The Power of Purpose in Banking

Jim Marous (00:12):

Welcome to a special executive leadership series edition of the Banking Transformed Podcast, recorded at the Financial Brand Forum in Las Vegas. This series is sponsored by our friends at Microsoft. I'm your host, Jim Marous.

Jim Marous (00:26):

During this series of episodes, we dive deep into the world of digital transformation in the financial services industry. We speak with seven top executives from some of the most progressive financial institutions, each of whom has embarked on a unique digital transformation journey to become more future ready and responsive to the changing needs of consumers.

Jim Marous (00:48):

We explored the strategies, challenges, and lessons learned by these forward-thinking organizations as they navigate the complex landscape of digital transformation.

Jim Marous (00:59):

Whether you're a financial services professional, a fintech entrepreneur, or simply interested in the future of banking, this executive leadership series provides you with valuable insights and inspiration as we explore the cutting edge of digital transformation in the banking industry.

Jim Marous (01:19):

Okay, I don't want to fall too far behind. I know people are going to be strolling in because the form X started a little late and then went a little long. So, the worst-case scenario is, and at some point, everybody's got to go to the restroom, so I assume that people keep on coming in.

Jim Marous (01:34):

I'm Jim Marous. I am the co-publisher of The Financial Brand and the owner and CEO of the Digital Banking Report. I'm also host of Banking Transformed Podcast. Hopefully, some of you have picked up some of my podcasts.

Dennis Devine (01:47):

We have done 400 podcasts over the last four years between Banking Transformed, and another one I do called FIsionaries, which is small banks doing great things sponsored by Alkami. One thing I try to do, and it's basically been my mission over the last 15 years, is to continue to stay relevant by digging deeper into what's happening in the industry.

Jim Marous (02:10):

An industry I've been in since I left college in 1976. So, do the math. I've been around a fricking long time. What's interesting is while a lot of things have changed, banking isn't completely different from what it was then.

Jim Marous (02:24):

Now, I started before there were ATMs, and we thought when we introduced ATMs, we would remove a lot of people from the branches because we'll have ATMs. We found out for the first time in multiple times that we're going to go forward, that we didn't get rid of transactions or employees, we simply increased the number of transactions that were being done.

Jim Marous (02:45):

The same thing happened with online banking and then with mobile banking. What is different about what's going on today versus what's going on in the past though, is we're completely transforming the way the consumers can be able to do banking based on the fact that we have more access to data and insights than ever before.

Jim Marous (03:06):

Where we used to have to do bits and bytes and have the IT department do things and give it to us six months after we really needed it, we now have instant access to what's going on in our branches and our digital platforms in the marketplace. It's an amazing time.

Jim Marous (03:24):

This podcast here is with a friend of mine, Dennis Devine. He lives in Cleveland, Ohio, as I do, but he's also quite a bit in Chicago, at his credit union, Alliant Credit Union. And what’s interesting is this is the first podcast that we developed while riding a 25-mile bike ride for cancer research in Cleveland, Ohio.

Jim Marous (03:46):

We started the discussion as the ride started, and I asked him, "So what's going on in your bank?" I found out not only everything is going on at his financial institution, but how it related to what had happened in the past.

Jim Marous (03:57):

Dennis' past is filled with legacy banking organizations that he had major roles in including, let's see if I can get them all right. PNC/National City Bank, Citizens Bank, and KeyBank. And in each one, a legacy financial institution that he was instrumental in each one of those organizations trying to move the digital mindset forward.

Jim Marous (04:24):

He worked within organizations in different types of situations and different types of organizations, different levels of complexity of what he's trying to do. But right now, he's like a kid in the candy store.

Jim Marous (04:36):

He's sitting there with no branches, digital only as a credit union with the tax ratifications of being a credit union. In other words, he has a lot of ability to change things very rapidly. One thing I found very interesting in our conversation on the ride was that he's a big believer in giving power back to employees and to members.

Jim Marous (05:04):

Trying to look and say, "How can I build an organization that really is structured so that people want to come in and do business with me for ways other than just I got a checking account."

