I [Heart] Hotwire

So what do leaders in long-term care have to learn from Hotwire?  I just found out during my trip to Texas.  I went to Texas (Dallas & Houston) to introduce our company to 2 skilled nursing facilities that we were about to acquire (another post on those culture integration/introduction meetings later).  My flights were booked for me correctly and I booked my hotel/car weeks later, the day before the trip.  I got my cities mixed up.  I landed in Dallas and started walking to the car rental and then suddenly had a flash of panic hit me when I realized that I’m supposed to continue on to Houston.  I looked at my itinerary and discovered that, luckily, my next flight was in 30 minutes.  I rushed to the other terminal.  I had about 15 minutes before boarding.  I called Hotwire.

I explained my situation.  I admitted that I made the mistake when I booked the hotel & car for the wrong cities.  What are my options?

  • ‘No problem, Mr. Sedgwick, I can take care of that.’
  • How so?
  • With your permission I’ll cancel your reservations, book your hotel & car for the correct dates and cities, and waive the reservation cancellation fee.
  • So … this isn’t going to cost me any penalty or fee?  You’ll just make it right for me?
  • Yes.  You’re a loyal customer of ours and we’d like to keep it that way.

She did.  I am.  And, you should be too.  Does travelocity, orbitz, expedia, etc. treat you like that?  I don’t know … and, I have no interest or intention to find out.  I’m Hotwired for life.

How does that relate to healthcare?  One of the main problems with long-term care approaches to customer service is that, systemically speaking, our policies are usually drafted to reflect or agree with the regulations.  So, we end up with very cold guidelines.  Have you heard this exchange?

  • My mom lost her earrings.
  • When?
  • I don’t know.  I can’t find them anywhere.  They were expensive.
  • Were they on the inventory list?
  • I don’t know.
  • Well, I’m afraid if they’re not on the list, we can’t do anything about it.

The saying of stepping over dollars to pick up pennies also applies.  The reality of these types of breakdowns is that it’s usually the facility’s fault.  What an opportunity to exceed expectations!  Where customer satisfaction is involved, the regulations come no where near a guideline.  Rather, asking the simple question, ‘how would I hope to be treated?’ is all the guideline you need.  Follow it.  Always.  You’ll turn around digruntled, distressed, disapointed customers and build loyalty and promoters.

Just like that one guy who became so loyal to Hotwire, he dedicated a blog post to sing their praises …

Work-Life Balance

A friend/colleague of mine recently asked for my advice/experience with ‘work-life balance.’

I found it difficult to ‘coach’ this b/c that elusive ‘balance’ is so individually, personally defined.  It’s defined by one’s life perspective, motives, goals, values, beliefs.  And mine are mine alone that …

‘No Success In Life Can Compensate For Failure In The Home’ …

Nevertheless, below is some of what I shared with him …

It’s all connected.  Spiritual-Physical-Emotional-Mental-Professional.  The word balance is misleading.  Harmony is a better word.  It’s more like an orchestra.  All of the instruments matter.  But, they don’t matter equally.  But, if even a minor instrument is ‘off’ the whole suffers.

The book 7 Habits of Highly Effective People has sold over 15 million copies.  I read it about 12 years ago.  It had had a huge impact on me.  There’s several principles there that help me be ‘effective’ aka balanced.  If you haven’t read it, read it.  If it’s been 12 years ago, read it again.  Here’s the cliff notes: http://www.quickmba.com/mgmt/7hab/

I’m sure one of the most universal new leader experiences is to have your spouse say something to the effect of …

  • I never see you anymore.
  • You’re not listening … Or … Have you been listening to anything I’ve said?
  • You’ve been saying it’s going to be worth it for 2 years.  When will it be worth it?
  • You do remember why you go to work everyday, don’t you?
  • You’re not as happy as you used to be.
  • Your son started walking yesterday.

I’ve had several wake up calls by my wife, Jessica.  Fortunately, I took each one seriously and she has course corrected me back to the correct course (which is focused on her happiness and on presiding in my home and on having a deep relationship with my kids).

