By Lisa McCracken, Director, Senior Living Research & Development, Ziegler Investment Banking. Reprinted with permission from “Senior Living Z-News,” week of Feb. 25, 2019:
It has been stated a number of times in recent years that the complexity of the senior living business has increased coming out of the recession. The consumer is changing. Healthcare reform and payment reform are redefining the care continuum. Workforce pressures are challenging daily operations and the industry consolidation is increasing the scale and sophistication in many markets. There is little room for uninformed and disengaged board leadership in today’s not-for-profit senior living environment. The aim of this week’s Z-News article is to not only emphasize the importance of spending time in meaningful, strategic dialogue, but to also provide a sample of generative questions that can be utilized by your board.
A few years ago, Ziegler conducted a survey through its CFO HotlineSM series and determined that roughly 40% of senior living boards meeting quarterly and another 30% meet every other month. With meetings only 4-6 times a year, you may ask how a board has time for open-ended discussion, particularly if meeting time is limited. The reality is, you do not have a choice but to spend time in such discussions. If your board does not designate one meeting as its annual retreat (36% of senior living boards have an annual retreat ), then these deep-dive conversations need to be built into the agenda for each meeting or at designated times throughout the year. The ultimate role of the board is to set the strategic direction of the organization. If board meetings are spent discussing operations or listening to a round-robin of updates that could have easily been distributed in advance, you are missing the boat. It is without a doubt that organizations who spend time in generative work have greater clarity around identity, strategic direction and a collective vision for the future. There are some organizations who spend 30-minutes at the end of each board meeting in discussion around a generative question. Others weave these discussions in with educational topics brought forth during meetings.
It is important to note that these types of conversations require a level of trust and respect among board members. There can often be disagreement and varying perspectives on a particular topic. That is a good thing, but it needs to be done within a board culture that appreciates diverse schools of thought and understands how to use those discussions to move the organization forward. Here are some examples of questions that boards should be contemplating:
- If we were to build this organization from scratch, what would it look like?
- What is our organization’s risk tolerance regarding pace of growth?
- Would we be willing to grow in a certain direction if it meant challenges for the next 2-3 years, knowing that long-term we would be in a more stable position?
- Is there anything that we do or offer as an organization that we should really consider not doing anymore?
- Is there something that we do really well, better than others, that we could build upon and use as a growth strategy?
- Under what circumstances would we be willing to affiliate with another organization, if any?
- Would we ever consider creating a for-profit division or joint-venture with a for-profit entity? What would that mean for us as a not-for-profit?
- What is most exciting about the current senior living environment we are in today?
- What are the greatest threats to the future viability of this organization? What can be done to diminish the threats?
- What are our weaknesses as a board? What could we be doing better?
- Would you, as a board member, be willing to live in this community (one of our communities)? What would you want to see changed before making that decision?
- Would you describe the organization as innovative?
There are dozens of potential questions that can be created for use with your board and leadership teams to stimulate conversation. Spring is often a time where strategic planning sessions are held and organizations look to redefine their future direction. This can be the ideal time to utilize some of the above questions to help advance the planning efforts and grow the overall strength of the board itself.