Nov 2017: Samaha & Associates CEO Sabeh Samaha featured in Credit Union Management The Big Purchase Decision: For best results, the Board needs to set direction. . .
By Charlene Komar Storey
It happens over and over again at board meetings— in all types of credit unions, in all kinds of locations.
The staff members start explaining the benefits of a rather large technological purchase they’re proposing. But not long after their greeting, they slip into a language that few of the directors find familiar. Sure, they might pick up a word here and there, but not nearly enough to fully grasp the staff’s arguments and to make a competent decision based on them. Asking for explanations helps a little, but so much needs to be explained that it can seem hopeless. And too many directors are faced with trying to decide if the purchase recommendations are a good fit for the credit union without having a solid understanding of the topic. Of course, some directors will follow the conversation easily, and they can help their fellow board members. But each and every director is responsible for casting an intelligent vote, and there are ways that even non-tech-savvy board members can do so.
The easiest way is to do what directors should do about nearly everything: Plan ahead. What’s more, the board must ask credit union staff to present its plans in terms beyond mere technological details. Experts have a number of concrete suggestions for both boards and management to consider.
“Definitely, the board should be tying its decision to benefits to the credit union,” says Sabeh F. Samaha, president/CEO of Samaha & Associates (ssamaha.com), Chino Hills, Calif. “I feel there should be a very structured approach to this.” Samaha & Associates believes in a scorecard process, rating such elements as tactics, security, IT, functionality and industry strategic alliances. Then it adds in price and a section on strategic goals. “This is the place where the board could get involved” if it chooses to do so, Samaha says. It could review the scores and then give its approval, or not. Most experts agree that it’s not the board’s role to get into the weeds. “It’s a fine line on responsibilities at that level,” Samaha observes. “You don’t want a board that’s completely disconnected, and you don’t want a board running IT. “If the board wants to participate, then they need to understand the needs technology is fulfilling at their credit union. Technology is highly practical. These are engines that enable the credit union to be more competitive.”
A Structured Approach
Samaha believes in a hierarchy: a strategic plan that leads to a business plan that leads to a technology plan, which should be run by a technology committee. He sees directors involved in the technology committee only in certain circumstances. “The CEO and the technology committee should be able to do the heavy lifting,” Samaha says.
Charlene Komar Storey is a veteran credit union writer based in New Jersey.