Commonwealth Senior Living CEO Earl Parker joined the industry almost three decades ago. Needless to say, he’s seen a lot of change in that time.
With the pandemic’s impact fresh in mind, Parker is leading changes in 2023 related to getting back to pre-Covid brand standards for the company’s 37 communities. Central to that effort is a need to make operations friendlier to staff.
Through his Changemakers interview, Parker discusses the ways in which he has changed since he got into the industry in the 1990s. He also talks about the need for more iterative changes, and why continuous improvement is something he feels strongly about.
How have you changed as a leader since starting in the senior living industry?
I’m a lot closer to the age of our residents than I was when I started. Back in 1995 was when I first started in senior living. I came out of the hotel business. When I got into senior living, it was my first multi-site role. I was corporate director of dining services when I first started in the business. I would say when I first started, I was more of a manager than a leader, really.
Over the years, I’ve come to learn the importance of servant leadership and focusing on supporting the teams throughout the organization by setting a vision and providing the right tools and resources that people need to be successful.
I’ve learned the importance of listening a lot. I think that was a lesson that I learned over time. I tended early on to do more talking and less listening, and I’ve really learned to listen more and really use that information. I also have learned over time to really appreciate all kinds of diversity, and understand and value that not everyone sees the things the same way I do — that really helps the organization to get better outcomes for everybody. That was a tough one for me as a younger leader, but it’s something that I’ve really come to appreciate and focus on over the years.
Do you see yourself as a changemaker, and are you always excited to drive change?
My first response was, no, I don’t see myself as that. My first reaction to that word, changemaker, is probably a dramatic, earth-shattering kind of change.
But as I gave more thought to it, I could see it. My first mentor when I started working in hotels was a GM who I’m still in touch with, and they introduced me to the concept of continuous quality improvement and it’s been a key part of my life — work and personal — ever since then.
It’s really a consistent leadership mindset that I have and try to bring to the organization, but it’s really continually focused on how we can try to make our communities a better place to live and a better place to work. I try to spend a lot of my time digging in on that, and I believe that if we can stay focused on that as an organization, that we can’t help but be successful.
It’s a little bit of change every day, and ultimately that does create change. I certainly have changed a lot over the last 20-plus years.
What are some ways that you think senior living needs to change in the next five years?
We’re actually finally getting to the Silver Tsunami age wave that we’ve been talking about for the last 20-plus years. I think with that dramatic increase in demand, there’s going to come an increased demand for differentiation, unique offerings, boutique options, niche settings.
That’s going to provide an opportunity for a new level of creativity to be brought to the industry. As the size of some of those demand groups become large enough to support some more specific type offerings, I think that’s going to be very interesting.
I think one of the largest groups that is going to be out there is the group that are middle-income, and certainly there’s a lot of discussion about that. There are some folks that are making some headway on developing some product lines that were targeted for that group. I also think about further collaborations, public-private partnerships, continuing to work with legislators, and look at what options there are out there.
It still frustrates me every day when I see, across our 37 communities, we lose probably at least a resident a day that moves out to move into a skilled nursing setting because they have spent down and qualified for Medicaid, and they’re going to a less inviting setting where the government is paying more money for them to be there than they would pay for them to stay in assisted living. Really, there’s no defined need for them to be in that skilled nursing setting.
I think we have to continue to try to work with the government and legislators to make some more sense out of that so that people can have the option of being in a more residential setting and still getting the care that they need, and can be provided in that setting. Those are two of the things. I think one is really exciting, for folks that really want to target and do these really neat, cool, fun things, because I think there’s going to be enough demand for those things. The other is, how do we solve the issue for this big group of people that maybe can’t afford the traditional offerings that we’re providing today?
I’m hopeful that through working on the advocacy committee with Argentum, and some of the work that we’re trying to do can get these issues in front of lawmakers. It’s not going to happen overnight.
As you look across the rest of the senior living industry, do you think that it’s changing fast enough to keep up with the times?
I may seem like a contrarian based on what a lot of I read other people saying, but I think it is. I think the industry evolves along with the demand. The markets that we’re in especially, we’re regularly engaging our residents, their families, associates, prospects, and getting feedback.
I’ve been here at Commonwealth for 10 years, and there are many things that we’ve changed over the last 10 years: Dining, programming, physical plants, we’ve added hydroponic gardening, we’ve got a farm-to-table dining program, we’re using virtual reality with seniors. We’ve got robust Wi-Fi in all of our communities for residents and families to take part of. We have quartz countertops and stainless steel appliances.
