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Issue 355
July 2 - July 8, 2007
Volume 7
page 1
 

This Issue

Gaming News

Casino City's 2007 Sweepstakes

Simpson: Wynn's tip sharing plan fair

McCarran traffic increases

Analysts pessimistic about Trump deal

Mohegan Sun breaks ground on expansion

Show Time
B.B. King
at the Trump Taj Mahal

Column
How casinos choose payoffs: Ranked hands with elective probabilities
by Alan Krigman

Check out our entertainment highlights & upcoming tournaments

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Running the World Series of Poker can be tough
by Ryan McLane, Casino City

It's not easy running the World Series of Poker.

Complaints about the official playing cards began pouring in just one hour after the 2007 Series began. WSOP officials had contingency plans in place for a variety of possible first day disasters, but not the card design.

Still, players couldn't tell the difference between sixes and nines from certain seats. So within 24-hours, WSOP officials had the U.S. Playing Card company shipping 200-300 new set-ups a day. Four days later, every single card was replaced.

"We tested those cards on focus groups, sent them to the Player's Advisory Council and had near unanimous agreement on the design," said Gary Thompson, media director for Harrah's. "But when we put them into play on a 12-foot table, it became apparent rather quickly that we had a problem. You plan and plan and plan, but there things just come up."

More than 50,000 poker players are expected to participate in the 2007 WSOP. And the Rio, which requires 4,600 employees to run its day-to-day operations, adds another 700-800 workers to help make the WSOP run smoothly, said Geno Iafrate, an assistant general manager at the Rio.

The extra employees come from all around the world, serving as dealers, cage personnel, food and beverage servers, managers and customer service staff. Each poker player has their own set of special requests, forcing Iafrate and other WSOP team members to plan incessantly in order to deploy their workers in a manner that maximizes customer satisfaction.

It doesn't always work, but as Thompson said, there is no way you can please 50,000 people. "All you can do is your best."

"You prepare for the 50,000 pound gorilla and the 100,000 pound gorilla shows up," said Howard Greenbaum, the vice president of specialty games for Harrah's properties in Las Vegas. "The frustrating part is not being able to get it perfect. But believe me, it's rewarding to see the team gel and put together the best poker product in the world."

Crisis Management

WSOP commissioner Jeffrey Pollack started his career in crisis management, working as a political consultant whose main focus was putting out fires.

Customer service issues can break out at any time at the WSOP, and when they do, they're usually big unexpected fires. That's why Pollack trained his management team months in advance on how to handle the unknown.

WSOP officials opened up the registration cages one day before the 2007 event began, learning from last year's mistakes. They had hoped to eliminate lines and create smooth registration lanes. A new computer system was added to handle registration procedures. And the staff felt ready to handle the rush.

But registration wait times for the 2007 WSOP's first day ended up being more than three hours long. More than 3,000 players fought to enter Event #3, the third largest live poker tournament in history, creating a mess that required immediate attention.

"We meet weekly in the months leading up to the WSOP to handle the unknown," said Joe Scibetta, director of customer service at the Rio. "We thought we had the situation under control, but it became apparent that something needed to be done."

In previous years, Harrah's allowed third parties to pick up tournament entry tickets for pre-registered players. That allowed representatives from PokerStars or Party Poker to pick up tournament tickets for their entire player contingency. But the Unlawful Internet Gambling Enforcement Act forced Harrahs to require that players register themselves. Now, players needed to show their own identification. And this was causing the backup.

Scibetta jumped into action, splitting the registration line into three lanes. Walk-up registrants, the quickest of the three transactions, were shuttled into one line, while the pre-registered players were herded into another. Here, Scibetta placed employees with extensive registration experience, whittling down transaction time from five minutes to a little more than two. Lastly, a third lane was created for players with VIP cards. Scibetta also called for back-up, bringing in double the employees to handle registration.

The end result – no more lines with above average wait times.

"There will always be lines when you're running the largest poker tournaments in the world," Scibetta said. "But we responded to the issue quickly and I haven't heard many complaints since that first day. The next big issue will be the Main Event, but I think we're ready."

The 2007 seniors event caused another major issue. Greenbaum and WSOP Tournament Director Jack Effel planned for a 10 percent increase from last year's 1,100 registrants. But registration for Monday's event soared beyond 1,800 players.

"We realized that we were going to be about 20 tables (and dealers) short," Greenbaum said. "So we got on the phone and called in additional staff. In the meantime, the floor supervisors jumped into the pit and dealt the tournament themselves. About 30 minutes later, the new dealers arrived and things were normal once again. These things just happen. You have to deal with them as they come."

Pollack said things will never be perfect.

"We have a couple of textbook examples of how you listen to the customer and how you respond on a very large scale," Pollack said. "That's how we want people to measure our success. We're never going to get it 100 percent, but if we keep moving closer to perfection everyday, that's good."

