Executive Book Club Series: The Customer of the Future, Chapter 2

Seniors Housing Operators Are Failing When It Comes to Creating Company Culture

Independent and assisted living, memory care, active adult and CCRC communities focus on operational efficiencies before culture; creating a backlash of problems that could otherwise be prevented

After reading chapter 2 of The Customer of The Future by Blake Morgan, its clear that anyone can invest in and even operate a senior living community; yet only a select few can curate a culture that creates loyalty and raving fans. The ability to do so is a game changer; it removes you from the churn of employee turnover, resident and family complaints, unnecessary lawsuits and more when stakeholders are vested in your organization.

While it may seem like a pipedream, it’s possible to resolve 80% of your current problems by focusing on the top 20% of your employees; your Company’s leadership team who can bring culture to life.

For any business, the key to a successful scale up is the recruitment and training of its leaders. We are seeing unprecedented growth in seniors housing without proper investment in infrastructure or leadership development. The result is the failure to maximize revenue, net operating income and the value of the portfolio. It’s time to take a good hard look at your culture, define it and utilize it to guide the rebirth of your seniors housing business to provide next level growth for the long-term.

REDEFINING COMPANY CULTURE IN SENIORS HOUSING

While the CEO of your organization may be great or even amazing, it’s the Regional and Executive Directors that have the most direct impact on front line staff and their job satisfaction. Many of these individuals have grown up in the business meaning they have moved from line staff to department head into sales or the executive director role; ultimately moving into a regional or divisional director role. Ask just about anyone in the business and most likely you will hear a fascinating story of their career trajectory.

While this is a wonderful testimony to the opportunity in the seniors housing industry, the business itself has undergone dramatic change. What used to work no longer does. Not only do leaders need to manage a budget, they need to understand how to run a business as well as to maximize revenue and net operating income to ensure investors see promised returns.

Many of today’s senior living mid-level leaders don’t even understand how to read a balance sheet let alone how to drive culture. Adding to the complexity is that small operators have grown incredibly fast, with regionals overseeing twelve to fifteen communities. With all their time consumed putting out fires, few have time to invest in developing their people or driving culture – that’s why so many seniors housing operators are failing at creating company culture.

Sadly, many of senior’s housing’s original founders, who created culture based on their passion for seniors have retired, sold their platform or become so buried in growth that culture is nowhere on the radar.

All these factors combined are taking a toll on operators, making it harder than ever to run the day to day business and achieve strategic goals. They too, like many of their employees are burnt out.

Reinvigorating company culture can be a game changer and ignite a fire for a tired, mediocre performing company that has the potential to be great!

CULTURE STARTS WITH EMPLOYEES WHO DETERMINE THE CUSTOMER EXPERIENCE  

Before we can dive into the customer of the future, we must address the employee of the future. Heck, the employee of today because the future is here, now!

Creating a raving fan culture is simple – start by creating raving fan employees.

You can’t have one without the other and while it would be great if this could happen overnight, it doesn’t. The good news is you can begin right now because it’s never too late to start anew…to wipe the slate clean and put massive effort into driving culture.

IT’S IMPORTANT TO PICK YOUR WORD TO DEFINE YOUR CULTURE

My best advice is to keep culture simple. If you over-complicate or over think it, people are not going to execute.

If you had to pick one word to define your culture, what would it be? What type of experience do you want employees, residents, family members, referral sources and the community at large to have when interacting with your organization?

As you ponder your culture word, realize that to create raving fans, people must experience this culture firsthand. It can’t be a word on your website or in your collateral.  It must be alive within the organization as a whole and in every fabric of its being from recruitment and onboarding to the sales and resident experience.

Odds are you have a few ideas but nothing you are willing to fully commit to. Take your time, this is a big deal but ultimately pick a word and begin to put that culture into practice; starting with your leaders. I can speak to this personally as to what it takes to craft a raving fan culture.

In fact, many of you reading this have watched my business grow and feel a personal connection to its success over the past 20 years due to being a part of it. Getting from where I was as a solo entrepreneur helping small mom and pop operators implement sales and marketing systems to recapture lost revenue; to a national team of consultants that serve organizations internationally is 100% attributed to our culture. I can tell you, without a doubt, it’s the foundation of our business; creating incredible customer and employee loyalty that has allowed our business to thrive. It’s at the forefront of everything we do – we call ours The Bild Way. What about you?

SENIOR LIVING OPERATORS SHIFTING FROM FOCUS ON PURPOSE TO FOCUS ON OPERATIONAL EFFICIENCIES IS KILLING YOUR CULTURE

Culture is shaped by people and tends to change over time. What starts as a company focused on purpose, eventually becomes a company focused on operational efficiencies once its original founders leave.

