5 Questions That Reveal Whether Your Core Strategy Is Prepared for the Future

A credit union’s relationship with its core provider is arguably more important than ever before, as efficiencies, openness and a modern infrastructure heavily impact IT planning capabilities. The competition is high, and institutions need the ability to select the proper technologies to differentiate their organization and their unique business plans.

Credit unions must be careful when it comes to core planning, whether selecting a new provider or simply evaluating existing services, as the power and flexibility of a core can make or break a business plan. There are five key questions that must be considered when determining if an institution’s core strategy will position them for success in the years to come:

1. Will the infrastructure of the core platform be deep enough? It’s important to ensure that systems have the deeply embedded functionality and openness to provide a great user experience, as members won’t tolerate inconvenient and clumsy interactions. Many new companies enter the market lacking the back-end capabilities that members need to manage their banking with ease. It is critical that credit unions do their due diligence and complete a comprehensive overview to evaluate valuable back-end capabilities as well as the company’s future potential.

2. Is it open to integrations? A core platform should have robust capabilities, but it may not be able to meet your every need. That’s why an open platform is equally as important. Credit unions must ensure they can seamlessly integrate their core platform with published application programming interfaces (APIs) – and in a timely manner. If a core’s technology is not updated and doesn’t connect well with that of others, that’s going to be an issue. Some credit unions have claimed feeling handcuffed by their cores – openness is crucial to being able to adopt a modern technology infrastructure. While we don’t know what the future may hold and what institutions will need in the months and years to come, those that build upon an open environment will be more adaptable than those that don’t. Don’t be in the position of waiting countless months in a queue, or paying exorbitant amounts for integrations that may be more routine with the right core. Institutions that are nimble and flexible will be the ones that will continue to differentiate themselves.

3. Are you confident in your disaster avoidance and recovery capabilities? Natural disasters have proven to impact every part of the country and cyber-attacks are taking advantage of the weaknesses in our systems. Credit unions are charged with effectively protecting mission-critical data and systems, and must bolster disaster resiliency to ensure they will be available when members need them most; a core partner should be integral in ensuring the reliable delivery of services.

Consider the options that the provider offers. It takes a multilayered approach to manage security services and it’s important to have a holistic view and conduct an analysis of events. Overall, a credit union’s reputation is its most valuable asset, as members rely on their trusted relationships. Therefore, it’s the credit union’s responsibility to deliver upon those expectations.

4. Is your provider preparing for the future? Institutions should also consider providers’ investments into R&D. How dedicated is the vendor to being an innovator? Are they constantly improving their technology to evolve with the marketplace and making enhancements to the level and types of services they provide?

A credit union’s vision must be supported by their core provider’s strategy. The work doesn’t end after implementation; the vendor must continue to be a dependable partner throughout the entirety of the relationship. Is the provider receptive to feedback or are they not responsive at all? Credit unions need providers that they can constantly be in communication with to maximize their use of the platform, overcome roadblocks, strategize for the future and ensure everything is running smoothly.

5. Should you consider outsourcing? Credit unions must evaluate which hosting option fits their organization’s unique strategy. Outsourcing is swelling in popularity because of its ability to optimize efficiencies and allow credit unions to spend more time with members. The institutions that find an outsourcing vendor they can view as a true extension of their institution won’t face the burden of having to focus on hosting their technology and will be able to free their employees to spend less time on tedious manual processes and more time on what matters most – strengthening relationships and enhancing the member experience. And, outsourcing can also allow credit unions to easily scale.

A credit union’s relationship with its core provider should not be taken lightly. With the core platform being so critical to an institution’s success, credit unions need to be talking to their core providers about their vision and plans. Institutions must ensure that they will receive both modern, secure technology and an expert partner with an innovative mindset and a passion for supporting the community.

Gary Lee is chief client officer of Member Driven Technologies (MDT), a CUSO based in Farmington Hills, Mich., that hosts the Episys core platform from Symitar to provide a private cloud alternative for credit unions’ core processing and IT needs.