Getting into the groove

WSOP personnel do not work together year round. They come from several different Harrah's properties and outside casinos. The group has a plan and a management structure, but very little experience working as a team when the WSOP begins.

"Picture a basketball team with no pre-season or season at all being asked to jump right into the NBA finals and play perfectly," Greenbaum said. "It's a little different because our NBA final is 45 days long, but I'd say it takes about a week before we hit our groove."

Thompson and Pollack also said it takes about a week.

"By the fourth or fifth day, we've usually seen the day-to-day, handled a few problems and can finally settle down a bit," Thompson said.

The bracelet events draw the most attention, but Effel said the Series is much more than just 55-historic tournaments. The WSOP runs 24 hours a day with anywhere from one to six bracelet tournaments, cash games, single-table satellites, mega-satellites, evening tournaments and ESPN final tables running concurrently. The Bluff Sequestrium was also added this year.

Effel hired 750 dealers and 60 floor supervisors to run daily poker operations. The hiring process began in late 2006 when Effel received hundreds of applications. He also hand-picked several floor managers from different Harrah's properties to round out his team.

The WSOP day never really ends. Dealer, managers and table staff need to make decisions 24-hours a day. Effel's nightmare is not having enough personnel, but so far, the 300 tables have passed the test with "a little bit of something for everyone."

"We have an amazing system," Effel said. "Our floor managers handle setting up the tables, rotating the dealers and spreading the different offerings for the day. When issues arise they can't handle, they run them up the chain to my assistant directors and if need be, to me. We've been able to handle every tournament and have started most of them on time with few complaints."

Dealers can be tough to come by.

Due to attrition, only 625 of the original 750 dealers the WSOP hired for this year's tournament are actually working, Effel said. Dealers are classified as either A, B, or C dealers, with C dealers being basic employees who can essential deal only Hold'em. "A" dealers are the best, employees who can handle the 16 different poker variations offered at the 2007 WSOP. Effel structured the tournament schedule in a manner that prevents the harder variations from running at the same time, but at some junctures, the squeeze on the dealer-related staff is tight.

"Essentially, what we've created is a poker player's paradise," Effel said. "There's something here for everyone, but having that type of spread takes more man power than people realize."

There's more than just poker, however.

Iafrate has other concerns as the Rio's assistant general manger, like keeping the regular casino running and finding places for all the guests to stay.

"Our casino doesn't shut down because the WSOP is here," Iafrate said. "It's a big deal, but it's just one piece. We need to make sure everything is running smoothly."

The Rio is 95 percent full year-round, so his staff needs to change their regular marketing strategies to ensure there is enough space for the 50,000 poker guests. When the Rio is full, players are moved to other Harrahs' properties, like Caesars, Bally's or the Flamingo. Every player who registers for a WSOP event receives a room discount.

"Like any customer-service business - restaurants, Disney Land, anything, the difference between success and failure is organizing the chaos," Iafrate said. "Keeping the customer happy by putting in the maximum amount of effort makes all the difference. We do that here."

The average day for a WSOP official is intense.

Thompson begins his day somewhere between 9-10 a.m. He handles 300 emails by the time the media credential room opens, and then he spends most of the afternoon handling media inquiries and player complaints. If there's an important final table running, he sticks around late into the night to ensure the media has everything it needs.

There are no days off for people like Thompson. The grind can be tedious, especially when large events like the $50,000 H.O.R.S.E tournament and the Main Event require 24-hour attendance. Thompson maxed out his vacation time two years ago and has taken two weeks vacation in the last five years.

"You have to pace yourself because it's a long 45 days" Thompson said. "But this is what we prepare for and there is no greater joy than watching it all come together."

The List

Planning for the 2007 WSOP began on day one of the 2006 Series.

Pollack insisted that members of his team note problems they encountered during the 2006 event. Eventually, the resulting document was simply named "The List."

The staff whittled down the list to 15 priorities during post-WSOP debriefings and subsequent weekly meetings throughout the off season. The priorities, like tournament structure and registration procedures, were the focus of the staff in the weeks leading up to the 2007 event.

The 2008 list started as soon as this year's WSOP began.

"Next year's planning started several weeks ago," Pollack said. "We never stop planning for next year."

Thompson adds to the list daily, as does Effel, Greenbaum, and Iafrate. Each official briefs their staff in the morning and afternoon, asking for feedback. A decision is made on the spot whether or not the concern can be solved this year, or will be put on the list for 2008.

The card debacle, the lack of air conditioning in the player tent and the registration-line issue were examples of on the spot corrections. But other 2007 complaints, like the structure of the Limit tournaments, may need to wait until next year because it would cause such an impact on the way this year's events are played, Thompson said.

"Dealer training is definitely on the list," Pollack said. "We've done a much better job of training dealers this year, but it's an area we can improve on."

Greenbaum said one area of concern is managing the conflicting needs of the amateur and the professional.

