What would it look like if Walmart went into the senior housing business?
By Steve Moran
During the month of November, 2011, there were a rash of stories about how Walmart was preparing to get into the primary physician business. It got me to thinking . . . what would it look like if Walmart went into the senior housing business? In doing some research for that article I came across a piece that talked about how a business can come to dominate their marketplace. Here are some ideas that could help you to dominate your marketplace.
How to Gain Market Dominance
In 1993 researchers Treacy & Wiersema took a look at a number of retail businesses that had mostly come from nowhere to dominate their market space. As they examined these businesses they concluded there are three ways to gain market dominance:
- Operational Excellence — Operational excellence means that there is a singular focus on providing a terrific product or service at the lowest possible price. The idea is that by having operational excellence it is possible to create systems that reduce costs and that those cost savings can be passed on to the purchaser of those products or services.
- Customer Intimacy — When an organization focuses on customer intimacy it really means two things: first, the organization works at understanding what each individual customer needs or wants and, second, commits to meeting those needs and wants. The idea is that providing a customized solution is key to success of the organization.
- Product/Service Leadership — Organizations that are focused on product leadership are committed to finding the latest and greatest ways of meeting a customer’s needs as desires. They are always looking for new and better ways to meet needs. They are so focused on leadership in this area that they are always looking to make their own innovations obsolete with their next generation of products or services.
The thing that is particularly fascinating about these three attributes is that in order to gain market dominance an organization only needs to excel in one of these three areas. Then all they have to do is be as good as the rest in the other two areas.
While it is possible to excel in two areas, it doesn’t happen often and it is not clear that it improves market dominance.
Dominate Your Senior Housing Marketplace
So how does a senior housing organization accomplish this? Here are a few ideas and I am hoping you, readers, will add to the list.
- Operational excellence — This means having computer systems and operational systems that keep costs to a minimum. It means looking at all of your expenses and cutting those things that are not benefiting the community and residents. This does not mean short-term cuts that will result in long-term problems or pounding your vendors so hard that they are not making a fair return. It also means putting money into things that will increase efficiencies and increase the resident and team experience.
- Customer Intimacy — This is an area that is ripe for senior housing. It means getting to know the local community and local referral sources. It means being willing to ask prospective residents, “What do you need from us?” and then being ruthlessly committed to meeting those needs and desires.
- Product/Service Leadership — This means looking at what other people are doing and then figuring out how to do it better; figuring out how to mesh these ideas with your local community. Once you have innovated, move toward making those innovations obsolete with even better ideas.
How do you create excellence in your community?