A Member Linkage Tool Builds Policy and Action

NOTE: This article is a summary of a workshop presented at CCMA 2000 called "Building Member Linkage: A Tool for Policy and Action." What follows is first a description of the presentation and then the results of small group discussions among participants.

Member linkage. It's a phrase that inspires unquestioned support in board and management discussions. It's an area that universally gets ranked as a high priority for attention. It's often an area that is cited as a problem by board candidates. Arguably, lack of attention to this area is also a common factor in the failure of co-ops.

At the same time, there isn't a lot of agreement about exactly what is meant by "member linkage." What are the key indicators of effective member linkage? What defines the best practices of member linkage? How do we know if a co-op has strong or weak member linkage? Our colleagues in credit unions have developed an interesting new tool that holds some promise in this area.

The credit union experience

Credit unions have experienced strong challenges from banks in recent years. One of the most significant centered on legal challenges to the way that credit unions take in new members. Following ambiguous court rulings, credit union advocates finally proposed federal legislation that makes clear how consumers can join credit unions. After several years of lobbying and a massive grass-roots program to get credit union members' support, that legislation (HR 1151) was finally approved in late 1998.

The Statement of Commitment to Members focuses on the co-op's commitment to core values and its connection to members. Most importantly, it further details how the co-op acts on its beliefs.

Through this process, credit unions realized that they needed to do a much better job at making clear how they are different from banks and other financial institutions. According to Bruce Wheeler, Coordinator of Project Differentiation for Credit Union National Association (CUNA -- the national association for U.S. credit unions), "Credit unions have countless anecdotal stories of how they help individuals, but those are only pieces of the puzzle. What we have lacked is that snapshot that captures everything in one place -- all the special services offered, all the member and public education being provided, all the volunteer work and support of local causes."

A leadership group from credit unions was given the assignment of developing a tool that could help them in this area. Its task: to help credit unions clearly articulate the difference between credit unions and for-profit financial institutions. Furthermore, those involved with this leadership group wanted to make sure that this tool would result in more than just words on paper. They wanted to have statements linked with actions that the credit union is actually engaged in -- actions that illustrate how the credit union lives up to its commitment in those areas. "The things we're talking about here -- lifeline checking accounts, ensuring democracy at the credit union, raising money for charitable causes -- these are the things that make us different and these are the things we should absolutely not be taking for granted," said Mary Cunningham, President of CUNA Credit Union in Madison and Chair of CUNA's Project Differentiation Committee.

And so, CUNA launched a national initiative called Project Differentiation. All 11,145 U.S. credit unions have been asked to create a document that summarizes the philosophical and socially responsible activities of the credit union and how those fit into overall operations. Called a "Statement of Commitment to Members," the document can range from a single page to several pages, depending on the size of the credit union, the services it offers, and the scope of the activities it's involved in.

What does this have to do with food co-ops? Although there are differences, the current situation for food co-ops is very similar. We are also facing increased challenges in our markets from private competitors. In this environment, food co-ops are finding that they need to focus more and more on ways that they can distinguish themselves from other stores that carry the same or similar products. The model developed by credit unions of writing a "Statement of Commitment to Members" has the potential to fulfill this need and address the vital area of member linkage.

An action-linked statement

The "Statement of Commitment to Members" is described as a "philosophy policy" that focuses on the co-op's commitment to core values and its connection to members. Perhaps most importantly, it further details how the co-op acts on its beliefs and helps the co-op delineate how it is different from its competition in goals as well as in action. Writing a Statement of Commitment to Members (SCM) offers many advantages:

  • It helps the co-op make a statement about how it intends to live up to its identity as a cooperative and challenges the co-op to do more than just copy its competition.
  • It provides a tool to evaluate how well the co-op actually lives up to the values it espouses.
  • It reinforces the co-op's commitment to cooperative principles and other values.
  • It serves as a great benchmark for strategic planning discussions -- for identifying key beliefs, for identifying how the co-op will distinguish itself in the marketplace, and for discussing and setting new goals in these areas.
  • It describes to members the real value of belonging to the co-op.
  • It provides valuable messages and images for marketing and positioning.

The goal of an SCM is twofold: to give co-ops a way to document certain practices and activities, as well as to provide a framework for strategic planning that incorporates these activities. Credit unions have found that additional benefits have surfaced through this process, including ways that the statements can be used for staff and member education, in marketing and public relations, for member recruitment, and for advocacy.

What does an SCM cover?

A Statement of Commitment to Members begins by providing the overall context for the rest of the statement. It documents why members are important to the co-op, how members affect the way the co-op operates, the co-op's commitment to service of members, and how the co-op will monitor its statement of commitment to members.

A sample opening from a Statement of Commitment to Members of a credit union (CUNA Credit Union of Madison, Wisconsin):

At CUNA Credit Union, members come first. We promise to offer honest, fair deals to every member, every time. We promise to treat every member with respect and dignity. We promise to strive to be a trusted financial advisor that our members can count on to assist them with achieving their financial dreams. We will continually demonstrate the value of membership in CUNA Credit Union. We will deliver a range of low cost products and services to the diverse economic and social make-up of our members and potential members. We will look for better ways to serve the needs of unserved and under-served portions of our member and potential member base.

