Where most people hear warning shots, entrepreneurs hear the starting gun
Credit unions are facing huge challenges right now. First, new interchange laws have reduced or eliminated fees that merchants pay to credit unions; second, regulations on lending – combined with the poor state of consumer credit – are hampering credit unions’ ability to make loans. Combine these factors with a sagging economy and a host of other industry and individual issues, and credit unions are riding a roller coaster of uncertainty.
In a situation like this, it may be human nature to go into shock. Instead of facing challenges head on, it may be tempting to view the situation as “impossible.” With no clear way forward, the plan of action is no action. There’s a lot of complaining, naysaying and just plain giving up. Unfortunately, none of these is especially constructive.
As someone who has written about the business world for nearly 30 years – and recently became a small business owner myself – I’m shocked at this response. It’s not that I don’t see the difficulties involved. It’s that difficulty is such an inherent part of running a business. Businesses face “impossible” challenges every day – not just from Uncle Sam, but from ever-changing markets, consumer tastes and technological advances.
When I feel like I’m hitting the proverbial brick wall, I remember that Thomas Edison was ridiculed by British Parliament when he first created the electric light bulb; that President Rutherford B. Hayes told Alexander Graham Bell that he didn’t know who would “ever want to use” a telephone; and that many people told a major league baseball pitcher he would never succeed. That pitcher? The legendary Babe Ruth.
To do the impossible, try adopting your own “entrepreneurial attitude.” Here are four things entrepreneurs excel at. Think like an entrepreneur, and adapt these approaches to your credit union.
1. Get personal.
Today more than ever, connecting with your customers and creating a sense of caring and community is what it’s all about. (Witness the rise of social media.) Because a credit union can provide personalized service on a human scale, you’re better positioned than the big banks to give members what they need right now – a financial institution that truly understands their needs.
2. Think small.
So, you’re up against some big banks? Today, many entrepreneurs and small businesses in search of financing are turning to smaller providers, like community banks, microlenders and, yes, credit unions. So while your credit union may be battling the “big guys,” your small size can actually be an opportunity – not a disadvantage. (After all, it was David, not Goliath, who won the battle.) Based on my daily interactions with entrepreneurs across the country, I can tell you the small-business market is very receptive to new options in financial services.
3. Do more with less.
Facing a decline in income? Sure, it hurts, but many entrepreneurs are facing the same in these challenging times. To ease the pain, start by looking at where you can cut back. Assess inefficiencies in your operations and systems. Figure out how to streamline procedures. Ask your employees for help: As the people on the “front lines,” they often have great cost-savings ideas – and they’re motivated to keep expenses low so they can keep their jobs.
4. Respond to change rapidly.
When you’re an entrepreneur, there’s no time to waste bemoaning fate. You’ve got to act – fast. That’s what Michelle Gamble-Risley and Michele Smith did when the recession hit and sales at their marketing company, M Communications, took a nosedive. Building on Gamble-Risley’s prior experience in publishing, they launched a second business, 3L Publishing, that provides writing, editing and publishing services. Since authors need marketing help, 3L Publishing not only brought in its own clientele, but also new clients for M Communications. Today, the combined companies’ sales are higher than ever – all because the founders took creative action. Change can be unsettling, but it can also spark real innovation and growth. What if hitting a dead end (finally) motivated you to forge a new and better path?
As the former editorial director of Entrepreneur magazine, I used to write about entrepreneurs and their never-say-die attitude. Now, I’m living it as an entrepreneur myself. When I started my company, GrowBiz Media, in spring of 2008, our business model was predicated on big sales to corporate customers. Then the economy tanked, our prospects’ budgets disappeared, and we had to rework our business model from the ground up. We’ve revamped our business plan more than once since then – and so has just about every entrepreneur I know.
When I get together with fellow entrepreneurs these days, there’s some complaining, sure. We’ve all got reason to vent about how the economy has affected our cash flow. But overall, the mood of these gatherings is positive and energetic. Entrepreneurs are, by nature, optimists, and after a few minutes’ gripe session, the mood in the room quickly turns to excitement as we suggest new ways each other’s businesses could approach problems, find solutions and explore new revenue streams. Facing the impossible isn’t discouraging: It’s what we do.
In this issue of THINK, you’ll find plenty of great ideas for tackling the challenges credit unions are facing. Combine that inspiration with a can-do attitude, a creative approach and a refusal to accept defeat, and you’ve got an unbeatable combination – one that can help your credit union not only survive, but thrive in the face of what seem like impossible challenges.
Rieva Lesonsky is CEO of GrowBiz Media, Costa Mesa, Calif., a content and consulting company that helps entrepreneurs start and grow their businesses. Follow Rieva at Twitter.com/Rieva. Visit SmallBizDaily.com to sign up for her free TrendCast alerts.