Title: Getting Help From Hospitality: Strategic Opportunities, Competitive Advantages, and Growth in the Assisted Living Industry Cheri A. Young, Ph.D. David L. Corsun, Ph.D. University of Nevada, Las Vegas University of Denver College of
1Getting Help From Hospitality Strategic
Opportunities, Competitive Advantages, and Growth
in the Assisted Living IndustryCheri A. Young,
Ph.D. David L. Corsun, Ph.D.University
of Nevada, Las Vegas University of
DenverCollege of Hotel Administration
School of HRTM
2A New Model for ALFs
- Similarity to hotels and resorts
- Driving profits through sales
- Focus on service quality and customer
satisfaction
3Shifting Paradigm
- Break out of the medical paradigm
- A shift to the hospitality paradigm
4Todays Situation
- Overbuilding of facilities
- Length of stay overly optimistic
- Pressure on profits margins are shrinking
- Seniors want to age in place
- Neglect of human capital in ALFs
5Profit Sales - Costs
- Decrease sales?competing on price
- Cost cutting erodes quality
- Value
6So Whats An ALF To Do?
- Take advantage of seniors wanting to age in place
- Drive sales by offering value quality
- Invest in human technological capital for mass
customization - Partner with hospitality companies
7ALFs and Aging in Place
- Bring the mountain to Mohammed
- Provide ancillary services In-home aides,
technology, rehabilitation services, geriatric
assessment - One stop shopping Let them age in place at the
ALF
8Driving Sales
- Focus on service quality customer satisfaction
- Sell, sell, sell
- Have something to sell
9Lessons from Hospitality
- Do not forget to sell to adult children
- Hotel/extended stay rooms
- Bundle services
- Give them opportunities to spend
money on their parents - Outsourcing
10Health and Wellness
- Increase the length of stay
- Manage costs through acuity
- Revenue enhancement through wellness services
11Focus on Value and Quality
- Service-profit chain
- Minimize gaps between expectations and delivery
of service - Mass customization achievable with technology and
human capital
12The Chain
Operating strategy/svc. delivery system
Revenue Growth
satisfaction
Internal Service Quality
loyalty
External Service Value
Customer Satis-faction
Customer Loyalty
Customer Value
capability
productivity
Profit-ability
-wkplc design -job design -EE
selection development -rewards
recognition -tools for svc.
-retention -repeats -referrals
-svc designed delivered to meet needs of target
market
-svc. concept results for customers
13Happy Employees, Happy Residents
- Correlation between employee and customer
satisfaction - Most difficult competitive advantage to imitate
- Invest in human capital via training, employee
commitment, empowerment
14Cost of Turnover Lessons from Hospitality
- 3,000 EEs _at_ 6,000 per housekeeper
- 10 reduction in turnover cost savings of
1,800,000 - Spending 600K to reduce turnover by 1 nets
1.2M to the bottom line - This amounts to spending 2K/EE
15Services as Theater
- What aspects of service make theater an
appropriate metaphor? - Performance service can only be experienced
- Those involved are playing roles in an effort to
create an audience impression - Much backstage work must be done to make the
performance possible
16- comprehension of, evaluation of, and response
to a service emerges over time, just as
understanding of a motion picture or a theatrical
production develops as the plot unfolds.
Meanings are assigned to the many signs, symbols,
and actions that are part of any service
experience. Hence, services are not simply like
theater, they are theater.
17Elements of the Experience
Actors - they are the service Customers perceive
the contact employee as the organization, not
just its representative Similarly, employees
perceive their managers as the organization, not
its representative Audience - casual interaction
with/observation of one another affects the
service Setting - influences expectations and
perceptions of the service Performance -
improvisational and must involve congruence among
the other elements
18Seeking Competitive Advantages
- Partnering with the hospitality industry
- ALF/resorts or ALF/vacation ownership
- Generate two important referral sources adult
children and independent seniors
19ALF/Resort/Vacation Ownership
- Combine to provide familiarity
- Can gear for the 55 crowd
- Share laundry, housekeeping, FB, human
resources, sales marketing - Generate sales to ALF residents of resort
services during off-peak hours
20Design Issues for ALF/Resorts
- Particularly important for appeal to non-ALF
residents - Locate rooms in pods or segments for increased
flexibility - Provide the opportunity for families to spend
quality time together
21Recommendations
- Let them age in place
- Focus on both sides of the profit equation
- Drive service quality, value, and customer
satisfaction - Invest in human and technological capital
- Partner with hospitality companies