As the Patient Protection and Affordable Care Act (PPACA) implementation unfolds, health lawyers continue to answer employers’ questions about its impact.
“The act has multiple potential penalties for failure to comply with its various requirements. The risk of not complying is a financial risk,” says Jules S. Henshell, of counsel at Semanoff Ormsby Greenberg & Torchia, LLC.
Smart Business spoke with Henshell about what employers need to be aware of as they take their next steps under the PPACA.
What do employers most frequently ask?
The most frequent questions relate to the ‘pay or play’ penalties in the law. The majority of employers are currently providing health care coverage through group insurance plans. However, it’s too early to determine whether to provide coverage at levels required by the act or pay the penalties because future premium costs and the affordability of employer offerings through health exchanges are uncertain.
Employers also are concerned about reporting health care benefits on W-2 forms, whether they qualify for transitional relief, and the provisions against discrimination in favor of highly compensated individuals.
What’s important to know about W-2 reporting and IRS transitional relief?
In 2012, employers are required to report health care costs to the employer and employee on employee W-2 forms or face a $200 per-form penalty.
The IRS has provided transitional relief from reporting for employers that file fewer than 250 W-2 forms. Some employers question if they are entitled to relief from reporting when their company files fewer than 250 W-2 forms but is one of a number of related companies. The IRS’s informational Q&A suggests that it will not aggregate among related companies to calculate the threshold for reporting.
Whether the W-2 reporting currently applies or not, it’s a good idea to formalize the practice of tracking these health insurance costs to better enable retrieval of information in the future.
How do provisions about non-discrimination impact employers?
The PPACA prohibits discriminatory practices in favor of highly compensated individuals. Prohibited practices include providing benefits to highly compensated individuals that are not provided to other employees as well as affording greater choice, higher amounts, lower premiums, a higher employer subsidy or more favorable benefits. Many companies have used such practices to create competitive compensation packages for executives and management. Penalties include an excise tax or civil monetary penalty or civil action to compel provision of nondiscriminatory benefits.
The IRS, U.S. Department of Labor and U.S. Department of Health and Human Services (HHS) have stated that non-discrimination requirements will not be enforced until the first plan year after regulations are issued. And so far, they have not issued regulations.
Employer health plans with grandfather status are not impacted, but should be conscious of how their status could be jeopardized. Raising co-insurance, significantly raising co-pays and deductibles, lowering employer contributions, and adding or tightening annual limits on what the insurer pays will result in loss of grandfather status. Those without grandfather status need to review their compensation packages and practices in anticipation of future regulation and enforcement.
Do any significant PPACA cases remain?
The most active litigation challenging the PPACA in multiple jurisdictions target the requirement that new, non-grandfathered group insurance plans provide contraceptive coverage. The lawsuits focus on alleged violations of either the First Amendment right to free exercise of religion or the Religious Freedom Restoration Act.
Regulations have granted exceptions for certain religious employers and provided a one-year safe harbor for religiously affiliated institutions that wouldn’t otherwise qualify for exemption. HHS has stated it will provide further accommodations before the end of the safe harbor period.
Jules S. Henshell, of counsel, Semanoff Ormsby Greenberg & Torchia, LLC. Reach him at (215) 887-3754 or email@example.com.
Insights Legal Affairs is brought to you by Semanoff Ormsby Greenberg & Torchia, LLC
With the election settled and a number of lawsuits decided, it’s clear the implementation of the Patient Protection Affordable Care Act (PPACA) is moving forward.
There could be numerous timing glitches with implementation through delayed issuance of regulations and enactment of the exchanges, but Matthew R. Huttlin, vice president, Employee Benefits Division at ECBM, says it is important that every organization continue with its planning.
“This law will continue to be modified and adjusted over the next few years and employers are going to need sound, detailed guidance to negotiate their way through the PPACA legislation,” he says.
Smart Business spoke with Huttlin about the decision of whether to continue your health care program or relinquish coverage to the exchanges.
What risks are employers facing from the PPACA and health care exchanges?
For employers with more than 50 full-time equivalent employees — considered ‘large’ employers under the law — a number of areas need to be reviewed in anticipation of the 2014 effective date of the government health exchanges. However, none is more important than the financial impact. Employers that do not provide adequate coverage or offer coverage that is considered unaffordable may face penalties. However, the calculation to determine whether any penalties will apply in 2014 is fairly straightforward.
