Recently I was thinking about some of the very tough banking competitors we had a few years ago. I never could figure out how those guys did what they did while remaining successful. They had rates and fees just as good as credit unions'. Bank branches were popping up everywhere, and they were open on weekends and evenings although hardly anyone was in those branches. The bankers had technology, and they did OK at making their employees friendly and caring. And on top of it all, bankers had to make a profit. I remember wondering if somehow I'd missed out on something in business school. How were they doing it? There was a little local example here in Margaritaville: Washington Mutual had ATMs in all the Walgreens drugstores, although they had no branches in the Florida Keys. How on earth could it make money doing that? WaMu's ads sounded like they were a credit union. Countrywide, WaMu, IndyMac and the other big mortgage dudes kept offering better interest rates and terms that were incredible. They made liar loans sound reasonable. How could these guys keep whipping us with what looked like high-risk and seemingly crazy behavior? Credit unions did their best to compete, sometimes entering arenas like business lending where the penalty for lack of expertise could be liquidation. Many credit unions followed the bankers with fee maximizing behaviors that made some a little uneasy. And still we were barely keeping up. How could those clever bankers do it? Well, it turns out, they couldn't. As we all know now the losses, layoffs and damage to mortgage lending are of historic proportions. It was as if credit unions had been playing a game by the rules, only to discover that those crazy bankers had been on steroids. Perhaps one lesson learned is that if the dudes you are competing against seem to be doing impossible things, there is a good chance they are doing impossible things. Eventually, the impossible catches up with them. Perhaps you just need to be a slower performer for a while until the guys on drugs begin to show the signs of their abuse. You can wait for their regulators to react. But by then the dudes on steroids should already be showing problems. Well, given what has happened to the crazy banks and credit unions, what should credit unions do today? I suggest that each credit union look at itself in the mirror and figure out what it wants to be. All successful organizations have a philosophy of doing business, and they stick to it. That consistency is crucial to their success. Credit unions used to be good at having a philosophical focus. Yet today many credit unions seem to have gotten lost. Their business philosophies are not clear and their operations often do not reflect a consistent adherence to anything more specific than "we love our members and we want them to use our services." There are many paths to choose, and credit unions will always have their unique features. But a credit union's leadership team has to pick a way to go and stick to it. We need to get clear about our business philosophies, including our mission statements, visions and guiding principles. Then we can put together viable business operations that return tangible and consistent benefits to our members. And lay off the steroids.

John Dolan Heitlinger of D-H & Associates Consulting consults on planning, turnarounds, metrics and execution with credit unions. He can be reached at 305-292-1208 or [email protected]