With Lessons Learned From CoBank-Led Session, Electric Co-op Builds Consensus On Challenges Such As Succession Planning

Looking back at his own career, David Stuva says that 22 years ago, he envisioned a top job at a large, high-profile cooperative. Instead, his first opportunity came at a smaller co-op that seemed like a perfect fit and where, he figured, he could make an immediate difference.

Fast forward to today and David, the president & CEO of Rural Electric Convenience Cooperative (RECC), has no regrets. Neither does RECC, which has thrived under his leadership to serve more than 5,900 consumer and commercial members in five counties of South Central Illinois.

“I’m so grateful for my long tenure here at RECC,” David says. “It takes a number of years for leaders to make meaningful changes to the culture. We’ve done that, and now we’re viewed as a progressive, forward-looking co-op, one that’s well positioned to be a low-cost provider into the future.”

David can be forgiven for being in a reflective mood. Earlier this year, he advised RECC Board of Directors of his plans to retire in January 2023. As a next step, the Board re-visited the co-op’s policy for succession, which had been formalized in 2018.

Planning With A Purpose

Once finding David’s successor became a top priority, RECC’s nine Board members decided to take a proactive approach toward addressing this challenge. They contacted Aaron Johnson, electric distribution vice president for CoBank, RECC’s longtime financial partner, to inquire about “Beacon,” CoBank’s new strategic facilitation and planning service for electric co-ops.

CoBank does these Beacon sessions well. They facilitate the discussions so that participants can fully engage throughout the meeting.

RECC scheduled a Beacon session for late August for a full-day meeting. The session succeeded in two ways, David says. First, it allowed the co-op to get an early start on the executive search process. It also gave RECC leaders the opportunity to consult real-time with the CoBank team, leveraging their experience and shared knowledge to help assess and resolve short-term issues and make significant progress in long-term planning as well.

“Especially with me retiring, everyone agreed about the wisdom of carving out some time to focus on high-level strategic planning for the benefit of our members,” David says. “CoBank does these Beacon sessions well. They facilitate the discussions so that participants can fully engage throughout the meeting. Importantly, due to the enormous trust we’ve placed in Aaron and with CoBank over the years, people feel free to speak their mind.”

A Collaborative Approach

Over the years, RECC has turned to CoBank for the financing help with planned investments such as the construction of a wind turbine, buying substations and transmission lines from their former power supplier, and fixed interest rate loans as part of a prepayment of RUS (Rural Utilities Service) debt.

RECC also leases its entire fleet of vehicles, at a substantial discount, from CoBank Farm Credit Leasing. Most recently, in a lease arrangement with CoBank FCL, the co-op leased its first all-electric vehicle -- a Volkswagen ID.4 SUV. Employees can now drive it to experience a vehicle of the future; RECC will soon loan out the vehicle to members as well.

While the RECC-CoBank partnership traces back to 2006, Aaron Johnson’s one-on-one work with the co-op encompasses a longer period, spanning some 25 years to be exact. Aaron facilitated the entire Beacon session with David and the RECC Board. When the day was through, the value of the Beacon session manifested itself in a timeline for the CEO secession.

“Whether remote or in-person, you can get a lot accomplished with our Beacon strategy sessions during the course of a day or two,” Aaron says. “It’s an exercise that every co-op, large or small, should take the time to do. How productive those planning sessions can be depends upon how much trust and confidence you have in the meeting’s facilitators. In my view, knowing everyone involved on a first-name basis, as I did, made all the difference in having open and honest conversations that build consensus and drive big decisions.”

Offered free-of-charge to CoBank electric co-op members, Beacon sessions are customized to help leaders address major changes happening in their own organizations and challenges facing the industry as well. Among the examples of subject matter discussed at previous sessions are: cooperative governance and board structure, cybersecurity and cash management, financial and debt management insights, employee retention, power supply relationships, and rate strategy.

For more information on the new Beacon strategic planning service from CoBank, please contact your CoBank relationship manager.