At our CCMA workshop, we didn't spend time trying to write an opening statement, but we did generate a list of key elements to be included in an opening statement for a food co-op:

  • ownership and accountability
  • honesty, integrity, and trust
  • co-ops model an economically sustainable way of life and way of doing business
  • offer an avenue to encourage member participation
  • emphasize education that enables members to live healthy, fulfilling lives
  • demonstrate the value of membership
  • keep co-op principles in front of members
  • community ownership
  • profits from sales to owners are returned to owners
  • listen to members
  • service-driven
  • build and maintain relationships
  • agent of diverse consumers in the food industry, offering the best products our members want to use

At our CCMA workshop, we slightly adapted the model developed by credit unions. We decided that following the opening statement, our SCM would be divided into seven sections (as opposed to six). These sections cover:

1. Service to members and community: how the co-op provides services to all groups within its community.

2. Consumer and member education: how consumer and co-op education activities enhance membership.

3. Governance and involvement: how the co-op maintains its active commitment to democratic control and to member-focused governance systems.

4. Diversity: what the co-op does to encourage and promote diversity and to reflect the variety found in its membership and community/service area.

5. Commitment to the co-op movement and co-op development: what the co-op does to support other cooperatives and the co-op movement as a whole.

6. Public service/corporate citizenship: community outreach activities, contributions, and other activities that benefit the community at large.

7. Member input and influence: an area added by the CCMA group based on its discussions and review of the other six sections. The group felt that it was important for co-ops to make a statement about the importance of member input on decisions affecting the long-term direction of the co-op, as well as keeping member influence an integral part of daily operations.

Each of these sections starts with a general statement of:

  • what the co-op wants to accomplish in that area or why that area is important;
  • Current activities that illustrate how it is currently involved in that area;
  • additional activities through which it plans to strengthen its commitment.

In this way, the SCM becomes an active document with lists of current and future endeavors. In addition, it ties in with the strategic planning process by providing a framework for prioritizing new areas of activity to support the commitment to members.

Some examples

Four examples from the workshop illustrate how an SCM would work. In small groups, participants were assigned different specific sections and asked to list key elements in a statement for that section and to list current activities their co-ops were involved in to support that section. Keep in mind that the list of current activities includes examples from all of the co-ops represented by group members and that the statements were developed in a workshop setting.

Services to members and community

Statement: Building community, connecting and serving one another to meet our needs.

Current activities:

  • member discounts/patronage refunds
  • special orders, delivery service
  • access to a credit union
  • working member discount
  • free workshops, discounted classes
  • book group, riders club
  • electricity co-op
  • subsidized transit, carpooling
  • equipment sharing
  • community dinners
  • bartering

Governance and involvement

Statement: Spice of Life Co-op will endeavor to preserve the democratic principles including demographic representation and participation in the organization.

Current activities:

  • voting
  • committee meetings
  • suggestion box
  • general membership meeting
  • serve on the board
  • volunteer opportunities

Planned activities:

  • policy governance education
  • political education
  • personal invitations to board meetings

Public service/corporate citizenship

Statement: Good Food Co-op will be an active partner in the community and will enhance members' health and social well-being. Each year the co-op will support the following programs:

Current activities:

  • community shopping days (2% of day's sales to specified organizations)
  • support of local farmers
  • donations to food bank
  • tours of store
  • bursary (scholarship) for graduating high school students/members re: co-op studies, food, farming
  • green patch program (C.H.I.P.) to give to designated group, 5 cents per bag)
  • bulletin board for advertising and community announcements
  • collection at checkout to buy food at wholesale prices (for food bank, homeless or women's shelter)
  • community reinvestment (C.H.I.P. 1% onto bill)
  • food taxi to deliver to homebound
  • dog wash
  • annual endowment (based on applications)
  • sponsor of community radio
  • allow organizations to petition on public issues (or set up tables)
  • signs for international co-ops in need

Member input and influence.

Statement: Our Food Co-op will create avenues and opportunities for two-way communication between members and the co-op at large.

Current programs:

  • focus groups
  • surveys
  • two-cents board (posted questions and answers)
  • council (board) hour: sit and talk to members
  • suggestion box with comment cards
  • impromptu conversations
  • customer service desk
  • graffiti boards
  • member forum
  • letters to the editor
  • member labor programs
  • website
  • quality council
  • annual meeting with discussion groups
  • board meetings

Planned activities:

  • personal invitations to members for dinner/speaker/meetings
  • offer discount for board attendance

Writing a Statement of Commitment to Members may not address the entire area of member linkage, but it will certainly provide a good start. The process of crafting such a statement will help a co-op identify areas for attention and focus strategic discussions on the vital role of members in the co-op's success.

The value of an SCM comes from the fact that it clearly documents how the co-op is different, as well as what it does and plans to do to back up its commitment to members. After writing such a statement, keep in mind that it will be equally important to review and update it every year. This will provide the co-op's board and management with an opportunity to discuss what the co-op has done in terms of building its linkage with members and what it needs to do to continue to strengthen this key area.

Website resources

A model credit union SCM, as well as statements from many of those that have already completed this work, are available by following the links to "Project Differentiation" on CUNA's website (www.cuna.org) or at www.cuna.org/data/cu/different/pd_front.html.

Materials from the "Building Member Linkage" CCMA workshop, as well as the lists generated by participants in all seven areas, are available on the CGIN web site, www.cgin.org. For members, direct access is at www.cgin.org/member/c27

See other articles from this issue: #092 January - February - 2001