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Consortium helps credit unions map e-commerce strategy

Wiegeshaus, Gutierrez, Ghimire, Veeramani, Waller, Vickroy,
                        Ferderer, Sponem, Kachelski, Racine, Bushman

Several members of three top credit-union organizations collaborated via the Consortium for Global Electronic Commerce on a project to help their constituents establish web functions. Pictured left to right: Connie Wiegeshaus, CUNA Mutual; Alfonso Gutierrez, Global E-Business Consortium; Shailesh Ghimire, CGEC; Raj Veeramani, Global E-Business Consortium; Ellis Waller, CUNA and Affiliates; Cheryl Vickroy, CGEC; Bob Ferderer, CUNA Mutual; Kim Sponem, CUNA Credit Union; Barb Kachelski, Credit Union Executives Society; Sue Racine, CUNA Mutual; and Peter Bushman, CUNA Mutual. (Photo: Bob Rashid) (large image)

As the Internet expands in scope, technologically savvy businesses' sites evolve from "standard" web presences to extensive E-commerce initiatives. Yet many more organizations lack the knowledge and resources to get their sites off the ground.

The scenario is especially true in the credit-union industry, where credit unions of all sizes compete with brick-and-mortar and dot-com financial institutions. And according to a fall 2000 survey, about half the credit unions in Wisconsin didn't have websites, says Raj Veeramani, industrial engineering professor and director of the UW Consortium for Global E-Business Consortium (CGEC).


But they wanted to. "What became very clear as part of that survey was that these credit unions were really seeking any ways by which they could learn the right ways of basic E-commerce and E-business," he says.

CGEC offers companies a nonthreatening, unbiased forum in which to share knowledge and experiences about the intricacies of conducting business via the Internet. As a result of that fall 2000 survey, the industry's three major trade organizations, CUNA Mutual Group, CUNA & Affiliates, and the Credit Union Executives Society (CUES)-all CGEC members-saw a unique opportunity to collaborate via the consortium on a comprehensive guide to help their credit union constituents adopt E-commerce initiatives, says Veeramani.

To begin, the group divided credit unions' states of E-commerce adoption into three phases: creating a website, adding automated features such as account lookup or transactions, and implementing advanced mechanisms like account aggregation and personalization. They interviewed credit unions around the country either via phone or questionnaire, conducted literature searches and spoke with providers who specialize in developing E-commerce capabilities for credit unions.

In addition, the student-team leader, then-graduate student Cheryl Vickroy, conducted in-depth case studies with 12 credit unions at varying phases of E-commerce adoption. "These case studies provide actual examples of how those credit unions faced those issues and what approaches they took to be successful and what were the challenges they faced," says Veeramani.

From the group's findings, Vickroy wrote the white paper, "Roadmap for e-Commerce Adoption by Credit Unions (PDF)." The paper addresses the strategy associated with each phase of E-commerce adoption and how it delivers value to credit unions and their members. It details how credit unions can progress through each phase and what technologies they need to succeed. In addition, it covers issues related to organizational structure and business processes: If there is an "E-mail us" feature on the website, for example, who will answer the mail?

The researchers also investigated privacy and security issues, ways to promote the web presence, and since many credit unions lack the resources to undertake a website at all, what options and approaches exist for outsourcing.

Each organization made free copies of the white paper available on its website and distributed hard copies to some of the 2,500-plus attendees at the credit union industry's largest trade show event.

Vice president of professional development and product research for CUES, George Hofheimer assisted the group with technical issues, defining each phase for the roadmap, and selecting credit unions for the case studies. He says credit-union CEOs, senior managers and directors found the white paper useful. "We put the report on our website as a free download and approximately 600 unique users downloaded the report," he says.

Ellis Waller, product manager of electronic commerce for CUNA & Affiliates, talks with credit union representatives daily. He says their attitudes about developing websites and adopting E-commerce are becoming more positive. "They're planning for it, they're budgeting for it-they are planning better now than their predecessors two years ago," he says.

This study was in line with one of his organization's goals: helping credit unions establish Internet and E-commerce presence. "It definitely helps them and gives us greater name recognition," says Waller.

Its benefits for CUNA Mutual were threefold, says Sue Racine, CUNA Mutual account vice president of association relations and project manager for the study. It helped CUNA Mutual gain a strategic insight into how credit unions are planning for and implementing E-commerce initiatives; conversely, the roadmap showed credit unions that E-commerce is possible for them.

And perhaps its most important aspect was the opportunity to collaborate with CUNA & Affiliates and CUES for the good of the industry. "This is a way to help these different players pull together to really bring strength and value to the credit union industry," she says.