Senior Living Operators Get More Strategic About Tech Investment

The benefits of using senior living technology are clear at this point in 2022. What is not as clear is how operators will pay for it, pilot it or benchmark their progress.

Take senior living operator HumanGood, for example. The company a few years ago began examining how its technology is deployed and selecting technology. Early on, it became apparent the company would need to formalize the process to make it effective.

“We are an industry that thrives on what I call vapors and good feelings,” HumanGood CEO John Cochrane said during a panel discussion late last month at the Silicon Valley Senior Living Summit in California. “We thrive on promises, and how this is going to make your life easier — but no one can ever quantify it.”

Pathway to Living Executive Vice President Justin Dickinson, who hosted the panel discussion, echoed that sentiment.

“As an operator, it’s hard to see the forest through the trees with all the fires we’re putting out every day and how we’re trying to keep all the balls in the air,” he said.

Through insights from a panel of both HumanGood insiders and experts outside of the company, the organization developed a process wherein they would look for “real problems” to solve, and use that as a guidepost for which technologies to invest in and deploy.

“That discipline has allowed us to quickly screen out the stuff that either doesn’t solve a real problem or doesn’t solve it in a measurable way,” Cochrane said.

Retirement Unlimited, Inc. President Doris-Ellie Sullivan weighs technology in a similar way. Instead of looking at the bells and whistles or functionality, the Roanoke, Virginia-based senior living operator looks for adoption from residents and staff.

A cautionary tale lies in an app the company launched. Although around 500 family members had signed up to use it around launch, “only two of the families were using it,” Sullivan said. That prompted the organization to think about reinventing how it looked at technology.

“I think there’s a disconnect with the home office, where everyone is tech savvy, and our frontline staff,” Sullivan said.

Another fast-growing operator with regard to technology is Olathe, Kansas-based Bickford Senior Living. The company “probably adopted more technology … post-pandemic than we did in the previous 20 years combined,” said Executive Vice President Alan Fairbanks.

Olathe, Kansas-based Bickford operates a portfolio of 60 communities in nine states — Illinois, Indiana, Iowa, Michigan, Missouri, Nebraska, Ohio and Virginia. According to Fairbanks, the company’s executive directors need to regularly interact with more than 40 different platforms simply to operate a single community.

As such, the operator needs to have technology with both the scale to handle its portfolio and the flexibility to make quick decisions.

Fairbanks said he is focused on avoiding a disconnect between what a technological solution can do in theory with how it will be practically used in the field.

Sullivan concurred, noting that line staff should be “champions” of technology for it to work as planned.

“They’re the adopters … so, including our line staff in that process is critical,” Sullivan added.

In addition to knowing the desired product and the desired function, operators also need a formalized investment structure, according to Cochrane.

Cochrane said he had approached the HumanGood board of directors after a recent investment opportunity popped up. His goal was to create a financial tool with which to move on technology more quickly.

“The technology world moves a lot faster than the senior housing world,” Cochrane said.

His pitch paid off. The HumanGood board set up a fund controlled by Cochrane.

“We need to get to fast ‘no’s as well as sustained yesses. We’re not good at the fast ‘no’s,” he said. “We’re trying to push the rock up the hill, but sometimes you just need to let it roll down the hill and stay there.”

Indeed, senior living operators will need to navigate what looks good and what will actually work — for operations and for the bottom line. In some cases, capital partners are stingy about participating in technology improvements.

“When I think about capital partners, they are very much lagging as it relates to the willingness and the capacity to help us as operators invest in technology,” Fairbanks said. “They’re not willing to join me in that journey to create some aligned incentives… that ultimately will benefit them as the capital partner.”

Crafting a disciplined approach for finding, funding and rolling out new technology is particularly difficult in senior living.

“We’re challenged with balancing what I consider to be two very difficult aspects of the business — mission and margin,” said Dickinson. “Taking care of people is at the heart of what we do, but we have to do it with a margin-driven approach.”

But the industry also has an opportunity to overcome those challenges by working together, either as a formalized consortium or more loosely as an industry.

“It’s about collaboration,” Cochrane said. “If we can collaborate across disciplines, then we’ve unlocked something really powerful.”

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