Best workplaces 2006: On the money - Vancity

Progressive workplace policies have helped turn Vancity into Canada's largest credit union.

Vancouver | financial | 2,000 employees

Vancity chief operating officer Ian Warner and his colleague Kari Grist, the vice-president of marketing, arrive at the Fraser Street Community Branch in East Vancouver at 8:30 a.m. It's an hour before opening, and only a couple days after the last-minute RRSP crush, but branch manager Gerry Collins and all 27 of his staff are already waiting, chatting quietly over a light breakfast on Vancity-red paper plates.

Executives never quite know what to expect when they walk through the door on these branch visits. Twice a year, Vancity's 15-person senior management team divvies up the credit union's 60 divisions — including 46 branches in B.C.'s Lower Mainland, Fraser Valley and Victoria — and travel in pairs to sit down and talk with all 2,000 employees. Neither Warner nor Grist have ever been to the Fraser Street location, so they're not sure what they're getting into. “Each branch is a little different,” says Warner. At one meeting this year, the COO was cast as the star witness in a mock inquiry into company practices, which was presided over by two employees acting as “justices.”

This occasion turns out to be more sedate. The group quickly settles into chairs set out in the main customer area. They let out a cheer as Grist congratulates them for beating their RRSP-season targets. She then hands out two shades of Post-it notes. The employees break into small groups and, on the yellow squares of paper, they note what work initiatives or accomplishments they're proud of; on the blue, they write questions or concerns. “Anything goes,” Warner says. “We don't have anything prepared. Any questions are fair game.”

The positive comments that follow come as no surprise. Vancity (formally Vancouver City Savings Credit Union) is widely recognized for supporting many community-related and environmental causes, and that clearly resonates with employees. Likewise, its progressive workplace policies, such as tuition reimbursement of up to $2,400 a year and other training initiatives, are also lauded. But often, the most important thing for a manager to do well is to address problems, so talk quickly turns to the blue Post-it notes. One staffer is concerned that lineups are long because the largely South Asian immigrant community in the area doesn't read English well enough to use the ATM for simple transactions. Someone else wants to discuss mortgage rates and how they stack up with nearby banks. The burning question, though: When is the branch slated for the renovations that are being gradually rolled out?

Warner and Grist, of course, don't have all the answers. But as awkward as such visits can sometimes be, they have become a critical way for senior managers to connect directly with employees. Vancity puts a lot of effort into internal communications — and listening. Employees are not an afterthought. Just like its clients, they are one of the key groups that Vancity strives to impress every day.

With $11.8 billion in assets and 330,000 members, Vancity is Canada's largest credit union. But it's still dwarfed by the financial clout of the Big Five banks. Vancity tries to differentiate itself through its service, and even takes on what CEO Dave Mowat sees as an “advocacy role” — promising to get the best deal for its members. Of course, all the banks claim to “put clients first,” too. So Vancity has to prove it in subtle ways. “If you walk into our branch and get a mortgage,” says Mowat, “you can feel that difference, in how you're treated, the language we talk to you in, the respect we have for your business.” But that strategy, he emphasizes, is only effective if employees buy in. “People have to believe.”

Vancity's focus on employees shows up in unique ways. Take its executive compensation model. It's based on five equal performance measures, one of which, naturally, is profitability — but that accounts for only 20% of the total, because, as Mowat sees it, financial results reflect events already past. To gauge its current health, Vancity tracks membership growth and the depth of its relationships (the number of accounts and their size). A fourth measure is member satisfaction, based on a survey sent out every year to some 40,000 people. The feedback has a tangible financial impact: members who respond in surveys that they are “totally satisfied” — 5 on a five-point scale — have, on average, four-and-a-half times the amount of business with Vancity than those who circle 3, for “satisfied.” The only way to boost those member-satisfaction scores? Employees. So the final fifth of an executive's compensation is based on employee surveys. “That's the secret sauce,” says Mowat. “But it's super hard. Execution is everything. It's a whole lot more challenging to manage and motivate humans than it is turning on a computer every morning.”

Communication is critical, Mowat stresses. “There is so much stuff that's misunderstood in an organization, and there is even more stuff that's just not known about.” So Vancity takes as professional an approach to communicating internally as it does externally, with the equivalent of four staffers dedicated to the job. Their efforts are managed strategically — for instance, they distribute memos in weekly e-newsletter briefs instead of a barrage of daily e-mails, and post short stories about employee and community achievements in lunchrooms and elevators. The staff intranet, Insite, is an expertly designed, plain-language repository of all things Vancity. It includes Discoveru, an extensive resource for career planning that allows employees to map out their professional development.

Annual employee surveys are scoured for meaning and opportunities to improve. In 2004, the survey showed that while overall engagement scores were 77% — among the highest in North America, according to the consultants — only 63% of employees felt they could voice their opinions. The executives were stumped. So Mowat turned to the Employee Advisory Committee, a group formed 20 years ago with a representative from every branch and department, to offer ideas. Committee members were asked to gather stories about experiences in their workplaces.

What they reported back was that loyalty to teams at Vancity is so strong that individuals are often reluctant to offer opinions that counter perceived consensus. The executive team, in response, set itself a goal to improve employee voice — and even wrote a four-point commitment statement. Since then, they've launched efforts to recognize people who speak up, and a program called “Courageous Conversations” that teaches managers how to engage employees in open dialogue. Mowat wrote an all-employee letter to express his personal surprise about the problem — and what management was pledging to do about it.

But there is likely no greater evidence of Vancity's trust in the role of employees than how it used their ideas to update the company's public face. In late 2003, the credit union undertook an 18-month process in which employees and members were asked what they felt makes it special. From that, themes emerged that were collected into the Story of Vancity, a 48-page book that now informs everything from executive decisions to Vancity's branding and advertising. It's also a template for how everyone — from members to front-line tellers, right up to Mowat — talks about the organization.

In fact, as the CEO sees it, those initiatives resonate only because Vancity's culture stresses that success starts with employees. “We don't do it to be nice and win awards,” says Mowat. “We're doing it because our ability to compete with companies 35 times as big as we are rests in the fact that when somebody walks through our door, an employee will walk up to them and treat them really well, treat them with respect. And that makes us money.”

At the Fraser Street branch, Ian Warner and Kari Grist do their best to field questions with frank responses. Some ideas seem to stick, like posting a branch renovation schedule on Insite. And what they don't know, they promise to look into. As 9:30 nears, the staff grows restless — a lineup is forming outside the branch. Warner and Grist know it's time to go — and let the Vancity employees do what they do best.