When humankind invented places for reflection, knowledge, good deeds and community leadership, the laws of nature were not repealed.
Organizational design wether this be a church, non-profit driven entity, a credit union, or political office, leaders are all members of the human race. With their bundles of good intentions and temptations.
Money is an especially potent allure in critical moments, from petty cheating on travel claims to large self-dealing transactions.
So organizations develop checks and balances to, in the words of my college roommate, “keep honest people, honest.”
Designs Are Not Enough
Returning from a weekend reunion in Chicago, this was the new design for the Metro exist at Bethesda.
The gates have been altered to heighten the exit to prevent “jumpers” from leaving Metro without paying. Metro had announced that it was losing so much in unpaid fares, that this redesign was necessary to discourage an ever growing temptation.
The “Barriers” in Credit Union Design
There are three elements of organizational structure in credit unions to discourage the ever present temptations when managing money.
- The credit union supervisory committee and its system of internal and external audits;
- The oversight and review of policy, process and results by external regulatory exams;
- The political check and balance provided through the democratic oversight of members in the annual required election of directors.
When these checks and balances are listed, it is easy to see why credit unions can go “off the rails” in terms of personal and organizational shortcomings.
Human temptation is not overridden by organizational design. For ingenuity can work around the most explicit of processes or checks and balances.
That is why the most critical aspect of leadership is integrity. One of the best indicators of this quality is the words leaders use when describing an organization’s activity. In cooperatives those who talk about MY members, MY credit union, MY board or even MY agency reveal potential misunderstanding of their responsibility.
In cooperatives, the operative word should be OUR. OUR collaborative system, OUR dual regulation, OUR insurance fund, OUR communities’ needs . . .
Designing barriers can help reduce temptation. Leaders’ integrity is necessary to keep them meaningful.