Preschool Podcast
Preschool Podcast Innovative Business Model To Retain Child Care Staff

Innovative Business Model To Retain Child Care Staff

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Episode 176 – Turnover is one of the biggest challenges of running a child care business. In this episode, Marnie Forestieri, CEO of Young Innovators, shares how she implemented an innovative win-win business model that encourages ownership, promotes accountability and has improved her staff turnover, program quality, and income. If you’re a child care entrepreneur looking for a new way to improve your business, this is a must listen for you!

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Episode Transcript

Marnie FORESTIERI:

That’s when I decided to change and try something new, because I believe that businesses – especially in this day and age – have to change and look for new ways to be better from a user perspective. And I had to start with my staff.

Ron SPREEUWENBERG: 

Marnie, welcome to the Preschool Podcast!

FORESTIERI:

Thank you so much, Ron! I’m excited to spend this time with you and your audience.

SPREEUWENBERG: 

We’re delighted to have you, Marnie. We have on the show today Marnie Forestieri. She is the CEO and founder of Young Innovators Academy. And Marnie has a really diverse and fascinating background. And I would love it, Marnie, if you could tell our audience how you got to be where you are today in your journey towards being involved in early-childhood education.

FORESTIERI:

Thanks for asking! I kind of divide my career before and after early-childhood [education]. So, I did have very meaningful experience prior to entering the early-childhood education [field], but I started in the field as a franchisee of a brand. And that’s how I actually moved first to the United States. And then I transitioned into becoming an independent childcare provider. And that center became a franchise concept. So, then I later became a franchise school.

But along the way I did something very unique. It was that I wanted to… I became fascinated by the education aspect of the operation. So, along the way, I became an educator myself. And that goes back to my first center. I was a teacher; I was the director of the site. So, I spent a lot of time in the classroom.

And that actually became one of my passions of writing curriculum and finding new, innovative opportunities to teach children; new learning frameworks; understanding and adapting recent research into and [adopting] and bringing that into the classroom. So, that’s really one of my passions, [is] to incorporate those teaching strategies into our preschool classrooms.

And I’ve done a pretty good job in kind of translating the trends in terms of curriculum. So, when I started writing about STEM [Science, Technology, Engineering, and Mathematics education] in 2015 for Gryphon House. And I started writing for parents, for teachers and later on for administrators – that’s the new book coming next year.

So, I’ve been evolving myself because I always consider myself as the lead learner in the process in this niche. It has become my purpose to try to bring and share the wealth with other educators, administrators, owners from around the world – or to the best of my ability – to share what we have learned in this journey.

SPREEUWENBERG: 

And I have to ask you, because your background in terms of your studies is more around business administration and you are a graduate of a Stanford University program, and yet you’ve decided to focus a lot of your attention and time in your programs on the education and learning side of the equation, versus necessarily the business side. Can you tell us about your thinking there?

FORESTIERI:

Absolutely. So, that goes back to my family and where we come from. So, I’ve always heard from my father, who was a very successful entrepreneur, who said, “You can never get into a business that you don’t understand.” So, his words and those phrases and his teachings kept coming back to me. If I am in the education business I should be the lead learner and understand the education side of the business.

So, I came across the idea that if you have a very good product the business will follow and the marketing. And that has been my model and kind of my drive. And I have been able to open centers at full capacity because I think that quality leads [those] marketing and business components. So, that’s why I think in business of the 21st century everything is interconnected. And because this is an education business the biggest driver is the quality of the education.

SPREEUWENBERG: 

I really, really love that. It really hits home on something I am passionate about and we try to cover in the podcast a lot, which is the quality of your education in programing leads to business success and vise versa. They are very interconnected, as you say, and we can’t have one without the other. And I love how you really dove in to be the leader of education in your programs. Great story!

Another thing that I’ve learned about you reading through your website a little bit is you talk quite a bit about staff and staff development. Can you share with us a little bit about your thoughts on employees and in staff engagement in your programs at Young Innovators Academy?

