Eight simple things to look for in a great third-party management company.

By Jason Childers, 2Ten Consulting

Over the last few months, I have noticed a growing, disturbing trend in the senior housing industry. Owners and developers of senior housing communities are struggling to find good third-party management companies. This is troubling for a couple reasons. First, there is enough mediocrity in our industry already. We need operators that can change perceptions of senior housing and generate new interest in our communities. Second, our industry is growing very fast and new developers are entering the space every day. We need quality managers to ensure these new communities will be successful and residents receive the services and care they want and need.

After reading a few articles on this topic and talking to a few owners/developers of senior housing communities about their struggles to find good managers, I started thinking about what makes a great management company. For the last 14 years, I have worked with and for a number of third-party management companies. I have seen the good and the not as good. If you can find a company with the eight characteristics below, sign them up quick. They are going to do great things for your communities and our industry.

1.  They Talk About Employees More Than Residents.

This may seem a bit backwards. After all, we all know that the Customer is King. However, your management company doesn’t have a direct touchpoint with residents on a daily basis. They do have a huge impact on the engagement and empowerment of employees, though. It starts with hiring great people. From there, it’s all about giving them the tools to be successful and providing assistance when times are tough. One truth I have seen time and time again in our industry is happy employees create happy residents. Happy residents, in turn, make for happy bottom lines.

2.  Creativity And Innovation Are Key.

You should feel this in your very first interaction with a prospective management company. How do they think about the industry and what are they doing to change it? Apple built an empire by Thinking Different. Your management company should be looking to start a revolution, too. You should definitely feel this in their website, marketing materials, and social media strategy. However, it should also shine through in their programming, thoughts on building design, use of technology, and employee development.

3.  Customer Service Applies To All Customers.

Providing outstanding customer service to residents and their families is absolutely critical. That’s a given. However, you should also look for the customer service they provide to you and your team. From all levels of the organization, promises should be kept and communication should be easy, open, prompt, and accurate.

4.  They Don’t Have A Big Ego. Well, Not Too Big.

 A good management provider is going to have an ego of some significant size. They should. The work they do is complex, difficult, and changes every day. The great companies can manage through this, keep residents happy, census high, and create tremendous value. That being said, they should also be open to new ideas. The best companies know a lot. However, they recognize they don’t know it all and are always excited to learn.

5.  They Have Focus.

As mentioned earlier, senior housing management is complex and ever changing. The best management companies have a strong focus on their operations. They are driven to be the best in the industry. Some companies may have their own development projects or have other lines of business they are building. This isn’t necessarily a bad thing. However, ideally, the team working on your communities will be 100% focused on your projects.

6.  They Will Say “No” To New Business. 

Third-party management companies love getting new business. It makes sense, that’s how they grow. However, growing too quickly can cause resource issues. Strong operators have strategic growth plans. They look for partners with similar values and communities that fit well in their portfolio. Companies that focus on high-end independent living may struggle with high-acuity assisted living. Strong regional operators may have difficulty assigning the appropriate resources to a community outside their current footprint. Good management companies recognize the strain this can create on the organization. If a community doesn’t fit their strategy, they will say no to the management contract.

7.  They Feel More Like Partners And Less Like Clients.

We all want to work with people that we like. This is especially true in senior housing. No matter how great the management company is, the business isn’t always easy. There are going to be issues. There are going to be tough meetings and phone calls. You want a partner that is truly invested in your project. A great management company is going to treat your community like it is their own. They recognize that they are only successful if you are successful. They will be proactive in bringing new ideas and solutions to the table. Good management companies will fight for the tools and resources they need to make sure your communities are not just meeting, but rather exceeding, expectations.

8.  They Create That Little Something Extra.

This one is difficult to explain, but you will know it when you experience it. Choose a market, any market. Shop the senior housing communities in that area. Typically, you will walk into one of those communities and, while you won’t be able to explain it, it will just feel really good. That feeling is the result of a community firing on all cylinders. Residents are happy. Employees are engaged and empowered. Census is strong and there is a buzz of excitement and energy in the building. This is a community operated by a great management company.

That’s it, eight simple things to look for in a great third-party management company. If you have any thoughts to add or want to chat about great third-party management, send me an email at [email protected]. I’d be happy to bounce some ideas.