Why we sold the franchise

Turbulence

Almost 12 months since my last entry.

I find myself on a plane headed back to Maryland after meeting with my partners in SoCal about my short- and long-term plans now that the sale of Doctors Express has been finalized.  We announced the sale of the franchise business to American Family Care (AFC), based in Birmingham, AL a few weeks ago.

What took me away from doing what I love with and near the people I love in the place I love?  One of my best friends and Ensign partner, MikeD, started a new venture within the org. in a new sector of healthcare – urgent care.  He had already brought on a couple urgent care veterans to accelerate his learning curve as he planned to build several centers de novo.  Quickly after the venture got off the ground, their plans expanded into a couple new paths including the acquisition of the only urgent care franchise in the country – Doctors Express, based in Maryland.  Mike asked me to lead that business and they made it worth my bet.

Personally, it was a high risk/high reward proposition.  Much to my surprise (and the surprise of my family and friends and colleagues) my wife and I decided to go for it after just 4 days.

By the time I could transition my role to “the upgrade” BHulse, my new partners were already underway with Doctors Express.  10 months after I joined … at our annual conference in March in Vegas, I told the franchisees that the best word that I could think of to describe the last 12 months is TURBULENT.  Turbulent because even though there were bumps along the way, the plane kept moving forward and the system made huge improvements in terms of number of centers, patient count, and revenue.  2013 is definitely poised to continue its upward trajectory.

So why sell?

Good To Great

You have to understand Ensign’s culture to understand the answer.  The book Good to Great teaches a lot of the same values and strategies that have been part of the Ensign Way for years …

“The pivot point in Good to Great is the Hedgehog Concept. The essence of a Hedgehog Concept is to attain piercing clarity about how to produce the best long-term results, and then exercising the relentless discipline to say, “No thank you” to opportunities that fail the hedgehog test. When we examined the Hedgehog Concepts of the good-to-great companies, we found they reflected deep understanding of three intersecting circles: 1) what you are deeply passionate about, 2) what you can be the best in the world at, and 3) what best drives your economic engine.” (source)

hedgehog and fox

Mike and I (both 11 years with Ensign-related businesses) concluded that, in spite of the promising future for the Doctors Express franchise, being a franchisor was a significant departure from our hedgehog.  I found myself in the peculiar position of recommending that we sell the business I lead – making my future uncertain – b/c I believed it was the 1) right thing for Ensign and 2) the right thing for the franchisees.

A cornerstone to the culture at Ensign is the independent/interdependent nature of the facilities, agencies, and companies.  Franchising requires strong (sometimes rigid) corporate control to retain brand standards among franchisees who bring a vast range of values, motives, and competencies to the system.  At Ensign, the word “corporate” is a ‘bad word.’  I constantly wrestled with the misfit between my/our approach/culture and the approach/culture a franchise system requires.

square peg round hole

Fortunately, we became acquainted with AFC and quickly saw their huge corp. infrastructure and decades of urgent care experience AND TRADITIONAL CENTRALIZED CORPORATE structure to be a better fit for franchising.  Could we have continued the upward ramp of the last 12 months?  Yes.  No doubt.  I think many, if not most, organizations are driven principally by the numbers.  In our case, no matter how pollyannish this may sound to outsiders, Ensign’s success is largely attributed to our hedgehog-based discipline to say no to seemingly great financial opportunities that are only attractive because of the numbers but do not fit with who and what we are.

I admire many of the franchisees and staff I worked closely with and I will be cheering AFC and Doctors Express on for years to come.

Gratefully, I will be returning to what I know and love: senior care/skilled nursing. In the coming weeks & months I’ll be writing about lessons learned 1) at DRX and 2) from returning to skilled nursing.  Good to be back …

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Act 2, Scene 1

Take your pick of metaphors …

Shifting gears
A clean slate
Starting a new journey
Passing the baton

 All of those metaphors apply to what I’ve decided to do … help grow a new Ensign-backed venture in a new segment of the healthcare industry: URGENT CARE.

I started this blog in 2007 to share lessons learned the hard way in healthcare administration in the long-term care setting.  I had run 3 skilled nursing facilities in Arizona and California.  Then I was asked to help reshape our Administrator in Training (AIT) program where we select, train, and place around 20 AITs per year.  Having not-too-long-ago gone through my own learning curves/new facility and having a small part in the training of over 100 AITs has given me a unique viewpoint of the ‘new healthcare leader.’ I’ve really enjoyed the platform and really appreciate the many friends, acquaintances, and opportunities that have come from it.  In some cases, it has helped people make the decision to join the industry.  In others, it has convinced people that it’s not for them.

During Q4 of 2010 I was getting very antsy to get back into the thick of operations.  My wife and I flew out to Boston (from California) several times looking at homes, facilities, the industry, etc. to see if I would attempt to open up a new Ensign-affiliated market there.  After 4 months of a roller coaster of emotions, we decided to stay put … I love what I do.  I love who I do it with.  I love where I do it.  Once I put that decision behind me, I re-engaged in a big way and 2011 became for me one of my favorite years at Ensign ever … The eprize! being a key ingredient in that.

2012 started as 2011 ended … incredibly excited about the year and the work on my plate: a re-design of our AIT program (3.0?), eprize! encore?, making HR a bigger force for good, etc.  Then, one morning everything changed …

My friend and colleague, Mike, recently branched away from skilled nursing to take Ensign into Urgent Care.  He met two urgent care industry giants: John Shufeldt and Glenn Dean.  Mike was the catalyst that brought John and Glenn and Ensign together to form a joint venture.  The original plan was to open up a handful of centers in one market.  While that’s still progressing, the ‘plan’ has expanded.  The joint venture acquired Doctors Express on March 1, which is the nation’s first and only franchise system of urgent care centers.  It has currently about 50 centers in 25 states (and counting).  The corporate office is near Baltimore, MD.

John/Glenn/Mike asked/offered me to join them in the joint venture by having primary responsibility for the franchise system.  At first I laughed it off.  It didn’t really register as real or possible.  I was so locked in to what I/we’re doing and have been doing for the last 10 years, I couldn’t really imagine it.  But, after a few days I started to feel like it was the right thing to do … much to my and my wife’s surprise!  What was really shocking was to see her feel the same way.  Whereas the Boston indecision was a 4 month roller coaster, this was a 4 day natural, fast decision.

It’s hard to articulate why the decision came so quickly.  It just felt like the right thing for me and my family.  We’re excited to move to Maryland and have some more elbow room for the family (5 kids).  I’m excited to be back at square 1.  I feel like an AIT again.  Having to learn a new industry — quickly (although 10 years of healthcare management experience helps).  I’m excited to be part of a very small new venture that has HUGE potential.  I’m worried about my ability to be/do what’s needed.  I’m, at times, overwhelmed by everything that needs to happen in a very short amount of time.  For the last couple months, life/work has been running at a frenetic pace.  I’m loving it.

I’ve replaced myself at Ensign someone who I call ‘The Upgrade.”  Talk about luck.  Once everything is squared away for his transition, he’ll be announced.

This Blog …

I’ve decided to continue this blog for the time being.  The title of “Transforming Long-Term Care” will have to change to something else.  But, I expect that the lessons I continue to learn the hard way in urgent care management will translate to any/all healthcare leadership as has been the case with the skilled nursing stuff.  I hope you’ll continue to value the thoughts, experiences, links, and mistakes I share here going forward.

On to Act 2 …

Act 2, Scene 1