In this candid Q&A, Nick Wodogaza – a retired CEO of Palmetto Citizens Federal Credit Union turned consultant – calls it like it is. Whether it’s credit unions’ aging problems, technology or his own leadership mistakes, he’s facing them head-on in this raw Q&A with The Credit Union Connection.
Which is how he’s coaching credit unions now. If you’re technology isn’t where it needs to be, neither will your credit union, because millennial and Gen Z members demand immediacy and personalization. With the hindsight of running a credit union, he’s helping smaller credit unions with strategic planning, executive coaching and more.
Keeping with the collaborative theme of credit unions, Wodogaza launched the CUs Together Conferences to promote leadership development and networking between credit union volunteers and leadership. Current and future credit union leaders can learn a lot from his insights, so read on!
Q: What are your views on leading a credit union to success?
As a credit union leader, my focus is on helping my organization be the best place for members and a great place for people to work. Obviously, financial and regulatory requirements must always be met.
In addressing member service and staff success, I address two main points:
- You cannot manage what you cannot measure (membership success, staff success, financial performance, and operational performance).
- Where are we green and growing, or ripe and rotting? In borrowing from Ray Kroc of McDonald’s fame, organizations are either “Green and Growing, or Ripe and Rotting.” I believe every organization has parts of its business that are Green and Growing, as well as some Ripe and Rotting parts of its business. Meaning, there are successful business areas and declining areas of the organization. There should be a process of continually evaluating and making each area of the organization better and more successful.
Q: How do you advise credit unions to evaluate and implement emerging technologies?
Too often, credit unions have not been strategic in their technology planning and are locked into a mishmash of solutions with out-of-sync contracts for out-of-date systems.
They seem to alternate between the status quo and feeling pressure to adopt new technologies without considering how technology factors into the strategic intent of their organizations. Further, technology solutions are too frequently selected with conflicting priorities. Because credit unions serve members with high trust expectations and generally have tighter budgets, the approach needs to be disciplined and both member and staff focused.
Credit unions should look for cost vs. return on their investments in each of the four service delivery areas:
- Branches
- Mobile/Home Banking
- Automated Teller/ITM (disbursement and deposit)
- Call Services
I believe in striking a balance between member-focused solutions, people-focused priorities, and operational-focused solutions.
Annually, whether small/medium/large, a credit union should review and evaluate its systems against the credit union’s strategic needs (e.g., improve member experience, improve staff usage, increase efficiency, etc.).
I look for the overall value in the technology investment and prefer to rely upon already proven systems that may not be the most cutting-edge. My lone exception is never scrimping on cybersecurity systems and services; member service and reputation are too important.
Concerning AI services, I’m very excited for the opportunities being implemented that allow staff members in contact centers and branches to better assist members with unique questions and requests through AI-assisted systems, as well as the ability for AI systems to better assist members seeking answers through the credit union’s website.
Q: What role do strategic partnerships play in a credit union’s growth strategy—and how do credit union leaders decide who to work with?
Strategic partnerships can create a huge advantage for credit unions, especially given the limited resources, competitive pressures from big banks and fintechs and the need to remain relevant to members.
Good strategic partnerships are especially important in the growth and success of smaller and medium-sized credit unions. They allow credit unions to expand their capabilities with minimal investment.
Every credit union, including our small credit unions, should be focused on membership growth and engagement. If not growing in membership, services used by members and savings and loan balances, they are missing the point of the organization’s existence. Sidenote: Just because a credit union is not growing, it is not necessary to seek a merger as the solution.
First and foremost is Value (cost versus comprehensiveness and quality of services being provided) as the most critical component. In addition to enhancing member service, the partnership should reduce the cost (as a %) to the credit union expenses over time.
I believe there is a big difference between the expectations for different services (for instance, the difference between insurance versus digital services versus alternate investment services). I do not believe every credit union should be adopting new service offerings solely because it’s what others are doing.
Like every part of the credit union, all partnerships must be monitored, managed, and enhanced, with measurable objectives being addressed.
Q: What’s something you believe credit unions need to stop doing to remain relevant over the next 5 years?
What do credit unions need to STOP doing?
They need to STOP comparing themselves solely to other credit unions (and neighboring community banks) as they really need to focus first and foremost upon how they are most relevant in the lives of their members and differentiated from the other financial service providers (including other credit unions, banks and fintechs).
Success should be measured in relevance in the lives of members and in differentiating the credit union from other financial service providers.
