Ken Keen, 60 years of age, moved to aged care after 26 years in the banking industry. He has been the CEO of ECHO Foundation for the past 11 years.
The origins of the Foundation stem from an initiative of the Red Cross Eastern Cape back in 1965 to look after the frail elderly residents of Port Elizabeth. In 1991 the Foundation was formed as a section 21 Company, registered as a non-profit organization, with a defined mission of; “providing acceptable and cost effective housing, institutional care and community service to senior citizens”
The Foundation currently owns and manages 1, 050 cottages and flats situated in nine Villages and a centralised frail care facility with accommodation for 150 frail Residents
The Foundation’s success and growth is attributed by Ken to its stable Board, dedicated Management and Staff, who follow a client centric approach to its Residents. The Board determined a growth strategy back in 2006 and the Foundation has been on this path since then adding over 400 cottages and flats to its property portfolio.
Ken noted that it is important when undertaking new developments to provide a product that the market wants. Younger people are moving straight into retirement accommodation instead of scaling down first and then undertaking another move into a retirement setting. He suggests that a combination of security and costs is driving this change.
Of a 14 cottage development currently in progress in Walmer, with cottages ranging in size from 179 to 189m/2, ten have been sold in the first year since starting the project. He noted that the Foundation had recently completed a 68 cottage development in South End, and the demand was for larger cottages of 125 and 160m/2. The market seems to want more space in their retirement years he noted.
Ken believes the key to success of an organisation is its cash management and control of expenses. In 2005 their staff costs were 65% of their revenue; now this stands at 52%. Income must keep pace with expenses and to do this ECHO continues to grow its footprint.
Their property portfolio stands at 80% rental and 20% Life rights. Ken feels it is a model that works for them whereby the rental income covers expenses. However the challenge is that there is a huge demand for rental accommodation in their area of operations and to build suitable rental accommodation is capital intensive with returns on investment over a long term.
Another challenge is to keep service at the same level without increasing costs. The Foundation endeavours to keep annual increases of rentals and levies as low as possible. These increases have been kept as close to CPI as possible over the last ten years.
One of their cost cutters has been to outsource and centralize functions extensively. Ten years ago they had 185 staff, today they have 160, yet they’ve grown their business by 43%. He believes this can be done by working “smarter”
They outsource transportation, catering, emergency health care and security. ECHO recently spent R10m to upgrade their security with 24 hour camera monitoring.
Another critical success factor is to ensure continuity in Management skills; to this end the Foundation has implemented a succession planning program to fit with Staff retiring over the next five years.
Their present General Manager Operations’ role has several areas where staff are being mentored in the areas of Human Resources and Industrial Relations and Operations.
They have a young, multi skilled board of eight Directors. Their Chair is a CA, the vice chair an attorney – they also have a town planner, an architect, a social worker, a banker and a realtor. Attendance at their bi-monthly meetings is always 95% plus. So ECHO enjoys great commitment from their Board.
Talking about leadership, Ken feels you need to lead by example, be really involved, know your staff, and give your staff the tools and the training to do their jobs well. He feels it important to give people a career path.
Thinking about the aged care industry as a whole, Ken suggests the old thinking may need to change. Where nursing specialists were traditionally expected to manage an aged care facility and the nursing functions; it may be more beneficial to employ a business manager to a facility and split the business from the nursing function and allow the various parties to undertake their core functions of expertise. The key to the success is the financial well-being of the organization together with the specialised care of the frail Residents.
ECHO based their frail care model on that of Green Pastures in Cape Town. The basis is that 80% of the residents need care not medical assistance/nursing. ECHO employs care managers from the hospitality industry, they have blister packing in place for the medication, and fewer professional nurses.
ECHO is serious about receiving client feedback and does annual surveys, and always a survey with the family of a resident who has passed away, at the frail care Home.
Talking broadly about collaboration in the care sector, Ken believes there is a need for it but it is not happening in the Eastern Cape, and believes that Industry appointed bodies such as SARHA and Care Forum will only be successful if they have someone permanently employed to do the work and coordination. He gives the example of a recent development with the local Municipality over a sewage development charge recently introduced which severely financially affects NPO, an issue that could have been lobbied and advocated on behalf of a group in the care sector but he says he doesn’t have the time to do that. So each organisation must struggle on their own. It seems that the value of connecting and collaboration is not well understood in the Eastern Cape. A pity…
When Ken is not busy with Echo Foundation work and activities he loves to travel with his wife to visit children and grandchildren across the globe – UK and USA. He also enjoys taking long walks on the beach to relax. Thank you for sharing your thoughts with the South African Care Forum Ken – we would love to have Echo join as a member and make a contribution, particularly in the Eastern Cape.