Jim Marous (05:18):

So, Dennis, thank you very much for joining me. As he said, he was surprised when he came in here. There weren't a bunch of pallets set up, so we could actually do the exact reincarnation or recreation of our journey through Cleveland, Ohio for a bike ride.

Jim Marous (05:34):

But can you talk a little bit about what you've seen change the most before we get into what you do at Alliant and how Alliant's different. Can you talk a little bit about how banking's really changed from your perspective, which is probably a big piece of what everybody's felt, but you've actually been on the front line in most cases.

Dennis Devine (05:54):

Well, first of all Jim, thanks for having me. Now that everybody's a big fan of mine as you introduced me as a credit union leader with tax benefits, with all these bankers in the room, maybe I'll inject just a hear more of my history to set up context to this.

Dennis Devine (06:11):

So, you're a big fan of mine. I was also a lawyer at one point in my career, a management consultant. Why are they moving back further and further away Jim?

Jim Marous (06:20):

If you didn't like him before, you just totally don't like him now.

Dennis Devine (06:23):

So, my first job in banking was … and I was a banker for decades, was as a CFO. And when a really awesome leader gave me an opportunity to do something different in the business, he asked me, "How would you feel about leading our alternative channels?" Has anyone ever had a job in the alternative channels?" At the time, that meant digital. And it meant contact centers and other channels like that.

Dennis Devine (06:52):

And it's funny for me to think about in the course of my career, that was something that was regarded as maybe a nice to have something that we ought to build out because some of our customers might ask for it to the very center of the way most of our clients, members, customers now interact with us every single day.

Dennis Devine (07:08):

No matter what institution we're representing in this room, most of the interactions are occurring digitally. We know it, and we're building experiences around it.

Jim Marous (07:15):

So, your organization has grown rather fast, but it's not by any of the things I discussed on the front side, except for the fact that you're deploying digital in ways that people are wanting to engage with you. Talk a little bit about your growth over the last several years.

Dennis Devine (07:32):

So, many of you might not know Alliant Wealth. We are one of a kind, a national digital credit union. So, there's not many institutions that look all digital the way we do or 20 billion in assets entirely focused on consumer digital experiences and we are structurally organized as a credit union.

Dennis Devine (07:52):

So, that comes with organizational advantages because we're not serving shareholders, we're giving back to our members each day, and it does have the corresponding tax benefits as well. The benefit of that is we're able to think every single day from the beginning of the day until the end on how do we design something that's better for our customers, our members. And it’s a terrific structural advantage.

Dennis Devine (08:14):

We have the best cost structure in the industry, 10 or 15 points better than good banks and credit unions because of the digital model that we have. And what there was other structural advantages we're able to offer best in class experiences, top of market deposit rates, the full elimination of fees, and partnerships that do things like more free ATMs in the top two banks in the country combined. But that’s allowed us to grow with a proposition that’s strong.

Dennis Devine (08:45):

A good credit union has grown its membership 5 or 6% over the last few years, that's faster. Credit unions are good purpose-driven institutions, that's faster than most banks have grown their customer base over the last couple of years. We've grown about three times that fast.

Jim Marous (09:04):

So, it's interesting. So, there's probably a lot of people in here go, "Okay, so why did I come here when I'm not anything like Alliant?" The reason I thought this is important from the standpoint of perspective is we're all trying to engage in ways that are more digital, more human, more purpose driven.

Jim Marous (09:23):

We all talk a good game, but how do you improve upon that? And this is almost like the perfect test unit, perfect test model to say, "What would you do if he had freedom to build a great financial institution from scratch?"

Jim Marous (09:40):

I mean, you're not from scratch. You've been around a long time as an organization, and it was United, what is it? United Federal Credit-

Dennis Devine (09:46):

The roots of the credit union was the United Alliant Credit Union.