In summary, to remain relevant, credit unions must stop trying to out-bank the banks and instead reclaim their role as member-owned, mission-driven financial partners who use available tools to deliver member services of value.
Q: What would you advise an up-and-coming credit union leader to ensure they’re trained/educated on?
Developing the next generation of credit union leaders is critical for our long-term relevance.
For someone up-and-coming who seeks to grow into a management role, I’d recommend focusing on learning:
- Financial services fundamentals,
- Leadership and people skills,
- Member services,
- Technical knowledge,
- Strategic leadership skills,
- Operational knowledge,
- A Cooperative mindset.
Up-and-coming leaders who desire to grow into management positions should have a combination of mentors and teachers, including older more seasoned leaders whom they can share ideas and gain guidance.
Leaders working to further develop should assess their skills on an ongoing basis, performing an initial assessment, and perform ongoing (every six months) gap assessments to evaluate their growing skills and areas for further attention. Their immediate supervisor plays a part.
Every person, regardless of position, is a leader—and potentially an excellent leader.
Emerging leaders should recognize they are already leaders, whether they supervise people or not.
There are additional key areas for their growth and development, which also include the regulatory environment, lending and new account practices in their organization, finance ratios, and let’s not forget the philosophy and cooperative difference of the movement.
Lastly, if they desire to become a CEO they should consider a path to become the CEO of a small credit union with a plan to learn and create success in this organization. In following this path, they’ll want to recognize the role of a small credit union CEO will be incredibly challenging, but they’ll learn so much and if successful have an opportunity to advance to larger opportunities.
Q: What’s a risk you’ve taken that didn’t pan out as expected, and what did you learn from it?
As a CEO for over 28 years, there are so many instances where I made mistakes in member services, people and leadership, and operational missteps. Where to choose!?
To borrow from Winston Churchill: “Success is going from failure to failure without losing enthusiasm.”
I’ve never had a major failure (thankfully), but I have had many smaller failures.
I can think of many smaller failures in service to members, where my organization did not do a good job in assisting individual members, and they were not receiving the level of service and guidance they needed to best help the member achieve their best financial future and grow in their relationship with our credit union. As I noted, “You cannot manage what you cannot measure,” and it was surveys and staff feedback that uncovered areas where we needed more staffing, better products and enhanced lending processes.
Q: How do credit union leaders need to rethink member engagement as digital expectations evolve?
As credit unions will be slower to adopt digital solutions expected by members, credit union leaders and staff members want to evolve in their abilities to move from merely helping perform a transaction or making a loan to a mindset of further engaging members in thinking about their credit union as a partner in their financial success. And the sooner the credit union (again, leaders and staff) makes this shift in working with younger consumers, regardless of their technological disadvantages, the better the opportunity to develop a life-long financial services relationship, whether primary or secondary.
Start with the members’ relationship and then expand into how we can most effectively and efficiently assist members regardless of our digital services.
Are we doing a good job in assisting individual members to help them achieve their best financial future?
I also recognize that we cannot be all things to all people and must continually balance our organization’s ability to help individuals with the realities of limited resources against unlimited needs.
In member engagement, it starts with, “What are we seeking to achieve?” I consider core services, such as checking services, credit cards, vehicle loans, mortgages, investments, and business services, and measure their usage by individual members as a gauge of success. Additionally, there can be other areas where the credit union can especially excel—for instance, in a niche product like solar panels or an HVAC loan program. Based upon size, adjust the specific core services.
I foresee staff members in member-facing roles will become some of the biggest beneficiaries of AI services and be in the best position to better aid members, develop deeper relationships and become more effective product promoters.
Q: In what ways should credit unions be preparing for the next generation of financial challenges?
Credit unions have a generational problem. The average age of credit union members in the United States is 53 years old, compared to the median age of the country of 38.5 years old.
I believe first, second and third, it’s about relevancy in the lives of members, as measured by the services of the credit union being used by members, especially the number of services per member. Therefore, growth in membership and growing in services used by members are important gauges for success.
A credit union should be tracking its average member age and working to achieve both a younger age, and most specifically the ideal member age to balance the credit union’s need for both borrowers and savers. When I left the CEO role, the average age of our credit union membership was 40 because we worked to make it happen.
Tactical and operational plans outline a strategic approach to attract, engage and retain more millennial and Gen Z members beyond focusing solely upon digital services (or lack thereof). Credit unions can become attractive to younger members by enhancing our brand relevancy, providing valuable services at better pricing, and delivering personalized experiences.
