Leadership through tough financial times

Employees are becoming very nervous about the current economic crisis that the United States appears to be in and are unsure how it will affect their jobs and financial security. Increases in gas and food prices, an unstable stock market and diminishing 401K plans, a distressed housing market, and rising consumer debt are all on the minds of almost every employee. These fears may lead to lower quality and productivity, increase absenteeism, and destroy morale.

Employees are aware that facility operations are based on a preset budget. Many department heads are involved in setting the budgets, but more importantly, they are involved in maintaining their departmental budgets. Unforeseen circumstances, such as a decrease in census, a need for capital purchases or repairs, or increased food and supplies costs can result in frequent budget adjustments. But what happens to budgets during this economic downturn? What will employees think and how will they react?

There has been no better time than right now, in fact, for confident and motivational leadership in long-term care to emerge. It will steer employees through this current crisis. This article examines a new role for leadership and outlines the business strategies that can be used to help employees through rough financial times.

The new role of leadership

Effective leadership depends on recognizing how employees are being affected by events and how they feel, collaborating with them to form new or stronger relationships, and setting the course for working toward the common good. The new leader must be able to rally employees together both in good times and bad, have courage and competence in making tough decisions, be sharply focused on goals and a new vision, and lead employees with great passion and compassion.

New leadership strategies

With the goal of this type of leadership being to build a stronger team, ride out the storm, and come out better than before, there are a number of ways to achieve this.

Manage yourself. Great leadership requires that the individual truly knows him- or herself. One must be honest about one’s natural talents and obvious weaknesses. To truly lead or manage a team, one must be able to manage one’s self. This means that the leader is willing to take on extra projects, keep an eye out for extra personal expenses that can be cut, and lead employees by example, both verbally and nonverbally. Managing one’s self as a leader also means managing one’s own stress. This is no time to panic. More information on the effects of stress on health, relationships, and work is available at https://www.apa.org/releases/stressproblem.html.

Define a new vision. Another important leadership technique involves creating and communicating a new vision for the staff, facility, or perhaps the entire company as a whole. It is important that the vision be positive and motivating, e.g., “We are all in the same boat together. We will not sink, but will swim safely to shore together”-a new vision that the leader communicates on a regular basis. An ideal vision helps employees to look beyond the negative economy and search for a better tomorrow.

Defining a new vision may also mean reprioritizing projects, goals, and jobs within the facility. One of the most important keys to becoming a great leader, in good times or bad, is being able to prioritize what needs to be done sooner than later, and then effectively and efficiently follow through. When reprioritizing, remember the Pareto Principle: “Twenty percent of your priorities will give you 80% of your production, if you spend your time, energy, money, and personnel on the top 20% of your priorities.”1

Communicate often. There may be no better way of leading employees through tough times than to meet regularly and talk about what is going on in a genuine and open manner. Keep staff informed about any changes that may take place in the facility-changes in policies and procedures, staff cutbacks, and departmental budget restraints. Secrecy simply will not work when times are tough. (It rarely works when the economy is good.) Straight talk is prescribed in this situation. Sugarcoating may insult some employees and create distrust among others.

What else needs to be communicated to employees when times are economically unsound? Ask employees where adjustments can be made or where money can be saved. They may have some very interesting and creative ideas, and the exercise can certainly enhance staff teamwork, ownership, and empowerment. Ask employees to voice their reactions and concerns and, when they do, address them openly and honestly. Don’t allow fear to take over the facility. Ask that employees refrain from creating a culture of complaints but, instead, come up with solutions to problems. Be clear about the challenges being faced and promote the ideal of partnership among employees. Also, don’t allow long periods of time to go by without addressing issues. Much negativity can fester during long periods of leadership silence, and allowing employees to fill in the gaps with their imagination can make things worse.

Hold regular in-services on special topics. Hold regularly scheduled in-services on each shift to help employees effectively handle changes and manage their own reactions to the current crisis. Topics can include: Stress Management, Caring for the Caregiver, Work-Life Balance, Time Management, Conflict Resolution, Customer Service, Team Building, Motivation in the Workplace, Managing Finances and Budgets at Home, Reducing Expenses at Home, and many more.

Why offer these kinds of in-services to staff? Professional development is vital to enhancing skills and knowledge not only in prosperous times but in challenging times as well. Sometimes, in long-term care, it is either feast or famine. The economy will come around eventually and, when it does, the smart leader will have a team of professionals, with minimal turnover and quality of care still intact, if not better. The smart leader can turn difficult times into learning opportunities for growth and change.

Train supervisors to lead. Even the greatest leader needs help and it is a good idea to sit down with administrative staff and supervisors and create a plan that enables them to better lead and serve their departments. Give management all the information they need to inform the rest of the staff. Encourage them to handle difficult situations themselves, deal with employee issues, and answer tough questions with confidence. Encourage them to shut down any rumor mills spreading alarming untruths (i.e., fictitious layoffs, cutbacks, wage freezes). Getting all of management on board is also important because of its symbolism-it indicates that staff in leadership positions are leading by example and are committed to assisting employees.

Provide small but regular rewards. Even in tough times, leaders will see the benefit of providing staff with small, symbolic rewards on a routine basis. Employees may actually need extra attention, recognition, and motivation to help them deal with difficult times. Such attention may produce greater productivity, enhanced morale, and bolstered psychic income.