Jim Marous (09:50):

So, if you're a credit union, you all had roots that went back to a group of workers or community that was very tight. But he's now having to build something that not only is big and good and profitable but has the ability to expand in scale and size and speed. So, a big difference between KeyBank and Alliant. Not good, not bad, but very different. What enticed you to take over the reins of Alliant?

Dennis Devine (10:20):

Everybody probably has a predisposition about any role that they're thinking about. And I've been really blessed to work with some super talented folks over the years whether as a management consultant or with some of these large banks. But the opportunity to do something completely different and purpose led was too good to pass up.

Dennis Devine (10:37):

So, we operate 90% the same as everyone else is operating their institution. So, we've got product owners and we've got asset liability committees, and we have credit committees, and we have the technology needs that everyone else is thinking about in terms of how to create these experiences. We just have a different end goal in mind.

Dennis Devine (10:58):

Our mission is to serve our members. Our first value is to serve our members, and it's actually to wow our members, to delight them because they're the why of what we do every day. And so, that was super interesting to me Jim, as a chance to do something different and to change banking for good.

Jim Marous (11:17):

So, it's interesting because I would say every bank and every credit union here says — in fact, I know because we research people and say, "What's your number one priority?" A better customer experience, better customer engagement, better everything. And then down the line when we say, "How are you going to invest in things?"

Jim Marous (11:33):

I mentioned this yesterday in my innovation workshop, is that we saw that organizations prioritize the allocation of funds for data and analytics very far down, even though we all know we have a challenge in that area.

Jim Marous (11:47):

In addition, while we talk a good game, we sometimes miss things like employee experience, employee engagement, actually building it so that people want to work there as well as bank there. What have you done since you've been at Alliant to make banking better, first for your members and then for your employees?

Dennis Devine (12:10):

Everyone that's participating in this podcast, in this discussion has a priority to serve clients and members for sure and folks mean it. When you're organized the way Alliant is as a national digital credit union, you could put some real structural difference to that.

Dennis Devine (12:25):

So, for example, we don't have shareholders to serve. So, if you look at our annual report, the first headline number is, how much better is it to be an Alliant member than to be a member of an average bank or credit union? Super easy to calculate that because we’re all issuing call reports every quarter.

Dennis Devine (12:43):

And so, you could look on the basis of deposit rates, on the basis of fees, on the basis of interest rates and other advantages that you get, what does that look like? This past quarter, the answer at Alliant was $498 million.

Dennis Devine (12:58):

I've got a good CFO when he would not round up that little bit, I was like, "Come on Mark, how about half a billion?" “Nope, 498 million.” That's how much better. And so, we sweat that detail every single time the call reports.

Dennis Devine (13:09):

And so, everyone's paying attention to, “What do my delinquencies look like and what does my net interest margin look like?” We're paying a ton of attention to what does member return look like. We also structurally, are organized so that everything we give back to our members is treated as a good thing from an incentive perspective.

Dennis Devine (13:27):

So, as a banker, I can recall well, meetings weekly trying to determine how can we take deposit rates down so that we can expand that address margin, which is the single largest profitability lever in a retail bank.

Dennis Devine (13:41):

There is literally no incentive to do that at Alliant, it's the opposite. It's how do we give back to our members? And so, that's a big structural difference to try to serve members in a different way.

Jim Marous (13:51):

So, when you were talking, you talked about building new financial wellness capabilities to be actually able to bring new products and services to your members that are a differentiator beyond simply rates and fees.

Jim Marous (14:04):

I mean, it's really great not to have fees. It's really great to have great rates, but the economy can switch things out very quickly and make it so you have to switch things out within your organization to some degree.

Jim Marous (14:16):

What other aspects are you doing from the standpoint of being able to leverage your investments towards financial wellness, maybe a better digital platform integration better top of glass, if you're in Derek's session earlier today. How are you helping build the structure for just a better financial institution?

Dennis Devine (14:37):

And a good example might be something super practical. The average person in our country is swimming in debt. Interest rates are increasing and it's getting tougher and tougher to service that debt, and they don't have the basic savings to be able to address it.