Once you’ve assessed potential penalties, what’s the next step?
The more difficult question is whether an employer should continue its health care program or relinquish coverage to the government exchanges. The two primary areas of concern are financial and human resources. From a financial standpoint, a risk manager can run a detailed analysis to determine the cost impact of each option. The results depend heavily on the current cost of coverage, both for the employer and the employees, and the salary distribution of the full-time employees. The human resource impact is difficult to quantify, having to gauge the impact of each option on retention and recruitment.
Do employers that continue to offer health plans need to revisit their decision?
Employers that decide to maintain their programs should test these programs annually. Rates vary from year to year and from group to group based on the impact of the group’s claim losses in the determination of their rates. The impact of a group’s actual experience on their projected costs increases as the size of the group increases for insured programs. The projected rates for self-funded plans are typically based solely on the group’s claim losses. Whether self-funded or not, the greater a group’s claim losses impact their rates, the more important it is to control costs through utilization management, wellness, plan design, etc.
On the other side of the equation, PPACA penalties are expected, at a minimum, to be indexed for inflation. Also, the cost to obtain coverage from the exchanges — particularly for employees with salaries that exceed 400 percent of the federal poverty limit — is anticipated to increase, possibly at a rate greater than inflation.
How should employers that decide to eliminate their health insurance handle it?
This is a major undertaking for the HR personnel. Detailed communications with the employees explaining the organization’s decision and guidance will be required. This decision also will have a critical impact on administration. Businesses that choose this path should reach out to risk managers and consultants for assistance.
What is the risk of upcoming ‘Cadillac’ tax?
Looking further out, there is another ‘test’ looming under PPACA for 2018, commonly called the ‘Cadillac’ tax. Under this provision, if the combined cost for health care benefits exceeds the dollar threshold limits of $10,200 for single person plans and $27,500 for other plans, the PPACA will tax these rich benefits at a rate of 40 percent on the cost above this amount. According to a 2011 survey by Mercer, approximately 60 percent of employers with more than 500 employees believe their plans would trigger the tax unless they take action to avoid it. Employers will need to keep a close watch on costs as they progress toward this test.
Insights Risk Management is brought to you by ECBM
Interconnecting three or more sites across a metro or wide area network has traditionally been accomplished via a hub and spoke network using private lines, frame relay or Internet Protocol virtual private networks (IP VPN) over the Internet. However, Ethernet services are a cost-effective alternative that can also support hub and spoke topologies as well as a unique, “any-to-any” network topology.
Both Ethernet methods can achieve secure, high performance multi-site connectivity with full IP transparency, but by weighing the differences in the two methods, you can impact IT operations, management and cost, says Mike Maloney, vice president at Comcast Business Class.
Smart Business spoke with Maloney about considerations and best practices when connecting three or more sites via Ethernet.
Why use Ethernet services in the first place?
Because most applications today are IP-based, you could presume IP VPNs are more suitable than Ethernet VPNs. While both deliver connectivity, there are three benefits of Ethernet VPNs:
• Security — Ethernet services are immune to certain Internet-based threats, such as the popular IP denial of service attacks.
• Quality of service (QoS) performance — Ethernet services run over the service provider’s managed network, resulting in better control, more predictable performance and more service availability.
• IP transparency — Ethernet services don’t require IP routing information to be shared with the service provider, enabling companies to keep their existing IP address with freedom to expand.
What are the advantages of using either hub and spoke or multi-point connectivity?
With hub and spoke, sites connect through the hub site to communicate with any other site. The benefit is centralized traffic routing, requiring simpler and lower cost routers to attach to the spoke sites since these locations only make a direct, point-to-point connection to the hub.
Any-to-any connectivity enables all sites to communicate with each other over the wide area network. One advantage is simplicity in adding new sites to the shared service across the network. Routers at each site automatically discover new sites with no additional device configuration changes.
How can you decide which is better?
In addition to service pricing and availability, assessing your current and future needs will help determine the more appropriate Ethernet service:
• Adding bandwidth — With hub and spoke, you can add more bandwidth until it exceeds the physical speed port, and then, there’s the capital expense of the higher-speed port and possibly additional service cost to upgrade the on-site equipment. However, you can selectively apply bandwidth upgrades to specific spoke sites. With any-to-any, bandwidth is increased at the particular site, which could result in a service disruption at the local site.
