Goal-Getter

When Elevations Credit Union declared its intention to win the Malcolm Baldrige National Quality Award in its spring 2009 planning session, the Boulder, Colo.-based organization’s new president/CEO, Gerry Agnes, CIE, understood that it would not be easy to achieve this ambitious goal.

It’s a testament to Agnes’s leadership that $1.5 billion Elevations CU was named a recipient of the award in 2014, just five years after formalizing it as an organizational goal and far ahead of the timetable Agnes had envisioned.

Since the 1988 launch of the Malcolm Baldrige award, named for the late U.S. Secretary of Commerce who served during the Reagan Administration, no CU had ever won it. In fact, only three organizations in the State of Colorado had previously received it, the only formal recognition of excellence for both public and private U.S. organizations given by the President of the United States. By winning the award, Elevations CU joined the ranks of such well-known entities as The Ritz-Carlton, Boeing, AT&T and IBM.

In a career of stellar accomplishments, putting his organization in a position to win this national recognition is a crowning achievement for Agnes, a CUES member, and makes him deserving of being honored as the 2015 CUES Outstanding Chief Executive. The award will be presented this month during CEO/Executive Team Network in Scottsdale, Ariz.

An Impressive Journey

The journey to winning the Baldrige award began during Agnes’s job interview for the CEO position at Elevations CU in July 2008. Agnes already had racked up an impressive career in the financial institution sector while living and working in Southern California, working in three different banking charters—a mutual savings and loan, a multi-bank holding company and a state-chartered federally insured credit union. A graduate of California State Polytechnic University in Pomona, Agnes also had logged experience at a Big Eight (at the time) accounting firm and a community development foundation.

As he described his vision for the CU during that 2008 interview, Agnes spoke about the award’s framework as a means of achieving performance excellence. Intrigued, the Elevations CU Board hired Agnes, and gave him the go-ahead to use the Baldrige framework.

“I’m a (Jim) Collins groupie,” reports Agnes, referring to the well-known business consultant and author of the book Good to Great. “So, using his principles, we established our corporate vision and our core values. Then, in April 2009, we identified our Big Audacious Goal: to win the Malcolm Baldrige National Quality Award.”

The first step was to have extensive conversations in the boardroom and among the senior leadership team about the Baldrige framework.

“I told the board from the outset, and I was very clear about this, that if we ever did receive this award during my tenure as CEO—because in all honesty, it might not happen—that it would likely take 10 to 15 years,” Agnes says.

Thus, he was as stunned as anyone when Elevations CU achieved this goal within five years of setting it. It was especially remarkable considering that Elevations CU was a first-time applicant.

“Less than 1 percent of applicants receive the award the first time they apply, so I really didn’t think it would happen,” Agnes says. He was already elated that Elevations CU’s first national application had been impressive enough to have warranted an onsite visit by the Baldrige team of national examiners in October 2014. In November, all of those who received a site visit received a phone call indicating whether they had won the award. No set number of organizations wins the award each year; some years seven have been named, others two.

Agnes was alone when he fielded the call, certain that he would get disappointing news. “Then, I heard a woman’s voice on the other end of the line say, ‘Hello, Gerry, this is Secretary Penny Pritzker.’ Well, my mind went blank after that. I knew that the U.S. Secretary of Commerce would not be calling us if we had not received the award, so I knew immediately that we’d won.”

Everyone at the credit union was thrilled. “It was extremely inspiring to our staff to have their efforts acknowledged by the President of the United States,” Agnes says. “It’s also been wonderful for our members because they’ve enjoyed the improvements we’ve made, and when they hear that their credit union is a Malcolm Baldrige National Quality Award recipient, they’re thrilled to be a part of our organization.”

As a Baldrige award recipient, Elevations CU will be sharing its practices and strategies with other organizations through speaking engagements and on-site tours. “That is one of the main purposes of the Baldrige program,” Agnes explains. “It gives organizations across the nation the opportunity to come to Elevations and learn more about our journey—specifically what we accomplished and how we accomplished it. The goal is to inspire them to consider this as a potential framework for excellence that they can apply to their own organizations.”