Dennis Devine (14:57):

We do a lot of work with employers as well, and we talk with employers and we're like, "Take a peek at the borrowing that's going on in your 401(k) right now." And because people are stressed and they're looking to unsustainable ways to try to deal with near term issues, we'll work with employers and other partners around things like emergency savings and sustainable savings efforts.

Dennis Devine (15:20):

So, for example, one of our close partners is an awesome person and influencer Suze Orman. We built a savings product in partnership with her called the Ultimate Opportunity Savings Account, where it's not just about making sure people are putting that large sum in of savings, which is good for the balance sheet of every financial institution but working around the behavior of how do you do it month after month after month after month.

Dennis Devine (15:51):

And with partners like Suze and with employers, we'll build consistent programs like that so that the users feel the power of building those habits and those savings and what's taking place.

Jim Marous (16:06):

So, in making this financial wellness your partnership with Suze Orman and your ability to continually to educate the wellness journey, obviously that has good benefits from a member growth perspective.

Jim Marous (16:19):

If you haven't been in one of those sessions already today, I asked the group, and I'm going to ask the group here, how many of you have closed a primary financial relationship in the last five years? Your primary checking account relationship or your primary bank relationship? Raise your hand.

Jim Marous (16:36):

I think we have two people. And that's kind of interesting because we're all bankers probably doing banking at our banking organization. And maybe these two people left their old organization, went to a new and opened a new account.

Jim Marous (16:46):

How many of you have opened a new account in the last two years from an alternative financial institution? Be it Chime, SoFi, Robinhood, maybe Acorns, maybe another checking account program. How many of you opened an account within the last two years? Okay, keep your hands up.

Jim Marous (17:04):

Look around the room, everyone, I'm going to keep on doing this until we all resonate this whole thought. This is what's happening in your organization with your members, your customers. This is called silent attrition.

Jim Marous (17:15):

Your customers are finding alternatives to what you can provide. You talked about your automated saving program. So, if I had Acorns for instance, and I do have Acorns and I'm really jazzed about the amount of business I'm doing with them, and I'm building my first savings account ever, now that my son's graduated from college, because I don't have to worry about next tuition, which I won't even talk about your tuition bills, but that's the side of the point.

Jim Marous (17:38):

The reality is how do you help make it so you stop that attrition? Do you monitor flow of funds? Do you try to see how your members are actually doing their daily lives and how you can make it better for your members?

Dennis Devine (17:53):

We do. Well, I mean, so I shared the one example. So, of course every good financial institution is going to know well, it's flow of funds. We all know that deposit growth disproportionately in any short period of time comes from your existing members. Your existing clients are bringing you additional funds. All of your clients have other financial relationships and finding ways to bring those experiences.

Dennis Devine (18:16):

But yeah, where you have new memberships and a traded memberships is something that you're going to manage very closely and that's why digital experiences become so very important. Because if all it is, is a rate, then folks will pick one rate and then as soon as the rate's lower, they'll pick another rate.

Dennis Devine (18:34):

I was surprised (I've been at Alliant now for about four years), at when you can attract somebody who picked you for the right reasons. And I'm guessing as we spend time together, there's a number of you that don't know Alliant very well.

Dennis Devine (18:48):

You do a little bit of research, you find, “Holy cow, this does seem like a much better deal.” You give it a try, you experience. We have no competing priorities. Our priority is that digital experience and it feels like a good one.

Dennis Devine (19:03):

And there's no tricks. This rate is the same rate, it's not going to come down because it was some promotion that cohesive experience causes the retention rates to be way better than I would've even thought.

Jim Marous (19:19):

So, you've had to continually upgrade your digital platform because the competition has changed their digital platform. You also have no branches. So, if you don't do well on the digital platform and make your members feel that they're getting not only a good experience, but they trust you and you have credibility because they can't walk into a branch to complain, you don't have that capability.

Jim Marous (19:43):

So, how have you built out this experience over the last four years? How have you made it a better digital banking experience?