FORESTIERI:

Absolutely. So, I came to the realization in this journey of the importance of the first five years. 90% percent of a child’s brain develops when they’re five [years old]. So, when you see that and you put that in perspective and at the center of your mission you understand that the key indicator of quality is not a brand or a curriculum or anything but the teaching staff. So, it all goes back to, what kind of interactions is that child experiences throughout the day?

So, that was a very key, important moment of discovery because I had built very successful businesses but I was coming across one of the biggest problems of the industry, which is turnover. And I was not able to control it. As we know [there] is a 40% turnover rate in the industry. And I was very concerned about that because if we tie that to what we know from research that the most critical years of that element are those years and you have staff coming one day and leaving the other there is no way that you can provide that consistency.

So, staff development became my main problem to solve, and that’s why I landed with Young Innovators [Academy]. So, my career has been a progression because in order to solve that, I had to think as a designer: “How do we solve the problem? How do we solve the problem of teachers leaving our industry or just seeing early-childhood as just as a transition to something else, at least here in the United States?”

And I guess my former background as a reporter helped me a lot: the best way to do that was to ask them. So, I started calling the employees that were leaving the center. And I came across the same answer every time, that they didn’t have the right environment; they didn’t have the conditions; they didn’t have the health insurance that they were looking for, the benefits to cover the basics.

So, I came to the realization that I was asking the staff at some point to do something and they were not even able to cover that. So, it had to do something with the business model that I was doing, too.

So, that’s when I decided to change and try something new because I believe that businesses – especially in this day and age – have to change and look for new ways to be better from a user perspective. And I had to start with my staff.

SPREEUWENBERG: 

That makes a lot of sense. And I just want to reiterate to everybody about your very novel idea, which was asking people why they were leaving. It’s a great way, obviously, to find the answers and start to come up with a solution to help resolve it. So, let’s talk about that: What are some of the things that you then have implemented or are things you’re doing maybe a bit differently than the average childcare program when it comes to retaining your early-childhood educators?

FORESTIERI:

So, I started back to basics and I went back to one school from some having several. So, in this one I had to figure out the model that works. So, I went ahead and I asked them, “What is it that…” of course, we cannot give and provide everything they need. But I knew my finances and I knew how to tweak around my budget.

And what I did is, I actually increased the salaries. So, I changed my business model – that was the first thing. And when I changed my business model I had an additional income coming to the school. And I allocated that business among my best performers, the best teachers that I had, which were, like, ten lead teachers. And then I gave them health insurance and I wanted more.

So, this time, when I created this brand, I wanted to not only create the great conditions – the 30% increase in their salaries and health insurance – but I wanted to create a culture. I wanted parents to know that when they were walking in there it was not about me because my intentions are to expand – in a corporate model, right now, as well.

So, I knew I had to bring [in] some other industries and see what they were doing. And I found something very novel – well, to our industry, at least – but that had been one of the great success stories for big, known brands. And it was that ESOP [Employee Stock Ownership Plan] model. So, what I did is that I turned part of my company into an ESOP employee-owned company.

So, by doing that I was creating this ownership culture with my staff. And we had all the same missions. And I had a legal structure that would allowed me to actually [retain] the best of the teachers, because, of course, there are some that will not stay. But I had a legal structure that would allow me to actually reward the loyal employees that were helping me build this business. That was a thing I did.

SPREEUWENBERG: 

What a really cool idea! I think you’re the first childcare program I’ve ever heard of that has this model. And so I think you used the acronym “ESOP” there – for those of you who don’t know, that’s an employee stock [ownership] plan. So, your employees actually own… they’re shareholders in the company. And so they’re also owners and so make decisions like an owner of a business and so are very invested, obviously, in the outcomes. And have you noticed a change in culture with implementing this different structure?

FORESTIERI:

Oh, Ron, it has been amazing. I went back to what I’ve always wanted to. It brought me back to why I started in this industry because all of a sudden I’m seeing vested employees that have the same mindset. It was like I’d just pulled a small trigger – it was a switch from becoming an employee of a childcare center into an owner. So, I think now they’re walking in our doors and serving our families with pride and with much more commitment than I’ve ever dreamed of.

