I recently worked with a global retail company that wanted to understand the ways in which technology would affect their customers, how they developed products and goods, and what they should begin to consider for their digital transformation strategy. After walking out of the action-steps meeting, their team had more than 20 technology deployments it wanted to begin and pages of next steps for each item.
During our final session, we tried to help them pare back their goals, but they fell into the problem many companies are facing. They were struggling to prioritize and, against our advice, they felt that they needed to begin to address each item all at once.
Senior living business leaders and companies are facing a very similar challenge in 2024, and should they fail to focus and prioritize addressing the greatest issues they face, they will soon find themselves asking how they didn’t make any headway in 2024 and what to do about it in 2025.
This can prove challenging, as these companies aim to meet immediate financial targets and operational goals while they also need to lay the groundwork for sustainable growth, innovation and quality improvement in the long term. To cut through the noise, leaders must strategically focus and prioritize the right challenge by determining its urgency over its relative standing in the hype cycle.
So, let me help with that. Here are the four challenges and their implications that leaders and companies could face that must be addressed if they are to not only survive 2024 but thrive.
1. Today’s trendiest AI isn’t everyone’s best tool
Senior living businesses have arrived at a crossroads in 2024. Integrating artificial intelligence into general business practices has become an imperative and an untenable obstacle course.
Many companies are moving forward with the misguided hope that the benefits will outweigh the upfront costs, and that can be true. AI can personalize care, customize resident plans, provide predictive analytics and tell you what your budget could be next year.
Companies, however, will need to make smart choices, as not all AI models are built and, more importantly, trained, equally. Choosing the wrong model means a potential for a closed-loop input system where the model does not consider outside needs of potential future customers other than what it was trained on.
To make the most of AI, businesses should prioritize models that have transparency and ones that can help them fix their fragmented data. Siloed records, notes, charts and schedules in multiple platforms that lack interoperability means there will be limited value in the analytics from a model only able to pull from one source of data. The integration challenges are real, but the potential is transformative.
2. The demographic cliff
It’s not news to you that senior living businesses are facing the stark reality of the increasing number of potential residents and a lack of talent to care for them. As baby boomers continue to age and look to move into active-adult or various other tiered classes of caregiving, not only are the communities lacking or nonexistent, but so are the caregivers. Flexible working options and higher pay elsewhere are fueling resignations.
To address those challenges, businesses need to consider new development routes for staff and properties. Considerations for creativity in how administrative roles are staffed and developed through training and upskilling local community members is one way to start.
Long term, the labor shortage may mean rethinking on-demand workers over full-time hires. Also, there is the potential for modular construction, and investors looking to be recession-resilient could mean new forms of capital that could allow for the right-sizing of the units and technologic improvements needed.
3. Transparency versus personalization versus privacy
Senior living companies have leaned heavily on personalization to drive engagement. Data collection can provide unique offerings, especially with the advent of wearables, which can help customize meal plans, activities, amenities and medicine, but consumers and clients have begun to demand more privacy and protection of their data.
Businesses must become more transparent about where they collect data, where outside data are being used and what is done with them. If done successfully, the transparency can bolster engagement and increase communication between the residents and the communities, another potential data perk.
Equally important will be open communication on issues such as sustainability, social responsibility and employee well-being. Today’s residents and families expect more transparency. Companies that honestly address their practices and shortcomings will build trust.
4. Inflexibility in your future direction
Operators facing these pressures often suffer from a lack of agility and flexibility in their planning. Anticipating future challenges in healthcare and demographics is crucial yet challenging, especially with limited resources, as those challenges constantly move.
Even with prioritized challenges to address, however, leaders must be open to being nimble enough to adapt their hardened three- to five-year plans while also realizing that type of planning needs to shift to become 10- to 15-year planning. This change will allow them to be ready for shifts in behaviors, to grow as digital health evolves, residents’ preferences morph and staffing dynamics shift.
Allowing for re-perception of the challenges and trends that are faced throughout the year will allow companies to be proactive instead of responsive. Most companies lack this flexibility, which ultimately means they stay the course when they need to pivot and, in doing so, become obsolete to the whims of their clients and residents.
In 2024, these challenges and trends are not just obstacles but also catalysts for innovation and improvement. For business leaders, particularly in the senior living industry, addressing these challenges head-on is not just about survival but also about thriving in an ever-changing landscape. By doing so, you can ensure sustained growth, improved service quality and enhanced operational efficiency, ultimately leading to long-term success and a positive impact on your communities.
Mark Bryan is the senior foresight manager at the Future Today Institute, an advisory firm specializing in strategic foresight aimed at driving corporate strategies that lead to long-term success and resilience. The institute partners with leaders of Fortune 500 companies, world governments and other major organizations to help them pivot, adapt and thrive in the face of disruptive change.
The opinions expressed in each McKnight’s Senior Living guest column are those of the author and are not necessarily those of McKnight’s Senior Living.
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