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Don't Buy Into This Narrative . . . I Am Begging You

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By Steve Moran

I am well into the 2019 senior living spring conference season with 3 conferences under my belt and 3 more gatherings scheduled for April. I am beginning to hear just whispering, hints of a new song -- which, on one hand, might feel comforting -- but should actually scare you to death.

Here is the chorus . . .

50% plus turnover is the new norm.

Some Context

A few years ago, I started hearing at conferences the idea that maybe 90% or even sub-90% occupancy ought to be the new norm and I find that as I think about occupancy and others talk about occupancy, we all seem to think anyone who has their communities at 90% occupancy is doing well, is above average even.  

Well okay, except that when you think about it . . . in a 100-resident community that charges $4,000 a month, which for many of you is a very modest fee, that is an extra $40,000 a month, nearly half a million dollars a year in potential income.  

That is money that could, yes, flow to the bottom line as profits; however, it could also be used to give staff living wages, to increase staff . . . so many things.

Fast Food

According to a May 2018 Business Insider article, fast food staff turnover has hit 150% and by most accounts, the big fast food companies like McDonald's, Burger King, and Taco Bell just accept that as a cost of doing business and, in some sense, why not? The customers tolerate it and they are making a good profit.

Yet, there are exceptions to this.

Take a look at:

  • In-n-Out Burger
  • Pal's
  • Chick-fil-A

They all have rates that make 150% look silly or absurd. And, it would be hard to argue that they are making less money. Chick-fil-A has an average per store top line revenue that is almost double that of McDonald's and they are only open 6 days a week. You can bet those number flow to the bottom line in very attractive ways.

Senior Living

Here is why I am horrified by accepting 50% turnover as the norm for senior living:

  • If we accept it as the norm, we stop needing to work very hard on the problem.

  • We are talking about the lives of real people in senior living. In fast food, no one has a relationship with the person taking their order or staffing the takeout window. In senior living, relationships between staff, residents, and families are absolutely critical to the health, wellbeing, and longevity of seniors.

  • Turning over our frontline staff means critical life impacting damage to those frontline team members, many of whom are living on the edge of financial disaster. In my view, this is a moral concern, not just an economic one.

Head-Bangingly-Hard to Understand

This is a fixable problem. It requires thinking about teams and hiring differently. It honestly probably requires paying a bit more money, though that alone will not fix the problem. Mostly though, it requires investing in learning how to do things differently. This does not mean purchasing another program, this means reading books, joining a mastermind group, going to conferences on building cultures, experimenting and taking risks.

As most of my regular readers know -- along with Denise Boudreau-Scott, the founder of Drive -- I lead an exclusive mastermind that does a deep dive into how to create senior living cultures where teams love coming to work every day, love their residents, and love inviting their friends to be a part of the team.   

Because it is small and intimate, it is not inexpensive. However, compared to the potential pay-off, it's not really all that much money. But we are continually surprised by how put off people are by the price. It honestly suggests that, while we as an industry like to talk about the staffing challenges, we are not really yet willing to invest seriously in making it different. We mostly keep doing the same thing over and over while expecting or at least hoping for different results.

If you are interested in what we are doing, we would love to chat, but the group is invitation only because it has to be the right fit for us and for the others in the group. We have just 2 more spots available for this year's class and have already started a list for 2020.

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