Not to Mention Internal Training…
A topic routinely left of out the outsourcing benefits discussion is that it serves as a solution to exorbitant continual internal training costs. What might seem as manageable to some credit unions, the costs to keep your compliance staff up-to-date on training can be quite burdensome, (1) because of the hard costs and (2) because of the time it pulls the compliance manager away from their duties, which can be difficult for a small team to coordinate.
Compliance professionals are, by necessity, life-long learners. Administrations change, regulations and regulators change, credit union products and services change…. What you learned last year may not apply this year. For that reason, compliance managers require ongoing, highly specialized training to stay abreast of the rules. That’s expensive.
“When you look at NAFCU school or something similar, you’re talking $1,500 to $2,000 for one class. Now, for three people, that’s anywhere from four, five, six thousand dollars. The average cost to hire and train an employee can be costly especially to a small credit union.” A dense, urban, industry-competitive market increases the dreaded turnover, as well. Even high-level staff bounce around for the next best salary and opportunity or move away from the city. Urban populations are notoriously mobile. “When you have high turnover, which we’ve been lucky the last couple of years to not have, training becomes very costly to an institution,” says CEO James.
One of the challenges is that small credit unions lack training for their managers. They don’t have the time to hone their skills because they’re putting out fires all day.
Wearing Many Hats
Which leads us into our next topic on why compliance assistance can be so beneficial for cost-conscious credit unions: most credit union folks wear many hats. This should come as no surprise to the reader. It’s the nature of the industry – thriftiness is top of mind for credit unions and staff who are skilled in many areas is more cost-efficient. This is especially true among small and mid-sized credit unions, where even the CEO’s functions span across many areas within the credit union.
“The Aux Team helps us because of all the hats that I wear as the CEO. I’m the CEO, the chief lending officer, the chief information officer, the chief compliance officer, the chief marketing officer, etc.,” comments CEO James. Really, the only thing he isn’t doing is hitting the streets and collecting loan payments.
“Often a managerial team can’t see through the weeds to think strategically because they are putting out so many fires,” laments CEO James. The Aux Team has found this to be an enormous and pervasive problem across their small and mid-sized back office clients, regardless of demographics. “I can tell you right now that I average between 75 and 120 emails a day,” says CEO James. I need help managing my time: this is an area where many smaller credit unions don’t have the expertise, including my own credit union. How do we overcome this?”