Talking story with Tess Shimabukuro of KCFCU

The title of president and CEO of Kauai Community Federal Credit Union hasn’t really sunk in for Tess Shimabukuro, who has been with the credit union for over 30 years.

For the Kauai High School alumna, it’s business as usual.

“Because we have seven of us for the management staff, we all know how everybody thinks,” said the 56-year-old. “A lot of times, we don’t always agree but there’s always something good that comes out of our disagreements. The team that we have here is amazing. It just makes what I’m doing a lot easier.”

Shimabukuro, who was previously the credit union’s executive vice president, replaced long-time CEO Mel Chiba in October.

Since she started working at the credit union in the mid-80s, she’s enjoyed helping her members and her community.

“Once I started work, I kind of got the bug about what credit unions are about,” she said. “Their whole motto is people helping people. That is really something that you just start living without realizing you’re doing that.”

Where did you grow up?

I grew up on Kauai and I went to Kauai High School Class of 1979. I went to Oregon State. Back in the day, what I really aspired to be was a fashion designer. When I graduated from high school, I was thinking I wanted to do that. My parents being very conservative — second generation — told me, “That’s not a job.”

I always had the desire to do that, but I went into accounting and got an accounting degree with a minor in computer science. I went to get a master’s degree because I didn’t really enjoy auditing, but it was one of those things when you start school, you need to commit to it.

I went to get my master’s in taxation because I thought that might be a little twist. I worked for a couple of CPA companies in Denver. I worked for them for a little while and I decided it was time for me to go home.

When was that?

I moved home in 1984. My husband was my boyfriend at the time and he moved with me to Denver. He was doing odd jobs then got into the Arvada Police Department. That is what probably made us realize — Denver’s a city — we come from Kauai, where everybody trusts everybody. Living in the city for a couple of years made us think, “This is not the place to be if we’re going to raise a family.” That’s what made us move home.

He joined the police force here, and I was out of a job. As I was looking through the paper, I saw an opening in the credit union for a controller position. I had no idea what a credit union was. I went to the library, checked it out and I thought, “Nonprofit, that’s an interesting concept. Am I going to get paid?” Quite honestly, I don’t even recall Mel telling me how much I was going to get paid.

I didn’t think I was going to be here this long, to be quite honest. It started off as a job, but then you start to get involved. You have to be a jack of all trades to work here. No matter what, you learn about other aspects of the business: about lending, member services, tellering and everything else. Mel was real strict about that. When you start at the credit union, you start off as a teller. Two weeks as a teller was the most stressful job I ever had in my life. The fear of not balancing. It’s not a matter of not balancing. If you’re over, you took money from a member. If you’re short, you gave too much money to a member.

Essentially because the credit unions are a hui or tanamoshi, the whole Japanese tradition of getting together and working with each other, that was embedded in your brain. If you’re short, you’re giving somebody else’s money away to somebody else. If you’re over, you’re gypping somebody. You got to be one hundred. That was Mel’s philosophy: “You have to learn everything about this business, then you immerse yourself and you understand it.” We still carry that tradition on. Every manager comes in has to go to the process of being a teller. It does make sense. I admire our tellers and loan people because what they do every day is new every single day and you have to have your A-game.

What do you enjoy about the credit union?

It sounds kind of maybe cheesy, but it’s really the people that I work with. We have been one lucky organization. The people that we hire are top-notch at what they do. Like every other business we have turnover and it’s tough because at the entry level we are competing with the hotels that can pay little bit more.

We want to make sure that we’re spending our members’ money wisely well. The other part that happens, and nobody really sees it, is that as we grow we want to promote from within. That’s our philosophy here. A lot of our tellers, they become financial services reps, then they move up the ranks to become loan counselors. Some of them transfer to other branches. Although it looks like we have a lot of turnover, we do have some, but a lot of it is upward movement.

We’ve been really fortunate to keep staff on. We try to be creative and focus on what is important to the staff. A couple years, we gave gym reimbursements. We think that if we have healthy employees, they’re going to come to work and it’s just good for their overall well-being.

We focus on my work-life balance. Everybody here works very hard. I enjoyed the management team that I work with. With Mel leaving, we really didn’t bring any anybody new from the outside. We just promoted from within because we had people who were perfect for these positions and ready to move on.

I’ve worked with all of them and they’re just young, energetic, smart people. A lot of them are a in their 30s. The rest of us — maybe about 10 or so of us my age — we’ve been around for a while. We’re slowly going to be retiring within the next 10. We’re trying to make sure that the 30-year group is ready and they are.

What are some of your accomplishments?

I don’t really have any personal projects that I handle on my own. Mel was the one who wanted us to get something that is very different than any other institution on Kauai and keeping us relevant to our membership and then also making sure that the product that we develop gives back to the membership. They’re the ones who built us.

Mel has been a great person to work with quite because he would set the guidelines and tell us the end goal and let us go to figure it out within his guidelines.

Along the way, as we’ve grown, we added ATM machines — small things like that. As much as we are trying to be member-centric and looking at what’s relevant to them, what do they need and fulfill their needs, we’re also on the back end.