Never has this been more evident than in seniors housing. I’ve seen this play out again and again; strong, mission driven operators who had loyal, hard-working employees that delivered incredible service to residents and who loved their jobs. Then with the onset of massive growth and the founders exit, employees find themselves unable to keep up with the demands of the job, burning out and seeking employment elsewhere. The culture experience is not one of inspiration but of deprivation and exhaustion, leading to constant turnover and a fractured resident experience.

IT PAYS TO DRIVE COMPANY CULTURE

According to Gallup, organizations with engaged employees outperform the competition by 147 percent.

The last decade has brought such tremendous change to the seniors housing industry that most operators have not had the opportunity to catch their breath let alone determine what creates an engaged employee or more importantly how to deliver on it.

The reality is we have a workforce crisis and while we talk about it a lot, it’s time to do something about it. The cost of turnover is tremendous and like anything else in business, you must spend money to make money. That means, at some point, you are going to have to invest in people development starting with your culture.

For example:

  1. Gather honest, voice to voice feedback from employees about their work environment. What is working, what isn’t working and what would create greater loyalty and satisfaction.
  2. Create an employee task force with focus on improving workplace engagement, loyalty and satisfaction (make it multi-generational).
  3. Prioritize the top three areas your company can make an impact on employee satisfaction and engagement through culture.
  4. Brainstorm ideas and implement strategies; just take the first step- you can always pivot but you must do something now.

The alternative is that you continue to churn through employees, disrupt resident life due to constant turnover, lose residents entirely and burn through cash due to your inability to fix the employee problems facing our industry. Your customer of the future depends on your employees both today and tomorrow.

Treat your employees exactly as you want them to treat your best customers.” Stephen Covey

Customer satisfaction is a direct mirror of employee satisfaction. This could not be truer than in seniors housing as the front-line staff is deeply woven into resident life; ultimately impacting their happiness or lack of with your community.

With the massive growth among mom and pop operators the last decade, many have lost their ability to impact the lives of their employees in the way they once did when their company was small. It’s time to re-group because employee culture and experience can no longer be ignored.

According to Blake Morgan, the author of this month’s book club selection, employee experience is the first step in creating a customer-focused culture. I could not agree more. As the CEO of Bild & Co, my primary customer is my team and their customer is our client; the operator or investor group we are supporting. The greatest value in my company is the depth and scope of our unified knowledge—it’s irreplaceable and the loss of even one employee would be devastating. For this reason, we have a very strong employee centric culture, survey our team regularly, partner with them to create 90 day visions to ensure their success and bend over backward to go above and beyond what a typical company of our size might do for their employees. In short, my employees are my single greatest asset and our culture reflects that; yours should too.

SMART OPERATORS KNOW THAT CULTURE CAN’T BE AN AFTERTHOUGHT  

A survey of more than 6,700 managers found that managers who show more empathy toward direct reports are viewed as better performers in their job by those managers’ bosses. Being empathetic and vulnerable helps leaders better connect with their employees.

In fact, employees who had managers with a high emotion quotient (EQ) were four times less likely to leave than those who had managers with low EQ.

My question to you is, “do your leaders even know what emotional intelligence is, how to develop and utilize it in the field with their staff?”

As seniors housing continues to mature, companies must invest in leadership training to further develop managers who are responsible for their team’s experience with the company and that which they provide to the customer.

Gallop also found that managers account for at least 70 percent of the variance in employee engagement scores across business units as they play a critical role in shaping employee life. Creating a leadership strategy for your mid-line managers is transforming and something most companies never figure out how to do.

According to Morgan – and I agree, if your growth is taking a toll on employees, here’s what you need to do:

  1. Senior leadership should model self-care. Emails should not be sent at 2:00 am or on weekends.
  2. Health and wellness programs for employees should be a focus at the company. Being that we are in the business of care, this is a no-brainer.
  3. Consider more flexible vacation policies. Promote self-care and mental health days. With residents passing and staff being closely engaged, the toll taken on caregivers must be considered.
  4. Create guardrails but grant freedom to employees so they can do what’s best for the customer in the moment.
  5. Reward delegation and efficiency improvement ideas (I love this). Employees should be incentivized to collaborate and find ways to make their work smoother.

 

This executive book club is designed to make you think. Our goal is to inspire operators, owners, investors and developers in Seniors Housing to implement proven strategies along with their ED’s and management to help them stay ahead of the curve.

Your job as a leader is to drive the success of the culture. What one thing can you do today to move your culture forward and to begin to shift your organization in a way that prepares you to meet the demands of the customer of the future? All you must do is take the first step; do something!

Bild & Co is a strategic sales and marketing consulting and advisory firm with focus on implementing the infrastructure needed to scale. We have an entire division dedicated to helping our clients craft a culture unique to their identity, build it into the fabric of the organization; and most importantly, train leadership teams how to execute and to drive culture within each individual community they serve. Curious? Text Traci at 813.390.3349, email Revenue@Bildandco.com or call 1.800.640.0688. Once again, all you must do is take the first step. By this time next year, your culture could be alive and thriving, bringing drastic change within your organization.

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