• Adding sites — When adding to hub and spoke, the service provider connects the new spoke to the existing hub site, requiring a software configuration change and possibly a reboot. Adding a site to any-to-any doesn’t require service disruption.
• Traffic flow patterns — A hub and spoke approach works well if most of the communications are to a particular site, such as regional sites connecting to a headquarters site or data center. It’s also well suited for centralized IT management of Internet access, email and storage. An any-to-any approach is most sound when regular communications are required between two or more sites.
• QoS performance — With hub and spoke technology, bandwidth, packet latency and packet loss are more granularly engineered and managed per site. Each site’s bandwidth and QoS performance can be unique with each site’s costs more accurately allocated.
An any-to-any implementation enables bandwidth to increase or sites to be added without impacting other connected sites. However, since it is a shared resource, bandwidth, management and QoS performance may need to be monitored more closely. This approach also can support many applications requiring different QoS performance such as IP telephony (VoIP) and IP video.
Mike Maloney is vice president at Comcast Business Class. Reach him at firstname.lastname@example.org.
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Companies typically want to do what’s right for those they serve. Key priorities should be customers, investors, employees and the communities in which the company is located — but not necessarily always in this order. The dilemma, however, is that many times short-term decisions can prove to be long-term problems that cause more pain than the initial gain.
It’s difficult to make all constituents happy every time. As a result, management must prioritize decisions with a clear understanding that each action has ramifications, which could manifest themselves in the short, intermediate or long term. Seldom does a single decision serve all of the same timelines. There are no easy answers and anyone who has spent even a short amount of time running a business has already learned this fact of life. So what’s a leader to do?
It’s a sure bet that investors want a better return, employees want more money and benefits, and customers want better quality products, higher levels of service and, oh yes, lower prices. This simply all goes with the territory and is a part of the game. The problem can be that, most times, it’s hard to give without taking something away from someone else. Here are a couple of examples.
Take the case of deciding to improve employee compensation packages. Ask the auto companies what happened when they added a multitude of perks over the years, as demanded by the unions? The auto titans thought they didn’t have much choice, lest they run the risk of alienating their gigantic workforces. History has shown us the ramifications of their actions as the majority of these manufacturers came close to going belly up, which would have resulted in huge job losses and an economic tsunami.
Basic math caused the problems. The prices charged for cars could not cover all of the legacy costs that accrued over the years, much like barnacles building up on the bottom of a ship to the point where the ship could sink from the weight. Hindsight is 20/20, and, of course, the auto companies should have been more circumspect about creating benefit packages that could not be sustained. Yes, the employees received an increase to their standard of living for a time anyway, but at the end of the day, a company cannot spend more than it takes in and stay in business for long.
Investors in public companies can present a different set of problems because they can have divergent objectives. There are the buy-and-hold investors, albeit a shrinking breed, who understand that for a company to have long-term success, it must invest in the present to build for the future. The term “immediate gratification” is not in their lexicon; they’re in it for the long haul. Another type of investor might know or care little about a company’s future, other than whether its earnings per share beat Wall Street estimates. These investors buy low and sell high, sometimes flipping the stock in hours or days. And, actually, both types are doing what’s right for them. The issue becomes how to serve the needs and goals of both groups. When a company effectively articulates its strategy, it tends to attract the right type of investors who are buying in for the right reason. This will avoid enticing the wrong investors who turn hostile because they want something that the company won’t deliver.
When interviewing and before hiring employees, it is imperative that candidates know where the company wants to go and how it plans to get there. Many times, this means telling the prospective newbie that the short-term compensation and benefits may not be as good as the competitors’ down the street, but in the longer term, the company anticipates being able to significantly enhance employee packages, with the objective of eventually outmatching the best payers because of the investments in equipment being made today.
The key to satisfying employees (present and prospective), investors, et al, is communicating the types of decisions a company will make over a specific period of time. Communication from the get-go is integral to the rules of engagement and can alleviate huge problems that can otherwise lead to dissatisfaction.
Knowing what is right for your company, based on your stated plan that has been well-communicated, will help ensure that you do the right thing, at the right time, for the right reasons.