I think we have adapted and changed a lot over the last 10 years, and I think we’ll have to continue to do it. I’m not really sure what’s going on in San Francisco, or L.A., or New York City, but I think in the areas that we operate, we’ve changed a lot over the last 10 years, and I think we’ve got a product that’s appealing to the seniors and their adult children that are here today.
We’ve all got to be responsible to continue to look at and monitor and evaluate where we think that demand is coming from in the future. As an industry, we’ve adapted pretty well. You could say the overall product looks and feels like it did 25 years ago, and the fact that we have apartments, and we provide care, and we provide dining, but I think the way that we do those things has changed dramatically. Again, I think it will continue to change as we go forward, but I think we’re doing a pretty good job.
Can you talk about a time when you tried to execute a change and things didn’t go according to plan? How did you pivot and what did you learn as a leader?
Unfortunately, I can think about too many times where things didn’t go according to plan, but I think that’s what happens when you focus on continuous improvement. You try new things and you learn from it.
I talked about my mentor that introduced me to this, but the whole Deming Cycle of continuous improvement. You plan something, you do it, then you study it, and then you react based on what you learned. You’re constantly trying things and knowing that they’re not always going to work out.
We were making a change with one of our technology providers. It’s a technology that affects every one of our associates very personally, and it’s related to their pay. They had done a great presentation, and we projected significant savings. We spent several months working on this solution and getting ready to implement it. We did several beta tests that didn’t go quite as well as we planned, but we were going to continue forward. Then we began training the entire company.
Literally, about two weeks before the transition, our implementation team came to me, and they were in a crisis. They said it was not going to work, and many of the features they were told were going to be available were still in development. The end users were voicing major frustration. We had invested months of time and a lot of money, and we had no recourse to get that money back from this provider. Ultimately, we decided to pull the plug and write off the money that we spent, and the projections that we had made for savings.
I think it was the right answer. The lesson for me was that we’ve got to be focused on making sure that whatever we’re doing and implementing from the home office is going to make our community teams jobs easier and more fun. That’s our role as the home office and the leadership team. If we’re going to make their jobs more challenging, it’s not going to work right now. Our teams are working so hard, with the staffing challenges that they have and trying to drive things forward, that we’ve got to look to streamline and make things easier.
If something is not going to do it, we’ve got to swallow our pride and adjust, and make sure that we don’t allow that to continue. This time, thankfully, we were able to stop it before it got to actual implementation, because that would’ve been a much harder pivot if we had actually completely gone through with the implementation and then had to pull it back.
It was the right thing to listen to the team and say, ‘Okay, we are going to need to find another approach here. We might gain something on one side, but if it is causing us to lose good staff because they’re feeling like it’s making their job too hard, then it’s not going to be successful.
How do you think about timing so that your company can innovate without getting so far ahead of the market that your new idea is now on the bleeding edge and it doesn’t work?
[laughs] Well, I generally like to be more in the leading-middle than the cutting-edge. Maybe that’s that continuous improvement. But I generally find that for what we’re doing, we’re okay putting things in place that have been tested if we’ve seen them work somewhere else with a similar resident and profile setting.
I think we have to be willing to try to be cutting-edge, or embrace early-stage technology as related to the workforce. I believe it’s the biggest challenge that we have as an industry before us, and the people that are going to win are the people that are going to figure it out sooner, better, and faster. We’ve been early adopters in several of the technology solutions that have been aimed at helping hire and retain more effectively.
We’ve had varying degrees of success. Some of them we’re still using, and some of them we went through for a couple years,and then decided we weren’t getting the results. We’re taking those resources and trying them in another area. I want to see it has been implemented and that it worked somewhere. But as it relates to workforce development and retention, I think we need to be willing to invest in the early-stage.
Changemakers tend to be risk takers, do you agree with that statement, and how would you describe your own appetite for risk?
I don’t see myself as a big risk-taker. I like to generally make educated, informed decisions when possible, carefully studying and looking at data. I guess that means probably I’m not likely to be that exponential changemaker, but I, as we talked about earlier, I also believe that slow and steady change done well can still win the race.
If you could change one thing about the senior living industry, what would it be?
This is an easy one for me, because I’ve been trying to work on it and encourage folks.
