By Jack Cumming
The biggest challenge facing senior living is one that is seldom spoken of. Talking on a deep level with a broad cross-section of residents can reveal that many often feel that they don’t matter, i.e. that they are virtually invisible.
It can be a challenge, to give residents a sense of purpose beyond merely existing in a state of perpetual vacation. That is one of the most difficult barriers preventing today’s senior living from reaching its potential. Unless age-demarcated senior living can enrich life beyond the alternatives, it will have lost its purpose.
What Do You Want for Retirement?
How do you view your own retirement? Do you plan a do-nothing retirement, or do you hope that, after a short self-indulgent respite, it can become a time for you to find new purpose? Perhaps pursuing something you long dreamed of being able to do.
We’re entering a new era for senior living. Everyone seems to sense the winds of change, but few senior living organizations are setting their sails and changing direction. Those that do embrace change will be positioned to catch those fair winds to propel their enterprise forward confidently through uncharted waters. Here are some radical ideas, some you may immediately reject, but others you may find intriguing.
1. Include co-working spaces in senior living communities
This is best done on a time rental basis, alternatively as a community amenity attraction.
Advances in the science of longevity have extended vitality and energy to older ages. The new generation expects to remain productive. Appealing to those who are aging productively requires supporting them with workspace so they can pursue their social missions and other callings.
2. Embrace the flexible work scheduling of the “gig” (flex) economy
Flexible work structures empower workers to better match work needs to workers, and to benefit from the emerging “Opportunity economy.”
Some residents are distressed by the current state of employer/staff relations, by the resulting tensions, and by fear that essential services may not be there when needed. We need to make work attractive. Happy employees are essential for happy residents, happy families, and a positive reputation.
The realities of the pandemic reduced the attractiveness of job security (as workers were laid off) and increased the need for flexibility to cover childcare obligations. As workers have learned to survive under these changed circumstances, a new work-worker relationship has been emerging. Resident services often suffer as a consequence of understaffing and frequent turnover.
3. Rethink relationship structures
To appeal to the growing expectations among newer residents, there needs to be a unified camaraderie culture of mutuality among residents and staff – a neighborhood community feeling.
In most senior living communities, two cultures exist side by side. One culture, the staff and workers, view the facility as a workplace; they look forward to paid time off, and they are open to leaving for more lucrative or more rewarding opportunities. That calls for special acclamation for those workers who pass up more attractive, less hierarchical jobs outside senior living, to remain often at minimal wages in service to residents and to each other. They are heroes whose voices need to matter.
Residents, typically, are committed for life and are dependent on staff for the lifestyle – neighborhood feeling, carefree living, and peace of mind — they signed up for. These cultures can be brought into harmony with each other, eliminating the sharp demarcation that now often exists. If residents and staff sometimes run into each other at the friendly bar across the street, why not bring the pub on-site and open to all. And that’s just a start.
Since staff has the paramount decision authority in most senior living enterprises, the cultural demarcation renders residents and those low-paid workers less visible than the deciders, even though residents are the reason staff has jobs at all and the workers are the people who deliver on the promises.
4. Review options for corporate organization
Align the form of the corporation more closely with its mission to provide the security and value that it promises to residents.
Nonprofits look to donors, resident prepayments, and retained earnings for the equity investment capital needed to operate. For-profit enterprises have more capital flexibility and greater accountability to the providers of their equity capital, but they may put owner interests before their responsibility toward residents. Of course, nonprofits, too, can also put corporate interests ahead of the interests of those they serve.
Mutual benefit and cooperative corporations (common for social clubs and homeowners’ associations) bridge both forms of organization. While attorneys advising senior living enterprises often prefer condominiums, condos present transition challenges for senior residences. Mutual benefit or cooperative organizations give greater visibility and meaning to the lives of residents. Wise boards are continuously considering strategic options for the entity that they serve.
5. Give residents a seamless range of contract options
This gives residents greater flexibility to meet their individual financial planning needs. This simple change can make one senior living community more attractive than another that offers fewer options.
The major contract alternatives are variations in how much care is included, whether entrance fees are refundable or forfeitable, and whether refunds are immediate or contingent. There may also be contracts that include Medicare Advantage type healthcare.
All of these options can be calculated mathematically to be financially neutral so the contracting enterprise neither stands to lose or gain by the choice that a resident makes. Thus, it is possible to make the choice of contract type a matter of consumer preference rather than enterprise specific. Moreover, there are financial products that can be used at the corporate level to ensure that choices of contract type are financially neutral to the corporation. This potential competitive advantage is ignored throughout the industry.
There are other changes that can elevate residents, giving them more visibility and thus having the capacity to disrupt today’s entrenched industry practices and perspectives. Examples include dining offerings, age requirements, price classification by risk exposure, fundraising insights, etc. But the five enumerated possibilities above can go a long way toward meeting the developing expectations of today’s customers. And toward persuading people to move in younger, thereby expanding senior living market reach.
Change is Coming
One thing we learned during the pandemic is how suddenly and inexorably change can come whether we welcome it or not. Considering strategic possibilities like these, and the many others alluded to, can allow today’s management teams and boards to pivot decisively to be ready for the future.
At a minimum, any reasonable management should be piloting changes and gaining experience to prepare for coming cultural and product evolution. The classic example is that good executives, instead of asking “why,” ask “why not”. Those who ask “why not” have brought us to where we are now, and it is they who will shape our future.
Who Has the Responsibility?
The biggest driver of corporate failure is inaction in the face of change. If your corporate culture is one of inaction, it’s likely that blame is more common for “failure” than praise for achievement. Who, on the other hand, gets blamed for inaction? There’s always a good excuse. The passenger rail and shopping center retail industries know all of them. Let’s not have senior living go the way of the horse-drawn buggy.