A common complaint from poker professionals in 2007 is the boring structure of the Limit events -- especially the long low limit levels early in the tournaments. This has translated into many pros skipping the early levels, or multi-tabling other events. But Greenbaum says the amateur is happy to get more play, wanting more table experience for their money. WSOP officials are considering changing the structure of the higher buy-in (professional laden) events next year, while keeping the lower buy-in (amateur laden) events the same.

Several mechanisms serve as a complement to the list. Staff members listen to player complaints daily. Surveys are sent to every WSOP participant who has an e-mail address. Advice from the Player's Advisory Council and the newly formed International Player's Advisory Council is solicited during and after the WSOP. And Pollack held the first WSOP open town hall meeting this week to hear player concerns en masse.

"We pour over the data, prioritize the issues we hear over and over again, and then make a change if necessary," Thompson said. "We spend hours and hours making decisions that will enhance the experience for the customer because that's who this is all for."


Simpson: Wynn's tip sharing plan fair
by Jeff Simpson, our partners at the Las Vegas Sun

I spent an hour last weekend at Wynn Las Vegas talking with Steve Wynn about the ongoing controversy surrounding the property's tip-sharing system.

Wynn hasn't spoken to the news media about his dealers' vote seven weeks ago to have the Transport Workers Union represent them in contract negotiations with Wynn Las Vegas.

Wynn says the three-to-one margin of the vote was an expression of anger toward him, but asserted that the dealers, and the TWU, are mistaken if they think he will reverse his decision to allow front-line supervisors to receive small shares of the tip pool.

"What did they really get by voting for the union? " Wynn asked me, before answering himself.

"They got the right to walk off the job. And that's it."

Thousands of qualified dealers, not to mention the hundreds of extra-board, nonunion dealers Wynn Las Vegas already has, would gladly fill the positions of any dealers who walked off the job, Wynn said.

The new tip system gives most front-line supervisors, now called "service team leaders," 40 percent of a full dealer's share, with craps boxmen getting 20 percent of a dealer's share.

The shares given from the tip pool, plus additional salary boosts provided by Wynn Las Vegas, increased supervisors' salaries from about $60,000 to about $96,000. The dilution of the tip pool to include team leaders cut dealers' shares by about 15 percent.

Wynn expected dealers' total take-home pay to drop by less than that amount, from slightly over $100,000 to about $90,000, as he expected improved service on the casino floor to generate more tips.

The system is working well, Wynn said. Blackjack hold percentage has almost doubled and 35 of the 39 new service team leaders are former dealers, a promotion dealers used to refuse because it meant a big cut in pay.

Since announcing the system, Wynn has always told me that his dealers were the best paid in the city - and the world - but last weekend he said that the numbers vary week to week.

"Some weeks they're the top paid, some weeks they're No. 2 or No. 3," Wynn said. "But this is important. Every dealer is doing better today than they ever did before they came here."

Wynn said that he will have the same tip-sharing system in place when he opens Encore next to Wynn Las Vegas at the end of next year.

I asked Wynn the same question many dealers have asked me: If he wanted to pay supervisors more, why didn't the company pay them from its own funds, and leave the dealers' tip pool alone?

Wynn grew animated as he answered.

First, he said, the company has increased team leader salaries.

But more importantly, he said allowing team leaders to get a cut of the tip pool was a matter of fairness, a move that needed to be made.

Wynn said that dealers fail to appreciate the amount of service provided by team leaders. And he said that the size of the tip pools themselves has grown so large that it was alienating supervisors.

"The team leaders are responsible for a majority of the good will," he said. "Everyone knows the people in the suits have the responsibility to service the players. Those who provide the bulk of the service are entitled to participate in the pool. The tip pool is so big that it caused the team leaders to feel screwed.

"Everything has changed in Nevada. The size of the business, the kind of customer we get, the amount of money we invest and the income of our employees. We're now a culinary capital, a retail capital.

"And the jobs here are among the best, and the most highly sought after in the world, particularly when you consider the skills required to do them. The skills to be a dealer can be mastered in a matter of months."

Wynn acknowledged that pay cuts are unpopular.

"Nobody likes it," he said of the dealers. "I can't blame them. It's not that I'm unsympathetic to how they feel. But the change is necessary.

"It will allow us to have the best team leaders and the best dealers, and will give dealers the incentive to advance, a wonderful opportunity to do better. It is unreasonable for the dealers to pretend that it is not so. They should not begrudge giving up a tiny fraction of the tip pool. Is this system the right one for our customers? I say yes. This is one of those moments that faces business where traditions must change."

Since the controversy started I've had a lot of dealers ask me how I'd like it if the top editor of the Sun took 15 percent of my pay and gave it to my boss.

Of course, I wouldn't like it. But it would be his right to do so, just as it would be my right to leave and work elsewhere if it happened.

This is a tough issue, but management must have the ability to balance the compensation of its employees. I think that is a fundamental principle of business, and a sound one.

Jeff Simpson is business editor of the Sun and executive editor of sister publication In Business Las Vegas.

 

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