This is the challenging part: having to deal with regulations. Financial institutions are a highly regulated industry. The NCUA, who is our governing body, is probably one of the most conservative ones. The nature of credit unions is we’re dealing with people’s money and it’s a cooperative. We deal with cybersecurity and that’s kind of a sign of the times. Everybody has to deal with them. You hear about those data breaches with retailers. As financial institutions, retailers are not held accountable for that, but we are.

We have to protect our members’ personal information. It just becomes tougher and tougher to monitor. We have to be really careful about maintaining the top-notch firewalls we have. We have to have IT people monitoring that at all times. It’s really a different, different world on the back end. That’s why a lot of small credit unions have a hard time surviving.

You’re servicing your members to make sure that everything is in place. You know we don’t really hear much about — where people hack into credit unions — but I’m sure it’s happening.

Now it’s balancing that because people are smart. Cyber criminals are intelligent people that have nothing else to do, but they make tons of money.

That’s just kind of the industry that were in.

Who at the credit union made an impact on you?

Mel’s been very good mentor. He was very true to his philosophy of why we exist and what our mission is. He made sure that we knew that every day. Every day when we came to work, we would take care of our members. He was real good about and he drilled that in us without us really knowing. Mel is the one who really took us and grew this organization to what it is today.

That was just him understanding what was going on in the industry, knowing what was going on the economy.

That might be my biggest challenge: to be like Mel. I don’t see myself as the CEO for another 40 years. There’s no way.

Our VP of human resources, Owen Nishihara, retired in November after nearly 25 years of service, and he taught me to always be fair. I always keep that in the forefront of whatever I do.

Owen is a dear friend and has positively influenced me is so many ways.

How has the role of CEO been for you so far?

It really hasn’t sunk in yet.

Everyone in the management team has pretty much moved — since I moved up — so everyone is in new roles. What we’re trying to do is train the person who’s coming in plus doing our regular work. That’s probably the the hardest transition right now. Everyone’s putting in a lot more hours than we normally do, but it’s working out really well.

What are your goals?

Our goals for KCFCU have never changed from year to year. it’s just a matter of improving the financial well-being of our members. A lot of that has to do with areas of financial literacy.

Our goals don’t change, but maybe the strategies that we implement change from year to year. Last year, for example, financial literacy has always been a big topic with us. We’ve been trying to get into schools; maybe talking to seniors. We do some credit seminars. Last year with Monica Belz and Terry Kaniho, we kicked it up a notch, opening three credit unions at the three public high schools.

That was a snowball effect that really gave us the opportunity to get into the schools and really make a difference. Students actually work at the credit union, so we train them to take deposits and make withdrawals. We also dedicate our staff. Our staff has to be there because we don’t want the students to look at members balances.

With financial privacy, we have to be really careful about that. We’re trying to encourage the students also to open checking accounts and understand how credit unions work. A lot of them have part-time jobs. A checking account would be great to have.

Teaching the students what it’s like to kind of work in a financial institution, giving them that exposure and being able to provide financial literacy to those students. The worst thing that could happen if they start college and then they get all these these credit cards solicitations and start going to town and not understanding finances.

One of the things we’re doing this year is we’re joining what’s called a shared branching network. A group of credit unions in Hawaii got together and basically the members of all our credit unions get to use each other’s credit unions.

There’s a total of 12 credit unions statewide and close to 70 locations that our members can mutually go.

Justin Ganaden, executive vice president, who took my position, jumped on it right away. We’re looking at implementing this in the third quarter of this year. We belong to the co-op network a national network. Anybody who has a credit union card with a club logo can go to any one of these ATM machines, and they can withdraw money surcharge-free. We’re joining that network which would also allow members to make deposits.

We have to keep up with technology, so making sure that we have what everybody needs as far as what’s on our website.

We just started (where) you can set up your debit card on this app. Every time you make a purchase, it’ll come up. Every once in awhile, you might have an unwanted purchase. You can immediately shut your card down.

We want to make sure that we put the control of that stuff in our members’ hands. We’re trying to make sure that the services that we provide and then the things that we add, that we offer to members, also complement all the other services. Our goal is to provide whatever it is necessary to improve the financial well-being of our members. That’s our ultimate goal.

Internally, for our employees, if everybody is successful, every person in our organization can aspire to be a leader. It’s huge if they have the aspiration of saying, “You know what? I want to be a leader in this organization.” Everyone’s going to be successful no matter what. I keep that in the forefront. I spend as much time as possible adding value to members as well as adding value to the staff.

If your employees are happy, then your customers are happy. It’s more just enjoying what you do. That’s, to me, the greatest pleasure.

What’s your advice for anyone aspiring to work in finance?

It is really not as boring as you think. it’s not glamorous, but here I can speak to the fact that when you work for a credit union, what you do every day matters to somebody. It may be something very small. But whatever you do has changed them in some fashion and that’s a really good feeling. You’ve helped them in some way.

A lot of people in the financial industry have to be problem solvers, and it gives you a lot of gratification if you know you’ve done something good for somebody. Nine times out of ten, we’ve been able to find a solution for them or help them understand why it’s not possible.

As long as I’m here, I want to make sure that we continue to be relevant by adding value.