It is important to recognize top performers, whether times are good or tough. Create new and innovative recognition programs for employees, such as “employee of the week,” “most caring staff of the day,” or a “wall of fame” composed of photos of employees who have done exceptional things in the building. Provide prime parking to recognized employees for the week or month, free passes for lunch, or gas cards. Other innovative employee incentives include paying the employee’s home heating bill during the coldest winter month or buying shoes for their children before they go back to school.

Never forget to say “thank you” and “job well done.” Always make sure that employees know that they make a difference and that they are appreciated.

Create successful business strategies

Leadership strategies alone are not enough in assisting employees through economic crises. Sound business strategies are also a must and should include revisiting and discussing departmental budgets, creating new and more effective marketing plans, and boosting customer service to an all-time high. Combining committed leadership and effective business strategies can not only create an atmosphere of stability, they can improve quality of care, increase job satisfaction, make families happier, and improve the overall picture in long-term care, both today and tomorrow.

Create budget accountability

As noted earlier, most employees already are aware that the facility and its departments run on a fixed annual budget and that the budget is associated with expenses, cost of food and supplies, census, and other factors. Great leadership involves getting the department heads together and examining each department’s budget in a creative and strategic way. After each department budget has been reviewed, leadership needs to have their department heads commit to operating within that budget, find additional areas that may be adjusted as the opportunities arise, become even more innovative in providing services, and economize without compromising quality of care or of life.

Remind department heads that they are in control of their department’s budget and they need to be responsible and accountable. There is no room for “the blame game.” Sometimes it is easier for managers to blame the facility, company, or administrator when times get rough and budgets tighten. Department heads may say, “I’m sorry we had to cut that program-the company made me do it.” This is neither functional nor a quality of good leadership. This is no time to pass the blame around to coworkers and management. It is instead a time to rally, form a stronger team, and get through this financial downturn together. Encourage department heads to “own” their budgets.

Create a recession-proof marketing plan

One important thing to remember during tough financial times is this: Families and residents can find care almost anywhere, anytime. What makes your facility and staff so special that they should choose you and not your competitor? An innovative and professional marketing plan can stimulate business during the worst times and can strengthen the quality of care, reputation, and stability of the facility for years to come.

Start creating a marketing plan with the facility’s admissions coordinator, marketing director, and other management staff. Use the following themes to drive the plan: “efficiency,” “affordability,” and “effectiveness.” Brainstorm all of your primary and secondary referral sources, along with other potential sources of business. Does the facility do all it can to expedite the admissions process and communicate with new families to ease transition into the facility? Does the staff do all it can to educate referral sources and families on how long-term care is covered under most insurances? You never know where the next referral will come from, so a combination of “throwing out a wider net” and precision marketing can be very effective in building and maintaining a strong census.

Marketing effectively through economically challenged times involves sending out the right messages to the community. The community should know that just because times are tough, care and quality will not be compromised. Send out messages of stability, growth, and quality, regardless of the economy. An important point to remember in getting the right message out to the community means “putting your money where your mouth is” and educating employees about increasing quality of care and life, and improving customer service. Don’t promise a lot and under-deliver-this can destroy community relations and damage reputation. Instead, promise a lot and over-deliver!

Take customer service to the next level

Customer service is always important and should never be compromised. Exceptional customer service is an attitude, a philosophy, and a significant part of a facility’s culture. It takes place 24-hours per day, seven days a week. Exceptional customer service means over-delivery of services, care, and quality and exceeding the expectations of those being served. Leaders need to provide customer service training on a regular basis, either by bringing in experts or consultants or by doing the research themselves and getting in front of their team and teaching it. Beyond training, one of the golden rules of customer service is to empower employees to deliver their own personalized brand of customer service to those they serve. This is no time for micromanagement, especially when it comes to customer service. Micromanaging customer service serves only to demoralize and discourage staff.

Exceptional customer service cannot be delivered without a plan. Elements of a great customer service plan involve walking through the facility from front to back and inside out, and identifying primary points of service and customer contact. For instance, the driveway, parking lot, and front of the building are “hot zones” for customer service that are sometimes forgotten. These are the first line of contact that customers make, and can create positive or negative first impressions. Consider other “hot zones” such as the front lobby, offices, nurses’ stations, and hallways-are they customer-ready and friendly? Think about service delivery and what upsets customers. Unmet needs and expectations are primary reasons-when residents or families feel they were treated unfairly or staff behaved rudely toward them, they may become dissatisfied with your facility in general. When they feel that no one cares and no one listens to them, they may feel negatively about the quality of care and service in the facility. Leaders should build a plan around these concerns and make addressing them paramount to that plan.

Final words

No one knows how long the current economic situation will last. Employees are showing understandable signs of fear, anxiety, and worry about their jobs, their finances, and their futures. There has never been a better time than now to step up as an exceptional leader and help put employees’ minds at ease. It may be easier said than done, but it is possible with good leadership and business strategies.

Look around, roll up your sleeves, and get busy. Get the team together, because no leader can do everything alone. Put better leadership and business strategies and practices into play immediately. because these can help calm employees, improve quality of care, and promote financial stability through tough economic times. No company or facility can afford not to move in this direction.

James H. Collins, PhD, is a gerontologist based in Poland, Ohio.

For more information, phone (330) 707-1691 or e-mail profjcollins@aol.com. To send your comments to the editor, e-mail mhrehocik@iadvanceseniorcare.com.


  1. Maxwell JC. Leadership 101: What Every Leader Needs to Know. Nashville:Thomas Nelson Publishers, 2002.
Long-Term Living 2009 August;58(8):42-44

Topics: Articles , Facility management , Leadership