Dennis Devine (19:54):

That's interesting. Everybody that has a branch knows at some level it becomes a catchall. It's like, it could be for risk reasons, it could be for policy reasons. It could be just because it got complicated. Well, we'll just have them go to the branch. I know for years my teams would do that. It'd just become a catchall.

Dennis Devine (20:10):

And you wouldn't design it that way, but it's okay, we're going to go ahead and do it that way. We don't have that option, which means everything we do has to be digital. I think the question of trust is an important one.

Dennis Devine (20:23):

The demographic trends are clear. Thousands of branches have closed every year since 2009. So, folks become more and more comfortable. And there's no doubt, there's not one financial institution model that's going to serve everybody in the country these days.

Dennis Devine (20:41):

But most folks are becoming more and more comfortable with digital. Telephone becomes very important. I know that's true in every one of our organizations. Every new class of member care consultants I spend time with, and I tell them, "With no branch, this becomes the face of our institution. And you become increasingly the face that they think about for trust." And so, we invest a lot in that experience and making sure it's great.

Dennis Devine (21:04):

And then maybe one, just slightly more controversial notion. I think there is the idea that trust has to be a human interaction. A lot of times when folks are visiting branches and I’ve with branches for decades, for decades, you'd be surprised how few financial wellness conversations are occurring day-to-day in branches. It's typically maintenance issues. It's different escalations of different servicing issues. Same would be true in your contact centers.

Dennis Devine (21:35):

Automation and ease is an amazing builder of trust. When people find that the experience is excellent, that they didn't have to pick up the phone or reach out, that the net promoter scores are higher than ever. And that that is a great way to build the foundation of a long-term sustainable relationship itself rather than forcing them to go down a path that they didn't want to.

Jim Marous (21:58):

How do you cross-sell using the only digital channels? Because we've seen that obviously with humans, and you get a person in the branch, you have more time with them. You can cross-sell easier. How do you do that with a digital platform only? How do you improve upon cross-selling?

Dennis Devine (22:13):

Well, that's excellent. And so, I think folks are going to resonate with this as well. You can train people to be excellent at profiling in the context of retail banking. But you're now getting the variability of whether it be the hundreds or the thousands of employees that you're now interacting with.

Dennis Devine (22:36):

In a digital environment, you can bring the power of data to know why is that person there, what are they trying to accomplish? What does the rest of that relationship look like? And our best CRM systems in a distributed retail network and database are bringing ideas to the RM to be able to deliver.

Dennis Devine (22:54):

But you can just do that in a digital environment or reach out to them in the onboarding experience or reach out to them when they just called in. So, the power of data and presentment across the digital channels is an excellent way to make sure that you're personalizing the experience in a way that's right for the member. And it's one that is going to be presented at the right time consistently and thoroughly.

Dennis Devine (23:20):

And so, we find that we're able to do that pretty effectively with the power of data in digital in ways that sometimes it's hard to do consistently in a distributed retail network.

Jim Marous (23:32):

So, I'm going to do it hypothetical. You've got to learn back to a traditional financial institution for some way, shape or form. What is the first thing you do knowing what you know is possible now in a digital only environment with the advantages you have?

Jim Marous (23:49):

What would you do if you were to go back to X, Y, Z bank from the past, legacy bank, knowing that most legacy banks are about the same spot with regard to digital transformation? What's the first thing you'd make sure to go, "This is instrumental to us becoming a better financial institution immediately."

Dennis Devine (24:08):

So, I would be very purposeful about digital first. Most legacy financial institutions started the opposite. They started with an alternative channel, branch was the dominant channel, RMs, financial advisors and digital was the alternative.

Dennis Devine (24:26):

And it's been tough for decades to kind of get the change management to move so that folks don't want to send them to digital, they want them to come into the branch. Folks don't want it to go digital because sometimes there's different lower costs that way, they want it to make it to the arm. And so, there's that natural resistance.

Dennis Devine (24:43):

I think if I were hypothetically part of a traditional financial institution, I would start with the premise of most of our customers are visiting us digitally more than they're visiting any other channels. Let's make that experience astonishingly good.

