In what is a recurring feature, Finopotamus will profile interesting and intriguing tech professionals who are positively impacting the credit union industry.
For this issue, we spent time with Visions Federal Credit Union’s VP and Chief Digital Officer Thomas Novak.
By W.B. King
When asked to explain the role of a chief digital officer, Visions Federal Credit Union’s Thomas Novak likened the role to a Swiss army knife whose handler is part of a relay team running a marathon.
“In one instance you need to assess the profitability of a product or service primarily transitioning to a digital channel, and the next you are courting favor for a large SaaS platform spend to overhaul a process. You are essentially a chief operating officer, but with a digital-first focus,” explained Novak.
“My approach is people focused, and ultimately to move digital transformation efforts forward, we have to do it together,” said Novak. “It’s imperative to speak the language of all our stakeholders and address what’s important to them in digital transformation. That isn’t always immediately apparent; some common ground can take months to reach before the stakeholder realizes the benefit to moving forward.”
Prior to assuming his role of chief digital officer in December 2020, Novak began his tenure at Visions Federal Credit Union in 2011 as a branch manager. From there, he held other positions, including e-commerce solutions manager, director of digital banking and AVP of digital.
“I started my career at PNC Bank as a branch employee focused on sales in 2006. After in-branch experience at PNC Bank and (later) M&T Bank, I moved over to Visions Federal Credit Union, not fully realizing at first the difference between a credit union and bank,” recalled Novak.
A Binghamton University graduate, who later earned a Harvard Fintech Certification, Novak said that he was soon approached to start a new department, e-commerce, at the credit union.
“This was supposed to lead us into the future. I believe the senior management team at the time had confidence in my ability to add structure to the seemingly unstructured and handle the ambiguity of being an entrepreneur in a traditional financial institution,” he recalled. “Working to create digital transformation initiatives before it was even called that was very interesting to me. I became passionate about solving these larger puzzles that incorporate our tech stack, the human aspect of digital and organizational growth.”
Critical Thinking
When it comes to investigating new technologies, Novak said he enjoys studying different platforms, such as chatbots, and determining how these technologies will interface with membership and employees.
“It’s too easy and often times causes tech-debt when decision makers simply take the basic offering from their core provider to check a box,” explained Novak. “Over time, I’ve worked with some great thought leaders and industry research firms that have allowed me to curate my research approach and review at least five providers in any given niche. For instance, when we overhauled our digital banking platform in 2018, we did an extensive review of 17 providers.”
When suggesting what new technologies to adopt to senior management, he said the process can be “foreign” and that a change in approach isn’t always an easy sell.
“It’s critical to understand their objectives and tie digital transformation success to achieving their goals faster, better and more efficiently. After there are some wins under your belt, things tend to accelerate, but you always must maintain the trust and performance output that garnered their interest in the first place,” said Novak. “I believe any given group is looking for that leader to persevere and challenge the group to grow – that is what we are doing with digital transformation.”
When determining new tech initiatives, Novak said he often confers with fellow colleagues inside and outside of the credit union organization. He also noted that there are forums and industry groups that offer guidance on best practices.
“The research and thought leadership aspect of the position is the fuel that powers our eventual execution of objectives. Digital transformation is very much a game of critical thinking and working through ideas until they are refined,” he said. “Many times, those ideas need to be iterated upon in a real-world setting to get the best results and to mitigate the risk of beta offerings, my fellow colleagues and I learn from others and their past experiences via peer calls, industry research and group forums.”
The technologies that get adopted are generally driven by user data gathered in-house as well as industry tech trends deemed beneficial, he said.
“We use a combination of member and employee feedback, Net Promoter Score surveys and our internal innovation portal, but we also use a digital advisory board, which is a group of everyday employees that helps us shape the direction we take with fintech partnerships,” he said. “Additionally, we have a long-term roadmap that we iterate upon which represents a combination of research, internal stakeholders needs, market demands, and more.”
Novak added. “There are always at least a small group of digital employees who are beta testing new ideas, offerings and technologies, but with our move towards modular banking, we are usually getting selected by our partners to beta their latest innovations.”
This approach, he said, accelerates the credit union’s “innovation prowess” and “strengthens the partnership” with respective providers.
“It has become a mainstay of our digital business model that continuously feeds the pipeline of new technology,” said Novak.
Departmental Insights
The $5.3 billion Endwell, NY-based Visions Federal Credit Union serves 221,000 members at 52 branch locations. The credit union, supported by 750 employees, has three tech-related departments: IT, digital and business performance. In total, 100 employees are staffed in these departments.
The majority of tech employees are male, but span several different generations from baby boomers to Gen Z interns, noted Novak. He added that the predominant generations are represented by Gen Xers and millennials.
“Technology employees are our fastest growing talent segment, and we are supporting work from home and other benefits to cast a wider net in our recruiting,” said Novak. “We see a larger number of men in the segment, but there is a cohort of young talent that is coming into the workforce that is much more diverse. We’re excited to see that and foster opportunities for all demographics as we believe it makes for a better culture and it is more representative of our membership.”
At Visions Federal Credit Union, the ethos is “change before you have to.” Novak explained that he incorporates this philosophy in his management approach.
“We believe that digital transformation is a constant pursuit whereby the journey is never complete and therefore we also must be forging ahead,” he said.
Novak went on to explain that he focuses on three main areas of development:
1) Manage Up: “We expect our team to be present and express their ideas. If they believe in the idea, it should foster a healthy debate around the topic. Many ideas come from the employees, not necessarily the leadership.”
2) Educate: “We all must be stewards for continuous learning, both personally and professionally. The space that we are working in is constantly changing and we believe that the habit of learning and being a lifelong learner is critical to our success.”
3) Build the Team: “This has broad applications for both bringing in more talent to fuel our growth and also to facilitate new ideas, but it applies on a peer-to-peer level as well. We want our team to be comfortable mentoring one another and having the opportunity to hear directly from senior management.”
Tech that Excites
When asked, “What’s new and exciting in the credit union technology space?,” Novak spoke about having the means to humanize the digital experience. And while he noted that the phrase “humanizing digital” has been used in the indsutry for a while, the ability to effectively deliver on that promise has been difficult.
“Now, various technologies and our partner ecosystem are enabling us to execute on these lofty concepts, such as our partnership with LemonadeLXP. Our members and staff often are the last thing that someone may think about when introducing a new technology or process change, but they should be the first thing we consider,” said Novak. “It is the empathy of thought and action that we take to assist with digital adoption and member experience that will support growth.”
What also gets Novak energized is the potential for credit unions to “punch above their weight class.” This is achieved, in part, by offering digital services that leverage modular banking and a partner ecosystem.
“The Q2 Innovation Studio through our partner, Q2, allows us to develop in-house via its software development kit, gain access to fintechs through the Partner Marketplace and accelerates our time to market of these beneficial offerings,” said Novak. “We recently executed on such an endeavor and now offer free identity theft protection and credit monitoring services for all our digital banking members at absolutely no cost to them.”
Now firmly rooted in the credit union space, Novak said there are many differentiators from the banking industry, including a singular focus on the member experience. Additionally, he noted that credit unions are well-positioned to deliver on the”innovation and modern experiences”that consumers receive and expect from brands like Amazon and Apple.
“As credit unions, we already possess the main ingredients of the recipe to become true technology companies that happen to offer financial services to members,” said Novak. “But to sum it up, credit unions are different because we are striving to become digital-first organizations empowering people toward financial independence.”
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