We all use different calculations for occupancy, turnover, average daily rate, net operating income, capital expense per unit. I think we’ve made progress in a lot of areas in trying to get some consistency to be more like some of the other asset classes, like multifamily. Not that we have to, but I think if we could get more consistency on that stuff, it would help the entire industry to have better benchmarks and really know, “Hey, for that 50% turnover, do you include part-time employees?” Versus somebody else who’s measuring turnover using all of their employees, or some people do occupancy based on units and not beds.
It’s hard to really benchmark or look at some of the data and say it’s beneficial when there’s such variation in how people are calculating and reporting information.
What word of advice would you have about managing resistance to change?
Well, first, I think we have to recognize that resistance to change is pretty much human nature for most people. There are those odd people out there that just say, “Oh, yes, I love change,” but if you go to their kitchen and reorganize their cabinets while they’re gone, when they come home at night you will see how much that impacts them.
I think change is, to varying degrees, a challenge for everybody. The real thing that you have to identify, which is easier said than done, is that resistance to change impedes our progress or our ability to be successful.
We had a community where it was our business plan, generally. We purchased a community and then we invested considerable capital dollars renovating it and adding memory care to it where it didn’t have memory care. We had a very set plan of repositioning this property in its market, and obviously getting higher rates in order to provide a return on investment for those expenditures. For two years, we had an ED that said, “Oh, just no one can afford it here.” We can’t afford the rate. That’s why occupancy is down. That’s why we’re having to give concessions.
We were pretty sure that this was going to work. Ultimately, we parted ways with that ED and hired a new ED from out of state, and within six months, she had filled the community at market rates. It was all a mindset and resistance to change. That was an expensive lesson for us, because we could have probably been full in the first six months, and we were buying into it. I think it’s really got to dig in, and question, and we probably needed to be a little more rigorous in determining what was the real barrier there, because ultimately, the barrier was one person’s mindset.
Can you talk about how you see the need for diversity, equity, and inclusion in the industry, and what you’re doing at Commonwealth to drive change in that regard?
As an industry, we’ve had a track record that has been pretty strong at growing strong female leaders. I think leaders of color and ethnicity are obviously still underrepresented. I’m certainly a supporter of the women in leadership group and want to continue to drive that forward. We’ve been having dialogue over the last couple years. Our senior leadership team goes into each community a couple times a year and meets with the frontline team, and the department heads, and asks a series of questions.
In the last two years, we’ve added a question specifically around diversity, equity, and inclusion, and what things they think we should be doing differently. We’re continuing to listen to our team, and gather information. I wish I could say there’s been a dramatic ‘aha’ moment from the feedback that we’ve received, but there really hasn’t been. What we’ve heard in general is, keep talking about it. Don’t just put something on the wall that says, “We believe in this.” Keep talking with us, keep engaging us in dialogue, and so we’re continuing to do that.
We also implemented about 18 months ago three resource groups across our company. One for women associates, one for Black associates, and one for LGBTQ associates. The goal is to create opportunities for them to get together. Each of those groups has not only participants who are a part of that group, but has allies in the organization and on our leadership team that are engaging in those monthly calls that they have. Again, looking for opportunities to identify leaders that might have been not readily identifiable in the past, and also seeking ways and feedback on how we can improve representation and inclusion.
2023, obviously, is shaping up to be another year of growth and evolution for senior living operators. In what way is Commonwealth changing for the times?
For us, 2023’s changes are really all focused on staffing. We added an internal recruiting team this year, we added a new VP of HR position, we added a VP of training and retention position.
As I talked about earlier, we are somewhat putting our money where our mouth says our focus is. It’s saying we’ve got to allocate more resources at building the workforce. We’ve done that, and we’re in the throes of it right now.
Again, we’re going to follow that plan. We planned it, we did it, now we’re studying the impact, and we’re going to react based on what the outcomes are, and we’ll adjust and hopefully, keep doing the things that work and make changes on the ones that don’t. That’s our biggest focus on change for this year.
We’ve got two new communities that we’ll be adding to our portfolio by the end of summer. We’ll have some evolution and growth there, and then several others that are in the evaluation stage, but we’ve got definitely two that we know will be coming on board this year.
Outside of that, in our other areas, really, 2023 for us is focused on getting back to the pre-Covid brand standards. I think we had really solid consistency and adherence to our brand standards. Naturally with Covid, in 2020, 2021, and even into some of 2022, some of those things fell away.
In mid-2022 through now, it’s really focused on our folks saying, ‘All right, let’s get those standards back.’ We’re tracking them on scorecards and saying, ‘All right, we need to get back to that 90 plus percent consistency in those brand standards.’