Dennis Devine (24:59):

Let's make the investments that are necessary for that to be a core strength of ours and then let's supplement that with purpose. Why would they visit a branch? Why would they visit a contact center rather than the opposite, which is let's try to build out all those channels and have digital as a supplement.

Jim Marous (25:15):

It's interesting because in each one of the interviews we've done today and the innovation workshop I did yesterday, we've had the key presenters, the people that I've been interviewing in one way, shape or form, say, "We've got to get the basics right, really right."

Jim Marous (25:32):

We can't move to the next thing and say, “What are we going to do in gen AI and not have a good digital account opening experience?" And anybody who's been in all my sessions is bored to death on my comment about new account opening.

Jim Marous (25:43):

But I said in the last session, “I don't want to spend any money on marketing trying to generate new account relationships.” And so, I fixed the process so that the marketer can actually be effective. And to your point, unless I have a really good open front door with a good digital banking experience, which I consider the most basic of basic things, there's no reason for me to go any place else yet.

Jim Marous (26:06):

And then you talk about the purpose side, which is how do we show the consumer that we have empathy, that we're listening? Because we don't do that very well. I mean, I've given case studies of buying a Jeep and sending out all kinds of signals.

Jim Marous (26:19):

I was buying a Jeep and not one of my financial institutions reached out and said, "I'll help you." But every dealer and every manufacturer said, "Hey, we'll help you." Because we don't collect the data. We tend to try to jump from point A to point Z instead of doing the progression.

Jim Marous (26:35):

One thing you've done recently and continue to do is you try to hire strong at your organization to leap forward on what you're already doing. Do you have an example of how you've tried to hire beyond what you would normally think you'd hire in a normal financial institution?

Jim Marous (26:52):

Basically, because digital expects a whole lot more perfection and future vision to say, "Where do I want to end up 24 months from now?"

Dennis Devine (27:04):

Well, I'm blessed to be part of a really terrific team, and it's a group of folks. And by the way, the empathy piece, it's funny you should say that. My wife and I have three boys. The youngest just graduated from high school this week, and I'm going to bring that back to him and remind him that you think I'm empathetic as he's doing his, “Dad, what do you mean I got to get a job this summer,” speech.

Dennis Devine (27:30):

We're blessed with a great team of people that are driven and attracted by the purpose that we have. It was true for me; I didn't know much about Alliant after having spent a couple decades in the industry in retail financial services and was astonished by it.

Dennis Devine (27:43):

And so, the background of the people on our team are most of the large financial institutions are part of our team now. Leading marketing and digital, leading our product and operations functions. Actually, our board has term limits. And so, I might actually point to the board as another example of trying to bring the very best to an institution like ours.

Dennis Devine (28:09):

Our board has term limits and so, naturally, when a board member hits the term limit at 10 years, we say the board member graduates, we celebrate and we bring some new members on. But we just reflected on the fact that the last four board members that have joined this $20 billion financial institution are retired chief risk officer of one of the largest banks in the country.

Dennis Devine (28:33):

The just retired global treasurer of one of the largest banks in the country. The current chief digital officer of one of the largest retail brands in the country, not in financial services, but to push our thinking around how do we get better and better at digital. And the just retired head of service ops for one of the largest Canadian banks who before that spent time at Google and was a senior McKinsey person when I was there.

Dennis Devine (28:57):

And so, there is an ability when you have a purpose driven institution that is doing really cool things in the digital financial services space to attract people that want to be part of a mission like that, even as they're just getting to know us.

Jim Marous (29:12):

What I'm hoping everybody who's in our audience today understands is no, they're not going to be able to get rid of all branches overnight. They're not going to be able to do all the accomplishments you've done in that way. But we're all trying to become more digital.

Jim Marous (29:26):

We're trying to build something that says, "We're going to be able to serve our customers better, our members better in both the digital channels and our branch channels in those examples." In addition, this wasn't like a recruiting tour to say, "How do we get us all to get out of our organizations, go to digital organizations?" But it's possible.

