While the concept of collaboration within the credit unionmovement has been discussed for many years, technology CUSOs are arelatively new breed. More and more of these CUSOs are forming as away to help more CUs get the most out of a particular core system.Here's a look at how Bethpage Federal Credit Union and BellcoCredit Union have taken advantage of opportunities forcollaboration between the two credit unions via their OpenTechnology Solutions CUSO. The leaders of both credit unionsrecognized the potential benefits and risks associated withcollaboration, but approached the relationship with a commonphilosophy. Systems or applications that were “must haves” wereidentified early in the relationship and agreement to utilize theseapplications was reached quickly. In those business areas where oneor both credit unions were not particularly tied to a specificvendor or product, options from both credit unions were discussedand a plan for selection was prepared. The selection process forspecific functions is driven by the need to select the applicationthat best satisfies the combined requirements of both creditunions. This approach means that, from time to time, the “perfect”application for one credit union might not be selected because itdoes not adequately support the requirements of the other creditunion. This concept is readily embraced and espoused at the CEOlevel in both organizations. Prior to forming the CUSO, both creditunion partners dedicated significant time to the development of afive-year business plan to guide the collaboration processes of thenew CUSO. Strategic direction, specific products and services to beoffered, cost and revenue projections and SWOT (Strengths,Weaknesses, Opportunities and Threats) analyses were all developedand challenged to ensure that both credit union partners werecomfortable with the overall approach for the organization. A keyarea of discussion dealt with the operational governance of theorganization. While the concept of collaboration is a popular topicwithin the credit union movement, unsuccessful attempts tocollaborate can typically be linked to insufficient or inadequategovernance. A comprehensive operating agreement was developed thatclearly spells out how the organization will be managed, whatauthorities are provided to the manager of the organization versuswhat authorities are reserved for the board. The agreement wasstructured so as to ensure that current and future members of theCUSO have equal representation on the board and that unanimousvotes at the board level are required on major decisions. At thetactical level, cross-organization teams are in place to ensurethat each credit union, and the CUSO, are fully engaged andrepresented on all initiatives undertaken by the CUSO. Not only hasthis improved the outcome of the planned initiatives, but thisapproach has enhanced communication among all three organizationsconcerning day-to-day operations of the credit unions. For thesetwo credit unions and the technology CUSO they created, thecollaboration concept has been approached using several models. Insome cases, a proven solution from one credit union has beenimplemented in the other credit union. This reusability model hasprovided business knowledge to the second credit union and hassignificantly reduced the implementation risk, resulting in aquicker implementation timeframe with fewer issues. This approachhas been successfully employed in porting previously-developedsolutions for profitability analysis, relational pricing, andbusiness services from one credit union to the other. A key tosuccessfully employing the reusability model is ensuring thatsufficient flexibility and ease in maintenance are built into theapplications so that they can be deployed at the next credit unionwith a minimum level of rework. In fact, a key reason forBethpage's interest in forming a collaborative partnership was theexperience and technical talent Bellco had developed inimplementing and operating the core system (both credit unionsoperate OSI's core system). By tapping into this availableexpertise, Bethpage was able to significantly reduce the riskstypically associated with a large system conversion project.Collaborative Selection Teams and Fast Followers In some cases, aproven solution is not in use at either credit union. In theseinstances, a collaboration team comprised of business specialistsfrom each credit union and technology specialists from the CUSO isformed. The team jointly identifies business requirements, reviewspotential products, and selects a final product based on itsability to satisfy the joint business requirements. Vendordiscussions are designed to lock in volume-based pricing for bothcredit unions, as well as future credit unions joining thecollaborative partnership. This negotiation approach has resultedin significant cost reductions to both credit unions and any futurecollaboration partners. An implementation team is formed to assistin the deployment of the product in the first credit union, wheretechnology platform, product configuration and rollout issues areresolved. The same implementation team is employed to implement theproduct in the second credit union, taking advantage of what waslearned in the initial implementation and ensuring a quicker,easier implementation. This approach has being successfully used inthe selection and deployment of branch- and Internet-based newaccount processes, member relationship management and businessintelligence technologies and consumer lending technologies. Inaddition, a similar process is underway to replace the onlinebanking channel at each credit union. Both credit unions view thisnew CUSO as a vehicle to exploit the benefits of futurecollaboration opportunities. Preliminary discussions are underwayto leverage the power of the common core system and othermember-related systems to create a consolidated member call center.This collaboration will allow the collaboration partners to reducecall center expenses while enjoying the obvious benefits ofincreased call center hours. The success of these collaborationefforts is dependent on having the right business partners, theright technologies and the right technical skills.