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On Anniversary, Catalyst CEO Garner Reflects on Culture of Innovation
Tuesday, March 29, 2016 6:30 AM

"Same old, same old" is not an idiom that describes Kathy Garner's tenure as the president and chief executive officer of Catalyst Corporate Federal Credit Union. Taking the helm in 2012, Garner cast the vision for a new corporate and led the charge for success with a new business model.

Celebrating her fourth anniversary as Catalyst Corporate's CEO this month, she can look back at those formative days and appreciate the progress made through the collective efforts of a growing membership, a dedicated group of volunteers, and the staff of Catalyst Corporate.

Much of that progress was the direct result of Catalyst Corporate's new business model, which places less reliance on balance sheet activity for income, according to Garner. "Living in a low-interest-rate environment, we can no longer rely on interest income to cover operating expenses," Garner said. "We have to generate fee income, and that is tied directly to our ability to provide our members with products and services that have value."

This is the point where problem solving began to grow into something more for Garner. If Catalyst Corporate's future success depended on its ability to provide products and services of value, it made sense to create and foster a culture of innovation within the organization.

Garner had been engaged with Filene Research Institute's early i3 groups, think tanks known for developing new ideas to meet challenges faced by credit unions, so she contacted Filene about bringing the program to the corporate.

In 2014, Filene launched its first round of i3 training for 16 Catalyst Corporate employees. After working through Filene's framework for innovation, several ideas emerged for new credit union services. One of those ideas, Checking with Benefits, was introduced as a new service for Catalyst Corporate members in 2015. The mobile rewards program, tied to credit union checking accounts, already has 10 credit unions enrolled.

Catalyst Corporate repeated the innovation training, now known as Catalyst Innovation Groups, in 2015. Three of the ideas that emerged are being evaluated as potential services: marketplace lending platforms, an ACH data mining platform, and a human resources tool for credit union and SEG employees, which is currently being beta tested by Catalyst Corporate and several member credit unions.

A third round of the formalized innovation process has begun for 2016, and Garner is interested to see what ideas result. "New this year is participation by credit unions," she said. "We are always looking for ways to collaborate with other credit unions, business partners, and corporate credit unions to deliver new efficiencies and services. We have invited credit union professionals into the mix in 2016, knowing they will bring important insights to the process."

"Innovation at Catalyst Corporate is not new," Garner added, "but the formal process that gives employees the opportunity to brainstorm together, research, and test ideas is new. It is creating a culture from top to bottom that is focused on engaging all employees in research and development."

Garner points to other significant Catalyst Corporate innovations, including a new overnight sweep trading platform and a vault cash forecasting tool soon to be introduced.

She is quick to add, though, that innovation comes in small and large packages. "It is often the ongoing small service enhancements—a better way to get a report or file, for example—that make credit unions' lives easier. Our staff is constantly taking action on feedback we receive from member surveys. In fact, we have posted 16 of these 'small' service enhancements on our website in the past year."

Garner praised her team's ability to bring new products to market. "We have smart people, and we execute good ideas. I see our ability to bring ideas to market as one of our core competencies."

Innovation is not always easy, Garner admits, particularly for a credit union. "Efficiency is paramount at Catalyst Corporate, and we are not naturally open to risk. But we have to innovate. To thrive, you need both efficiency and innovation. That's why we've put a structure in place to bring those ideas forward. It takes the right platform to make innovation happen."

Garner has seen the culture of innovation at Catalyst Corporate take root and continue to evolve. Results have been so positive that the organization recently dedicated a full-time employee to direct the company's innovation strategy, with a goal to develop additional pathways to innovation by involving all Catalyst Corporate staff, as well as its members.

Garner noted that not all good ideas that arise can be pursued, at least not immediately. "Some ideas are not a good fit for our mission," Garner said. "You have to decide where you can dedicate your limited resources. There are also ideas that are good, but the timing may not be right. That's when you put them on the shelf to pull out later."

Garner admitted that she doesn't often talk about innovation with the nearly 1,400 member and client credit unions that now use Catalyst Corporate services. When she mentions new products, however, she has their attention.