A Culture of Excellence

Winning the Baldrige award requires an unrelenting commitment to a culture of excellence. As Agnes explains, “You have to have excellent processes that are deployed throughout the organization in a systematic way so that they can repeatedly produce predicted results that are well integrated throughout the whole organization.”

Elevations CU’s member-centric approach is conducive to achieving broad-based excellence. “Many people in the Baldrige community will adopt an approach like Six Sigma (www.iassc.org) or Lean,” Agnes says. “However, we built our approach around business process management.”

This approach is outlined in a map, which shows how various processes in the credit union are deployed in an integrated, highly functional fashion.

“You can have marketing and operations and branches and lending headed by different functional people, but when you put together a process map, it depicts from the member’s perspective how things get done, which allows us to substantially improve the organization from a service delivery standpoint,” Agnes explains. “You have to have your processes well deployed, measured, analyzed and integrated throughout the organization.” (Elevations CU has uploaded its process map to CUES Members Share. CUES members can access it by logging in at cues.org, choosing “Members Share” from the “Connect” menu, and searching for “Elevations.”)

The Baldrige framework helps organizations pinpoint improvements in seven categories: leadership; strategic planning; customer focus; analysis, knowledge and management; workforce management; operations; and results. These categories are the basis for 255 questions that an organization must answer to be considered for the Baldrige award. Answering the questions is a process of self-discovery and analysis.

These are 255 questions that any leader should be asking, Agnes explains. “They are all seemingly simple. For example, from the customer focus category: ‘How do you design your products and services to ensure that they meet your customers’—or in our case, members’—needs?’ On the surface, that sounds fairly easy, but as you start to type out your answer, you may come to the realization that ‘we really don’t do as good a job as we could with this.’”

Agnes acknowledges that an organization’s inadequacies will come to light during this process. “It’s painful in the beginning to confront these uncomfortable realities, but as we’ve grown and learned together, we’ve begun as an organization to do some really remarkable things.”

For example, “when we began honestly answering questions in the Baldrige framework about how we met members’ lending and mortgage needs, we realized we could provide even greater service,” Agnes explains. “After redesigning our consumer lending platform, we substantially decreased our funding turnaround times while also expanding our approval rates, particularly for credit-challenged borrowers. We also restructured our mortgage workflows, enabling us to consistently beat our competitors and recruit some of the nation’s most productive loan officers. Now, we’re the No. 1 mortgage lender in our core market.

“We’ve characterized it (the changes) this way: We want to be better today than we were yesterday and better tomorrow than we are today.”

The Journey to Baldrige

An organization’s journey to win the Baldrige award begins on the state or regional level. Elevations CU filled out its third state-level application in 2013, which resulted in receiving the state’s highest honor, the Peak Award. This qualified the CU to apply on the national level.

“Our goal with that application was simply to get a national onsite visit, which very few organizations achieve,” Agnes reports. “When we learned we had achieved the onsite visit, we worked very hard to prepare” for having a group of about 10 examiners scour every aspect of the CU.

After the onsite visit, a panel thoroughly reviewed the examiners’ findings and ultimately determined that Elevations CU’s level of performance excellence was worthy of a national award. While receiving the award at a national awards ceremony attended by many dignitaries was exciting, Agnes reports that the most gratifying aspect of the experience was being able to acknowledge the efforts of Elevations CU’s employees in serving its 110,000 members.

“The Baldrige framework enabled us to steadily improve employee engagement, which grew from 69 percent in 2009 to 82 percent in 2015,” Agnes notes.

Key Leadership Components

Agnes sees the Baldrige award as consistent with what he considers to be three critical components of his leadership style.

“The first is to create a safe environment for our employees so that we can have these brutally honest conversations about salient matters that affect our membership, employees and community,” he says. “We create forums that facilitate honest conversations. We call it our ‘operational rhythm.’ Essentially it’s a very thoughtful communication design that ensures ‘the right people are in the room at the right time to make the right decision.’ This notion, combined with our team’s desire to be seen, heard and valued” fosters a safe setting for having key conversations.

Agnes identifies the second component of leadership as creating an atmosphere for winning.

“But it’s not about winning at all costs,” he stresses. “It’s about winning in the right way. We accomplish this by expertly planning and designing the credit union to do the right things for our members, employees and community. The plan gets executed through the deployment of our operational rhythm.”