I’ve learned some things …

  • I need to make weekly plans/goals/schedule for my different roles (myself, husband, father, worker, church callings) in that order.  I put them on the calendar: work out/temple/read, date night each week/flowers, one-on-ones with kids on Sunday, ichat with kids if I’m traveling, home teaching visits.  I’m unorganized.  I need to force things onto the calendar or I forget, neglect, hurt feelings.  I make time for lunch appointments to interview or go marketing so I started to do the same thing for lunches with Jess. “I’ll be gone for a an hour or so.  I’ve got a lunch appointment.”
  • We have to go out every week.  I asked her to go on a date with me this Friday 2 weeks ago.  We’re going to a small, local theater. I don’t make plans that affect her (travel) before talking to her.   I have a bookmark folder on my browser toolbar with websites of local theaters, etc. (watching a video at home doesn’t count)
  • I buy flowers for her online for the future when I know I’m going to be working late (during boot camps or travel)
  • I encourage my partners to leave work at the facility by not emailing them or calling them at home and not replying to emails at night if it can wait until the morning.  Sometimes it can’t wait.
  • Related to that … I leave my laptop at work/facility most of the time.  Leave the laptop at work.  Leave the laptop at work.
  • If I HAVE to work on something at home, it’s after I’ve helped to put the kids in bed.
  • I do the dishes most nights b/c that matters to her more than just about anything I say.
  • I text her love notes during the day.  (I put an alarm in my calendar to do that).
  • I resist the temptation to reply to emails during Sunday if they can wait until Monday.  I’ve stopped bringing my iphone into church.  I use paper scriptures.
  • I don’t share with Jess what’s going on at work.  Sometimes she asks and I give her general answers.  I do not get into the detail, the drama, the stress.  I don’t talk about census.   I don’t talk about the department head(s) that’s keeping me up at night.  That’s what my cluster partners are for.

Probably the most important thing that has brought sanity, harmony, and ‘distance’ to my life is MONKEYS.  See your laptop and briefcase for what it is … A monkey cage.  Monkeys have one desire – to destroy your marriage.  I’m not joking.  You should listen to the whole thing.  Here are my thoughts on Monkeys: https://worldclasscare.wordpress.com/tag/monkeys/

I hope something here helps.


McKnight’s Guest Column

Guest Column @ McKnight’s

McKnight’s is a long-term care industry magazine that I’ve read for years.  Several months ago, I read on their site the words of an administrator who expressed a wish for more empowerment at the facility level.  I contacted the Editor of McKnight’s to see if I could contribute an article about my company since our business model is exactly what that administrator was looking for (empowered, decentralized, entrepreneurial).  Instead of talking about my company, The Ensign Group, he invited me to talk about the principles behind the different corporate structures.

Thank you to McKnight’s Jim Berklan for the opportunity.  I’ve received a lot of positive feedback from the piece.  Here it is …

What the long-term care world needs now

Dave Sedgwick
April 27 2010

The Centers for Medicare & Medicaid Services’ shift to a prospective payment system in 1998 sent shock waves through the industry and claimed the financial lives of many prominent long-term care companies.

The current combination of recession, Medicare cuts, RUGS IV, MDS 3.0, state budget crises, QIS, RAC, and the unknowable final shape of healthcare reform have today’s leaders feeling déjà vu.

What do long-term care companies need in order to avoid last decade’s casualties? Here are a few very important things:


An organization’s culture—its structure and values—is the single most important factor for overcoming acute challenges and for transforming the industry one facility at a time.

Centralization vs. decentralization

Speaking generally, there are two types of corporate structures: centralized and decentralized.  The most prevalent structure in long-term care is the centralized model. To be blunt, the primary need for a controlling, top-down, large corporate bureaucracy is to make up for incompetence at the facility level.

If this is not so, then why pay for all of those corporate puppeteers?

Imagine that your best regional and corporate nurse consultant led each and every facility in your company. Would you need the same amount of corporate overhead (divisionals, regionals, consultants, VPs, executive VPs, senior executive supreme VPs, etc.)?

Don’t get me wrong. I’m not saying that having better leaders at the facility means no support is needed. I’m also not saying there aren’t great administrators in traditional corporate settings. But I am saying that if you hope to attract a different breed of administrator and director of nursing, you have to cut the puppet strings—empowering the facility leaders to lead.

A decentralized model attracts the type of leader who is entrepreneurial and innovative, and has an ownership mentality. When the puppet strings are cut, facility leaders no longer say, “I have to check with corporate.” They own their problems and solutions. When major tests to a market or an industry happen, a decentralized organization has many creative partners attacking the problem in the trenches instead of a small handful of “know-it-alls” at corporate.

A decentralized model also attracts the type of support people who believe in the creativity and responsibility of local leaders and love to help them grow.