By positioning the credit union as a trusted, solutions-oriented financial partner working to better aid younger consumers, a credit union can aim to secure lasting loyalty and better serve this next wave of consumers as they also lower the average age of their credit union members.
Q: How do you approach leadership differently today than you did five years ago?
Recognizing I’ve transitioned from a CEO to an adviser role, I’ll answer this question based on my experience as a CEO.
Five years prior, my leadership lens was narrower. I focused heavily on execution—setting goals, measuring performance and ensuring results. It was about being efficient, being right, and perhaps not moving as fast. That served its purpose, but it also left blind spots. Later, I approached leadership less as managing outcomes and more as shaping environments where people can thrive. Regardless, measurables matter.
Q: What’s something you believe most credit union CEOs are overlooking right now?
Definitely the average age of their credit union’s members.
The average age of credit union members in the United States is 53 years old, compared to the average age of the country, which is 38.5 years old. Many leaders are rightly focused on balance sheets, compliance and digital upgrades. What often slips through the cracks is the deeper question: Why should an 18-year-old choose us over a fintech app or a digital-first bank?
Yes, Gen Z and millennials don’t think about financial institutions the way past generations did. Yes, they value immediacy, but they also value personalization and purpose.
Q: What’s your favorite home office feature?
I’m very fortunate. This home office is at the beach with a window behind my monitor overlooking a low country marsh and the Intercoastal Waterway. The marsh during the day will have egrets, birds, and the occasional deer walking through. Depending upon the time of the year, the sunsets are also visible. I never grow tired of this view!
Q: What books are you reading/have you read this year that you found valuable?
In addition to completely reading the Bible during the year, I have a variety of books on my reading list. Of special note, I read Zen and the Art of Motorcycle Maintenance by Robert Persig. I decided to read this book after I heard Bo McDonald talking about the book on his The Accidental Leader podcast, and we discussed the book during a podcast in July. Not my normal read, but the book was fascinating as a philosophical journey blending motorcycle maintenance with reflections on quality, reason and living authentically, exploring the balance between technology and human values.
Q: What’s the most important thing to you about your legacy?
Leaving this world a better place for having been here! Most specifically, helping others grow as leaders, helping others find their purpose, having led a life of purpose.
The most important thing to me about my legacy isn’t the titles I’ve held or the results I’ve driven—it’s the people I’ve influenced and the lives I’ve helped shape.
Q: What’s the best question for a candidate to ask during a job interview with you?
First, I appreciate people who have done their homework. Rather than the standard interview questions, I appreciate someone who, after having done their homework, poses a thoughtful question about strategic issues facing our organization or our industry.
Q: Favorite movie or TV comedy and why?
Movie: What About Bob?
Bill Murray and Richard Dreyfuss. Never ages, always funny.
TV Show: Hard to pick just one favorite. One of my favorite comedies is The Office. On the surface, it’s lighthearted and funny, but beneath the humor are lessons about leadership, culture and human connection.
Q: Favorite action movie or TV/streaming show and why?
Not an action movie, but one of my favorite movies is The Martian. Science, drama, adventure, comedy. Favorite line: “You solve one problem, and you solve the next one, and then the next. And if you solve enough problems, you get to come home.” Management 101
Q: Reading or podcasts? What are some of your favorites?
Podcasts: The Journal (WSJ); CNBC Squawk Box (business); Smerconish (political and social insights); NBC Today Show (1st hour); Dan Patrick Best Of (sports); The Prof G pod (Scott Galloway).
Q: Who would you want to play you in the movie of your autobiography, and why?
Young Nick: Richard Madden – Cool, strategic, and steady.
Older Nick: Matt Damon – leadership, confident, decisive, engaging, resourceful.
Q: Robot overlords are attacking your credit union. What one superhero would you want to help defend it and why?
The Arnold Schwarzenegger Terminator— the reprogrammed version—strong, strategic, and committed to success.
Q: If your credit union were a band, what genre would it play and why?
The Eagles: Soft Rocking, Mellow, Soulful, Insightful
Q: If you could swap jobs with anyone for one day, who would it be and why?
The President of the United States: There is a lot I’d like to “fix,” and one day should about do it!
Q: What’s the weirdest place you’ve ever had a great idea about/for your credit union?
While touring Ireland and traveling through small villages, there were many community credit unions, and I appreciated the part they play in these communities and took away several ideas from that trip.