Michael Feuer co-founded OfficeMax in 1988, starting with one store and $20,000 of his own money. During a 16-year span, Feuer, as CEO, grew the company to almost 1,000 stores worldwide with annual sales of approximately $5 billion before selling this retail giant for almost $1.5 billion in December 2003. In 2010, Feuer launched another retail concept, Max-Wellness, a first of its kind chain featuring more than 7,000 products for head-to-toe care. Feuer serves on a number of corporate and philanthropic boards and is a frequent speaker on business, marketing and building entrepreneurial enterprises. Reach him with comments at email@example.com.
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In our world of quick text missives, sharing the daily joke via inner office email, and generally more relaxed workplaces, informality can become a workplace hazard. Studies show that employers and managers often assess an employee’s career potential based on how that employee carries himself or herself in the workplace. None of us wants to be judged by the externals, but our respective “book covers” matter.
Poor manners at work – however unintentional - can lead to workplace conflict because they distract fellow employees from working or, in the worst cases, offend co-workers who have differing viewpoints and cause potential legal liability for the employer.
Therefore, it’s ideal to avoid these 8 bad work habits:
- Talking loudly on telephones and in person in common areas.
- Interjecting comments into conversations between other employees, unless your opinion is solicited.
- Taking supplies – even if they were bought by the office – from other employee’s work areas without getting prior approval.
- Wearing perfume that can be smelled even after you leave an area.
- Gossiping about co-workers or people outside the workplace.
- Sharing racial, religious or sexual jokes in any format.
- Arriving late to meetings.
- Regularly using large chunks of work time to resolve personal and family matters.
Most employees want to be viewed as valuable, contributing members of the company team. Thus, it’s worthwhile to periodically assess our workplace demeanor and, perhaps, adjust our behaviors, to help convey that image. Your future with your employer likely depends on it.
Patricia Adams is the CEO of Zeitgeist Expressions and the author of “ABCs of Change: Three Building Blocks to Happy Relationships.” In 2011, she was named one of Ernst & Young LLP’s Entrepreneurial Winning Women, one of Enterprising Women Magazine’s Enterprising Women of the Year Award and the SBA’s Small Business Person of the Year for Region VI. Her company, Zeitgeist Wellness Group, offers a full-service Employee Assistance Program to businesses in the San Antonio region. For more information, visit www.zwgroup.net.
One of the signs of a boom — or at least a boomlet — is that companies start wanting to drive their competition crazy. This occurs when “survival” is no longer an issue and optimization or maximization can become a goal. However, the desire to do things to the competition can lead a company astray — or drive it to even greater heights.
Companies go astray when defeating the competition becomes more important than taking care of customers. When companies become obsessed with the pursuit of excellence, by contrast, they often reach new levels of greatness. Here’s how to avoid the former and achieve the latter.
1. Know thyself. Before you can drive your competition crazy, you have to understand what your company stands for. Otherwise, you’ll succeed only in driving yourself crazy. For example, Apple stands for cool technology. It will never represent a CIO’s safe bet, an “enterprise software company,” or service and support. If it decided it wanted to drive Microsoft crazy by sucking up to CIOs, it would drive itself crazy — that is, if it didn’t perish trying.
2. Know thy customer. The second step is to truly understand what your customer wants from you — and, for that matter, what it doesn’t want from you. One thing that your customer seldom wants to do is to help you drive your competition crazy. That’s in your head, not your customer’s. One more thing: A good company listens to what a customer says it wants. A great company anticipates what a customer needs — even before the customer knows it wants it.
3. Know thy enemy. You cannot drive your competition crazy unless you understand your competition’s strengths and weaknesses. You should become your competition’s customer by buying its products and services. I never truly understood what it was like to be a customer of Microsoft until I bought a Sony Vaio and used Windows. Sure, I had read many comparisons and competitive analyses, but they were nothing compared with hands-on usage.
4. Focus on the customer. Here’s what most people find surprising: The best way to drive your competition crazy is to succeed because your success, more than any action, will drive your competition crazy. And the way you become successful is not by figuring out what you can do to the competition but for the customer. You succeed at doing things for the customer by using the knowledge that you’ve gained in the first three steps: understanding what you do, what your customer wants and needs and what your competition doesn’t do. At the intersection of these three factors lies the holy grail of driving your competition crazy. For most companies, the key to driving the competition crazy is out-innovating, out-servicing or out-pricing it.
