 7
The NAFCU Journal May-June 2020 - 8
The NAFCU Journal May-June 2020 - 9
The NAFCU Journal May-June 2020 - 10
The NAFCU Journal May-June 2020 - 11
The NAFCU Journal May-June 2020 - 12
The NAFCU Journal May-June 2020 - 13
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The NAFCU Journal May-June 2020 - 16
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The NAFCU Journal May-June 2020 - Cover3
The NAFCU Journal May-June 2020 - Cover4
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