Recap from Module 1 • Terminology – Capital – Assets, Liabilities, & Equity • Interest – Risk vs. Reward • Economy – Federal Funds Rate – Prime Rate
Terms for Module 2• Insolvency – Inability to pay debts• Resilient – Able to recover from or adjust easily to misfortune or change• Legacy – Something received from an ancestor or predecessor• Compliance – Conformity in fulfilling official requirements• Earnings – The balance of revenue after deduction of costs and expenses
But, I don’t want to go to the doctor…CREDIT UNION HEALTH
Why is Credit Union Health Important?• Viability – Stabilizing the Co-op• Service – Executing Core Competencies• Growth – Continuing Success
Member Impact • Better Rates – Investment Rates – Loan Rates • Better Service – More Employees – Knowledgeable Staff
Employee Impact• Job Stability – No Layoffs – No Closed Branches• Advancement Opportunities – Organizational Growth• Sufficient Resources – Technology, Training
Organizational Impact• Continued Operation – Long-Term Viability• Community Development – Providing Services/Jobs – Volunteering• Furthering the C.U. Movement – Contributing to PAC – Co-Operating with other C.U.’s
Agenda• The C.A.M.E.L. Rating System – What are the components? – How does it work?• The Role of the Strategic Plan – Why do we plan? – What impact does it have?• The Bigger Picture – How do I impact the organization?
The most confusing animal, ever…THE C.A.M.E.L.
History of C.A.M.E.L.• 1979 – FFIEC develops UFIRS• 1987 – NCUA Adopts CAMEL in October with 11 Key Ratios• 1991 – Key Ratios reduced to 7• 1994 – Key Ratios reduced to 5• 2002 – NCUA introduces Risk-Focused Examinations
MUDAWork that adds no value to the end product.• Firing Input Process 1 W V W Process 2 V Process 3 W V Output V: Value added W: No Value
Seven MUDA’s Motion Waiting Transport Overproduction Process Inventory Correction
MUDA of MotionMovement that adds no value.• Searching for files• Extra clicks or key strokes• Clearing away files on the desk• Gathering information• Looking through manuals and catalogs• Handling paperwork
MUDA of WaitingIdle time created when material,information, people, or equipmentis not ready.Waiting for:• Faxes• The system to come back• Copier machine• Customer response• A handed off file to come back
MUDA of TransportMovement of information that addsno value.• Carrying documents to and from from shared equipment• Taking files to another person• Going to get signatures
MUDA of OverproductionGenerating more informationthan needed.• More information than necessary• Creating reports no-one reads• Making extra copies
MUDA of ProcessSteps and efforts that createno value.• Creating reports• Repeated manual entry of data• Excessive paperwork• Duplicity of work• Use of outdated forms• Use of inappropriate software
MUDA of InventoryMore information, projects, ormaterial on hand than needed.• Files in queue• Open projects• Office supplies• Emails waiting to be read• Unused records
MUDA of CorrectionWork that contains errors, rework,mistakes, or lacks somethingnecessary.• Data entry error• Missing information• Lost records• Rework• Rescheduled meetings
Eliminate MUDA 1. Find the Root Cause 2. Ask “Why” 5 times 3. Use 5W 1H Questions
5W 1H Questions Who What1. Who does it? 1. What to do?2. Who is doing it? 2. What is being3. Who should be done? doing it? 3. What should be4. Who else can do done? it? 4. What else can be5. Who else should done? do it? 5. What else should6. Who is doing be done? 3M’s? 6. What 3M’s are
5W 1H Questions Where When1. Where to do it? 1. When to do it?2. Where is it done? 2. When is it done?3. Where should it 3. When should it be be done? done?4. Where else can it 4. When else can it be done? be done?5. Where else should 5. When else should it be done? it be done?6. Where are the 6. When are the 3M’s being done? 3M’s being done?
5W 1H Questions Why How1. Why does he do 1. How to do it? it? 2. How is it done?2. Why do it? 3. How should it be3. Why do it there? done?4. Why do it then? 4. Can this method5. Why do it that be used in other way? areas?6. Are there any 5. Is there any other 3M’s in the way to do it? process? 6. Are there any
MURAVariation in the operation of aprocess not caused by the endcustomer.Unevenness, unbalanced work.Example:Employees are told to work likecrazy early in the morning only tostand around and do nothing late in the day.
Eliminating MURAHow frequently does it happen?Where does it happen?Who does it happen to?Which side it OK?
MURIOverburden on equipment,facilities, and people causedby MURA/MUDA. Pushing a machine or person beyond natural limits. Results in safety and quality problems. Causes breakdowns and defects.
Recap• Credit Union Health impacts employees, members, the organization, and the credit union movement.• The CAMEL Rating rates the health of the credit union by assessing the amount of risk the organization is exposed to.• First Community’s Strategic Plan is based on the health of the organization – Growth, Relationships, and Efficiency.• We all can impact credit union health by making good decisions and trying to eliminate MUDA,