The final leadership component—which certainly is consistent with the Baldrige framework—is putting the focus on continuous learning and improvement. This is a highly collaborative process.

“I don’t have all the answers,” Agnes concedes. “Neither does our executive team. Neither does our board. However, if you take all of our 380 employees, our board of directors and some of the key alliances we work with in our organization—our legal counsel, our strategic planning facilitator, our technology leaders and others—if you take all of that brain trust in order to learn together and improve together, you can create a sustainable organization.”

Another characteristic of leadership is being actively involved in the community. Agnes places great emphasis on this, serving as chair, board or committee member on various civic organizations, and he encourages employees to give back to the community as well.

“We give every employee two full days of personal time off to serve the community in some charitable way,” Agnes says. “Many members of our leadership team are on boards or commissions, so we’ve got a very active organization that is committed to serving the community.”

In addition, Agnes has served on the boards of several industry-related organizations and is currently a member in the Filene Research Council. “I also recently was appointed by the governor of Colorado to the Department of Financial Services Board, the regulator of state-chartered credit unions,” Agnes reports.

In his personal life, Agnes and his wife, Cindy, are active in their church. They enjoy spending time with their three grown children and, in their spare time, pursuing various recreational activities.

“Now that we live here in Colorado, we ski and hike a lot,” Agnes says. “We also have a dog, and the three of us just enjoy life here in beautiful Boulder.”

Agnes’ leadership style is appreciated by the credit union’s employees. For instance, Chief Human Resources Officer Annette Matthies, SPHR, SHRM-SCP, characterizes him as a unique leader who operates with enormous integrity and authenticity. “He has a perfect blend of care for the numbers and care for the people,” says the CUES member. “He’s very democratic, listening to a variety of viewpoints, but is not afraid to make a decision if there is no consensus.”

Matthies appreciates the fact that Agnes is constantly seeking feedback from employees on how he can improve his performance.

“He wants to continue to learn and grow as a professional and as a person,” she says, adding that Agnes also places priority on the issues of staff development and succession planning. “He wants to support his direct reports—and all staff for that matter—in their development. He is driven and expects his team to deliver.”

A Temporary Steward

As Agnes enters what is likely the final decade of his professional career, he has given much consideration to the continuity of the organization he currently heads. Agnes followed in the footsteps of a revered CEO, Bill Sterner. President/CEO for eight years, Sterner positioned Elevations CU for extended growth with a conversion to a state charter. Tragically, Sterner’s life was cut short when he died of a heart attack in the spring of 2008. Those left behind continue his tradition of excellence at the credit union.

“Coming here, I had no idea that I would have such big shoes to fill,” Agnes says. “I wear an entirely different style of shoe, if you will. In fact, all of the individuals who preceded me each had their own unique style. I’m the sixth CEO of this credit union, and I’m standing on the shoulders of giants.”

Agnes hopes that his efforts in striving for performance excellence have made him a worthy successor to these past giants. He certainly has built on their past successes.

For instance, he reports, “When I arrived, we had one in four households in Boulder County, our primary market. Now we have one in three. We have a strong brand with good penetration in the community, and now our community is much larger. We cover seven counties, serving the front range from Denver northward all the way to the border of Wyoming.”

Nothing would please Agnes more than to see the next CEO, whoever and whenever that may be, continue the credit union on the path to improvement. “As the sixth CEO of this credit union, I view myself as a steward for a brief period of time in its enduring perpetuity,” he says. “My goal is ultimately to hand off this organization to the next leader, with the hope that she or he will fill it to the best of their ability just as I did when I came in here in August 2008.”

Agnes won’t rest with reaching just one Big Hairy Audacious Goal. He has another big and audacious goal in mind: to receive the Baldrige Award a second time—something that only six organizations have ever done.

“You can’t receive it (again) for five years, but it’s something we want to try,” Agnes says. “It might not happen until after I leave, but we want to ensure that the culture of excellence is so well-ingrained that it would carry on well beyond us. This is a legacy that we’re hoping to leave behind.”

Diane Franklin is a freelance writer based in Missouri.