Building The Case For Innovation
CU Management
Alex Hsu, CCM, wins the 2021 CUES Emerge competition based on his framework for an innovation center of excellence.
The business world is rife with examples of companies that have passed into oblivion because of a failure to innovate. Think of how Sears withered when it was unable to respond to Amazon, or how Blockbuster was caught flat-footed against the online streaming revolution that vaulted Netflix to a ubiquitous presence in consumers’ lives.
Alex Hsu, CCM, observes that credit unions can learn an important lesson from these well-known business failures. “As a movement, we have to be able to innovate to counter similar threats posed by fintechs and megabanks,” says Hsu, VP/planning and change management at $26 billion SchoolsFirst Federal Credit Union in Tustin, California. “Unfortunately, innovation too often gets treated as an afterthought and ends up on the back burner. I think we all need to increase our urgency regarding how fast we innovate. It’s imperative to our survival as financial institutions and the right thing to do for our member-owners who are looking for new products and services that meet their changing needs.”
Hsu made a strong business case for formalizing the innovation process during the final phase of the 2021 CUES® Emerge program. Sponsored by CUES and CUES Supplier member Currency, this year’s program featured a cohort of 32 up-and-coming credit union leaders who had the opportunity to further their knowledge in virtual classroom courses, mastermind sessions and peer collaboration sessions that guided them toward the development of a business case. Hsu was one of five Finalists selected from among participants to present their business cases in a live online pitch show in October, which culminated in his selection as the 2021 CUES Emerge winner.
An Adaptable Framework
Hsu tailored his pitch around creation of an Innovation Center of Excellence, an adaptable framework that can be scaled for use at any size credit union. “The key feature of the Innovation Center of Excellence is to create a team that is dedicated to innovation projects and formalize some of the efforts that are already underway,” Hsu says. “It could take shape at a credit union in a variety of ways. At SchoolsFirst, we have an established project management office, so it would be most appropriate to place our Innovation COE under that existing department. At other credit unions, it may make more sense to create a new business unit. The framework offers enough flexibility for credit unions to set it up according to the needs and resources they have.”
SchoolsFirst FCU, which serves 1.2 million members, is the largest credit union in California and the fifth largest in the United States. With approximately 2,600 employee team members, the credit union is brimming with innovative ideas every year. Under the auspices of the Innovation Center of Excellence, Hsu foresees a mechanism for SchoolsFirst FCU to harness the people, processes and technology to bring the best of those ideas to fruition.
“I envision the Innovation COE as a cross-functional effort,” Hsu says. “It’s not the sole responsibility of IT or technology vendors to drive innovation. We all need to have involvement, with sponsorship coming from the highest level of the organization in the C-suite. Executive support is critical to enable strategic, transformational change.”
Innovation has been a strong focal point for Hsu throughout his professional career. Prior to coming to SchoolsFirst FCU in 2017, he gained management and leadership experience at several major companies, including Deloitte, DaVita and AECOM. At SchoolsFirst FCU, he currently leads a team with responsibility for strategic planning and project execution.
“I’ve been really fortunate to work with incredible leaders here at SchoolsFirst,” says Hsu. “They were very supportive during my CUES Emerge journey.”
Among those offering support were Hsu’s boss, Kevin Martin, CCE, SVP/organizational performance & strategic planning. “When Alex approached me about applying for the CUES Emerge program, I felt it was a great opportunity to showcase his written and presentation skills,” says Martin, a CUES member. “Alex is a lifelong learner, and someone who is able to take any new learnings and put them to good use for the benefit of our organization. The Innovation Center of Excellence business case was an excellent example of taking relevant concepts and proposing ways to drive innovation not only for SchoolsFirst FCU, but also for the overall credit union movement.”
Also lending support was CUES member Jose Lara, CCE, SchoolsFirst FCU’s COO, who applauds Hsu’s initiative and drive to improve member service. “Alex was thoughtful and inclusive when developing his idea for the CUES Emerge Program, really wanting to make an impact on business processes,” Lara says. “His idea for an Innovation Center of Excellence to help bring products and services faster to our members will help SchoolsFirst FCU and potentially the larger credit union movement compete in our quickly evolving industry.”
A Passion for Education
As the CUES Emerge winner, Hsu receives a valuable prize package, which includes registration to the CUES Advanced Management Program from Cornell University and executive coaching from CUES Supplier member Envision Excellence (envisionexcellence.net).
Hsu already has impressive education credentials, which include a bachelor’s degree in international business and marketing management from California State Polytechnic University, Pomona, a master’s degree in Information Systems from California State University, Fullerton, and an MBA from UCLA Anderson School of Management. Additionally, he earned a professional certificate for Strategic Decision and Risk Management from Stanford University (stanford.edu) and an Executive Certificate of Strategy and Innovation from MIT Sloan School of Management.
“By participating in the CUES Emerge program, I also was able to earn my Certified Credit Union Manager designation, which added even greater value to the program,” he says.
Hsu left the CUES Emerge program feeling enriched by the experience. “It’s an outstanding program that I would recommend to any up-and-coming leaders who are looking for an intellectual challenge and who want to extend their network. I’m still relatively new to the credit union movement, but at the end of the program, I felt like part of a community.”
Having received recognition as the CUES Emerge winner, Hsu hopes his business case will inspire credit unions to prioritize innovation. The risk of not doing so is far too great.
“As a movement, we don’t want to suffer the fate of the companies that did not keep up with the innovators,” he says. “Our challenge is to continue to provide the wonderful products and services that our members expect but also maintain a pace of innovation that will sustain us in the future.” cues icon
Based in Missouri, Diane Franklin is a longtime contributor to Credit Union Management magazine.