5. Turn customers into evangelists. There are few things that drive a competitor more crazy than unpaid customers who are evangelists for a company. Create a great product or service, put it out there (“let a hundred flowers blossom”), see who falls in love with it, open up your arms to them (they will come running to you), and then take care of them. It’s that simple.
6. Make good by doing good. Doing good has its own, very sufficient rewards, but sometimes you can make good and do good at the same time. For example, if you own a chain of hardware stores, you can help rebuild a community after a natural disaster. You’re bound to get a lot of publicity and create bonds with the community — this will drive your competition crazy. And you’ll be doing something good!
7. Turn the competition into allies. One way to get rid of your competition is to drive it out of business. I suppose this might be attractive to you, but a better way is to turn your competition into allies. My favorite author of children’s books is Tomie DePaola. My favorite DePaola book is “The Knight and the Dragon.” This is the story of a knight and a dragon that train to slay each other. They are smashingly unsuccessful at doing battle and eventually decide to go into business together. Using the dragon’s fire-breathing ability and the knight’s salesmanship, they create the K & D Bar-B-Q. For example, if a Home Depot opens up next to your hardware store, let it sell the gas barbecues, and you refill people’s propane tanks.
8. Play with their minds. If you’re doing all this positive, good stuff, then it’s OK to have some fun with your competition — that is, to intentionally play with their minds. Here are some examples to inspire you:
- Hannibal once had his soldiers tie bundles of brush to the horns of cattle. At night, his soldiers lit the brushwood on fire, and Hannibal’s Roman enemies thought that thousands of soldiers were marching towards them.
- A pizza company that was entering the Denver market for the first time ran a promotion offering two pizzas for the price of one if customers brought in the torn-out phone directory ad of its competition.
- A national hardware store chain opened up right next to a longtime community hardware store. After a period of depression and panic, the store owner came up with a very clever ploy. He put up a sign on the front of his store that said, “Main Entrance.”
Guy Kawasaki is the co-founder of Alltop.com, an “online magazine rack” of popular topics on the web, and a founding partner at Garage Technology Ventures. Previously, he was the chief evangelist of Apple. Kawasaki is the author of ten books including Enchantment, Reality Check, and The Art of the Start. He appears courtesy of a partnership with HVACR Business, where this column was originally published. Reach Kawasaki through www.guykawasaki.com or at firstname.lastname@example.org.
While attending an event we put on with a local charity, I was impressed with the difference that seemingly minor things can make in someone’s life. I was proud of the contribution and effort that our employees put into the event and the dedication the nonprofit showed for its mission.
The event made me think about the business community and all of the wonderful things companies do for those in need. Take the recent destruction from Hurricane Sandy as an example. Businesses have pledged more than $90 million in assistance, two-thirds of which was monetary donations to organizations like the American Red Cross.
While companies give back in as many ways as possible, even during these difficult economic times, I was wondering if there wasn’t more that could be done in our local communities. Not every effort has to always include a financial component.
Here are some nonfinancial ways to give back in addition to what you already do for the community:
- Give more time. Some organizations have a greater need for man-hours in addition to financial backing. Your business may already give generously on the financial side, but maybe your favorite charity could use a labor boost as well. Nationally, about 35 percent of companies have some sort of formal volunteer program. Consider donating employee time to help out with a big project or basic cleaning and organizing.
- Offer advice. You probably already serve on one or more boards for a nonprofit, but there is always another charity out there that could use your help. You don’t have to become a full-fledged board member, but you can offer advice as needed to help the existing members navigate through a problem that plays to your strengths. If the nonprofit is looking for a board member and you don’t have the time, help it find the right person by making a recommendation or referral.
- Hire nontraditional employees. One way of giving back to the community is helping others help themselves. There are many skilled employees with either physical or mental disabilities that could be a great addition to your company if given the chance. When you have a job opening, make sure you are considering all candidates, including those from nontraditional backgrounds.
- Do pro bono work. If you can provide a service that a nonprofit needs, consider donating it. Marketing, printing, IT services — basically anything an office needs is probably something a charity could use. Find out what the nonprofit could use, then figure out a way to help out. Even if your company can’t help, maybe you know someone else who can.
In this season of giving, it’s not hard to find a worthy cause. There’s also no question that you and your company have most likely already given a lot, assuming you are in a position to do so. But there’s an old question that asks, “How much charity is enough?” The answer is easy: Just a little more.
