Inner Circle - January

2015… Preserve the Core, Stimulate Progress

I’m pleased to report 2014 was another successful year for Logix. We ended the year with record-high member satisfaction scores, close to $1.2 billion in loan production, our 12^th-consecutive year with the highest performance rating among all credit unions (as measured by Raddon Financial Group), a host of improvements in online banking, mobile apps, mortgage and home equity products, credit cards and other programs; plus, we opened a new branch in Chatsworth, and generated industry-leading financial performance.  All of these accomplishments provide value, convenience, or added security to our members.

Without a doubt, the credit union’s success is a direct result of support from loyal members, so it’s only right that we share our success with those who support Logix with significant relationships; so, as has been the case the past two years, the Board of Directors has once again approved a multi-million dollar loyalty dividend payout in early 2015.

What else should members expect in 2015? In brief, more of the same, but with a number of new initiatives to ensure we remain relevant. To paraphrase Jim Collins, author of “Good to Great,” to sustain success over the long-term, great companies must maintain the core strategy that made them successful in the first place, but must also constantly improve at the margins.  Collins uses the short-hand term, “Preserve the Core, and Stimulate Progress.”

What remains the same for Logix in 2015 is adherence to our core strategy, which ensures we generate sufficient income to offer exceptional value to members in our products, service, and convenience.  Our strategy calls for rigorous control over operating expenses, yet we know we must spend more in technology, and are committed to adding a significant number of new employees to ensure appropriate service levels, particularly in response to anticipated growth in the number of members.

We will also continue our focus on the service experience that now has our Net Promoter Scores at over 90%, an astonishingly-high result.  This strategy starts with employees who possess the right attitude about service, and includes sufficient training to ensure consistency, regardless of the channel or employee involved.

The narrative above summarizes how we will preserve our core.  To stimulate progress, we are committed to pursuing the following “must do” initiatives in 2015

• New Headquarters – we will soon decide whether to buy a larger building in another location, or add capacity on our existing site.  Once this initial decision is made and, if applicable, the appropriate property purchased, we will begin planning for construction or remodeling.

• New mobile platform – we executed a contract with one of the world’s premier mobile banking software providers, and will this year offer a new and improved smartphone app, as well as a tablet app.  The new apps will eventually offer many new features and place Logix in a leading position with our mobile banking offerings. 

• Chip Cards – otherwise known as “EMV” cards, the addition of chips to our cards will increase data security.  It will also ensure members are able to use our card in areas (such as Europe and Canada) where chip cards are the standard for in-person retail purchases.

• Apple Pay – Late last year, Apple offered iPhone 6 users the ability to use their phones for point-of-sale payments at certain retailers, but only in conjunction with cards issued by select financial institutions.  We intend to be among that group of institutions, and have already begun the process to make that happen in 2015. 

• Online Banking Enhancements – I believe our Online Banking offering is already among the best in our industry; but we still have a sufficiently-large backlog of enhancements to fulfill.  As was the case in 2014, we will continue to see incremental but material improvement in our Online Banking system.

• Business Services – We’ve discussed this issue for years, but want to make sure we get it right.  In 2015, we will update our analysis and determine exactly what business services we will offer, as well as the resources required to make that happen, possibly in 2016. 

• Sales Office – This is another issue that requires a great deal of technical, operational, and strategic planning.  Some Logix branches are so busy that members cannot get appointments at convenient times, or must face long waits in the lobby.  To offload some of this demand, we will experiment with a sales office near a busy branch.  This will be smaller than a standard branch, and will house Financial Service Officers, but no “live” tellers.  Instead, we will have either high-powered ATMs, or ultimately, Video Tellers that allow members to interact with real employees located at our headquarters. 

• New branches – We’ve already executed a lease for a new branch in Porter Ranch, with opening estimated for May. We also plan to add another branch in a yet-to-be-determined location of our market area, possibly in Simi Valley. 

Of course, every year, situations occur that cannot be predicted, but to which we must react to protect the interests of our members and the Credit Union.  These could include changes in the rate environment, demand for real estate, or some new technology or product that affects our markets.

It certainly appears that 2015 will be another busy and productive year.  I’m hopeful that one year from now, we will look back and see tremendous progress made in virtually every area of the Credit Union.  Thank you for your continued membership. I look forward to another successful year of returning value to our members.