Vol. 5, No. 12, December 2008
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Who You Gonna Call?
Former Harrah's CEO Phil Satre kept a direct line to the employees
Satre’s influence encompassed a remarkable 25-year career. Until three years ago, he was a gaming kingpin who spurred the ascent of the Harrah’s brand from two properties to upwards of 40. He served as CEO both of Harrah’s and Harrah’s Entertainment. The Wall Street Journal once named him the best executive in the casino and hotel industries.
“I’m fortunate to have been in the industry when it expanded beyond Nevada and Atlantic City,” says Satre, who now lives in Reno. “But I have to give a lot of the credit to being in Atlantic City. That’s really the reason I entered the business.”
In the early ’80s. Satre, general counsel for the late Bill Harrah, was sent here to export the company model. Atlantic City, gaming’s number two heavyweight, had an immense drive-in market. Harrah’s offered a marina, less congestion, infinitely more parking and a sense of exclusivity.
“The most exciting thing in my career really was the first thing,” Satre says. “We took the Harrah’s brand from our roots in Reno and Lake Tahoe and moved it to Atlantic City during the early days of gaming there. It was gratifying to take the concept Bill Harrah had crafted for 40 years and bring it across the country.
“After some bumps in the road, the success of Harrah’s in Atlantic City was the success that powered the company. Atlantic City had been table-games oriented, but Bill Harrah pioneered the idea that we were unabashedly slanted toward the slot customer. He was ahead of his time in recognizing that slots had the broadest appeal. We knew there was a customer who was being given short shrift in the industry.”
Harrah’s thought big and earned customers around the country. A Total Rewards revolution ensued.
“Before that, you had one program in AC just for AC. You had one in Reno, one in Tahoe. The breakthrough occurred when we cross-marketed and cross-promoted for Harrah’s properties nationwide. It was the foundation of Total Rewards. When we started seeing the revenues hit in the neighborhood of $1 billion to $3 billion, we knew something was working.”
The company also knew what not to emphasize. The bells, whistles, glitz and glamour of spanking new properties did not necessarily define Harrah’s.
“The image of the company was based on the experience the customer has with employees,” Satre indicates. “If you think about other brands, some were based upon a value, like Circus Circus. Some emphasized the physical attributes of the property. We expanded our brand in a way that we were not labeled as upscale or midscale. We had the flexibility not to be confined by the physical attribute of the company.
“You need to do that. In small properties like Indiana, for example, we would not have been able to expand if our brand was big hotels with lots of restaurants, retail and highly themed casinos. We leveraged the collective base of our customers and the great work of our employees.”
Ah, the big ingredient. Employees. Custodians of the realm. Maintaining harmony with them benefits every company. Satre did not want Harrah’s growth to blur the lines of communication.
“We tried to make the employees believe that our success would be theirs,” he says. “Just like we have customer loyalty, we have the 401K plans and try to be very accessible.
“I enjoy knowing the employees by name. As we grew to 40,000 of them, I knew I couldn’t get around to doing it, so we set up a way for them to reach out. It was 1-800-CALL-PHIL. That went right to my office. Everything else for me was put aside. On that day, I took phone calls. People could call anonymously or give their names, it didn’t matter. I just wanted their ideas, insights—anything that was on their mind. It was then my job to follow up on the suggestions. The message was that employees are not just a number out there, they all have input with the CEO.”
It’s another strong use of leverage. With customers and employees, Satre demonstrated that people numbers lead to profit numbers.
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