Take the time to evaluate whether you can do just a little more than what you are already doing to make an even bigger difference.
If you are in search of a worthy cause, consider donating to The Pillar Fund, a donor-advised fund administered through the Cleveland Foundation. For more information, contact Dustin Klein at email@example.com.
Fred Koury is president and CEO of Smart Business Network Inc. Reach him with your comments at (800) 988-4726 or firstname.lastname@example.org.
A strategic plan outlines the steps to achieve a desired future, and the process of creating that plan can provide an invaluable opportunity for the exchange of ideas and consensus among your management team and your staff. Defining your shared vision and then planning based on that desired outcome is the essence of strategic planning. With that in mind, allow me to share with you eight gaffes that should be avoided while outlining your strategic plan.
The time frame of the plan is too long.
First, strategic plans need to remain laser-focused on accomplishing strategic priorities in a timely manner. The plans also need to be frequently refreshed to keep them from becoming stale and to keep the organization energized on plan execution.
Long-term planning certainly has its place in a corporate world, but shorter operational plan horizons, going only 12 months out, allow organizations to utilize valuable current information and remain engaged in delivering the plan milestones.
Too many strategic goals.
We all fall victim to this mistake. Organizations often have a laundry list of goals. Dreaming up goals is never an issue. Instead, the issue is having the discipline to narrow down prioritized goals to a manageable and achievable level.
Five goals is a good number to consider as a maximum. When you factor in each goal that will lead to a sequence of programs, initiatives, activities and deliverables to be managed and implemented throughout the organization, it’s easy to see how a long list of goals can inhibit implementation success.
Goals are not tied to measurable outcomes.
Organizational goals should be constructed in terms of outcomes. They should be defined in such a way that they can be measured and managed throughout the layers of the organization to propel action and achievement from those involved.
Employees are unaware of the goals.
Believe it or not, this can be a huge problem in many organizations. When the corporate planning process fails to consider the individuals who will actually implement the plan, breakdowns happen and desired outcomes are rarely attained.
Key vendors and partners not considered.
By communicating organizational goals to key vendors and partners, much needed buy-in and assistance can be gained from these external parties to achieve desired outcomes. Think about it. Are they not critical to your long-term success?
Organizational culture is overlooked.
The corporate planning process must consider the organizational culture. Without this, it is impossible to fulfill the organization’s potential to dominate within their marketplace. Culture determines how the organization functions and how work will be completed.
Operational planning is overlooked.
An effective corporate planning process allows the organization to plan strategically at the enterprise level and then operationally at the business unit level with each part supporting the other.
Failing to reach all the way down through the organizational layers is a common problem with corporate planning processes. Strategic planning, to be effective, must address the entire business ecosystem — from top to bottom.
Customer value is overlooked.
At the end of the day, it is all about the customer. Customer-centric planning puts your No. 1 stakeholder — the end customer — at the forefront of the organization’s activities and goals.
By creating goals that reflect the type of value the organization can create for the customer, you’ll put a face to the name and more effectively connect members of the organization with the desired outcomes.
We have entered into a forever changed business climate. Put another way, the new normal is here and here to stay. Despite all the distractions we encounter every day, we must never lose sight of the fact that we must spend more time on the business rather than in the business, and it all starts with a strategic plan.
G. A. Taylor Fernley is president and CEO of Fernley & Fernley, an association management company providing professional management services to non-profit organizations since 1886. He can be reached at email@example.com, or for more information, visit www.fernley.com.
How Mark Baiada used a new branding initiative to join the past, present and future at Bayada Home Health CareWritten by Erik Cassano
There was a little disappointment at first.
After 37 years operating as Bayada Nurses, company founder and President Mark Baiada stood before members of his nursing staff and relayed the news: The word “nurses” was to be eliminated from the company’s name. As of January 2012, the company would operate as Bayada Home Health Care Inc.
It wasn’t a decision taken lightly by Baiada or his management team. But it was a decision they felt compelled to make.
“My wife is a nurse, we’ve been a nursing company throughout, so to drop ‘nurses’ when it had been in there for so long, I think there was a little disappointment,” Baiada says. “We still have nurses, but it’s not part of our official name now.”
Baiada and his team made the change as part of a wider rebranding initiative, recognizing that the scope of in-home health care services offered by the company had grown beyond nursing to include services such as physical therapy, occupational therapy and speech therapy.