Jim Marous (29:46):

I do believe that if you went back to any of the organizations you had been with before, you would very quickly stir up and change the whole mentality of the length of time it takes to make change happen. Because it's not about the size of the organization, it's not about digital versus non-digital, it's about mindset.

Jim Marous (30:04):

In fact, I think some of the transfers from organization to organization were caused by the lack of ability to make change happen. But I think we all have to leave this, I said it yesterday in my innovation workshop.

Jim Marous (30:17):

Unless you as individuals and organizations embrace change and take risks and disrupt the way business has been done in the past, unless you get out of your comfort zone of what's always worked but use that comfort zone to empower you to do more.

Jim Marous (30:33):

I mean, you've done it. You have a long legacy of financial institution relationships and things you've done that you didn't let go of that.

Dennis Devine (30:44):

Well, none of us like change. And we might say, "Hey, we like it," but then something changes in the neighborhood, or your favorite restaurant closes or your favorite musical venue, whatever it is. I think the key in this digital, and there's no institution that's not undergoing some version of a digital transformation right now for sure.

Dennis Devine (31:07):

It's helping people see why this is exciting for everyone. It's just honest change management discussion. So, when I talk with someone on our team around, "Hey, what's this going to look like if we think about a partnership here where we used to only develop it ourselves."

Dennis Devine (31:22):

I say let's spend a little bit of time with the partners, get to know them and talk about the possibilities, the speed we can work with, the creativity that we can bring to solutions, how it's going to further grow your career, rather than feeling like you're locked into some legacy tech stack that probably isn't where you want to be long term anyway.

Dennis Devine (31:42):

And so, I think it's natural for people to wonder but it's also quite easy to, and especially because some of the digital and automation solutions have with them as a natural benefit of automation and reducing manual touches.

Dennis Devine (31:56):

But we're all hiring so many folks that sometimes yeah, maybe we'll slow down the hiring a little bit, but we're going to take the folks that are in those roles and they're going to see great new opportunities time and time again. To me, it's amazing to see.

Dennis Devine (32:08):

At our organization we have a quarterly get together with the entire organization. I bet many of your teams do. One of the things we never fail to do is to recognize the promotions that are occurring across the company every single quarter.

Dennis Devine (32:23):

Because it's amazing the number of people that started in one role, and it might have been historically an operational process or a member care team, all of which we're trying to bring the power of digital to, and now they're leading digital squads or they're leading some of our product teams. And that kind of growth, I think is exciting for folks if you help them see where it can come.

Jim Marous (32:45):

Any questions from our audience? Because we have about three or four minutes we have to break, but any questions at all? Yes.

Female (32:55):

Has your core system or how have you gone working around your … credit union too? I've been in the credit union industry for 35 years, and that's been a huge hurdle and I was just wondering your experience.

Jim Marous (33:11):

So, the question, since we can't hear that behind the camera, the question was how do you work around or work with your core systems? How do you digitally transform and innovate, if I have it right, when you have an existing core system that has a contract that's really tough to get out of, as you all know?

Dennis Devine (33:30):

The technologists are going to make fun of me for not being as sophisticated in answering this question. So, Alliant's been around for nearly 90 years, and so we've got a legacy core system that you would know well. And nevertheless, we're able to do the things we want to do.

Dennis Devine (33:44):

We have invested in making sure that there's a good integration layer with APIs so we can make as many connections as possible and to make sure that there's much less over … and this takes a period of years much less direct connection into the core for the things that we want to do.

Dennis Devine (34:00):

Everything that's legacy connected that way is complicated, it's complex. It's more likely to be buggy when we want to go with releases. It takes a lot more testing. And so, it's a period of change over a period of years to think about that decoupling and modernizing given that historic relationship but commit to it and it's doable and you start to get really excited about what's possible on the other side.

Jim Marous (34:24):

And another thing is don't be afraid to double invest in a solution. Your core is going to tell you almost any solution you come up with to be a better digital organization, they're going to say, "We can do that." However, I love the cores. They're all good. They do really well with what they're good at.