And now they understand more the business side of it, as well. So, now I share with them numbers; I share with them, “Why can’t we do this?” Or, “Why do we want to do this?” Or, “How many children [do] we need?” So, it has been a wonderful evolution and growth for me and for my staff.

And now it just multiplies my efforts. Now I see employees that walk with pride and walk with accountability because now they know that they have to change that mindset and they have to also think like as an entrepreneur. So, it’s kind of [like] we’re all on the same page, working towards the same mission. So, it has been very powerful for our culture.

SPREEUWENBERG: 

Yeah, that’s a cool thing, too: you were saying you can share more information with them about what’s happening with the business and almost educate your employees about how the business side works, which is really neat for them, as well, so they understand the Why behind decisions that you’re making.

And the other thing that this really brings to the fore of my mind is, we talk a lot about how it’s difficult as an early-childhood educator sometimes even to make ends meet with the salaries that early-childhood educators are on. And we’re not in it to make money because it’s not a money-making career. But if we think about alternative options for compensating early-childhood educators this is interesting because it’s not necessarily costing cash upfront. But if the performance of the business is good they’ll have a positive financial outcome in the end, as well. And so it’s kind of a win-win for the owner and for the employees.

FORESTIERI:

Absolutely. And that is the end goal, that when we are all retiring in [the] next years we can provide that workforce, too, with a stable or reasonable retirement, too, so that I think one of the opportunities… and, by the way, when I started doing this my income increased. So, it was very interesting to see because all of a sudden [the employees] were vested in the bottom line of the business as well. And they were helping me to keep costs under control. So, it was a win-win for the whole operation.

SPREEUWENBERG: 

It’s such a smart idea. And like to clarify the point again, if we think about, “I’m going to give my employees a raise so they can make more money,” it is actually a zero sum game. So, I’m taking… my money has to go away, as the owner, to give it to the employees, whereas this truly is a win-win because you can give them part of the business and their behavior is going to change and the outcomes are going to be better for the children you’re serving [and] the parents you’re serving.

And the employees and the educators are going to have a better outcome as well. So, it really is a win-win, which is awesome and such a novel idea. What’s next for you from here, Marnie?

FORESTIERI:

Well, now that I feel more confident about the business model, which was one of my critical components, now that I know that I can open more locations, we will be opening more locations and helping. Now we are sharing the wealth to create a better world for everybody. So, we want to help other providers as well.

But we want to grow on their corporate model now because [with] what we were doing, I was not able to provide this environment because I had to pay a fee to a corporate office, always, under the franchise model. So, this model is better for us in terms of growth, as seeing the staff members as one of the end-users that will benefit from this.

SPREEUWENBERG: 

Totally. And, Marnie, if we’re listening to the Podcast and want to find out more about you or the programs that you’re running in Florida, where can we go to find more information?

FORESTIERI:

Well, thanks so much for the opportunity. Our website is www.YoungInnovatorsAcademy.com. And we’re in social media: Young Innovators Academy [on] Instagram and Twitter, LinkedIn, too. So, there are a lot of ways to connect and learn more about what we’re seeing. But I think this is a great other opportunity to consider for owners who are looking to solve the problem of turnover.

SPREEUWENBERG: 

Awesome. And one last question, Marnie: If you had to pass down one piece of wisdom to our young early-childhood educators out there, what would that be?

FORESTIERI:

Well, to become the lead learner of your company. I think we can never stop learning and that’s an attitude and mindset that we have to bring into the workforce and that will set the tone for the rest of the team.

SPREEUWENBERG: 

Love it! Marnie, thank you so much for joining us on the Preschool Podcast today.

FORESTIERI:

Thank you so much!

Carmen Choi

Carmen is the Marketing Coordinator and Preschool Podcast Manager on the HiMama team. She's been working with childcare business owners and consultants for 3 years. She is passionate making connections that empower the ECE Community through knowledge-sharing to support better outcomes for children, their families, and society!

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