The challenge for Baiada and his team was to unify employees in the many different disciplines around the company’s core mission and goals and to ensure that every employee, no matter the occupational field, felt accepted by and engaged with the rebranded organization.
“We created a new logo, with a larger dove icon, to symbolize the Bayada Way, a document which lists our guiding mission and values,” Baiada says.
“But we also wanted it to come to symbolize the extent of our services and the fact that we were doing more than nursing. The culture of excellence that had grown up around our nursing staff — we wanted to be sure our clients associated the same levels of compassion, excellence and reliability with all of our services.
“It was really a case of wanting to be fair to all parties.”
Baiada says the initial resistance to losing the word “nurses” in the company’s name was motivated by nostalgia more than anything else. Ultimately, the nursing staff wanted reassurance that the company still valued its nursing heritage and would preserve it alongside the effort to identify the Bayada name with a wider service offering.
Baiada took steps to reassure the nursing staff that the nursing practice would continue to be held in high esteem within the company. But with nurses seeking reassurance over their future role within the company and employees in other disciplines enjoying the recognition implied in the company’s new name, Baiada stepped back.
He surveyed the situation and saw the opportunity to use the rebranding initiative as a means of strengthening the connection between every employee and the mission of the company.
With a properly crafted message, he could renew the sense of purpose throughout the organization, re-energizing the entire workforce, regardless of role or background.
With more than 18,000 employees and operations in 26 states, Baiada encouraged a method of cascading communication that started at the company’s headquarters, eventually reaching all of the organization’s local offices with multiple forms of communication.
“We had a series of meetings, we rolled out a new website to let people know what we’re doing and why we’re doing it, and we also sent out some mailings,” Baiada says. “We had a lot of positives from the communications office, which handled the communication all the way down to the local offices, which then handed things out and supported the local nurses and field staff.
“If we had a meeting with 20 people, we’d have an introduction. If people couldn’t make it, they’d get something in the mail.”
Every move Baiada and his leadership team made had an eye toward rallying the workforce around the guiding company principles of compassion, excellence and reliability. That included altering the outward appearance of all employees by outfitting them with new uniforms. Bayada issued new scrubs to nurses and new uniforms to the other field employees, all bearing the company’s new logo.
“Everyone received new name tags and new uniforms with the new logo,” Baiada says. “It was another way to mark the change and another way to get it out in front of everyone. Almost everyone got something with the new logo on it.”
Ultimately, Baiada wanted to make the change real to everyone in the company. He wanted to immerse everyone in the new Bayada brand. If employees feel connected to the company’s future, they’ll be able to take more of a sense of ownership in the company’s mission and goals, which will strengthen the culture in turn.
“What you have to remember is, Enron had a beautiful mission statement, but they didn’t follow it,” Baiada says. “You need a sense of commitment that what you are putting down on paper and communicating to everyone is something that you are following continuously.
“If you aren’t following it, you don’t have integrity. And you want your people to agree to it, so you want to get a dialogue going and keep it going. What is in your heart also needs to be in their hearts.”
Start a dialogue
Baiada began to facilitate dialogue well before the rebranding initiative took effect.
If you want your employees to own the change, you have to let them buy in to the process.
“We conducted focus groups with our employees and additional focus groups with people outside the company,” Baiada says. “We conducted focus groups with clients and customers at-large and referral sources and also did surveys. What we really tried to determine was the key characteristics that are important.
“What we found was the research reiterated that the Bayada Way was pretty much on target as a set of guiding principles. When people needed help, they wanted compassion and reliability.”
But generating a renewed focus on the company’s guiding principles was only the first step toward fostering employee engagement. Baiada wanted to engage his people on a continuing basis, allowing employees throughout the Bayada organization to have a say in how the company embodies its foundational principles.
The engagement that employees feel in your brand, mission and values will show in the relationships they build with clients and customers.
“Happy employees and satisfied employees make for happier clients, which means we get more business,” Baiada says. “We’ve brought an analytic statistician on staff, and the research shows that when we compare our employee satisfaction, our client satisfaction and our business growth, they are highly correlated. They say it’s hard to find a good tomato, and it’s also hard to find a good nurse or therapist.