Jim Marous (34:42):

But downstairs you're going to find organizations that can get you to your solution in three months instead of two years and are being paid to be the best in market. So, that's what's interesting about what's happened over the last four or five years.

Jim Marous (34:56):

These composable solutions, if they aren't the very best at what they're trying to do, they will go out of business almost as fast as they grew. And I think that's what's so different where when you worked with cores, they have to juggle a whole lot of priorities. And if you're a small organization, as many of you are, you don't get the amount of attention you really deserve.

Jim Marous (35:16):

I will guarantee you the people downstairs and I promote them on an ongoing basis because I think the only way that a small organization can grow at speed and scale is using these composable solutions that may duplicate what your core says they can do.

Jim Marous (35:29):

That's a selling process. But if your new partner says, "Here's what I can bring you from a return on investment, I guarantee you should be able to get the funds because you'll end up in a net positive, which is a big deal. Any other question? Yes.

Female (35:47):

You've talked a lot about purpose driven and digital and as a digital credit union that doesn't have a strong connection to a seg or even really a defined geographic community, how do you discuss your purpose online with your member base?

Dennis Devine (36:05):

The question was as a national digital credit union without a direct connection into any given community or any particular employer, how do we talk about purpose with our membership, with our customers? Twofold, I love that.

Dennis Devine (36:21):

The first is we exist for them and to disrupt banking for good by serving our members. And so, we say to our members, five U.S. financial institutions hold 50% of all U.S. deposits. They disproportionately make their money through paying low rates so that they can grow an interest margin and growing fees, which is now a political issue.

Dennis Devine (36:46):

With Alliant, we're making conscious choices every day, which they see that are different than that so that they can build those experiences. And occasionally, one of them might call me and say, "Hey, what about that branch?"

Dennis Devine (36:55):

And I'm like, "It's a fair point. If you need a branch, we're not for everyone, but think about who's paying for that branch." It's not you and look at the value and the experience that you're having.

Dennis Devine (37:04):

The second is our brand DNA is organized around savvy members. You've got to be thoughtful and digital to want to be an Alliant member served by savvy employees. Our team, selfless, we're in it for them. We're not in it for shareholder return.

Dennis Devine (37:21):

And the third is socially responsible. We've massively increased the scale of our foundation efforts with one particular mission, which is to bridge the digital divide and improve digital equity in our country.

Dennis Devine (37:34):

There is an enormous number of people, often our neighbors who don't have access to high-speed broadband, that don't have access to the devices or the skills to be able to use them or the confidence.

Dennis Devine (37:47):

You probably think of people even in your family who are not as confident as they can be, and that keeps them not just from the financial services that they want, but it keeps them from making doctor's appointments or from attending school.

[Music Playing]

Dennis Devine (38:00):

And so those two pieces, which is how they're going to feel as a member of the credit union, both for the experiences they have in making financial services better for good, but also the social impact from the digital inclusion mission is a consistent theme as we talk with our members.

Dennis Devine (38:16):

And one thing we did talk about Jim, is we measure success on the basis of the returns our members are getting, but our net promoter scores are twice bank averages and those are the true Norths for us in terms of how are our members feeling about being an Alliant member.

Jim Marous (38:31):

Great. Thank you very much for being our guest today. Thank all of you for being part of the first wave of live podcast we've done. It makes it a whole lot different when you have an audience like this. I usually am in a very small office with padded walls, literally padded walls.

Jim Marous (38:48):

We're going to be going live with this series of podcasts. Each one has been unique. Each one builds on the other from the standpoint of digital transformation. If you kind of close your eyes a little bit, you can take any of these engagements we've had and apply them to your organization. So, thank you so much for being part of this. Appreciate it. Thank you.

Dennis Devine (39:06):

Thank you very much.

Jim Marous (39:07):

We hope you enjoyed these candid conversations sponsored by Microsoft. Microsoft enables digital transformation for the era of intelligent cloud and an intelligent edge. Its mission is to empower every person and every organization on the planet to achieve more.

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