One of the main arguments against decentralization is that it is too risky—clinically and financially. The centralized mantra is “Thou shalt do things our way” in order to ensure “things” are done right. To avoid risk, decisions are made at the corporate level: vendor contracts, hiring, firing, compensation, policies, forms, etc.

The trade-off for operating that way, of course, is that you get a culture that attracts “employees” instead of “owners” and you promote the “all-stars” out of the facilities where our staff and residents need them most.

In order to mitigate the inherent risk of decentralization, a company must have deep-rooted shared values among its facility leaders.


Without a fanatical commitment to core values, a decentralized structure is too risky. But if a decentralized company hires, trains, and measures based on shared values, it has the potential to outperform its centralized competitors because it has infused top talent throughout the company and where it’s needed most.

Almost every company has a written culture statement (mission, values, motto, etc.) But, the difference between those that will be able to overcome major tests and those that won’t will be how real those values are to the facility leaders themselves. Too often, mission-type statements collect dust as decorations.

The structure will shape the true values and feel of a company more than anything. When shocks to the industry hit, our companies’ culture (structure & values) will be tested.

The testing of Johnson & Johnson

One of the prime examples of a decentralized company’s culture leading it through crisis is Johnson & Johnson. In their 1981 annual report, they state:

“Johnson & Johnson is not one company but many  . . . The largest has 6,300 employees; the smallest, at year-end had six. . . .

“Whatever their size or location, they share a commitment to meeting the special needs of a well-defined customer. In doing so, they create a wide variety of innovative ways to successfully run their businesses.

“We feel that the secret to liberating that productivity is decentralization— granting each company sufficient autonomy to conduct its business without unnecessary constraints.  In short, we believe decentralization = creativity = productivity.”1

Do we see companies in long-term care that are structured that way?  Rarely. But, therein lies the key to both attracting and retaining a different breed of facility leader.

These statements by J&J were soon put to an extraordinary test.

In 1982, cyanide-laced Tylenol pills killed seven people in a few days in the Chicago area. J&J’s reaction was extraordinary. In spite of requests from officials to not recall the product, J&J called for a nationwide recall of 31 million bottles with a retail value of $100 million. Their market share went from 35% to 8%. One month later, they reintroduced capsules in a new, triple-sealed package, and within several years, Tylenol had reclaimed its top spot in the market.

Speaking in 1983 about that major crisis, James Burke, J&J CEO from 1976 to 1989, said the following:

“I do not think we could have done what we did with Tylenol if we hadn’t all gone through the process of challenging ourselves and committing ourselves to the [culture]. We had dozens of people making hundreds of decisions and all on the fly. And they had to make them as wisely as they knew how.

“And the reason they made them as well as they did is they knew what the set of beliefs that the institution they worked for were.  So they made them based on that set of beliefs and we made very, very few mistakes…. “2

Creating new cultures

What lessons can we learn from recent long-term care history and companies like J&J? In order to be prepared for the significant tests ahead, we need to have efficient, nimble, talented organizations fanatically committed to its core values.

Companies with centralized, top-down, bloated bureaucracies needing to justify their position and authority are slower to react to the shockwaves that will come.

Not only will a decentralized organization of many owners and partners come up with better ideas than a centralized few, but it also will be able to act quickly, like J&J.

Empowering the field and eliminating bloated bureaucracy is for many an impossible pill to swallow. Yet, if you were to ask the dozens of beaten companies from the late 1990s if they would try that medicine if given the chance, I bet they would.

1 Harvard Business School, Case Study: Johnson & Johnson (A): Philosophy & Culture, pg. 3

2 Video, Philosophy & Culture, A Question & Answer Session With Advanced Management Program Participants at Harvard University, December 1983

Dave Sedgwick is vice president of organizational development for The Ensign Group. His healthcare leadership blog can be found at https://worldclasscare.wordpress.com.

But WHY!?

One of the puzzles each leader needs to decode is how to get his/her ‘followers’ to passionately & quickly mobilize towards his vision of change.  In other words, how do you get people you’re leading to WANT to do what you want them to do?  Below are two TED talks that try to answer this question.  I find both compelling …

Do you agree or disagree with these principles?

I agree …

To start a movement

  1. Stand Out – To be a lone nut.  To stick your neck out.  BE PASSIONATE.
  2. Nurture your first, most important followers.
  3. Tipping point.  Make it less risky for the skeptics/cynics.
  4. Sell WHY you’re in business or WHY you’re making the changes.  Not the generic, common reasons (to make money), but the virtuous, larger-than-yourself reasons.