“So when we get them, we have to take care of them. We need to focus them, give them a voice, respect and honor them. If you respect them and engage your people, you’ll be able to build a team that can meet your clients’ needs.”
Engagement is about stimulating the thought process within your people. You want your employees to frequently think about the end users of your company’s product or service and how those people benefit from it.
“Knowing the stories of the people you serve helps employees put a human face on the work they do each day, and it also helps spur ideas around the subject of building better customer service.
“A success for us is when a client improves to the point that they don’t need our services anymore,” Baiada says. “We share those kinds of client stories, and we’re continually trying to put them in writing and record them on video. It’s all about getting that message out there, even in ways you might not immediately realize.
“For instance, all the photography on our website is images of actual clients and employees. We don’t use stock photos or actors.”
Though he can’t be everywhere at once, Baiada also recognizes the value of a visible, accessible organizational leader in maintaining a dialogue with employees and reinforcing the mission and values.
“You have to start out with an open door and a willingness to let people in,” he says. “If you have a story to share or an issue to address, here is my phone, here is my email. If you find something isn’t right around here or you feel something is going on that is disconnected from the Bayada Way, let me know.
“Hopefully, you’ll be able go to whoever is in charge of your area first, but if you need to contact me directly, I’m accessible.”
Hire for the culture
Achieving buy-in with existing employees is critical to the success of any effort to rebrand the company or refocus on your cultural values. But every bit as important as your existing employees is the employees you don’t have yet.
The reinforcement or erosion of your cultural values can hinge in large part on the quality of the hires you make and whether those people can align with the foundational principles of your organization.
As the leader of an organization that provides in-home care to clients who might be struggling to overcome disease or disability, Baiada believes his company’s culture of compassion is essential to success and is a critical pass/fail measurement in the hiring process.
Job candidates are presented with Bayada literature emphasizing compassion as a core value alongside operational excellence and reliability.
“We try to be clear in our materials about who we are and what we stand for,” Baiada says. “A lot of people take a job based on what they think it is or isn’t, and when they start working at the job, it’s not the same thing that they expected.
“For example, if a person is working primarily for money, this really isn’t the place for them. If you don’t like working for the clients and serving them, you’re probably not going to like the job.”
To develop a deep understanding of a job candidate’s behavior and thought patterns, you need to put the person in a work situation during the interview. Bayada’s team asks scenario-based questions and tries to uncover real-life examples of on-the-job situations in which the candidate demonstrated an adherence to Bayada’s core values.
Baiada says reliability is often the hardest to gauge, and if there is a hiring mistake to be made, it will often involve hiring a person who otherwise fits the mold of what you’re looking for but has reliability issues.
“Some of our care is on a one-on-one basis, so if someone doesn’t show up to work, we have a crisis on our hands in trying to find a replacement,” Baiada says. “You can get a feeling for compassion based on how someone behaves in the interview process. You can measure excellence in their performance.
“But the reliability factor can be harder to gauge.
“Ultimately, if you’re serving people, you want to find people who are motivated by serving people. That’s one of the biggest keys to continuing to strengthen our culture moving forward. It’s that focus on people. We like helping people, and the job can’t satisfy you if that doesn’t push your buttons.”
How to reach: Bayada Home Health Care Inc., (856) 231-1000 or www.bayada.com
The Baiada file
History: Founded Bayada Home Health Care Inc. in 1975 as RN Homecare. The company was subsequently renamed Bayada Nurses, and then rebranded as Bayada Home Health Care on Jan. 17, 2012 — the company’s 37th anniversary.
What is the best business lesson you’ve learned?
It is all about people. It is getting the right people connected and capable of serving our clients, and in making the Bayada Way come true as they carry out their responsibilities. We have a lot of people who make that happen each day.
What traits or skills are essential for a leader?
In our system, you have to be compassionate, excellent and reliable. If you can model that and make that come true, we’ll be in a great position to do what our clients require.Baiada on keeping an eye open for small-scale factors that can make a big difference to the culture: I am a nut like that, personally. I hope we have enough people here like that, to keep things going forward. I am kind of a stickler for connecting the details to the bigger picture. And that takes constant attention. You are always trying to draw a connection. You’re always asking if everything is coherent and connected, if there are any disconnects. Is there any way we can be doing things better? It is a matter of being attentive, like coach, teacher or chef. You have to be attentive to it all, with an eye for improvement.