The Secret Sauce To Success

Empowering your Executive Directors may be the way to go.

I finally found out the secret sauce for success in the senior care market, at least for The Ensign Group. It is called empowerment. Simplistically, the home office does not interfere with the operations at each local community. Other than property, casualty and health insurance, the executive directors are pretty much free to do what they want with expenses. But, they have to succeed.

Here’s the deal. A young ED is given full P&L responsibility, with certain benchmarks, of course. He or she is then part of a local team of a few other EDs, and they meet regularly and compare notes on costs and revenues. They can even decide on who in the company’s ED training program is the right person to fill a vacant spot.

It seems like they are given a lot of rope to hang themselves. But they don’t, at least not very often. It is the concept of being the CEO of a $5 million or $10 million business unit right out of business school that seems to be enticing, and empowering. Remember the days when Holiday Retirement’s PE owners would call up each community and tell them how to adjust rents…. weekly. Doesn’t happen at Ensign.

Some corporate guys can’t let go, but it is your people on the scene who usually know best. You’ve just got to go find those people, and make sure they are financially incentivized. No margin, not much of a mission.


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